Washington – Backed by key Democrats, including House Minority Leader Nancy Pelosi, Connecticut U.S. Rep. Joe Courtney, D-2nd District, returned to an old theme on Wednesday — how to cut college student debt — by introducing a bill that would do just that.
The “Bank on Students Emergency Loan Refinancing Act” would cut interest rates on all student loans, both federal and private, issued before July 1, 2015.
The new interest rates would be 3.8 percent for undergraduates, 5.4 percent for graduates and 6.4 percent for loans taken out by a student’s parents, called PLUS loans.
“This issue is front and center in terms of the worries the middle class has about whether or not they’re going to be able to see their younger children succeed and hopefully surpass their parents in terms of thriving and growing in the U.S. economy,” said Courtney, D-2nd District.
The issue is also one President Obama has made a priority lately with his “Student Aid Bill of Rights,” which requires the U.S. Department of Education to create a new web site by July 2016 that would give borrowers a simple way to file complaints and provide feedback about student lenders.
According to the U.S. education department, about 511,000 Connecticut residents owe a combined total of about $12.7 billion in student loan debt.
Pelosi called on Republicans to back Courtney’s bill.
“Our Republican colleagues are always talking about how we can’t heap mountains of debt onto future generations,” Pelosi said. “We all agree…but we also don’t want to heap mountains of debt onto individual American students and their families.”
Another Democrat, who is in charge of his party’s message in the House of Representatives, Rep. Steve Israel of New York, indicated there’s a chance Democrats will try to attach Courtney’s bill to the GOP’s budget, which is expected to be considered in the House next week.
Sen. Elizabeth Warren, D-Mass., plans to introduce a companion to Courtney’s bill in the Senate.