GOP derails student-loan debate

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GOP derails student-loan debate

The Associated Press – Senate Republicans derailed a Democratic bill Tuesday that would keep interest rates on federal college loans from doubling July 1 in an election-year battle aimed at the hearts — and votes — of millions of students and their parents.

Republicans said they favor preventing the interest-rate increase but blocked the Senate from debating the $6 billion measure because they oppose how Democrats would pay for it: boosting Social Security and Medicare payroll taxes on high-earning stockholders of some privately owned corporations.

GOP senators want a vote on their own version heading off the interest-rate increases and paid for by eliminating a preventive- health fund created by President Barack Obama’s 2010 health-care overhaul. That financing idea has no chance of passing the Democratic-run Senate and has drawn a veto threat from the White House.

Tuesday’s vote was 52-45 in favor of starting debate on the Democratic legislation — eight votes shy of the 60 needed. Senate Majority Leader Harry Reid, D-Nev., was the only one to defect his party’s position, a procedural move that will allow him to have the vote again should the two sides work out a deal later.

The vote was largely symbolic because the Democratic bill had no chance of approval by the GOP-led House.

The measure would extend today’s 3.4 percent interest rate on subsidized Stafford loans for another year. Those rates would grow to 6.8 percent without congressional action, thanks to a 2007 law that gradually lowered those rates but expires July 1.

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