Student Loan Interest Will Rise July 1 without Action
COLUMBUS- State Reps. Debbie Phillips (D- Albany) and Michael Stinziano (D- Columbus) will introduce a resolution urging Congress to act immediately and pass S. 2343. Without action federal student loan interest rates are set to double from 3.4 percent to 6.8 percent.
"A strong educational system is at the very foundation of economic success and prosperity for individuals, communities, and our nation. However, it is becoming increasingly difficult for young people to attend institutes of higher education, not due to a lack of academic proficiency but rather, the increasing burden placed on students stemming from tuition hikes and debt from their student loans," said Rep. Phillips who represents Ohio University. "I am deeply troubled by the debate in Washington because it is not about whether we must work to keep interest rates low, but rather is bogged down by who should pay; big corporations or the middle class."
S. 2343, co-sponsored by Sen. Sherrod Brown of Ohio, would stop student loan interest rate hikes that will be effective July 1. This legislation would offset an interest rate hike by closing a corporate tax loophole. Republican refusal to close tax loopholes for corporations and desire to take funding from preventative healthcare is a further demonstration of a lack of concern for Ohio's working and middle class families. Yesterday U.S. Senate Republicans filibustered the Democratic proposal. If action is not taken rates will automatically rise July 1st of this year.
Rep. Michael Stinziano (D-Columbus), whose district includes parts of The Ohio State University, is also troubled by what an increase in the interest rate on student loans could mean for his constituents and students across the country. "The key to economic growth in Ohio and across the country is an educated workforce prepared to lead the world. Doubling interest rates will saddle our graduates with more debt inhibiting their critical participation in local communities and discouraging others from pursuing a college degree due to the rising cost of college tuition. We know that an increasing number of professions require some type of post-secondary degree, and many of our most talented students rely on these loans. A failure to act on this issue discourages students from pursuing a degree and directly threatens the economic viability of states and communities across the country."
More than 382,000 students in Ohio have received Stafford loans, with disbursements totaling more than $1.55 billion. According to reports, the average Ohio student graduates from a four year college or university with nearly $27,000 in debt.
"If interest on these loans continues to rise and repayment becomes difficult it will hurt our graduates and our economy. The success of Ohio's economy depends on well educated individuals entering the workforce and having the freedom to pursue their professional goals. Student debt has reached nearly one trillion dollars nationwide, placing an immense weight on recent college graduates who are just starting their professional careers. This overwhelming debt can prevent individuals from buying a new car or house, seeking a graduate degree, or even starting a family," added Rep. Stinziano.
"Students are willing and ready to go to work, and pay their debts, but changing the rules in the middle of the game isn't fair. They need a fighting chance to make a strong start, and Congress must act now," continued Rep. Phillips.