Speeches & Floor Statements

Floor Speech: "Veterans and Student Loans"

Posted on June 11, 2014

I heard the majority leader's comments about the importance of moving on to the veterans bill, so I have a suggestion:  Why don't we send this political stunt on student loans to the Senate education committee, where the senator from Iowa, Mr. Harkin, and I are busy working in a bipartisan way to reauthorize higher education, and let's move on to the veterans bill immediately.  Why should the Senate take a week on a political stunt that everybody here knows won't pass when veterans are standing in line at clinics, waiting for us to act on a bipartisan solution to their problems? 

It actually goes further in giving veterans more choices in health care than anything Congress has ever done.  It actually begins to give veterans more choice in health care in the same way Congress gave them choices in higher education with the passage of the G.I. bill for veterans in 1944.  Back then, Congress said to the veterans:  Here is the money.  Go choose your college. 

Moving to and passing the veterans bill, Congress would be saying, “If you have to stand in line too long or if you live too far away from a veteran’s facility, here is the money – go choose your medical care.” That is a very important step for millions of veterans.  It deals directly with the problems all Senators on both sides of the aisle are chagrined about – veterans standing in line waiting for health care. 

So I have one question:  Why should the Senate spend a week on a political stunt?  Why should we go all the way to next Monday before disposing of it?  Let's dispose of it today.  Let's send it to the committee that is already considering these issues, and let's move on to the veterans bill before noon.  We could do that, and the veterans and the people of this country would respect us for it.

I thought we had stopped the political stunts on student loans last year when the president, to his credit, worked with the Republican House and a bipartisan group in the Senate, and came to a result – a big result.  It affects $100 billion of loans every year. 

Half the students in America have a grant or loan to help pay for college.  Congress stopped this type of political stunt last year.  Instead of every election year where someone comes forward offering some preposterous proposal about what we can do in the hope that students might vote for them – Congress stopped that by saying:  Let's put a market-based pricing system on new student loans.  The effect of that was to stop semi-annual political stunts, while lowering the interest rate on loans for undergraduates nearly in half.  Undergraduate students are 85 percent of the students receiving federal loans.  So a 19-year-old student can get a loan to go to college at 3.86 percent without any credit rating and in some cases can get a grant of up to $5,645 to go to college.  Congress did that last year. 

This year the Senate education committee has held 10 bipartisan hearings on higher education.  This is a committee that knows how to work.  Senator Harkin, the Senator from Iowa, and I have big ideological differences in our committee, but that doesn't stop us from working, from doing our job.  We passed 19 bills out of our committee, and 10 of them have gone through the Senate and became law.  No other committee in the Senate can say that.  Right now we are working on this very subject of the political stunt.

So why not stop the political stunt and put this where it belongs – back in the committee that is already working on it in a bipartisan way.  Let's focus on the veterans who are standing in line and do what the majority leader said, which is let's deal with that issue. 

Why do I say this student loan idea is not a serious proposal?  It is not out of lack of respect to the sponsor.  Of course I have great respect for her and for other senators who are offering this proposal.  But let me outline why I say this is not a serious proposal.  And everybody in the Senate knows that.  They know it is not going to pass.  So why would the Senate waste time on it? 

No. 1: It does nothing – not one thing – for current or future students.  For students who are in college today or will be tomorrow, this does nothing for them.  So don't let the rhetoric fool you. 

No. 2: What does it do for people who used to be in college paying off a student loan?  According to data supplied by the Congressional Research Service:  It will give them $1 a day.  For the typical former student who has old loans, this bill will give them a taxpayer subsidy of $1 a day to help pay their student loans. 

How big is that loan?  For undergraduates – which are 85 percent of all students with loans – it is $21,600.  For graduates with a 4-year degree, it is $27,000.  So $27,000 – probably the best investment a person will ever make.  The College Board says that if you have a 4-year degree, your lifetime earnings will be $1 million more.  So $27,000 for a student with no credit rating and has a right to borrow that earns you $1 million?  I think that is a pretty good deal.  In fact, this $27,000, is about the exact amount of the average car loan. 

So what are we going to do next week?  Instead of dealing with lines of veterans at clinics, is somebody going to come on the floor and say:  Well, people have a $27,000 car loan, so let's raise taxes and raise the debt and give them $1 a day to pay off their car loan – or the mortgage loan or the credit card. 

This is not a serious proposal.  It is not going to help people. College graduates don't need a dollar-a-day tax subsidy to pay off their loan.  They need a job.  They need a job, and right now they are experiencing the worst situation for finding a job that they have seen in a long time. 

