Sun Chronicle: Warren says public can pressure politicians to act on student loans
The U.S. Senate is dealing with issues ranging from terrorist attacks to budget deficits, but freshman Sen. Elizabeth Warren chose student loans as the subject of her very first piece of legislation.
Warren, D-Mass., told The Sun Chronicle today that she chose to concentrate on student loans because they effect the economy, the security of the middle class, and the state of higher education.
More so, the price the federal government charges students for college loans is a reflection of what society believes is important because it is an indication of what it is willing to pay for.
Warren last week filed a bill that would set the interest rates on subsidized Stafford Loans at 0.75 percent for one year. That is the rate the Federal Reserves charges big banks for loans.
The senator said if the country can afford such a low rate for big banks, it can afford it for students struggling to get an education.
"This bill is about our values," she said in a telephone interview. "How we spend our money should reflect our values."
Besides, she said, the government makes about 36 cents on every dollar it loans, for a total take of $34 billion this year.
The subsidized loans currently have an interest rate of 3.4 percent. The rate is scheduled to double to 6.8 percent on July 1, adding thousands of dollars to the cost of higher education for millions of students.
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