Mt. Vernon Register-News

Opinion

April 23, 2014

Warren's call for student loan reform

(Continued)

That’s why she successfully fought to establish the Consumer Financial Protection Bureau, the first new pro-consumer, pro-people agency Washington has seen in decades.

The senator has since been deploying her compassionate, creative firepower to combat the student debt crisis. Last July, Congress allowed interest rates on federal student loans to double. Warren fought against the compromise solution — flawed legislation that tied interest rates for new loans to the market, but left those with existing loans out to dry. As she noted at the time, the federal government stood to profit from all those IOUs, to the tune of $200 billion over the next 10 years, an arrangement that Warren rightly called “obscene.”

She lost that round, but refused to quit. Earlier this year, she proposed legislation that would allow individuals with existing student loans to refinance at the same lower rates that were set last summer for new loans.

Warren’s plan would also enact the so-called “Buffett rule,” which would establish a minimum tax on income over $1 million and would allocate the projected $50 billion in revenue exclusively for refinancing student debt. “Do we invest in students or millionaires?” she asked in a speech at the Center for American Progress.

Sadly — and predictably — the resounding answer from the right is “millionaires.” The conservative Heritage Foundation has not only criticized the “Buffett rule” but also called for the federal government to get out of the college loan business, a step that would leave the middle class out in the cold when it comes to pursuing higher education. Meanwhile, Rep. Paul Ryan’s latest budget would slash $90 billion from Pell grants and start charging students interest while still in school.

The United States could and should do much more to help middle- and low-income families afford postsecondary education — especially at a time when our economic growth depends on an educated workforce. As I’ve argued before, we could make public college or advanced training free to qualified students for about $30 billion annually — less, for instance, than the $483 billion in defense discretionary spending that Ryan’s budget would add over the next 10 years.

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