Now Republicans have plans that would help create more jobs.  We would like to do what the president said, which was give the president more trade authority so companies in the nation can sell more things in Europe and Asia, but, no, we cannot bring that up.  We would like to approve the Keystone Pipeline, but, no, we cannot bring that up.  We would like to repeal Obamacare and particularly the parts that make it harder to create jobs, but, no, we don't want to talk about that.  We would like to at least change the provision about part-time jobs from 30 to 40 hours which affects millions of American workers, but, no, we cannot bring that up either.

If the Senate wants to talk about students paying back loans, they don't need a dollar a day, they need a job.  But my point is why should the Senate waste a week on this bill when veterans are standing in line waiting for us to take up and deal with a bipartisan proposal that the majority leader just described?  What else is wrong with this student loan proposal?  It could add up to $420 billion to the federal debt.  It does bring the money with it to eventually pay it off, we hope, but it adds to the debt.  The Congressional Budget Office says national debt is rising at such a rate that interest payments will go from around $200 billion up to around $800 billion in 10 years.  Taxpayers will be spending more on interest in 10 years than on national defense.  It increases individual income taxes $72 billion with what I call a class warfare tax.  That tax has been rejected eight times by the United States Senate, seven times on a motion to proceed. 

There already is a way to lower your payments if you are a student with a loan and your monthly payments are too high.  It is in the law.  The president talked about it this week.  It is called the income based repayment plan.  It could lower monthly payments $60 more a month than the Democrat proposal if you are a typical undergraduate and $300 more a month if you are a typical graduate student.  Former students can do that today.  That is a bigger savings on monthly payments than in the proposal we are debating. 

In addition to that, if this proposal were to pass the Senate, it could not be sent to the House.  It is unconstitutional.   We cannot originate a tax in the Senate, according to the Constitution.  So why would the Senate pass this if it cannot be sent to the House?  Next, it violates the Budget Control Act.  We passed a law that said we couldn't spend any more than X.  This measure violates that act.

So if it gives a dollar a day to pay off a $27,000 loan at a time when a college degree will earn people more than $1 million, if the loans for undergraduates are about the same as a car loan, if it raises the debt by $420 billion, if it raises taxes by $72 billion, if there already is a way in the law to lower monthly payments more than this proposal without raising taxes, without raising the debt, without passing the law that is unconstitutional – so even if it did pass, it cannot be sent to the House – if it violates the Budget Control Act, why would the Senate waste time on it when veterans are standing in line waiting for a bipartisan proposal to give them more choices for medical care?  Why would we do that? 

Right behind the veterans bill are Senator Mikulski from Maryland and Senator Shelby from Alabama with a series of appropriations bills that have bipartisan support.  They have been through committee too.  We haven't passed appropriations bills in the last 4 years – two of those years we passed zero, one of those years we passed one.  They are ready to do the job on both sides of the aisle. 

Why would we spend time on this if it doesn't deal with the real issue?  Students with loans don't need a dollar a day to pay off the loan.  They need a job.  We have proposals for jobs.  The real problems with student loans are complexities and over-borrowing.  Ninety percent of the loans we read about in the paper that are over $100,000 are loans held by graduate students.  But these are only 2 percent of the loans for all students. 

          Vote no.  A "no" vote means no to a week-long political stunt, no to debt and taxes, and yes to moving today to a bipartisan solution to the problem of veterans standing in line at clinics; yes to appropriations bills that deal with cancer research and national defense and the other urgent needs of our country, also in a bipartisan way; yes to the way the Senate ought to run, and it would mean no to the practice of pulling a bill out of your pocket, putting it on the floor, and wasting one week with a political stunt while veterans are standing in line at a clinic waiting for us to act. 

     So I would suggest the right thing to do is to vote no, send the bill and the discussion about student loans to the education committee.  We can work with the president on a solution just like last year, and let's move on to dealing with a bipartisan solution to veterans who are standing in line waiting for the Senate to act.

The question before the Senate is: Shall we spend the next week on a political stunt that gives some students $1 a day to pay off a student loan or shall we move to a bipartisan solution for veterans who are lined up at clinics and hospitals across the country in a way that shocks Senators on both sides of the aisle?  That is the issue. 

The proposal before the Senate is not a serious proposal.  There is nothing in it for current or future students.  It is a $1 a day subsidy to pay off a $27,000 loan.  What are we going to do next week – raise taxes and raise the debt to pay off a $27,000 car loan, which is similar to the average loan debt of a graduate with a 4-year degree?   In addition, this could not even be sent to the House if it passed because it is unconstitutional.  You can't start a tax in the Senate, and this has a big tax in it.

The way we deal with these issues is the way we did it last year.  We worked with the president in a bipartisan way and reduced rates for students.  What we need to do today is vote no – no to the political stunt, and move immediately to the deal to help veterans standing in line at clinics and hospitals across the country. I urge the Senate to send this to the committee that is already working on it in a bipartisan way, and let's move to help the veterans in a bipartisan way.