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April 27, 2012 12:56 PM Will the GOP Student Loan Gambit Blow Up?

By Ed Kilgore

Yesterday I noted Greg Sargent’s prediction that the maneuverings of House Republicans on the student loan interest rate issue might come to resemble their notably unsuccessful meanuverings on the payroll tax, with hard-core conservatives refusing to support the party line even as Democrats remained united.

It looks like Greg may have had a very good point, based on this report from The Hill’s Cameron Joseph:

The well-funded, fiscally conservative Club for Growth has urged House Republicans to vote against legislation that would extend lower interest rates on federal student loans, a move that could complicate Speaker John Boehner’s (R-Ohio) plan to pass the legislation on Friday.
“The federal government should not be in the business of distorting the market for student loans,” said Club for Growth President Chris Chocola. “Decades of government intervention have driven tuition costs to record highs, and continuing these subsidies is simply bad policy. We urge members of Congress to oppose them.”
The group said it would include the vote in its legislative scorecard, which it uses to decide which Republicans it should challenge in primaries.

I’m sure Boehner and his team are frantically reminding House conservatives that the vote is not necessarily designed to actually affect student loan interest rates, but rather to share the blame with Democrats, because it’s nestled in the poison pill of a provision offsetting the cost by raiding a health prevention fund created by ObamaCare. As Joseph notes, that’s why Democrats are expected to vote as a bloc against the House bill. If, however, conservatives begin to bail on Boehner and the bill goes down, the expected Senate bill without the poison pill will become the only vehicle for avoiding the interest rate hike, and then Republicans really do have a big problem.

I’m sure Boehner would prefer to accelerate the weekend and get out on the links for a smoke and some rays.

Ed Kilgore is a contributing writer to the Washington Monthly. He is managing editor for The Democratic Strategist and a senior fellow at the Progressive Policy Institute. Find him on Twitter: @ed_kilgore.

Comments

  • stormskies on April 27, 2012 1:18 PM:

    Of course it is so much better to allow the banks to charge the interest rate, which would increase it by about 4 percentage point, for doing absolutely nothing given the the U.S. government is the one that guarantee's the loan, and administers the loan.

    Obama and the Democrats simply took away that gift to the banks. But of course the Repiglicans don't want that giveaway to be taken back.

    And now the mealy mouthed Boner must and does lie about all this yet one more time.

  • Peter C on April 27, 2012 2:02 PM:

    I don't understand why this has a budget cost at all. What is there to offset? Can anyone point to an article which explains the economics of this?

    Thanks

  • Mad_nVt on April 27, 2012 2:21 PM:

    Hey Ed,

    You are doing a great job with this WashMonthly gig, you're really getting into high gear.

    Great to keep the humor in the air, great to call out the liars and cheats, and great to highlight the absurdity of so many of the GOP positions/leaders/charades/bamboozlements.

  • Ian A on April 27, 2012 3:27 PM:

    “Decades of government intervention have driven tuition costs to record highs."

    This is total BS. They want to argue that cheap student loans just cause Universities to raise fees. But the only places that base their fees on how much student loan money they can get are the for-profit institutions (which, almost by their very definition, don't provide much in the way of an education). *Real* colleges and Universities don't look to make a profit, they look to cover their costs, so set tuition without regard to the cost of loans. Tuition at state Universities (like mine) goes up because the State has more or less bailed on us.

    Republicans are in the wrong on all sides here (fighting for relaxation of rules on for-profit colleges, lowering funding for real institutes of higher ed, and failing to subsidizing student loans).

    Tearing my hair out . . .

  • Texas Aggie on April 27, 2012 6:27 PM:

    Stormskies, if you really want to see prevarication by the Boner in all its glory, check out his speech complaining about how the Democrats are accusing the republicans of conducting a war on women when the republicans insist on making up for not raising interest rates by cutting a women's health fund in Obamacare. It's found on Steve's blog over at Maddow.

    As far as the talking point about student loans being the reason for rising university tuition, we once again have an example of macro quantum theory. Tuitions were going up long before Obama changed the program from a bank give away to a totally government managed program. To claim that the loans are a cause for tuition increases means that the future affected the past which is possible only under quantum theory.

  • RalfW on April 28, 2012 12:07 AM:

    So Boehner got all wound up in the House this afternoon and bellowed "Do we have to fight about everything?"

    Well duh, dude! Here's the relevant info via Robert Draper's new book. Kevin McCarthy (R-CA) said at the inauguration night GOP festival of scheming in the Caucus Room restaurant: "We've gotta challenge them on every single bill and challenge them on every single campaign."

    So yeah, Mister Speaker. You are running the play your team laid out on night one of Obama's Presidency. So spare me the fauxtrage. Spare me the sudden noticing that "everything is partisan." It's your game. Don't cry about it now.