quorum call:

mr. brown: thank you, mr. president, i ask unanimous consent to dispense with the quorum call. the presiding officer: without objection. mr. brown: thank you, mr. president. i come to the senate floor from time to time to share thoughts from people in my state, and we all are hearing comments from people, college students, people who have finished college, and often from the parents of those who face these massive kind of debt from going to two-year, four-year, public, private public schools, sometimes most tragically at a for-profit school, where they haven't gotten much help in job seafnedz equally, more tragically, when they've finished school and still face this debt cht my wife

graduated from kent state university some number of years ago. she -- her father was a utility worker, carried a union card for more than 30 years. her mother was a home-care worker, oldest of four, first in the family to go to college. her two younger brothers and sister and brother also went to college. connie graduated from kent state university with a debt of only $1,200. that was 30-some years ago. that so starkl stark illustratee difference between today and then. she had little privilege, hill money, parents that couldn't really put much mo money out, but with lower tuition, pell grants, little-few scholarships and stafford loans, she will -- and working, sheefsz able to get through school with little debt. the stories we hear today are so different from that. and i'm -- i plead with my colleagues that we freeze interest rates at 3.4%. that won't solve anything close to all the problems of higher

college tuition and costs of room and board, but it will help. we need to do much more than that. i convene every year the 50 or 60 college presidents from ohio, two-year, four-year, schools, colleges, state universities, all of them to come an discuss these things. we've done it for six years in a row. it is helpful to try to find ways to keep college -- keep higher education costs in check. but again not nearly enough. but i'm hopeful that in the next 24 hours or so, we can freeze interest rates at 3.4% and then get serious about what we're going to do, what we're going do about the $1 trillion aggregate debt that college students -- that students or former students have in this country, focusing in part on the $150 billion of the $1 trillion, the 2 that 2.9

million students are burdened with. iis15% is in the private market, where interest rates are as high as 12%, 15%, 16%. and a few private banks are willing to refinance those loans. my legislation with senator heitkamp will help us with the carrot-and-stick approach both to encourage these private institutions, these banks, the private lenders to refinance these loans. but let me share a couple of letters from students and families because i think that speaks volumes better than i can, mr. president. this is a letter from daniel from centerville, ohio, daniel has been at the university of dayton. he said, "i currently have 100,000 in outstanding loans. last summer i graduated with a master's degree in middle child education. the previous summer i graduated with a bachelor's as well from wright state university in dayton. starting in july of 2013, my average monthly payment for all my student loans will be $600 a

month. i recently got one of my payments lowered. otherwise that total would have been over $00 a month. i've consol consoli disait cons. other loans which will be due in february 2014 are add to the $600 a month pavement i teach in a school in continue sifn sin and he writes in capital letters, "i love the work that i dovment" it was impossible to if i understand a job in dayton so now i spend $200 a month traveling to cincinnati 40 miles or so one kaye way. in addition, even though i have a part-time job in the surges while school is out, i still find myself struggling to pavement he says, the country needs to -- he said, i'll be well over 65 years old before i'm able to pay of my college loans. the country needs to rethink its priorities." that's daniel from centerville, ohio. melinda writes "after graduating from colleges, i had roughly

$23,000 in student loan debts. my payments are $27 a month. i am very tightly budgeted. while i am able to make this pairntle which is my largest, most important bill each month, aside from rent, it puts me in a vulnerable situation. i list had to have rurnlgry for a chronic medical problem. i had to visit the e.r., making that loan payment every month leaves little extra to be saved for unexpected expenses. i understand it's my responsibility to pay it. i loved every minute of my education, so it was worth t but at the end of the day, a hike in my interest rates may be the difference between my saving a little money each month or save nothing. i fall asleep at night knowing that i am 24 years old and yet to begin saving for retirement, which will be a very important issue for my generation and not even getting into the issues of retirement of social security and the efforts from some of our colleagues here to privatize that system. i won't even go into more detail

there. christie from ash at that buell larks the community my wife grew up in, writes as a low-income individual, i was forced to go to college, who could give me the best education, the most financial aivmentd but there was a carchtion i couldn't leave ohio because i didn't have access to a car and my single-parent mother who works two jobs would have no way to get me there if there were emergencies. i chose case western reserve university, a renowned university ranked, she say, at 37th in the country. my financial aid package was hefty. if i paid full tuition, i would be an insank $2 thew debt by gray d graduation. by the end only owe a quarter of that, that's $60,000 in debt. that's pretty much a house and a car. the last letter is linda from my hometown of mansfield, ohio. i have two children currently attending state schools in

cleveland and in akron, where a middle-class family working hard to make ends meet and help to make ends meet and help our children to the best of our ability, even after saving for them and thinking we had plenif i for hem to get through without much debt, the market crashed in 2008, more than half -- more than half our hard-earned colleges savings for them disappeared. they've had to take out loans in order to be able to attend. we don't have the cientdz of money for them to borrow from us or to pay the thousands that their college savings doesn't cover. but both of them are on the dean's list every semester. my son is an environment at science major my daughter majored imajored in spanish. they're bright, intelligent, they've worked extremely hard to get where they are. i implore you not to leave them with ridiculous amounts of debt by allowing the interest rate to double. " the stories are pretty consistent, mr. president. that these students are struggling, they already are

thinking about buying a house, starting a business, saving for retirement, even though they're in their 20's. they know the challenges are greater in this generation than previous generations. also what's really obvious in these letters is how the impact this has on families, not just the student that's -- whose 25 or 22 or 19 or 28 facing this lifelong -- or these years of paying off student loans, but what it means to the fathe -- te family, the family that maybe takes a second mortgage on the house to help their son or dawrkts the family had a faces foreclosure because of the financial problems, the family that simply can't help their student, as brokenhearted as that make a parent, they can't help their son or daughter because of their financial situation, help them with that college education. mr. president, i'm hopeful we can freeze interest rates at 3.4% for one year and get serious about what we need to do

for access to college and affordable higher education for our young people. mr. president, i suggest the absence of a quorum. the presiding officer: the clerk will call the roll. quorum call:

quorum call:

quorum call:

a senator: mr. president? the presiding officer: the senator from virginia. mr. warner: i ask that proceedings under the quorum call be dispensed with. the presiding officer: without objection. mr. warner: i ask that the senator from tennessee and i be allowed to engage in a colloquy and speak as if we're in morning business. the presiding officer: without objection. mr. warner: mr. president, it's a pleasure to be here today with my friend, the senator from tennessee, to talk about legislation that we and eight and actually now nine of our colleagues, bipartisan legislation that has been recently introduced to reform our housing finance system. i came into office a couple years later than the senator

from tennessee, but i got here in january of 2009 when the entire future of our financial system was uncertain. the members of the banking committee rolled up our sleeves and tried to work together to prevent future financial crises, and while history will determine whether we accomplish that goal, the senator from tennessee and i worked strongly together on a couple of titles of what has subsequently became known as the dodd-frank legislation. and while there are problems in that legislation and there are problems still within our financial system, i think no independent observer would not say that our financial system today in 2013 is stronger than it was after the crisis. but one area, one area that did not receive very much attention was the question of housing finance. we also know that in many ways, our housing finance system, both from lack of underwriting the --

