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Senator Warren and Congressman Tierney, earlier this week, discussed their student loan bill at a Student Loan Reform Roundtable. (Photo via warren.senate.gov) <\/span><\/span>The Bank on Students Loan Fairness Act<\/a> (pdf), the first introduced by the rookie Senator, allows students to borrow at the same low rate\u2013currently set at 0.75 percent\u2013that banks borrow from the Federal Reserve for a year, “providing a window for Congress to find a fair, long term solution on student loan interest rates.”<\/p>\nUnless action is taken, the rate of subsidized student loans is set to double from 3.4 to 6.8 percent on July 1.<\/p>\n
Congressman John Tierney (D-Mass.) has introduced a corresponding House version<\/a> of the bill.<\/p>\n “Students are being squeezed… Incomes are down, and tuition is going up.” – Joseph Stiglitz, Nobel economist<\/span><\/p>\n According to a statement <\/a>on Warren’s site which lists the endorsing institutions, the senator “has received an outpouring of support from students and their families, colleges and universities, and independent groups.”<\/p>\n Petitions in support of the legislation by groups such as Democracy for America<\/a> and Move On<\/a> have gathered a total of over a million signatures.<\/p>\n Both Warren and Congressman Tierney have been meeting with the groups to discuss “the moral obligation of investing in students and providing them with the same cheap access to credit that we provide big banks.”<\/p>\n “These students and their families have worked hard, saved what they could, and borrowed what they need to pay for higher education,” writes Warren in a Boston Globe<\/em> op-ed<\/a> earlier this week. “Rather than reward their efforts, the government plans to add to their burden.”\u00a0<\/p>\n She continues:<\/p>\n Some people say that we can\u2019t afford low interest rates for students. But the federal government offers far lower rates on loans every single day \u2013they just don\u2019t do it for everyone. Right now, a bank can get a loan through the Federal Reserve discount window at a rate of less than one percent. The same big banks that destroyed millions of jobs and broke our economy can borrow at about 0.75 percent, while our students will be paying nine times as much as of July 1.<\/p>\n This is not fair. […]<\/p>\n We should not be profiting from students who are drowning in debt while we are giving great deals to big banks.<\/p>\n Unlike big banks, students do not have armies of lobbyists and lawyers. They\u2019re banking on us to do what\u2019s right. Let\u2019s bank on students by investing in their futures and giving them a break on student loan interest.<\/p>\n<\/blockquote>\n Another voice that has come out in support of the measure is Nobel Prize laureate Joseph Stiglitz, who says that American students are “more dependent on the income and education of their parents than in other industrial countries.”<\/p>\n\n