Warren’s Student Loan Refinancing Bill Lacks Republican Support

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Wednesday, June 11, 2014

Nicholas Handy, GoLocalWorcester Contributor

Massachusetts State Senator Elizabeth Warren’s student loan debt bill has received a lot of support over the past week, with more than 35 senators, 30-plus higher education institutions and even the President of the United States showing support, but the bill still lacks key support from Republicans as it heads toward a vote in Congress.  

Not a single Republican has signed on to cosponsor Warren’s bill as of this time. The Democrats currently control the Senate 55-45, five votes short of getting to 60, which would overcome a filibuster if Republicans chose to unite in opposition to the issue.

“Senator Warren’s Bank on Students Emergency Loan Refinancing Act is a simple, common sense proposal that will help more than half a million borrowers in Massachusetts and millions of families across the country who are drowning in student loan debt,” said Matt Cournoyer, Deputy Press Secretary for Senator Warren. “The bill would allow existing borrowers to refinance their loans at the same interest rates almost every Republican and many Democrats agreed to last year for new borrowers.”

The Bank on Students Emergency Loan Refinancing Act was introduced by Warren on May 6, 2014. The bill would allow those with outstanding student loan debt to refinance at the lower interest rates currently offered to new borrowers. The refinancing would be paid for by the Buffet Rule, which would limit special tax breaks for the wealthiest Americans that allow millionaires and billionaires to pay lower effective tax rates than middle class families.

“A Partisan, Political Stunt”

Republicans in opposition to the bill state that the legislation introduced by Warren “does nothing for current students” and that the bill itself is a “partisan, political stunt.”

Tennessee Senator Lamar Alexander, the top Republican on the Senate’s education committee, is one of the many Republicans voicing his concerns about the bill. He says that while student loan debt should be a priority nationwide, the focus should be getting college graduates better jobs and educating them on not over borrowing.  

According to Alexander, the average college student wouldn’t benefit much from Warren’s bill. The average student with a four year degree graduates with $27,000 in student loan debt. Based on data provided from the Congressional Research Service, refinancing under Warren’s bill would save the average student around $1 per day.

“College graduates don’t need a $1-a-day taxpayer subsidy to help pay off a $27,000 loan, which is the average federal loan for four-year degrees,” said Alexander. “They need a good job. Republicans are ready to offer and debate our proposals to create more good jobs and to create better schools which mean better jobs.”

A Joint Effort

In addition to signing on to support Warren’s student loan bill, President Obama released his own attempt at reducing student loan debt.

Signing an executive order, Obama effectively allowed millions of student loan borrowers to cap their payments at ten-percent of their income.

In partnership with the Warren bill, the joint force between the two legislative actions would affect over 583,000 student loan borrowers in Massachusetts alone, according to recently released data by the White House’s Council of Economic Advisers and Domestic Policy Council. There are currently 980,000 people with student loans in Massachusetts, accounting for $24.2 million in debt.

"Exploding student loan debt is crushing young people and dragging down our economy," said Senator Warren. "Allowing students to refinance their loans would put money back in the pockets of people who invested in their education. These students didn't go to the mall and run up charges on a credit card. They worked hard and learned new skills that will benefit this country and help us build a stronger middle class and a stronger America."

Not a Partisan Issue

While this has certainly evolved into a partisan issue over time, Erin O’Brien, an Associate Professor of Political Science at UMass Boston, says that the focus should be on helping the students and not pushing a Republican or Democratic agenda.

O’Brien says that the division between Democrats and Republicans on this issue is a sign of the times where parties don’t want to agree upon a variety of issues. O’Brien is unsure as to whether or not the bill will pass the Senate, but hopes that both parties continue to keep students in mind rather than their division.

“As a political scientist that works at a college and studies poverty politics, I certainly understand that this is a crippling issue,” said O’Brien. “I am glad that this issue is being addressed but am ashamed that it has become a partisan issue. This should be an issue that both parties tackle together.”

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