the process that then ended up allowing a lot of mortgages to get packaged off, securitized, with the assumption that there would never be a decline in housing prices or significant decline in housing prices and that these securities would never be in jeopardy, in many ways led to part of that financial crisis. at the end of the day, those institutions, fanny and freddie that had been the core of our financing system, ended up acquiring $188 billion of taxpayer support to shore up those institutions so that the whole housing -- whole housing system wouldn't collapse. well, we're now five years later, and we believe that it is time to transform the failed model of freddie and fannie into a smarter, sustainable system with more private capital. we believe we can better protect the taxpayer and maintain broad

access to affordable mortgage credit, but we need to act soon to prevent this issue from falling victim to election year politics. the status quo and everyone from the administration to many of us here on the floor of this senate, many housing experts know the status quo is just not sustainable, so we have got two important questions before we get into some of these principles that i will engage with my colleague, the senator from tennessee, on about one, why we need to take action now, and the second question, why does congress need to act, and i will take the first question. why is the time now? well, the last five years since the housing and the overall financial crisis, we have seen, slowly albeit, the housing market come back to life. obviously, this has been supported by a low interest rate environment that has permitted more refinancing and more modifications. rising home values have brought many homeowners out from under water mortgages, and housing

prices have been a significant factor in fannie and freddie's recent record profits. but now those very profits have somehow been wrapped into at least some of our colleagues' discussions about our debt ceiling debate. to speak for this senator, i think the senator from tennessee, and candidly i think many senators are not even engaged with us on this debate right now. the last thing we want is for fannie and freddie to virtually serve as a piggy bank for either side of the aisle's pet projects, and if we're not careful, that could happen. fannie and freddie have been in conservatorship for five years. become we become even more dependent upon this broken system, it's time for us to move forward. so i would like to ask my colleague, the senator from tennessee, if now is the time, if he might share with us some of the ideas he feels and we feel about why it's important that congress be involved in this process and not simply

allow this conservatorship to go on ad infinitum into the future. mr. corker: i want to thank the senator from virginia. i have enjoyed thoroughly working with him on this. we have been working on it since last fall. we spent a lot of time talking to various groups to try to get this right, and we know that every bill can be improved, but we have done our best to present something to the united states senate that we hope will be marked up in the banking committee, something that as the senator, the great senator from virginia mentioned has attracted numbers of people on both sides of the aisle, and i want to thank again senator tester, johanns, heitkamp, heller, moran, hagan and now kirk for joining us in this effort, a diverse group of folks from diverse places around the country that i think have come together to solve this major problem. all during the dodd-frank debate -- and we were certainly in the middle of that -- all people talked about, it seemed, was the fact that fannie and

freddie were not included, and yet fannie and freddie were two of the biggest failures that occurred during that time. as the senator from virginia rightly mentioned, $188 billion of taxpayer money had to go into these entities. mr. president, we dealt with most of the issues around the crisis. i know there are still some rules that are being promulgated and we had some that came out yesterday, but this is the last piece, and as the senator mentioned, the housing sector has been -- been growing and coming back. we understand the importance of the housing sector, and therefore we designed a bill that transitions over time and moves us to a model that we hope and believe strongly is far more sustainable. first of all, let me just mention the five things that we have worked on together, and i know that each of us is going to stress a lot of different things as we move through. i know we plan to come down here in multiple intervals as we move ahead, but the fact is, number one, what does this do, this

bill? first and importantly, it breaks up the g.s.e.'s and liquidates them. it does it over time, but our bill does that. secondly, and very importantly, and this is something that we have talked a great deal with industry and certainly people from all sides of the aisle about this bill puts 10% private cap in advance of any kind of government re-insurance. i just want to say to the senator, one of the reasons we looked at it, if fannie and freddie had had just 5% capital, there would have been no taxpayer losses, but putting this much capital in advance really is a buffer against the taxpayer need to be involved in it. it fully privatizes numbers of functions that are currently performed by fannie and freddie. it gets government out of the business of pricing credit, which is something that we both have thought needed to occur. and it modernizes us, our system of mortgage-backed securities.

but i think the thing that we began with, and i so appreciate the senator's involvement, we realize that one of the major flaws in our housing finance system in the past and even -- well, it isn't today because the government owns these two entities, but in the past it's meant private sector gains, public losses. i mean, when you have a situation where you have shareholders, you have the private sector doing well when times are good, they had an empolice it guarantee, people figured that the government would come in and back stop these entities if they failed. obviously, they are -- their underwriting standards got really terrible. the organizations failed. and what happened? the taxpayers came to the rescue, unfortunately, with is $88 billion, which has not been paid back. we still have these entities in conservatorship. one of the flaws, both of us coming from the private sector, saw was this is not right. there is no way that we should

have entities where there is private sector gains when things are going well and public sector losses. so i want to thank the senator for joining in, for all the hours he and his staff have put into this to try to make this bill as good as we could possibly make it to bring it to the floor. i look forward to the input of the entire senate. i hope we have an opportunity for a markup and a presentation later this fall, but i couldn't be more grateful for the senator in his efforts and his willingness to do this, and obviously his willingness to work hard to see this go across the finish line. mr. warner: mr. president, i want to turn the -- return the same compliment to the senator from tennessee. he brought a greater breadth of background in the housing finance and public finance sector than i did, but together, working with our other colleagues, i think we have all -- all built together a series of critical points, and again echoing what the senator from tennessee said, there is

always ways to improve on legislation. but the first and foremost point was we need to make sure of taxpayer protection. we need to make sure the taxpayers are fully repaid that $188 billion. we need to make sure as well and we spent a great deal of time working with industry and others that there continues to be access to broad market credit. one of the challenges that i think we both felt with fannie and freddie was there was not only a combination of a private sector gain, public sector loss with this kind of hybrid model, but layered on top of that, there was a social purpose. i for one believe very strongly we have got to make sure that there is affordable housing, there is good access to market credit, but when you layered that on a quasi-private entity, as we did for years with fannie and freddie, you ended up where you weren't sure whether those entities were performing that necessary securitization and financing purpose to maintain

the overall housing finance sector, or whether they were allowing certain loans and maybe shouldn't have gone into this process because of the social problems. we have to make sure there is the 10% capital, very important. we also said let's go ahead and split off that public sector role, clearly identify it, make it sure that those loans that get securitized a small transaction fee, not a tax, small transaction fee is charged and that those funds are set aside to promote rental housing access to credit, low-income housing, have that audited stand alone, perform that important function. as we said as well, doing this, as the senator from tennessee has mentioned, and he has been quite strong on this, we're going to make sure that the government role is clearly defined but much more limited. there are some who say we can do this totally on the private sector side. we hope that there will still continue to be the 30-year fixed

