Bill to Lower Student Loan Rates Fails in Senate
GOP blocks measure; parties can't agree how to pay for it
By Kevin Spak,  Newser Staff
Posted May 8, 2012 1:25 PM CDT
Sen. Jack Reed, D-RI, joins students at a news conference to announce the collection of over 130,000 letters to Congress to prevent student loan interest rates from doubling, March 13, 2012.   (AP Photo/Manuel Balce Ceneta, File)
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(Newser) – Hope your federal student loans are paid off, kids, because Washington appears deadlocked over legislation that would prevent their rates from doubling this July. A Senate bill to do so failed in a 52-45 vote along party lines today, failing to get the 60 votes needed to avoid a filibuster, the Hill reports. Republicans objected to Democrats' method of paying for the bill, namely closing tax loopholes enjoyed by S-corporations.

Al Franken called that objection "wrongheaded," saying that if the S-corporation loophole is sacrosanct, "there's no loophole that you can get rid of." House Republicans have already passed their own version of the bill, but it pays for the $6 billion loan extension by cutting money from a preventative care fund created by the health care reform law, and President Obama has threatened to veto it. Unless the two sides can come to some agreement, the rate will jump from 3.4% to 6.8% on July 1.
 

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