McConnell: Dems will 'continue to fight with each other' over student loans

“Democrats need to finally allow the bipartisan student loan reform proposal to come to a vote this week, so we can pass it and ensure there’s one less Washington-created problem for young people to worry about in this economy,” McConnell said on the Senate floor. “Because it’s tough enough out there for them already. The Obama Economy has not been kind to the youth of our nation.”

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On July 1, need-based student loan rates doubled from 3.4 percent to 6.8 percent. Senate Democrats tried to pass a bill that would have extended the 3.4 percent rate for one year but failed to overcome a Republican filibuster requiring 60 votes to advance the legislation.

The bipartisan deal would be a permanent solution and base loan rates on the 10-year Treasury note, plus 2.05 percent to cover administrative costs. The bill also caps undergraduate loan rates at 8.25 percent. The House passed a similar bill last month.

Sen. Bernie Sanders (I-Vt.) said he’d oppose the bipartisan bill — which has the support of senior Democratic Sens. Dick Durbin (Ill.) and Tom Harkin (Iowa).

“Our job is to improve the dismal situation in terms of college affordability and indebtedness … to make it better not to make it worse, which is exactly what this piece of legislation would do,” Sanders said on the Senate floor after McConnell's speech. “Our government is selling out the young people of our country.”

Some Democrats, such as Sanders and Sens. Elizabeth Warren (D-Mass.) and Jack Reed (D-R.I.) have argued that the bipartisan bill would harm future college students because, if market based interest rates increase — as expected over the next few years — student loans could exceed 6.8 percent.

Sanders said he would introduce an amendment that would sunset the bill after two years — before the interest rates are expected to exceed 6 percent.