mortgage product that the american public i think has come to expect. we can privatize more, but not having that ability to have that government back stop would remove that very essential component of our current housing finance system. so a more limited government role with still the ability for our american consumer to have the kind of access to financial products that they have come to expect. again, it's been mentioned, making sure that we expand private sector capital and make sure that they take care of that underwriting and credit -- credit assessment, that quite honestly the old model didn't really provide. this is what i would like to ask the senator from tennessee, because this is one we went round and round again. i want to thank him and his staff and my staff and the staff of our now nine cosponsors of this legislation. one of the things that was quite important to us was if you're going to create this new model, how do we make sure that while

we want more competition, private sector competition, we want institutions to be able to go ahead and provide this important issuance and securitization function, how do we make sure that those small banks, that community-based bank or that credit union, that small bank in novel, that small -- in knoxville, that small bank in martinsville, virginia, still gets access to the same kind of ability to issue mortgages, have those mortgages securitized and not be at the disadvantage of some of the megainstitutions. i ask my colleague senator corker, why don't you speak to that issue. it did take us awhile to get this right but i think this is an area with the reaction we've seen, i think we've made a great first step. mr. corker: one of the things that, no question, the community banks and credit unions around our country have been concerned about, even though freddie and

fannie are 90% of all mortgages today and very dominant obviously because of what has happened and also because of the tremendous market share they have had, is that if you're going to wind these down are we going to be assured access into this market. and so we have created mechanisms for them to be able to come in through issuers, to be able to do this, one of the things that so many of the community banks and credit unions have complained about as a tremendous disadvantage with our existing system was that there was volume pricing. in other words, if you were a big, big user of fannie and freddie, they gave you a big volume discount. so wells fargo, bank of america, tph-pg -- j.p. morgan j.p. morgan, as they tried to process loans through this system, they got big-volume discounts, so they were more competitors.

the community banks that mean so much, the ones that drive things back home, the community bankers that are members of the rotary club and the lions club and involved in our communities they were constantly at a disadvantage as it relates to housing finance. one of the components of this bill is not only to ensure that they've got equal access into the system -- and we do that, i think, very eloquently in this bill. but in addition to that, we ensure that there's no mechanism that allows for volume pricing. everybody is treated the same, as it should be. because in this particular case we end up with an explicit government guarantee. it's very different. you don't have a situation where you have private shareholders doing well when things are good and public, the public doing bad. but one of the reasons we felt confident in moving this direction, again, was the tremendous amount of upfront capital in advance.

again, we've tried to deal with the smaller institutions. as a matter of fact, we haven't tried to deal with it. we sat down and worked this through and worked through the many issues that they have brought up. we know how important they are to everyone here and everyone in the country. we've dealt with that, but we've also created enough upfront capital, again, as the senator has mentioned, to protect the public. so i know that, again, every bill can be improved. we saw that most recently with immigration. as a matter of fact, i think that's a good model. we've introduced something. i hope that the banking committee will take this up soon. it's almost unprecedented to have nine members of the banking committee cosponsoring this piece of legislation. hopefully it will have the opportunity for markup or improvements. we know that the chairman and ranking member obviously are going to want to put their stamp, and many members in the

committee, of anything that occurs. but i think we've done some of the work that's important to establish a very good beginning place, and we've tried to address, as the senator mentioned, the many communities banks around you are -- our country that are in here constantly, so important to the states we represent. i think we've done that. again, i know the senator and his staff, and many of the cosponsors, that was something that was an ultimate threshold for them, was to ensure that the community bankers and credit unions around our country had the appropriate access. and i think we've hit that good place in this bill. mr. warner: mr. president, i know our time is about up. i just want to close and turn it back over to final comments to my colleague from tennessee. just to urge my colleagues and their staff and folks who are interested in this issue, this was the one piece of unfinished

business on our financial system reform. and while there are some today who say, well, things have gotten better. we should allow the status quo to continue. well, i don't think from the administration on down, there is anyone who thinks the status quo simply continuing with private-sector gain and public-sector losses is the right model. we ought to take the lessons of the last five years and some of the very good work in terms of standardization being done at the f.h.a. right now, take what we've learned and set up a new model, that as the senator from tennessee has said, make sure we get that tax rate protection. i would simply add when housing is a critically important part of our overall economy, any piece of legislation -- and let me not say all these groups have endorsed this legislation but they have all been generally supportive. they've all got areas they would like to see improvement. but when you've got realtors and home builders and large banks

and small banks and community organizations and groups who are concerned about low-income housing and rental housing all saying we're in the ballpark, that in an area that is so important to our economy and so complex, i think we've taken a great first step. i would urge colleagues to join with us. the senator and i will be happy to come make presentations. we found so far virtually many, many of the members that we sat down with, when we walked them through all the processes and all of the kinds of protections we built into this legislation, i think that's one of the reasons we've had such success, at nine members of the banking committee, almost half of the banking committee without not even all of them had a full presentation with this kind of support. i again want to thank my colleague from tennessee for his great work, his leadership on this. he has been the lead sponsor. i'm proud to be his wing man on

this, as we've continued to work through it. my sense is, though, that this is the time. it is my hope that the banking committee will take up this piece of legislation, make their improvements on it. but it would be a huge mistake if with interest rates at their kind of record-low time, with this housing market coming back, with us putting in place a five-year appropriate transition time, if not now, then when would be right to do the kind of meaningful housing finance reform that i think so many across the spectrum called for. i look forward to my colleague, the senator from tennessee, thank him for his good work. mr. corker: i think we both realize this is a beginning point, meaning there is a piece of legislation that has a lot of

bipartisan support among really talented and wise members, excluding the two of us. and i thank them for, you know, i thank them for joining in and helping make this bill better. obviously this is something that we think may be taken up sometime this fall. and i do hope we'll have the opportunity to make presentations to people throughout the senate very, very soon. but i want to make two points. the senator from virginia, because of his background, was probably more involved in the banking issues than most people here because he brought a lot of background and expertise. i felt fortunate to be involved in some way during that time. and he, he and i both remember -- and i hope the members of this body will remember back again -- the big issue that people felt during that time was unaddressed was

were the two g.s.e.'s fannie and freddie? candidly it was a complex undertake. that-- undertaking. that is a fair criticism. there was a lot being dealt with. time has gone by now. the housing market has improved. we still haven't finished our work. i think most people here understand that gosh, this last crisis brought such hardship to so many people across this country. trillions and trillions of dollars of household wealth went down the tube because we had a system that wasn't stable, a system that was making bets on things that it shouldn't have been making. it was excessive. as the senator has mentioned between the regulators and some of the rules that have been passed, the system is stronger now. but we still have not dealt with this. and i would just ask my colleagues to consider later this year looking at something to finish that work so we can

really shore up the housing market and do everything we can to keep that portion from happening again, because, again, we know how important the housing industry is to us. and secondly, i would say i think the window is closing. just for what it's worth, there are a lot of people throughout our country that have a stake, a personal stake, in trying to keep the status quo in place, to try to keep a situation where we have, again, private shareholders who the public believes has the government standing behind it, and no matter what they do, they're going to be bailed out or whatever in conservatorship. and people have made, you know, people are beginning to see that maybe, even though these entities haven't paid back a single dime yet, they haven't reduced the $188 billion, not

