First, the bill would not guarantee low rates for today's students. A rate that continues to vary after the loan has already been taken out would create uncertainty and lessen transparency for students and their families who are making decisions about borrowing for college. Second, the bill's changes would impose the largest interest rate increases on low- and middle-income students and families who struggle most to afford a college education. Third, the bill does not include the President's proposal to extend repayment options to borrowers who have already left school and often face the same debt burdens as current and future students. Finally, the Administration believes that student loan interest rates should not be raised to reduce the deficit.The Congressional Research Service says that the bill would force students and families to pay higher interest costs than is the case today. That's so even if interest rates doubled as scheduled in July.
The bill was introduced by Republican Rep. John Kline of Minnesota and has five co-sponsors. Opposition isn't confined to the White House. Kline's proposal has sparked vigorous Democratic opposition. Rep. George Miller of California has presented an analysis on H.R. 1911 that states the bill would make attending college more expensive.
"According to the Congressional Budget Office (CBO), increased interest rates for student loans will cost students almost $4 billion in additional loan interest charges relative to current law. [...]The Democratic proposal would freeze the current 3.4 percent rate on subsidized loans for two years.
[The variable interest rate is a classic bait-and-switch. [...] By the time next year’s freshmen graduate and start repaying their loans in 2017, the interest rate on that loan taken out during their freshman year is projected to more than double beyond today’s current rate for subsidized Stafford loans.