The Student Loan Affordability Act

Floor Speech

Ms. RICHARDSON. Mr. Speaker, the higher education system in the United States has for many years been the envy of the world. The universities here are a part of America's backbone, providing young people with the skills and knowledge necessary to succeed in today's changing global economy.

However, Mr. Speaker, right now, the cost of tuition at universities has risen so dramatically all across this country that attendance is tough to achieve. Nowhere is this truer than in public universities in the State of California that I represent, where budget cuts, furlough days, and tuition increases have become a new normal--at the expense of higher learning. Average in-State tuition and fees at public 4-year institutions have risen 8.3 percent in 2010 and now in the classes in 2011.

As a result of these increases, tuition at public and private universities now has caused student loan debt to exceed credit card debt, totaling $870 billion, and it's expected to reach $1 trillion this year. Students graduating from college between 2006 and 2010 had a median student loan debt of over $20,000. Not only are young adults in debt, but recent graduates are also facing one of the toughest job markets in recent memory.

In 2007, when I started here in Congress, we worked to pass the College Cost Reduction and Access Act which, among many other things, lowered the interest rate of subsidized Stafford loans from 6.8 percent to 3.4 percent. As a result of these lower interest rates on federally subsidized student loans, more students were able to afford to go to college. In order to keep college affordable, Democrats in Congress and President Obama are urging the House GOP leadership to bring forward the legislation that would prevent these interest rates on student loans from doubling this July.

I'm a proud cosponsor of H.R. 3826, the Student Loan Affordability Act, which will prevent the interest rate on subsidized Stafford loans from doubling in July. By extending the current interest rate, we are making an investment in our country's future. Our economy depends upon the educated workforce to out-compete and to out-innovate the rest of the world, which is something we've been known to do for quite some time.

Statistics tell us that it also makes a difference if you're able to go to college. According to the Bureau of Labor Statistics, the unemployment rate for those 25 years and older who've got their bachelor's degree is only 4.2 percent, but for those, unfortunately, who were not able to attend and graduate, the unemployment rate exceeds over 10 percent.

Unlike Pell grants, which provide a vital benefit to low-income families and students, Stafford student loans also benefit middle-income families who need financial assistance as well. Congress should not wait and allow this increase to take place. It would, for all intents and purposes, be a tax increase on middle- and low-income families and students during this very fragile economic recovery.

I urge the Republican majority and Speaker Boehner to take action now to prevent this increase. We are seeing right now the impact on the American economy when Congress waits too long to act on issues of national importance such as our Nation's debt. Students and families cannot wait any longer to know how much they will have to pay and owe coming out of college. Why? Because that might impact whether they can even go at all.

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