one penny, of capital or indebtedness has been returned. certainly there have been dividend payments. but people are coming out of the woodwork now to try to reinforce the old system. and i know that next year we're going to be moving into an election cycle again. it happens every two years around here. we've had a pretty productive year so far. i'm really proud of a lot of the work that the senate has done. this is a big and important piece of work, as we've mentioned. the timing is right because of a lot of forces out there that, again, would like to keep the status quo. and i would again thank the senator from virginia for his thoughtfulness, for the other members who have cosponsored this and gone through a really complex issue and, i think, come up with a very elegant solution to this problem. and i hope we'll have the opportunity to work together to actually do something again that makes our country stronger and

causes our housing finance system, which is so important to our economy, to be more sustainable. so i thank the senator. i look forward to coming down to the floor again with him again and continuing the many meetings we're having with sthors on both sides of the aisle -- with senators on both sides of the aisle and hopefully helping with a lot of other people's input, helping come up with a solution that the entire body addresses. okay. thank you. i yield the floor and notice the lack of a quorum. the presiding officer: the clerk will call the roll. quorum call:

quorum call:

quorum call:

quorum call:

the presiding officer: the majority leader. mr. reid: i ask unanimous consent the call of the quorum be terminated. the presiding officer: without objection. mr. reid: i ask the senate proceed to a period of morning business with senators allowed to speak for up to ten minutes each. the presiding officer: without objection. mr. reid: i ask the chair to lay before the senate a message from the house with respect to h.r. 588.

the presiding officer: the clerk reads about the senate the following message. the clerk: resolved that the house agree to the amendment of the senate to the bill h.r. 588 entitled an act to provide for donor contribution acknowledgements to be displayed at the vietnam veterans memorial center with the following house amendment to senate amendment. mr. reid: i ask unanimous consent the senate concur on the house amendment to the senate amendment and the motion to reconsider be laid on the table with no intervening action or debate. the presiding officer: without objection. mr. reid: i ask consent the senate proceed to calendar number 85. the presiding officer: the clerk will report. the clerk: calendar number 58, h.r. 251 an act to direct the secretary of the interior to convey certain federal features of the electric distribution system to the south utah valley electric service district and for other purposes. the presiding officer: is there objection to proceeding to the measure? without objection. mr. reid: i now ask consent the bill be read a third time, passed, the motion to reconsider be considered made and laid on

the table, with no intervening action or debate. the presiding officer: without objection. mr. reid: i ask consent the senate proceed to h.r. 254. the presiding officer: the clerk will report. the clerk: h.r. 254, an act to authorize the secretary of the interior to facilitate the development of hydroelectric power on the diamond fork system of the central utah project. the presiding officer: is there objection to proceeding to the measure? without objection. mr. reid: i ask unanimous consent the bill be read three times and passed, the motion to reconsider be considered made and laid on the table and there be no intervening action or debate. the presiding officer: without objection. mr. reid: i ask unanimous consent that when the senate completes its business today it adjourn until tomorrow thursday, july 11, at 10:00 a.m.. following the prayer and pledge, the morning hour deemed expired, the journal of proceedings be approved to date and the time for the leaders be reserved for use later in the day and that i be recognized and the following the remarks of the two leaders. the presiding officer: without

objection. mr. reid: so that's clear. i want the consent to indicate that after we've done the morning hour, after it's expired, the journal of proceedings have been approved and the two leaders' times have been used, or reserved for use later in the day that i be recognized. the presiding officer: without objection. mr. reid: following the remarks -- let's do this again. after i am recognized and we do our statements, senator mcconnell and i, then the time until 12:30 be equally divided and controlled between the two leaders or their designees, with senators permitted to speak for up to ten minutes each with the republicans controlling the first half and the majority controlling the second half. further that the senate recess from 12:30 until 2:15 to allow for caucus meetings.

i would ask the chair if it's clear now what i muddled through. the presiding officer: it is clear. without objection. mr. reid: at 2:15, then i'll be recognized, i ask consent that be the case. the presiding officer: without objection. mr. reid: mr. president, if there is no further business to come before the senate i ask it adjourn under the previous order. the presiding officer: the the presiding officer: the

i have to define what that is because as we know today, we have students of all ages. we've got financial impact that is applied to a 19-year-old, entered for the first freshman year, and depending upon where the income of their family is depends on under the current system they get a subsidized loan. the maximum they can receive under the subsidized loan as an undergraduate is $3500. i would be willing to bet the that president and i can't pick an institution in the state where the tuition on anen yule

-- annual basis is $3500. it doesn't happen today. that's the reality left out of the debate so far. this debate has been politics and not about students. it's not been about how to apply affordability, as broadly as we can in the marketplace. let me describe where we are today. between 1965 and 1992, the cap on the student loan program in this country was 10%. 1-0 10%, and the mid 2000 congress is going to subsidize it at 3.4%. and nonsubsidized loans at 6.8% and graduate loans are going to be at 7.9%. if you are a parent borrowing, you're going have an even higher rate at 8 plus percent range.

to me, that strikes me as incredibly unfair. because we take 2 19-year-olds entering the same institution with the same financial obligation and say to one, we're going give you a rate on your student loan that is half of the person that sits in the seat next to you. half. 3.4% sits in this chair, and 6.8% sitting in this chair, and understand that the person sitting in this chair, depending upon the cost of the institutions, parents may have an income over $100,000 and they may qualify for federal subsidize. let me suggest to you that the marketplace is the thing that ought to dictate and decide what the rate is. that's the only thing that is fair to the taxpayers in this country is the predictability of knowing it's tied to something.

now, let me suggest to you that the bill we're going take up and going to vote on a motion to proceed at 12:00 today is a bill that was created in 2000 we're -- 6.8 percent for others. 7.9% and 8 plus percent for parents. why? we are overcharging some to subsidize overs. let me say that again. we are overcharging some graduates 19-year-old freshman in college 6.8% so they subsidize the 3.4% we're charging subsidize loans. now, let me just to point to a chart i have here, ma'am president. it shows undergraduate under the

student loan. this is a comparison. let me move to another chart real quick. i think this one best displays what i'm talking about. 26% of our nation's kids are undergraduates and subsidized. 55% of the eligible students are either undergraduates or graduate students that fall under a 6.8% interest rate. so when the senate majority leader came to the floor upstairs he was 100% accurate. the reality is we're going have a vote on only one plan at 12:00. there's no option for members of congress. and what i would suggest to you is that here displays why at this there should be two options, at worse we ought to get the motion to proceed and see if we can come up with

another bipartisan agreement. you see the option the machin bill is a bipartisan approach. it's democrats and republicans it's coming together and saying question agree on something we think is fair and equitable and financially substantial. but this is the plan we're going have vote on at 12:00. 55% of the population of students, quite frankly, is being screwed. they are overpaying. they are paying 6.8% for interest. ..

