Democratic Rifts Stymie Senate Bill On Student Loan Rates

"A bipartisan Senate coalition on Wednesday blocked a Democratic proposal to retroactively cut interest rates on higher education loans in half, leaving any student loan rescue in doubt and laying bare divisions among Democrats about how to resolve the dispute," The New York Times reports. "The bill pushed by the Democratic leadership would have renewed a subsidized 3.4 percent interest rate on Stafford loans, whose rates doubled to 6.8 percent on July 1. But a bipartisan group of senators — led by Joe Manchin III, Democrat of West Virginia; Angus King, independent of Maine; and Richard M. Burr, Republican of North Carolina — had forged what they saw as a compromise measure that would have tied student loan rates to federal borrowing costs. Democratic leaders refused to give the coalition a vote on its plan, and Mr. Manchin and Mr. King voted with Republicans to filibuster the Democratic plan, which received 52 votes, 8 short of the number needed to break the delay. Senator Harry Reid of Nevada, the majority leader, switched his vote to 'no' for parliamentary reasons, leaving the final tally 51 to 49. ... Both sides said Wednesday that the failure of the Democratic bill would lead to last-ditch negotiations that could still yield a deal. But time for a breakthrough is slipping away for more than seven million students who receive subsidized Stafford loans. Most new loans for the coming school year will be issued at the beginning of August. 'The differences here are relatively small,' said Justin Draeger, the president of the National Association of Student Financial Aid Administrators. 'This is what our country was designed to do, work out our differences, right?'”

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