Student Loans

Student Loan Plan Fails Again in Senate

Dealing with the doubling of the interest rate

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A proposal to extend lower interest rates for some federal student loans failed for the second time in the Senate on Wednesday, putting new pressure on Democrats to reach a compromise on the issue.

A unanimous bloc of Republicans, joined by West Virginia Democrat Joe Manchin and independent Angus King of Maine, voted against a procedural step that would have allowed the approach favored by Senate Democratic leaders to move forward. Their bill would reinstate for one year the 3.4% interest rate for subsidized Stafford loans that expired on June 30. With no action in Congress so far, the rate has doubled to 6.8%.

With Senate Majority Leader Harry Reid voting no for procedural reasons, the 51-49 vote was nine shy of the threshold needed to end debate and allow the bill to proceed.