Iowa delegation frustrated by student loan impasse

WASHINGTON - There is a timeworn saying in Washington that even in the most difficult negotiations, lawmakers will always strike a deal once they hear planes taking off from National Airport for the weekend.

That didn't work last week on Capitol Hill, as the Senate grappled with how to keep student loan interest rates from doubling soon - an increase that would affect 7.4 million students.

In fact, nothing worked. Even by Washington standards, it was a frustrating week. After a week-and-a-half-long recess, the Senate on Tuesday voted against a Democratic bill that would keep the interest rates at the current 3.4 percent level by closing tax loopholes for wealthy taxpayers and corporations. But senators didn't just vote down the bill - they couldn't even agree to hold a vote on it. The 52-45 vote was on a procedural motion, and fell eight votes short of the 60 that is necessary to move forward and hold a vote on the bill. On a mostly partisan vote, the Republican-controlled House had already approved a bill in late April to keep the rates steady.

“It's very frustrating,” Rep. Bruce Braley, D-Iowa, told The Gazette. “If you work hard enough, you should be able to find a funding mechanism that's acceptable to both Democrats and Republicans. But that's not happening right now.”

The situation created a particular irony at the Capitol. Both Democrats and Republicans agree that the rates should remain low - President Barack Obama and presumptive GOP presidential nominee Mitt Romney concur as well - but the two parties disagree on how to pay the $5.9 billion cost. Obama even came to Iowa City last month to push the idea before a student audience at the University of Iowa.

Rep. Dave Loebsack, D-Iowa, has called the congressional impasse “sickening.”

“Just last week Republicans voted en masse to allow the student loan interest rates to double, and now hide behind a vote on a bill they know is going nowhere,” Loebsack said. “As someone who has helped craft and pass legislation to expand access to college, it is sickening to watch this unfold.”

Action is needed before July 1 to prevent a rate increase to 6.8 percent, costing each student about $1,000 per year. But the differences are stark. House and Senate Republicans want to use a preventive health care fund established in the 2010 health care law to pay for keeping the 3.4 percent rate steady, while Democrats want to preserve the child immunizations, screenings and mammograms provided by that fund and pay for the idea instead by closing tax loopholes.

Lawmakers from Iowa have been circulating statistics showing that since 2000, Iowa's median household income has fallen by 6.3 percent, from $53,532 to $50,164. In the same period, average tuition and fees have climbed 82.9 percent at the state's public universities, from $4,120 to $7,534, and by 37.8 percent at private colleges, from $17,808 to $24,399.

Also, according to a report from the Project on Student Debt - an independent, non-profit research firm based in Oakland, Calif., and Washington, D.C. - students in Iowa have the third-highest student loan debt of any U.S. state. Those who graduated in 2010 had an average of $29,598 in loans, more than $4,000 higher than the national average. The study also showed the state has the fourth-highest percentage of students who graduate in debt - 72 percent.

Iowa's two senators said they share the public's frustration but blame each other's parties. Sen. Tom Harkin, D-Iowa, also called for an idea he first proposed in 1995 - when Democrats were in the Senate minority - that would prevent abuse of the filibuster.

Harkin said the Senate's dysfunction is the worst he has seen it since his election in 1984.

“I warned at the time that if we didn't change (filibuster rules), it would get worse. And believe me, it's gotten worse,” he said Thursday. “When you filibuster, it becomes totally dysfunctional ... The way to go forward is for Republicans to quit their obstruction. You can't say both sides are to blame. No, I'm sorry. The Republicans are to blame. People have to understand what obstructionism is around here.”

Sen. Chuck Grassley, R-Iowa, sees a glimmer of hope that the two parties will find a compromise.

“Interest rates are not going to go up when both political parties feel they shouldn't go up,” Grassley said. “The way the Republicans want to pay for it shouldn't be obnoxious to the Democrats. There's no bipartisan disagreement on the interest rates, so we'll find a way to reach an agreement.”