Student Loan Debt

Floor Speech

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Mr. BLUMENTHAL. Madam President, tomorrow the Senate has a historic and magnificent opportunity to increase everybody's fair shot at the American dream--everyone's fair shot at a college education that enables and opens the American dream to people who come from families where college was an unachievable aspiration. I know about those families because I come from one of them. I am the first man in my family to have a college education, not to mention the opportunity to go to law school.

There are a couple of hard, practical facts, apart from all the rhetoric about the American dream. The fact is today college education is a major--maybe the most important determinant--of income. It is one of the major determinants of employment. The employment rate for college graduates is much higher than for those who lack it. In fact, the unemployment rates for college graduates are half or less than what they are for those who lack that education.

College education--in fact, education in general--is the single most important instrument of social mobility in this country. It is a way for people to reach the middle class or for families to stay in the middle class. Right now, the middle class is squeezed in every direction by so many different economic factors and pressures, and the cost of a college education is one of the most pressing of them.

So we have the opportunity tomorrow to enable countless people to take advantage of the American dream in a very hardheaded, practical way by enabling all college graduates or others who have student loans to reduce the charges--the interest rates--on those loans to a lower rate that is the lowest rate acceptable.

I thank the Presiding Officer for her leadership in championing this cause before it reached the Senate floor--way before it became the fashionable and popular issue it has become. I thank also the President of the United States who, by Executive action, has helped to ease the burden of those college loans to thousands of current student debtholders. He has recognized the importance of reducing that burden by expanding a program that was passed by Congress in 2010, tying monthly student debt payments to a portion of the debtholder's discretionary income. He has expanded that program to include many of those debtholders before the date that it is currently operative, and I thank him for that step, but it is a minor step compared to what we have the opportunity to do tomorrow in realizing an opening to the American dream for many students who have already been through education and now carry interest rates on their debt of 8, 10, 11 percent. It is an opportunity not only for them to reduce that interest rate but also for the economy to take advantage of their purchasing power that will be unleashed--consumer demands that will be enlarged--because people are more likely to buy homes, start families, begin businesses, become entrepreneurs, be innovators and inventors, who right now are making career choices because they are saddled with debt that forces them to pay interest rates much higher than current students do.

It is not a forgiveness program. They will continue to pay the principal on that debt. It is not a free ride or a handout. They simply get the benefit of the interest rates that our friends across the aisle thought was absolutely right, just months ago, when applied to the existing program.

So this opportunity is a commonsense, simple measure to provide some relief to people struggling under a debt load that is suffocating to them, their futures, their families, and our economy's future.

I believe sincerely there are equally important measures that eventually we need to take in this body, in this Congress, in this Nation, to make college more affordable. The costs of tuition and college expenses need to be brought down. The grants we provide--so-called Pell grants--and scholarships that come from other sources need to be expanded and increased. The opportunities for people who incur debt to work down or work off that debt through public service can be dramatically and drastically enhanced for their benefit and for the benefit of our communities and country that will stand to be forthcoming by their policing, their teaching, their firefighting, their public service that can be, in effect, rewarded and incentivized by enabling them to work down or work off those debts.

These programs are a moral imperative, as is affording the opportunity of students to discharge in bankruptcy those debts when they simply cannot fulfill them, but this idea of giving everybody the benefit of the lowest possible interest rates that will be part of the bill we vote on tomorrow is a solid and sound and vitally important beginning.

We enable homeowners to refinance and car buyers to refinance and many other kinds of debtholders to refinance but not student loans. That is a discrimination, maybe not unlawful but still a distinction that makes no sense either from the standpoint of our economy or the interests of the debtors. So I hope we will give them a fair shot but also impose a basic and fundamental tenet, an ethos of fairness: If it is good enough for home loans and car loans, why not for student loans?

We should not be adopting policies that encourage people to give up on their dreams. In fact, we ought to be doing just the opposite, making young people feel their dreams are within reach.

I will close by saying to my colleagues that in the last months I have been listening around the State of Connecticut--at roundtables and meetings--to both high school students and college students about this issue of college affordability. What is so inspiring to me, in the meetings I have had--in places such as Ansonia, Windham, and Bridgeport--is the drive and determination of our students to embark on a college education. They know its value, its realistic value, its cost, and they want to do it because they know it is a way up. They are gaining and they are giving back.

But many of them have to make compromises. They have been admitted to schools. Their first choice is a first-rate school, but they cannot put together the package financially that will enable them to go. It is beyond reach financially, even as it is within their grasp intellectually. So they may compromise--maybe the first of other compromises that they will make throughout their lives, as they pursue careers, as they have to make hard choices. But at that age, those compromises should not be driven simply by financial imperatives. They should have the best education that is possible for them, and this country should make it available, not just for their sake but for all of ours.

I have been listening to college students who are leaving--at the commencement addresses I have given at law schools, as well as colleges--listening to students talk about their futures as well, futures that will be compromised because of the debt they have, an average of $27,000 to $30,000 in the State of Connecticut alone, and it is similar in many States around the country and the reason we have $1.2 trillion in debt overall today.

They will compromise in doing a job that may be more lucrative but less rewarding, less so to them and less so to our economy, less so to our society--a lesser way of earning a living in terms of its impact in contributing to our social fabric, qualify of life. They may not be teaching, they may not be policing, they may not be doing things that give back to our society because they need the income, the higher income to pay back that debt.

So those compromises affect all of us as well. They are done because they simply cannot afford either to go to the school of their first choice or the career of their first choice, but the government can afford to give them a lower interest rate. We know the government can do so because right now it is profiting off the backs of students in billions and billions of dollars. The estimates range, over a 5-year period, from $66 billion to other amounts. We know the government will continue to profit even at lower interest rates from the Student Loan Program.

So let's have less profit to the government, better well-being in our communities, and fairer treatment for our students--a fair shot for them and their families and for all who have as their objective simply to better their lives and gain a fair shot at the American dream.

I thank the Presiding Officer.

I yield the floor and suggest the absence of a quorum.

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