Reid: ‘Maybe’ there’s hope for compromise on student loan interest rates

By Karoun Demirjian

Wednesday, July 10, 2013 | 10:33 a.m.

Senate Majority Leader Harry Reid said Wednesday morning that there was a chance, “maybe,” that the Senate could come up with a compromise on student loan interest rates.

But a mutually agreeable compromise didn’t come in time to save the Senate’s vote to proceed on a bill to lower rates back down to where they were before the interest on student loans for low-income borrowers doubled, from 3.4 to 6.8 percent, on July 1.

The Senate voted 51-49 in favor of the bill Wednesday — not enough to clear a 60-vote procedural filibuster threshold.

Democrats lost two of their own on the vote: Sens. Joe Manchin, D-W.V., and Angus King, I-Maine, voted against the measure. That doesn’t come as a complete surprise: Manchin and King are part of a six-member group that drafted and is now pushing for Reid to allow a vote on a bipartisan compromise that would peg the interest rate on student loans to the 10-year Treasury note, plus 1.85 percent, and put an 8.25 percent cap on loans in repayment, so long as they are consolidated.

Reid has applauded their effort but criticized their proposal as shortsighted mainly because, he argues, pegging the student loan rate to an interest rate that is expected to rise soon only sets up future generations of students to pay more down the line.

Of the Republicans and Democrats who drafted that measure, only Sen. Tom Carper, D-Del., voted for the bill Democrats presented Wednesday.

Reid spent Tuesday afternoon and evening in negotiations with the White House chief of staff and other officials from President Barack Obama’s administration. Today, Reid said, senators are holed up in Sen. Dick Durbin’s office trying to hash out a compromise that Reid feels he can put on the floor.