Want to fix the US student loan crisis? Put colleges on the hook

Helaine Olen:

The question of student loans is taking on an increasing urgency everywhere but Washington.
Rates on federally subsidized loans doubled to almost 7% on July 1,thanks to Congressional bickering and dithering. The latest attempt to roll back the rates failed to get out of the Senate earlier this week, when sponsoring Democrats failed to break a Republican filibuster against the bill.

There's a clear double standard here. If you are a Congressman who needs to fly somewhere, you can rely on your fellow elected officials to bail you out with special legislation designed to exempt air traffic controllers from the impact of sequester within a day or so. If you are a student who needs to know student loan rates so you can actually apply for one before the start of the academic year later this summer ... well, good luck to you. No majority in Congress has your back.

Senator Elizabeth Warren wants to set the rate at 0.75% for the next year, the same rate the Federal Reserve charges banks that borrow money from them on a short-term basis.Others - including many Republicans and President Barack Obama - would like to see a floating rate tied to the ten-year Treasury note.

Posted by Jim Zellmer at July 13, 2013 1:15 AM
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