Over the next two days, President Obama is set to visit the University of North Carolina at Chapel Hill and the University of Colorado at Boulder. The president pitching an idea that even his presumptive Republican presidential challenger Mitt Romney agrees with: Cuts to federal student loan interest rates cannot be allowed to expire on their July 1 deadline.
If legislators do not listen to the suggestion of their presidential hopefuls, federal Direct Stafford Loan interest rates will automatically double from 3.4 percent to 6.8 percent on July 1. Obama argues that allowing these rates to double would be a tremendous blow to people seeking higher education.
While the latest issue of Stafford interest rates will not on its own solve the student loan debt crisis or help anyone find a job, inaction poses a potentially serious problem to the next batch of employment-seeking college graduates, as it will further burden them with debt.
In Congress, Democratic Reps. Gary Peters of Michigan and Joe Courtney of Connecticut have introduced legislation to keep the Stafford interest rate at 3.4 percent. In a letter circulated around Capitol Hill last week and obtained by The Huffington Post, the congressmen write, “When Treasury bonds are being sold at 2 percent and mortgage rates can be had for less than 4 percent, it is outrageous to make college students pay two to three times the going interest rate. As parents and grandparents, it is unconscionable that we would even consider putting this burden on our children.”