>> my good friend who i have great affection for came before us and he said that we were balancing the budget on the back of the student loan program.

it is a $1.2 trillion program. $1.3 trillion. based upon the cbo score on this bill, it had a .7% surplus now, by washington's standards, it would be around this. this is a $1.3 trillion program and let me assure the president and my colleagues, this is a rounding error. i cannot say it might not cost us a hundred billion dollars. but we are certainly not balancing a 17 trillion-dollar deficit debt on the backs the student loan program. for anyone that suggests that we are, is in fact disingenuous.

let me suggest that this is the first time i have been accused of balancing the budget this way. but in 2010, is part of a healthy reform act, the democrats and that the federal family loan program in savings of 61 billion. of that, democrats directed 19 billion in deficit reduction and the rest help pay for obamacare or the affordable care act. if i'm being accused of balancing the budget on .7% as determined by the cbo, in 2010 the democrats voted to end the program in applied $19 billion in deficit reduction and they

applied this long before me. in 2007 as part of the college cost reduction act, we spent a good amount of it on new programs and then directed $1 billion to deficit reduction. now, i said earlier that i have a great affection for senator harkin. he said this should be part of the reauthorization education act that may or may not happen next year. well, we make changes with the interest rate on student loans outside of the higher education. in 2000 while we have a one-year extension of the 3.4%. we did in 2010 as well with the elimination of the feelp program. we did in 2005 under the deficit

reduction act. senator harkin's appropriations committee has made changes to eligibility rules each of the past several years outside of the higher education authorization, including the ability to seek benefits and lowering of the automatic enrollment for low-income students. it is just not fair to say that i am doing this outside of the higher education reauthorization when there was a track record continually of the person that accused us of doing this who did this himself. let me just say, if i could, i want to thank the senators for working on this together.

i think this is truly a bipartisan bill. it has been described as belonging to one party or the other and i think the senator from north carolina and senator coburn and myself and we have looked at basically how we can fix something. we look at the standpoint and they said it was a political atmosphere and we had to extend it. we knew that you would come. like everything else, nothing gets done at times. it has to be fixed. and if you want to fix it, look at the whole program, we have to understand the programs. i think now we are saying that we are hoping to pay down debt. whether there is profit or not it depends on the accounting procedures that are used by the federal government or you can blame whoever you want to blame. but it is built into it. we have to deal with the facts.

so senator, what i think i would ask as we have proven that we are willing that no profit will be made on the backs of students. but what we can determine through the builder we are working on, we have all come to that agreement as democrats and republicans and it should all go in lowering the race. we have agreed to that. we have agreed versus kicking it down the road for another year, knowing that another year will come and go and we will be here debating it. that is what we have gone for the conclusion. we have also agreed, which is different than what the house has sent us. and i applaud you all for working with us to put a fixed rate on us. if this is at 3.66 this year, $3500 of subsidized loans, that the taxpayers have been paying come in at 3.66 is fixed for the

full life of the loan. so these are things we have come. and they say that the republican bill, that is so erroneous and just not fair. we are working with all of the colleagues and i know that you all are working with yours to understand that if if i may subsidize stafford loan program to the federal government, the taxpayers will pay my interest while i'm in school. and at the end of that, then i pick up whatever interest rates have accumulated when i was in school and i take it from that day forward. what they didn't understand, and i think what a lot of them understand as i cannot make it just on that 3500. i have to borrow more money. so now i am borrowing money if i go with my colleagues on the democrat side. i i have to borrow about at 6.8%.

we were able to bring that out to 3.66 for all undergraduates. >> you are correct. i might add that this chart shows exactly what we are talking about. because of the need for students to borrow additional money at 6.8%, at the end of the process, they were in $78 a month. where under the bipartisan bill, where every every undergraduate is treated as income of eight oh $75. it is actually cheaper, even for the undergrads that are subsidized. >> money that i have to borrow, even though i qualify because my income for a subsidized loan, i don't have to pay interest on an annual basis.

so by bringing it down to one low rate, i make a much lower payment. it is less obligation and hardship as a college student. we want to help it be subsidized. i have to have a little but more help. we are not looking at the whole picture here. but i want to go to graduate school. senator, if i made, and i might ask our senator from tennessee, my colleague from tennessee, whoever would like to talk about this. let's say that right now we know we have a consolidated cap at a .25% and that i graduated and i went to school during the high

recession times. and so then i have been accumulative interest that i owe. >> if i may respond to senator from west virginia. first, i would like to congratulate the senators for helping the full senate understand this issue. this is like a lot of issues that we have to face. it is not simple. i used to be a college president. i used to be with the united states secretary of education. i had three educate myself on this legislation and i still make some mistakes. i was saying last night there were only 2 million subsidized loans. when i was forgetting was the point that the senator from west virginia makes which is 80% of

the students who have subsidized loans, low-income students, they also have the own subsidized loans. when you only take care of these subsidized loans, you are leaving 7 million students with on subsidized loans hanging high and dry an honest and carried on. so you're hurting both of the middle income families and low-income families when you have an incomplete solution. but the question is it right. but i graduate from the university of tennessee and i have a subsidized loan and that means the government has been paying the interest while i'm in college red time like four or five students, i have an of subsidized loan, so i pay that interest. suddenly the interest rates have gone up because the country's countries interest rates have gone up to 10%.

what i can do is take both of those loans at once and turn them into a .25% loan. so that is a cat on my loan. then i would have the choice and i would say this goes back to the senator from senator from west virginia one north carolina. when i consolidate my loan, i have heard some say that that just means the students went out to be a lot of interest. because it spreads blown out over a long period of time. it does not -- i mean, doesn't student have that choice? >> everyone will take the longest period of time. i'm understanding, and i think i'm accurate and correct on this

bet, okay, i want the smallest payment. i just got out out of school. so i'm on my smallest payment. now i am getting better jobs for five years out. i have a better job. and i can afford afford to pay for 400. >> okay. >> there is no penalty for me too short not as it would be in the conventional market. as i understand it? >> i have ask consent that the senator engaged in colloquy for a few minutes. >> okay. without objection. >> i would say to the senator from north carolina but i would presume a graduate of the university of north carolina be smart enough to make that decision for him or herself. >> one of the agreements we came to is that students ought to be in control of their decisions about their loan rates and if a student goes to the next four

years and they have a combined interest rate of about 15%, if for some time and there's not somebody got out of school and they are combined interest rate was 9%, we give them the option of going back to a .25. i think the senator from west virginia made an extremely good point. for the most subsidized student, they can only borrow $3500. so you think of the institutions that are out there. we know that they are going to borrow out of the 6.8% pot. what we are offering you the pots are the same and that the subsidy mr. students a qualified and they are not responsible for the interest rate while they are in school. the subsidy still exist. it's just that we are not overcharging one group and we are not overcharging the ones

that we just subsidized because they have to borrow more money to complete their college educations to me just say that i graduate now. the matter what the interest rates. no matter what they might have been. i graduate in economic times that are tough. i find a job at $40,000 in i married now and i have a child or two. don't we have in our bill introduction and has been in place for a long time, both democrats and republicans have supported this protection, which is called income-based repayment? by law i can only pay 15% of my disposable income and i think that that breaks down the to my payment can only be $142. we would be subsidizing that for

certain extent. i'm also understanding that might economic condition doesn't improve, and that is all i pray. by the end of 25 years, it is exonerated in 19 nothing. >> if i could respond to the senator. the answer is yes to that. not only is there -- and i think it's fair to say that the consolidation option that a student has kids the rates go up at 8.25%, it can be called a cat. not a hard cap, but a cat. the second is the income of the payment provision that you speak of. you're making $45,000 per year after they apply the formula, you probably aren't spending more than about 10% of your income. something you can be required to pay on your student loan and i continues for about 20 years.

