Imagine during the worst economic crisis in seven decades that your mortgage interest rate doubles, say, from 4 percent to 8 percent. Imagine also that this trauma is inflicted not by any economic or housing factors but because of the intransigence of a bitterly partisan Congress whose members have nothing against you, but despise each other so much as to just let it happen.A similar threat almost became a reality for 7.4 million college students in America (and more than 100,000 in Washington state). Fortunately, two days before deadline, Congress came to its senses on Friday and approved legislation that preserves the 3.4 percent interest rate for subsidized Stafford loans for undergraduate students.
This measure was a relatively small part of a much larger transportation bill that authorizes more than $100 billion over two years for highway, mass transit and other transportation programs. Rare bipartisan accord was shown Friday as the bill sailed through the Democratic-led Senate by a 74-19 vote. Moments earlier, the Republican-led House approved the measure 373-52. In both chambers, all opposing votes were by Republicans.
It’s unfortunate — and insulting to college students — that this issue had to be disputed for so long, as if college students needed to face one more economic hardship. The truth is, college students are making dramatic sacrifices during this recession. In Washington state, they’ve seen a burdensome pattern of tuition rates soaring by double-digit percentages for multiple years.
The idea of doubling interest rates on student loans emerged two years ago when Congress passed a law designed to save the government money. But pushing the rate to 6.8 percent would’ve added about $1,000 to the average student loan. And in our state, that would’ve meant about $83 million more in loan payments.
