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Senate kills bill to reset student loan rate at 3.4 percent

July 10, 2013 at 3:43 PM
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WASHINGTON, July 10 (UPI) -- The U.S. Senate Wednesday failed to break a GOP filibuster, killing a bill that would have maintained a 3.4 percent interest rate on student loans for one year.

The vote was 51-49 in favor of proceeding to debate on the bill but the motion needed 60 votes to pass. The outcome likely will force Senate Democratic leaders to consider a bipartisan plan they have opposed, Politico said.

Stafford student loans are fixed-rate loans for undergraduate and graduate students attending college at least half-time. Rates doubled July 1, from 3.4 percent to 6.8 percent.

Senate Majority Leader Harry Reid, D-Nev., and Sen. Tom Harkin, D-Iowa -- chairman of the Health, Education, Labor and Pensions Committee -- were the main backers of the bill rejected Wednesday. Democrats have been divided on how to deal with the issue, Politico said -- with some backing the Harkin plan and others inclined to support a bipartisan bill.

Opposition to the bipartisan bill is based on concern it will only maintain the lower rate for the first two or three years, Politico said.

"It's a classic bait and switch," Harkin said.

Sen. Joe Manchin, D-W.Va., and Sen. Angus King, Ind-Maine, voted with Republicans Wednesday.

Reid said a compromise bill could be brought to the Senate floor this month, The Hill reported.

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