Elizabeth Warren made waves recently when she introduced the Bank on Students Loan Fairness Act, which would offer students the same low interest rate the Federal Reserve offers big banks through the discount window, currently around 0.75%. This strong proposal highlights one of the most destructive, anti-capitalist practices of our government.
The Fed, which is partially owned and controlled by the banks, has been offering those very banks very low interest loans. Even though the abyss of private sector debt crippling ordinary consumers remains the primary force holding down aggregate demand, the Fed has refused to take more aggressive action to lower the real interest rates ordinary Americans pay on that debt. Warren’s bill would change that.
The sort of populist message that made the Democratic party the electoral juggernaut it once was, this bill has garnered considerable support from red state Democrats. Of the seven Senate cosponsors, four hail from states that voted for Romney and McCain. What these Senators see in Elizabeth Warren’s brand is that old-school FDR Democratic party, that pro-growth Democratic party that once swept to victory in today’s red states by catastrophic margins. Economic populism made the party great. If we return to it, we will be great again.
That is why it is so important that David Cicilline signed on as a cosponsor of the House version of Warren’s bill. It is a vote of confidence in the true vision of the party. Congressman Cicilline deserves to be recognized for his strong stance on this issue. You can give him a call to thank him here:
David Cicilline: (202)-225-4911
Unfortunately, Langevin, Reed, and Whitehouse have yet to sign onto Warren’s bill. Each of them has a good record on financial issues and should be winnable. If you’d like to see them join Elizabeth Warren, you can give them a call here:
Jim Langevin: (202) 225-2735
Jack Reed: (202) 224-4642
Sheldon Whitehouse: (202) 224-2921
A key ally of Warren on the banking committee, Jack Reed has introduced a compromise bill that keeps the interest rate on student loans from doubling but doesn’t push to lower them. Compromise is important. But it should never be your opening offer. Without a bold progressive proposal like Warren’s, Reed’s compromise will be seen as what the Democrats want. It will be the place Republicans start bargaining from. So the best thing Senator Reed can do to protect his bill is cosponsor Senator Warren’s.
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All else being equal, if a URI and a Brown grad both apply for the same job, the kid with the Ivy League degree is probably going to get the gig. That Brown diploma ought to be more valuable; at $54,000 a year, Brown costs a lot more than does URI, which runs the average student about $24,000 a year.
But it shouldn’t also be easier for the average Brown grad to pay for the premium! According to the Project on Student Debt, it is.
In 2011, the average Brown grad owed $20,455 for their degree while the average URI grad owed $25,973. At Brown, only 45 percent of 2011 graduates had student loan debt while 73 percent of URI grads did.
The Project on Student Debt Rhode Island ranks Rhode Island as having the fourth highest average student loan debt in the nation at $29,097. RISD didn’t report its data for the study, but here are some of the others:
- Salve Regina ……………..$43,237
- Roger Williams ………….$38,365
- Bryant University ………$37,813
- Providence College …….$32,850
- Rhode Island College …$21,384
The Brown Daily Herald had an article about this back in November with a great lede: “Despite having the highest tuition in Rhode Island, Brown had the lowest average debt of all reporting colleges in the state for class of 2011 graduates, according to the Project on Student Debt, a report published by the Institute for College Access and Success, a nonprofit.”
]]>Sen. Jack Reed, author of a bill that would prevent Stafford Loan interest rates from doubling this summer made these statements last week:
And Congressman David Cicilline will be meeting with Rhode Islanders tomorrow in a “call to action” on the “threat posed by escalating student loan interest rates.”
Here’s the full press release:
]]>U.S. Congressman David Cicilline (D-RI) will host a call to action along with Rhode Island students, parents, stakeholders, and business leaders to highlight the threat posed by escalating student loan interest rates. The call to action will take place next Tuesday, May 1st, at Rhode Island College, Student Union, Room 307, 600 Mount Pleasant Avenue, in Providence at 10:00 AM.
With interest rates scheduled to double from 3.4% to 6.8% on July 1st, if Congress does not act, more than 7 million students are expected to incur an additional $6.3 billion in repayment costs for the 2012 – 2013 academic school year. These increased costs would make college access more difficult and impose an additional financial burden on many young people and families already struggling in a difficult economy.
Congressman Cicilline is a cosponsor of H.R. 3826, which would prevent student interest rates from doubling; he spoke at length about the importance of this issue, along with Congressman Joe Courtney and Congressman Tim Bishop, on the House floor last Wednesday; and, next Tuesday, Cicilline will be joined by a coalition of students, parents, stakeholders, and business to leaders who will urge Rhode Islanders to submit their stories about student loan debt through the Congressman’s website at http://cicilline.house.gov/
share-your-story , as part of an ongoing effort to pressure House Republican leadership to take action to protect students from this doubling of interest on their loans. The freshman Congressman from Rhode Island plans to deliver these submissions to the House Republican leadership later this spring.