Student loan debt has topped $1 trillion -- more than the total amount of credit card debt in the U.S. The average amount of student loan debt for a graduating senior is currently $25,000. Nearly 8 million Americans use subsidized loans from the government to pay for their education. Doubling the interest rate for federal loans will mean that students with $23,000 in debt will pay an additional $5000 over a ten year repayment period, and $11,000 on a twenty year timeline.
Shouldering tens of thousands of dollars in debt is impeding new graduates from working toward important financial milestones like buying a house, or taking risks like starting a business. Unfortunately, the side effect of the bloated cost of a college education is a cycle of borrowing and defaulting on payments that is detrimental to the overall economy.
Lawmakers can keep interest rates from doubling by passing H.R. 3826 and S. 2051, bills to keep the interest rates at 3.4%. Congress should cut federal subsidies for oil companies and banks to finance the education of the country’s future leaders, rather than making students and taxpayers carry the burden of the growing cost of an education.