The U.S. Senate has stalled on adopting legislation on student loan interest rates, mirroring a similar partisan divide in the Alaska Legislature.
Alaska Rep. Les Gara, D-Anchorage, said both governments need to do more to make education more affordable.
“The second most crushing debt people have, behind their mortgage, is their student loan debt,” Gara said.
He questioned why used car loans are being offered for 3 percent, while Alaska student loans were between 6-7 percent.
In the U.S. Senate, the “Stop the Student Loan Interest Rate Hike of 2012 Act” failed to move from the Senate this week as Democrats and Republicans differed on how to pay for it.
Without the bill, some federally subsidized Federal Direct Stafford Loans will double their interest rates from 3.4 percent to 6.8 percent.
Sen. Mark Begich, D-Alaska, a former chairman of the Alaska Student Loan Corp., said the failure of the federal government would double rates for 7 million college students in the coming year.
Begich’s Republican counterpart, Sen. Lisa Murkowski, voted against the bill saying it would raise taxes on small businesses, and make it less likely new graduates would be able to find jobs.
She said the bill “tries to solve one problem by making another worse. Raising taxes on prospective employers will only decrease the chances that they’ll be able to add jobs and hire young college graduates.”
Begich, in his statement, disputed that.
“As a small business owner, I want Alaskans to know that the claim this bill raises taxes on small businesses is a red herring, designed to confuse the public,” he said.
“This is about closing loopholes that currently allow some lobbyists, consultants and lawyers to skirt the law and avoid paying Social Security and Medicare taxes — which every other hard-working small business owner pays.”
Gara’s bill in the Alaska Legislature was designed to reduce student loan borrowing costs for those who stay in Alaska or return following graduation.
He said House Bill 272 interest rate reduction “helps end the brain drain” of students who leave Alaska by making it more financially advantageous to return. Rep. Beth Kerttula, D-Juneau, was also a sponsor.
Chairman Alan Dick, R-Stony River, held Gara’s bill in the House Education Committee despite its being re-written twice to address concerns from Dick and the Alaska Student Loan Corp.
• Contact reporter Pat Forgey at 523-2250 or at patrick.forgey@juneauempire.com.
Comments (9)
Add commentSo let me ge this straight....
If we hike the student loan interest rate....it's a boost for business? Tell me how that works.
If we keep their rate the same it will harm business. Exactly what does the student loan rate have to do with small business?
What's the stated reason for this rate hike?
...poo poo on the students?
Gara is Wrong
The MOST crushing debt everyone has is the national debt! Why do most politicians refuse to accept this, Ds and Rs? Rep Gara would like everyone to get a "free" education. Admit it, nothing is free. Not even a "free" lunch. We are conditioning the future of this country to expect that meals are free/reduced, education is free, etc. Who the heck is going pay for any and all of this "free" stuff? Socialism is coming like a train wreck.
Fence - the dumbing down of
Fence - the dumbing down of America, so the rich can get richer now thats what I call a train wreck.
I would far rather see our youth get an education than pay for more wars and see more fat cats not paying their fair share.
Student Loans are not FREE....
The Senate failed to keep interest rates at the same levels available for a mortgage. (Less than what Wall Street and the Banks had to pay). Efforts by the State failed students this year as well. A low interest isn't FREE MONEY!
If you were really worried about the Federal Deficit you would have requested a suspension of the Bush Tax Cuts; both of them; until after the war(s) were done. Instead, our kids and grandkids will be paying for these wars while trying to pay their student loans. (Forget about trying to buy a house; buying a car; etc...) Let's give them a chance....
Murkowski
Voted in favor of much higher student loans. Remember that.
No one cares to tackle the question
Why banksters get a break but the students become a line item on the revenue side? Tax breaks for job creators...a joke as they continue to stash cash instead of creating those so called jobs. I really don't understand how you can all be so easily manipulated and why the students are getting thrown under the bus.
What happens...who suffers if the rates simply don't increase?
At one point a liberal
At one point a liberal education was valued. It produced scholars who were capable of critical thinking and promoted inquiry into ethics and reason. Dialog was emphasized over propaganda and "elevator speeches." Now, the degrees that don't lead "nowhere" are in the financial sector, where little boys learn to play with monopoly money and wager people's retirement in a big game of roulette. Yeah, let's stop those pesky "degrees to nowhere." Our current culture doesn't require an appreciation of the arts, let alone morals or ethics - and critical thinking will get you into hot water.
Veronica from Cash Advances US
Student loans: are they beneficial for students or not?
I like the statement: "both governments need to do more to make education more affordable". It goes without saying that government should support students in order that they feel themselves free, always have money for their everyday needs and education. But one fact attracted my attention: why do student loans have 6-7 percent when used car loans are being offered for 3 percent? It is really strange, because some of students are dependant from their parents, hardly have well-payed jobs. To my mind, it is not fair. Moreover I payed attention to that fact that new bill concerning student loans will lead to high taxes for small business that in its turn will lead to unemployment for future graduates. In such a way this bill isn't beneficial not only for small business, but also for students. I think that government should review this bill.
Gotta do something! I just
Gotta do something! I just heard that a mediocre school is now up to $50K/semester! For those who didn't master math, that four years for a batchelor's at two semesters each year for a total of eight semester's (assuming all goes as planned, which it rarely does) thats $400,000! Minimum! You want the good job? That requires a masters. And we are not even talking about Ivy League! Just a quick glance at UAS explains a lot of this. How much is the Chancelor making? The Provost? How many six figure incomes are there? How much property are they buying just because? We need to stop destroying our childrens futures to build empires!