Senate divided in student loan fight

WASHINGTON -- The Senate is the newest arena in the election-year faceoff over federal student loans, and both sides are starting out by pounding away at each other.

With Congress returning from a weeklong spring recess, the Senate plans to vote tomorrow on whether to start debating a Democratic plan to keep college loan interest rates for 7.4 million students from doubling on July 1. The $6 billion measure would be paid for by collecting more Social Security and Medicare payroll taxes from high-earning owners of some privately held corporations.

Republicans want a vote on their own bill, which like the Democrats' would freeze the 3.4 percent interest rate on subsidized Stafford loans for one more year. But their plan would be financed by eliminating a preventive health program established by President Barack Obama's health care overhaul.

Each side scoffs that the other's proposal is unacceptable, so neither is expected to garner the votes needed to prevail. Even so, everyone expects a bipartisan deal before July 1 because neither party wants the blame before November's presidential and congressional elections.

"We're still pushing on that," said Sen. Jack Reed of Rhode Island, chief sponsor of the Democratic bill. "But . . . if there is another proposal outside of going after the health care fund, we'll certainly listen."

Stafford loans are made to low- and middle-income students. With all student loans a growing household burden that now exceeds the nation's credit-card debt, the fight in Congress has come to symbolize how each party would help families cope with the rugged economy and how to pay for that help.

Still, the student loan fight is chiefly an exercise each party is using to vilify the other to voters, as Obama illustrated Friday in remarks to a cheering crowd at a high school in Arlington, Va.

"We shouldn't have to choose between women having preventive health care and young people keeping their student loan rates low," he said, pressing a Democratic theme that Republicans don't care about women's issues.

Senate Minority Leader Mitch McConnell (R-Ky.) called the student loan issue a phony fight by Democrats to distract young people who "can't find good jobs in the Obama economy."