By Jenna Johnson
Published: July 24, 2013
The U.S. Senate approved a plan Wednesday to restructure the government’s education loan program, tying interest rates to the market and imposing limits on how high those rates can go.
Although supporters are touting the plan as a long-term solution to a difficult problem, some Democratic senators are already saying that they will have to take action on it again soon.
The legislation, which still needs the approval of the House, would dramatically lower interest rates on nearly all new federal education loans taken out by undergraduates, graduate students and parents for the coming school year. But as the economy improves, those rates are expected to increase and could surpass the current rates within five years.
The measure was approved by a vote of 81 to 18; 16 Democrats voted against it. This passage follows weeks of negotiation and increasing pressure from the White House. Department of Education staffers camped out in senators’ offices, and President Obama summoned key negotiators to the Oval Office for a chat. Meanwhile, Republicans in both chambers criticized Senate Democrats for slowing the process.
“At least now they’re ready to put their partisan political fix aside and join President Obama and congressional Republicans in enacting real, permanent reform for all students,” Senate Minority Leader Mitch McConnell (R-Ky.) said.
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