Senate Republicans blocked consideration of a bill that would allow people to refinance their student loan debt in a 56-38 vote on Wednesday.
Democrats needed 60 votes to advance the refinancing measure, but Sens. Susan Collins (Maine), Bob Corker (Tenn.) and Lisa Murkowski (Alaska) were the only Republicans to vote with Democrats.
Reid voted against the motion for procedural reasons, so he could call the bill up again.
But Minority Leader Mitch McConnell (R-Ky.) said the bill was “designed to fail” because the pay-for raised taxes on millionaires.
“The Senate Democrats’ bill isn’t really about students at all. It’s really all about Senate Democrats,” McConnell said ahead of the vote. “Because Senate Democrats don’t actually want a solution for students. They want an issue to campaign on — to save their own hides in November.”
Sen. Elizabeth Warren (D-Mass.) authored S. 2432, the Bank on Students Emergency Loan Refinancing Act, which would allow more than 25 million people to refinance their student loans to today’s lower interest rates of less than 4 percent. She paid for the bill with the “Buffet Rule” — a minimum 30-percent income tax payment from people who earn between $1 million and $2 million.
“Student loan debt is crushing young people, making it harder for them to buy homes, purchase cars or start businesses,” Warren said. “We must act now to provide relief for existing borrowers.”
The Congressional Budget Office determined that allowing former students to refinance their loans would cost $51 billion, but the tax increase on the wealthy would fetch $72.5 billion in revenue for the federal government, meaning a net gain of $20 billion.
Senate Health, Education, Labor and Pensions Committee ranking member Lamar Alexander (R-Tenn.) called the bill a “partisan political stunt” that included a “class warfare tax.”
Democrats brought the legislation to the floor while President Obama travels around the country making a pitch for student loan reforms. Earlier this week, he issued an executive order that would allow 5 million students to cap their monthly student loan payments to 10 percent of their income.
More than 40 million contribute to the $1.2 trillion in student loan debt in the United States.
Democrats have been pushing their “fair shot” agenda ahead of the November elections by holding votes on student loans, raising the minimum wage and ensuring women have equal pay for equal work — but Republicans have blocked all of legislative measures.