not the end if you haven't paying off the loan, loan is forgiven. so any student who has a long has that opportunity to consolidate at a .25% and income are payment limits the amount they have to repay each year. you have that. then one of the things i notice about the bill by senator manchin, i would like to ask them to talk about this a little bit. i'm beginning to understand that this is a significant contribution. all of the undergraduate loans all have the same interest rate. it is confusing.

lower income students also have on subsidized loans. so let's say let's simplify this, provide certainty over a long period of time. otherwise it seems to me that you are leaving 7 million and middle income students with on subsidized loans and 80% of the low-income students who also have these on subsidized loans if you are not helping them either. i'm wondering if you can comment on this idea. you are able to get the interest rates for all undergraduate loans down to about 3.66%, which is a pretty low rate let me just say very quickly that it is

$10 million hypothetically, whatever you want to use. 25% of that money goes to the subsidized. i think that that is quizzed about 40% of the students that participate in borrowing money. but the volume of money is about 25%. one fourth of the money. so if we are keeping the rate low, that means we artificially have much higher rates that students need to get an education. but we are saying is that we will bring a larger majority of that down to the lowest rate. and we think it is a good policy that we should be discussing and talking about. that is where we are. we have reduced all of the rates. the plus loans went from six to one and then we had the graduate loans went from 682521.

but if you do all of the undergraduate stuff, we go to 3.66. >> for the undergraduates not subsidized come of it would go from 6.8. >> biscuits this gets at the heart of what the senator from tennessee says. is that today, the subsidy goes to 26% of our students. 55% of the students pay the 6.8% rate. under the bipartisan bill, 64%, all undergraduates, if this is about portability, if this is about what provides the greatest flexibility the fact is for a

typical student in their first year, taking $5000 out, they actually -- i be happy deal for questions. >> i cannot see the chart from the other side. on the 2.66%, for how many years is that hold? the 3.66%? >> and holds her one year until the readjustment which could be higher or lower. >> what does the cbo projects that interest rates will do?

>> and the reality is the question that we have as senators is how we drive interest rates the lowest. so we are able to get the 10 year bond point plus this and this is all cbo money. so the real question is are we

going to let 26% participate with an attractive interest rate are we going to explain that the 64%, which is the entire class of undergraduates, that was a bipartisan agreement that we had, and i appreciate it very much. here's the last 10 years. we would be his last 10 years with the bipartisan bill, this is what the students that are basically paying the higher rate would've been able to take advantage of as far as lower rates go. they never got a chance to take advantage of the lower rates. if rates go up and her four years, they will be paying higher rates. that is reasonable if it fluctuates. look at how the lower rates would've been paid. i know that we cannot use figures. but the bottom line is the caps

will be much higher. if you want to get a graduate degree in a higher phd degree commie of a much better chance. the bottom line is that we want to keep the rates as low as possible. and we have a lot of protections built-in. a lot of times that goes misunderstood and is not explained properly. i'm glad we're having this colloquy back and forth. >> if you want to get into this colloquy, that's fine. >> i would rather make my point that i need to do.

at 12:00 o'clock we are going to vote on a 3.4% extension kicking the can down the road for 12 months, not finding a solution and continuing to overcharge some students and go to bed at night and feel good about this. i think some don't feel good about this. we will definitely stay the united states senate had a demo people sent us here to do. again, i say to my colleagues that the cbo scored good. it is within .7% of having no cost and no surplus. i'm not sure that you can get any closer than that.

the end of the discussion is how do we get rates as low as we can. our focus was on the affordability for the students. secondly, the sustainability of the program, which was long-term, something that we didn't does visit every one or two or three years. or on subsidized loans, the rate is 3.41, which is tenure plus 2.5%. it removes the consolidation

cap. now, though that we will have at noon, i think everyone knows is a 6.8% rate for most students. it is under the president's proposal, the unsubsidized the unsubsidized of 2.93 plus the 3.93, and its uncapped it is

according to the cbo. the undergraduate as an undergraduate there should be a low income for at-risk students. ..

it's going to raise the percentage that each individual is going to pay. the senator if i may, i'm not sure how you voted on the extension a year ago. i voted for the extension a year ago. i intend to vote on it again for an extension because we have not fixed it and by voting on this extension what we are voting on is 3.4% just for the subsidized and everybody, 6.8 and 7.9 or plus loans, correct ?-quex so when you're talking about that the difference in savings cemetery between our bill, we have to vote on our bill. the compromised bipartisan bill. our bill would say close to $9 billion in interest of students would have to pay. i think we agreed on that. if we vote on the bill that we will have a chance to vote on one bill that's about 2 billion.

in west virginia that's a lot of money in savings $7 billion that i know students don't have to pay in interest and that's across-the-board. that's most of the students who have the subsidized and unsubsidized loans. that is the point where trying to make and we hope we can get that through and i know and you hope in the idea that we get a vote on this. stay with the senator yield? >> i would be happy to yield. i'm just saying to my friend from west virginia made a statement a few minutes ago that resonated with me. he said we are trying to get the market rates because we have always had market rates. i would say to my friend from west virginia has appointed a test today that when i first went to college in 1958, 59, 60 and 61 i borrowed running under this program. it came into being and 60 -- lack 58. it was called a national defense the national defense education act are the eisenhower bill. so i went back and looked to see what the treasury the 10 year

treasury note was at that time produce three years that i borrowed. the 10 year treasury note at that time ranged between 4.2 and about 4.8%. i borrowed money at 2%. that is not a market rate it i say to my friend. plus not only did i borrowed the money but all the time i was in college i paid no interest charges. i spent five years in the military. no interest charges. i then went to law school, three years in law school no interest charges. then i had a one-year grace. back after i graduated from law school so all those years the interest rate clock never started taking. >> every student served no matter what their ranking in no matter what service they have performed for the military or the ideal was that for a great -- anybody? everybody paid a rate of 2% with

no interest at all? >> that's right. c. i want to say to my colleague the reason i raise that is why are we so special? why was my generation so special that this country was willing to subsidize my education but for these young people we say no you have to pay market rates. it might have been the congress that dot its financial orders and better -- we have the time to invest in a generation of an american so they wouldn't have a huge amount of debt hanging over their heads but now it is not always been so. see i could say to my colleague what didn't exist, what didn't exist when he went to college and graduate school was that we didn't have an income test for repayment. we don't charge anybody over 15% are an annual on an annual basis. when the gentleman went through the system he was responsible to

