REPUBLICANS AND EDUCATION….In the past couple of weeks universities around the country have announced huge tuition increases. In California, for example, UC just raised tuition and fees for undergraduates by 8%, the fifth increase in the past five years.
The Republican response in Congress has been predictable: a massive reduction in student assistance in order to help finance their $70 billion corporate tax cut:
The budget bill would reverse a previous law capping the interest rates for student loans….would also increase the cap on parent loans….would also raise taxes on student loans, raise interest rates on consolidation loans and reduce subsidies paid to student lenders, totaling $20.5 billion in cuts over a 10-year period, according to estimates by the Congressional Budget Office.
You can watch George Miller’s impassioned floor speech about these cuts here. Be sure to keep watching after they try to gavel him into silence.
But here’s another related tidbit. Not only did congressional Republicans raise interest rates on working class and middle class students ? no big surprise, really ? but these supposed free market zealots also declined to change a rule that prevents students from refinancing their loans if interest rates go down. Here’s Dick Morris:
While homeowners can refinance their mortgages as often as they want and relieve themselves of high-interest debt when rates cycle downward, student and former-student debtors are only permitted to refinance once for the lifetime of the loan! And now the House is considering legislation that would stop students who are in school from keeping their current interest rate of 4.75 percent and would instead force them to pay 7.9 percent, creating a lifetime burden entirely unjustified by the lending market.
….Frequently, students use their once-only refinancing option shortly after graduation and find themselves helpless as the market interest rates drop ever lower….But student loan refinancing ? beyond the one shot now permitted ? is blocked by special-interest regulation and legislation.
Get the picture? Republicans are raising fees and interest rates for middle class students, cutting taxes on corporations and the rich, and allowing special interests to keep a special privilege that allows them to lock in higher rates on kids for years regardless of what the market does. That’s a pretty sweet deal. For someone.