Less Scroogerly College Loans

Before sweeping into power in both chambers of the U.S. Congress, the Democratic Party promised to improve access to higher education for all Americans. Once empowered to dictate the congressional docket, the House Dems swiftly and emphatically passed a bill that promises to cut the interest rate on federally-backed student loans to 3.4 percent from 6.8 percent.

There are few things to which politicians pay more lip service than higher education, but as with most issues, when it actually comes down to choosing a course of action, consensus proves hard to reach. After years of lagging federal spending on higher education, it is reassuring to see the 110th Congress put this issue back on high priority.

The bill seeks to aid the approximately two-thirds of college students who graduate with debt. Its proponents argue halving the interest rate can help make what would have been a prohibitively heavy debt load manageable for the 5.5 million low- and middle-income students receiving Stafford loans.

Opponents of the bill have argued that providing blanket subsidies for college admission, without stipulation that the education received would be put toward bolstering America’s knowledge-based economy—through, say, the study of science or engineering—is a waste of money. To them, the ultimate $5.8 billion price tag for this bill is too high, even though it was pared from $45 billion in earlier versions of the proposal.

Opening the halls of higher education, however, provides more than just an economic benefit: graduating college prepares young adults to be concerned, responsible, happy members of society. The best props for a debate on subsidies for higher education are not balance sheets and pie charts, but rather people whose lives were changed for the better when doors that had always been closed opened before their eyes.

Still, this bill hardly flings open the gates to American colleges. In fact, it simply undoes a $12 billion cut to the federal student loan program that was enacted last year. Moreover, the bill is slated to expire just months after it takes full effect in mid-2011.

Though we applaud the bill for its intentions, and the Democrats for keeping their promises, we urge lawmakers on both sides of the aisle in Washington to avoid settling into their newly dug niches. The bill passed last week is just a start, and we hope that Congress solidifies and deepens its commitment to higher education by reaching out to poorer students through an expansion of Pell grants, as proposed by Sen. Edward M. Kennedy ’54-’56 (D-Mass.).

We hope that Congress and the President have enough respect for our future to lay a solid, inclusive foundation for it today.