pay back 100% of it for you and today after certain. lack of time on subsidized loans we forget it. we have a lot of programs that didn't exist when he went through school. we have the programs that extended a tremendous amount of money that is not obligated to pay back $4000. we have student loan higher education tax credit that didn't exist when he went through education. we have a basket of products and what we are looking at is where looking at how can we take one program which is the rate-based program and make it as attractive and affordable for students as we possibly can and under this scenario we are able to accomplish that for 64% under what we will vote on we won't do it for 26%. you can't help but make the argument you're overcharging here to subsidize here. i agree with my good friend who i have great affection for by

the way that i want to make sure every student has an opportunity to go to college and it's affordable for all that we have the system right now that we control 100% of it, the federal government. when my good friend went to college there were private lenders that competed with the federal government. we have no private lenders. we legislatively admitted the private sector from competing with student loans. it's although made by the federal government so at least we can try to get as an expensively those loans as we can with the largest group of college students. let me suggest to my colleague i'm going to ask a unanimous consent question and i hope that we will entertain this because i think not only is the debate worthy of -- a vote is worthy but i ask unanimous consent that if cloture is not invoked on the motion to proceed to s. 1238 but jack reed bill on the student loans that it then be in order

to move to proceed to s. 1241 the matching bill and student loans. further the cloture motion which will be at the desk be considered filed on the motion to proceed and further notwithstanding rule 22 the senate immediately proceed to a vote on the motion to invoke cloture on the pending motion to proceed to the mansion max bill s. 1241 before the chair rules. see let me just state that this agreement would allow us to have on two version -- state objection is heard. see madam president this is an important issue and i want to thank my colleagues who have engaged earlier this morning to try to find an additional solution and i want to thank

senator mansion and senator king and senator carper because they were willing to try to fix this problem. i am convinced that my good friend from iowa we are doing this in good faith. but now is the time to find a solution. it's not a year from now. it's not a month from now, it's today. see if i may ask one question in the spirit of the colloquy from my dear friend from iowa. i know they are saying one year and they are looking at the compromise a bipartisan bill we have worked on three or four years from now rates may go up because market rates may change. where are we looking at one-year is there anything prohibitive in our bill that we couldn't go back a year from now if we see a better solution, if we get an education bill that we could say here is the grand bargain now which is better than what we thought we had. still yet our state is $9 billion my dear friends in my

caucus if we only do it for one year would help our people save more money and we can go ahead and still write another bill. are we able to do that? via i've learned in my 20 years in washington that permanent is defined as a two-year session of congress and the next one could change 7.9 for plus and hours as 3.66 for all undergraduates ended every rate goes down correct? as i said earlier how does that compute to the average student? it means a lower monthly payment under the bill that we will vote on. just kicking the can down the road $78 a month under the bipartisan bill $75 a month. on the graduate stafford

comparison by month that person who borrows under the graduate program under the kick the can down the road plan is going to pay 251 under the bipartisan solution. they're what the monthly obligation of $230. for the highest, the plus loans and in a lot of cases those are parents, the monthly obligation is going to be 197 and if we kick the can down the road under the bipartisan solution the monthly obligation is going to be $180 figured with $5000 borrowed over 10 years amortization of the loan. exactly the point my good friend from west virginia said why would we not make the opportunity the opportunity to make this cheaper for everybody for the next 12 months and if we find a better way to do it lets change it 12 months from now. >> i think senator what we are talking about also is they are saying if it consolidates its

strings for payment up to the maximum of 30 years which means they are paying more back and interest. that's the argument i have heard. from different people so that means why would you have an automatic consolidation? with that being said i'm understanding with the government ran on right now there are no penalties or if i string it out to get the lowest payment for 30 years and say say i want to 10 years i can do that correct? that is able to be done. i can reduce that amount of time and amount of interest to provide affordability to pay more pics of you want to recognize their others on the other side that would like to speak so madam chair at this time i would reserve the balance of the time on our side and yield the floor. >> madam president? v. the senator from iowa. see see i know the senator stedman out has an important meeting and i want to yield to her and just a second. i wanted to respond to my friend

to say why i objected since i don't believe in all of these reservations. either you object or you don't end there is a time to explain that later on. what the senator from north carolina once they get added as an amendment. they can offer that because any amendments that anybody has so the reason i object this because we have a bill. it's under regular order in which cloture in the pillows amendment and the senator from north carolina or tennessee or west virginia or anybody else can offer any amendments they want and that is the way the regular order up to proceed and with that madam chair i yield the floor. >> the senator from michigan. >> i think what we are witnessing today people who have

differences and i believe the issue before us is a vote on doing no harm. let's start to cause there isn't an agreement on both sides of the aisle as to whether or not we keep the student interest rates as low as possible for an ongoing basis or whether we tie it to the market rates going up as they go up over time. there is not agreement on that. i would hope we would have an agreement to do no harm so the vote at nantes is let's keep it at 3.4% where it has been which is by the way market rates right now you can go out and get a -- conine curt people to buy it. doubling the rates makes absolutely no sense in putting in place something that students are asking us not to do which

starts where we are and goes up over time does not make sense either. let's do no harm. let's vote yes to give us a new dear. zero we have people that care about the issues. let's vote yes to give it a year. we have people that care about this issue. we can sit down and spend that time working under chairman harkin who is committed to addressing in a conference of way and not just the interest rate on subsidized stafford loans but on all the issues. there is a whole range of issues not the least of which is $1 trillion in debt that students are carrying in this country and families are carrying in this country which is more than the credit card debt that we have but let's start with you no harm. if we do that than 7 million students are not going to get hit with the interest rate hike that will be put in place and if we do that we are going to be

saying to students we are not going to be the government making billions of dollars in profits on the backs of students because the loan rates have gone up. so i would encourage everyone people of different philosophies to vote yes to give us the time to work out what is clearly a broad comprehensive issue to make sure that young people and people going back to college have the opportunity to dream big dreams and at the same opportunities that many of us have had. i went to school and student loans. i went to school on tuition and fees scholarship because of my own family situation growing up and the reality is that we have the opportunity to do no harm and then work together on something comprehensive set does not down the road see students paying seven, eight, nine or in the house they topped up one of

their rates at 10.5%. i reject that. my colleagues on the side of the iowa project data. let's vote yes, do no harm and then get to work in a bipartisan way on the larger problem solving. and i yield the floor. >> madam president? be the senator from rhode island. >> madam president senator hagan who particular is the co-sponsor of legislation that i propose we keep the student loan enters trades and subsidized stafford loans at 3.5% while we deal with a very complicated complex set of issues. it's not just the rate structure. it's the issue of providing appropriate incentive to control higher education and also the issue of refinancing existing debt and prospective debt so that this huge wall of death,

you know this avalanche of debt affecting college graduates and professionals who are graduates today can be addressed. i don't think we can do that because these are complicated programs off the cuff as we are attempting to do today or the last several days. it turns out that if we do not extend for at least a year at this rate, then the contrary proposals will eventually raise rates on students across-the-board. that is because the law calls for now a 6.8% for the stafford subsidized and done subsidized loans.

