A compromise to keep student loan interest rates low proved unwinnable before Monday's deadline and interest rates on new loans are going to double — at least for a while — senators said today. Tom Harkin, the chairman of the Senate education panel, said none of the proposals being circulated among lawmakers could win passage, and he urged lawmakers to extend the current rates for another year when they return from recess on July 10. Harkin said his colleagues could retroactively lower the rates when they return from the holiday.
"Let's put this off for a year," Harkin told reporters. But many aren't willing to do that, either. "Last year we kicked the can down the road and passed a one-year extension," Richard Burr said. "Why would we make the same mistake again and just kick the can down the road another year?" Burr is among a group, led by Joe Manchin, pushing an alternative that would link student loan rates to financial markets, an idea some Democrats oppose but which President Obama has supported. (Read more student loans stories.)