Even as the Senate grapples with high-profile immigration reform, lawmakers are under pressure to strike a deal on the cost of college student loans before rates double Monday — a fight that sees Mr. Obama aligned closer to the GOP than his own party.
Complicating the search for a solution is the president’s own schedule. He departs Wednesday for a multination trip to Africa and won’t return until after the current, low loan rates expire.
In doing so, he leaves his party allies in the Senate to tackle an issue that affects roughly 7 million students, who will see rates jump from 3.4 percent to 6.8 percent on a subsidized Stafford Loan.
Democrats said the president’s absence shouldn’t affect them because he can always pick up the phone on Air Force One.
“The president, no matter where he’s been, he’s always been available,” said Senate Majority Leader Harry Reid, Nevada Democrat. “So that’s no problem.”
The pressure is on Senate Democrats after House Republicans said they’ve done their part to insulate students. The House passed a bill last month that ties loan rates to 10-year Treasury notes, plus 2.5 percent, with a cap of 8.5 percent. The plan ties PLUS loans for graduate students to the notes plus 4.5 percent, with a cap of 10.5 percent.
Senate Democrats, though, would prefer to see the current 3.4 percent rate extended, saying they don’t want to see any rise.
Mr. Obama’s own solution is much closer to the GOP. He, too, has said the current low rates are unsustainable for the federal budget, and he called for rates to rise tied to the market. Still, he wants to see each student’s loan frozen at the initial rate, and has threatened to veto the House measure for lacking that feature.
Seeing how close the GOP and Mr. Obama were, Senate Republicans tried to offer the president’s proposal on that chamber’s floor but Democrats objected, highlighting the split within the party.
Now, a bipartisan group of senators is trying to strike a deal before the deadline.
“People are just focused on the immigration stuff,” said Sen. Tom Harkin, the Iowa Democrat at the heart of negotiations that include Republican Sens. Richard Burr of North Carolina and Lamar Alexander of Tennessee.
Leading Democrats are insisting on a cap to newly negotiated rates, although the situation may have to be rectified after next week’s deadline.
“The issue is this — the Republicans want deficit reduction,” Mr. Reid said. “We don’t think there should be deficit reduction based on the backs of these young men and women who are trying to go to college. We feel there should be a cap, and the Republicans won’t give us a cap.”
But House Republicans, eager to pounce on inaction in the Democrat-controlled chamber, have unleashed a barrage of criticism toward Senate leadership and the White House.
Speaker John A. Boehner recently accused Mr. Obama of failing to lift a finger “to push his own party to pass his own proposal,” and Republicans dedicated their weekly radio address Saturday to the topic.
Republicans said the last-minute negotiations in Washington have demonstrated the need to let the market, and not politics, dictate the rates.
House Democrats fixed the rate at 3.4 percent when they controlled the chamber in 2007. Last year, the Republican majority agreed to extend the rates for 12 months.
Mr. Harkin said he would like to see the rates extended once more, so Congress can address the issue as part of broader debate when the Higher Education Act expires at the end of the year.
“That’s where this needs to be decided,” he said.
• Tom Howell Jr. can be reached at thowell@washingtontimes.com.
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