and i am suggesting we will go with a lower the lower rate now but that simply means mathematically that we will have to have higher rates in the future and the question of when that future arrives is a function of the way interest rates will be moving in the overall economy and every indication is those interest rates will start rising and perhaps quickly. the federal reserve has very indicated that they are beginning to pull back and these rates are likely to go up. we have seen a significant rise in the ten-year t-bill rate in the last month. it's gone off almost a full percentage rate so you are in a rising rate environment moving from a fixed rate to a floating rate without a cap, without an effective cap. so what we know is it might not

be next year and might not be the following year but relatively quickly we could likely see and will likely see students paying higher than the 6.8% rate. and without a catholic could be significantly higher. so, if we adopt the proposal suggested by my colleagues and they have been working with great energy and great sincerity to try to come up with a solution i'm afraid we are going to end up alternately seeing students paying much much more and that is not what we should be about. we have a situation right now even with the 3.4% that just doubled july 1 to 6.8% where the federal government is making $50 billion this year between the cost of funds in every payments being made by students so students have become profit

centers for the federal government. rather than as a think the intention of the program that the federal government is going to help students go ahead and get through college so they can help us as productive workers and our economy. and it's projected that between now and 2023 we will make $184 billion in terms of the difference between what students are paying back in the course of borrowing from the governmengovernmen t. so there is a lot we could do i think but not in 24 hours, to redesign our program so that students essentially are not being hammered with huge debt and we are benefiting properly from the students. the cbo estimates that under

this bipartisan loan at students would pay an additional 37.80 yen dollars more on their loans than they would under the current plan. those are my initial points. the first few years it has been designed so that the interest rates will be lower than 6.8 but according to the cbo between 2017 and 2023 so if you are a high school student right now you are looking at paying a lot of money if you intend to go to college, about $37.8 billion more because this all has to balance out to effectively a 6.8% interest rate which is the current law. students know that. that is why they have come and said listen thanks but no thanks.

this short-run discount of a few years in terms of the interest rate we know, we might be paying it if we are just starting out our college. we definitely know our younger brothers and sisters in high school and another generation of americans will. so i don't think we should take that approach. i think what we have said is listen let's wait. we have a lot of work to do. we want to look at the polls that might align the real cost of federal borrowing from the college college education and the real charges that we impose on students. right now my sense is that what our colleagues have done in their bipartisan approach has been essentially to make sure that the first few years look really good. they are certainly less than 6.8% and close to 3.4% but then they have to put in a rather

arbitrary delta, and increasing costs because at the end of the ten-year. map they have to make up all the interest that would have been charged at 6.8%. that is not a think the way to approach fundamental reform of college loans in this country. there is another point that is important to make two is that we have always either had a fixed rate or an adjustable-rate with a cap on each loan program. a cap on subsidized stafford loans, and subsidized stafford loans and the plus loans for families. now we don't have a cap. there is some discussion that if you consolidate your loans you will get an 8.25% cap but consolidation can only take place after you are in repayment and before you were in repayment

all the interest on it on subsidized stafford loans in the plus loans are accumulating and being capitalized and what you owe. so when you consolidate you have a much much bigger principle to pay off. there might be a cap of 8.25% but a much bigger principle and oakville by the way it's extended for a longer. map of time so you won't have to pay for that longer extension of time. that is not the cap we have had before in the context of these programs. it's been a cap on individual loans. a cap on and subsidized loans. not typically we have chosen a 91 day t-bill interest in the 91 day t-bill is cheaper frankly.

so that you start off with a much lower index that the student has to pay and then you add other cost to it or the discount they estimate of the fall than all those things that come up with the final rate but we are going to a ten-year t-bill rate which means that students will be paying more. again i just don't think that is what we want to do. we want to take the time to try to address this whole set of issues to do it in a thoughtful way, to understand that one of the big challenges we have is not just the issue of what rate. it's how do we keep college costs in check x. how do we provide the kind of education, how do we deal with the interactiinteracti on between

all these different types of loans? how do we go ahead and again this might be one of the biggest challenges we will face here going forward is how do we somehow allow the students who are drowning in debt to effectively refinance these loans so that they can buy homes than they can buy cars and participate in the economy. that is not included in the proposal and indeed one of my concerns is if these rates rates are locked in and this is long-term legislation, then we won't have the incentive, the proper incentive to effectively deal with these issues. we will just let them fly along and i think that would be to our great, our great detriment and more importantly the detriment of families throughout the country. there has been an appropriately so comments and criticism of the

short-term approach. we should have fixed it last year. well, we haven't fixed it and i think we have to give ourselves the time to fix fix it. there is a suggestion that we are just dealing with a portion of the loan, the subsidized stafford loan and everybody else won't get the benefit from the numbers we have seen from cbo one thing is certain. in the last few years from at least 2017 to 2023, everyone's subsidized unsubsidized plus loans will be paying more. so the one conclusion we can draw if we go to the alternative approach is that it eventually every borrower will be paying more. it and i therefore feel very strongly and would urge that we move forward with this cloture

vote to get onto the legislation and senator harkin rightly pointed out once we we are on te legislation it's open to amendment. at least we can have a proposal from all of my colleagues that could improve or change or modify but if we don't get to cloture then we we are not moving forward and they think we should at least -- thursday the senate later blocked a proposal in addressing the doubling of student loan interest rates. the senate is back tomorrow at 10:00 a.m. eastern for more debate. today in the white house spokesman jay carney talked about the delay of the employer mandate provision in the health care love. here is what he said. spain what authority did the white house decide to implement that law a year later than the law itself calls for the xp john i mean there are efforts aplenty who can provide specifics for you on this.

>> the chairman of the democratic -- see i highly recommend any issue of the federal register and finding samples of rules on waivers and that kind of thing. this is not an unusual process and this reflects an effort that the hue and cry, the calamitous hollering that you hear is reflective of a political and partisan effort. you are talking about the republican effort to complain about listening to business to postpone the deadline that affects 4% of businesses with 50 or more employees when you know they have done everything they can to undermine the law from day one. they don't want to see it implemented and they have made it clear from day one. john you can pretend this is about tom harkin but you know it's not and the fact is we have

demonstrated since the passage of the affordable care act that we will make improvements where improvements make sense. we will be flexible in its implementation where being flexible make sense. everybody recently to their credit has written about this is noted in comparison to the passage of medicare part d which was an issue the top priority of president george w. bush and it passed and a lot of democrats opposed it but it passed and democrats did not once it passed engaged in efforts and undermined it every step of the way. instead wants it became law they can gauge an effort to make sure the people they represented enjoyed the benefits of the law and i expect that most constituents who potentially would get insurance for the first time in their lives or for the first time in a long time if they are made aware of the possibility then rolling in

these marketplaces would expect their representatives they are senators whether democratic or republican would help them in that process rather than doing everything they can to prevent their constituents from enjoying the benefits of the affordable care act. see the republicans but did say on the issue of immigration if the white house can simply decide to delay implementation of certain aspects of those they have passed. >> again people who suggest that there's anything unusual about the delaying of the deadline and implementation of of the complex lot are deliberately sticking their heads in the sand or willfully ignorant about past president. it's not serious and we are going about the business of implementing this will and implement in a way that maximize the benefits available to the american people that minimizes difficulties