WASHINGTON - With fanfare and substantial bipartisan support, the House delivered Wednesday on the fifth of six bills Democrats had vowed to pass quickly, voting overwhelmingly to cut the interest rate on some college student loans.
The bill, however, was much scaled back from House Speaker Nancy Pelosi's campaign promise to cut all student loans in half.
Instead, the House measure, which passed 356-71, applies to the 5.5 million subsidized Stafford loans for students whose families earn between $26,000 and $68,000 a year, but would not increase Pell Grants or student tax credits, as originally considered. The bill sets a five-year phase-in of the interest rate reduction from 6.8 percent to 3.4 percent, but then, after six months at 3.4 percent, returns the rate to the original percentage. House Democrats called it a "first step."
The bill faces an uncertain future. In the Senate, Edward Kennedy, D-Mass., chairman of the education committee, is considering a broader bill that would increase grants and tax credits.
The White House questioned the wisdom of encouraging more loans rather than grants. "It is not clear that encouraging more loans is a wise course. Instead, the administration would support efforts to direct savings to additional grant support for low-income students," said a statement from the Office of Management and Budget.
The final piece of legislation in House Democrats' 100-hour sprint was on deck for a vote today: energy legislation that imposes billions in fees, taxes and royalties on oil and gas companies and uses the money to promote renewable fuels.
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