Mr. President, first, let me commend the Senator from Illinois for a very thoughtful statement about the pending appropriations bill, particularly with respect to the funding of the Department of Defense. I wish to spend a moment to talk…
Mr. President, first, let me commend the Senator from Illinois for a very thoughtful statement about the pending appropriations bill, particularly with respect to the funding of the Department of Defense.
I wish to spend a moment to talk about another looming issue that is beyond appropriations but is rapidly approaching.
In June of last year, as we commemorated the 40th anniversary of legislation to establish the Pell Grant Program, we narrowly averted a doubling of the interest rate on need-based student loans.
Back in January of 2012, Congressman Courtney and I introduced legislation to permanently extend the 3.4-percent interest rate that has helped make college loans more affordable for millions of students across the country. But my colleagues on the other side of the aisle instead voted for budgets that effectively called for the doubling of the rate. They did this at a time when students are struggling--and I will point out some of the difficulties we face--at a time when college costs are increasing and at a time when college is becoming more and more essential for obtaining any type of long-term, stable employment and ability to contribute to the continued economic growth of the country.
It took thousands of calls and letters and rallies from students and parents across the country and President Obama himself getting involved in this issue to bring everyone to the table to negotiate. However, we were only able to get a temporary, short-term fix. Essentially, we were able to keep the interest rate at 3.4 percent but only until July 1 of this year. Interest rates will again double then on these need-based loans unless we act.
One of the other ironies, of course, is that even at 3.4 percent, that is a substantial interest payment at a time when Federal fund rates are closer to 1 percent and when large financial institutions can borrow at these very low rates, et cetera. So given that factor also, it is essential we once again respond, prior to July 1, to the anticipated doubling of the student loan rate.
Now is the time to develop not just a short-term solution but a long- term solution to this growing burden of student loan debt, the rising cost of college, and the need to improve higher education outcomes so students complete their degrees and get the full benefit of their investment in education and we get the benefit as a society and as an economy of their education.
Everyone agrees college costs are too high and are climbing higher. There has to be real reform by higher education in terms of the way they deliver services. They cannot continue to pass on increased costs. If that continues to happen, families will be priced out of a college education, even with our grants and loans; so we have to do something.
Student loan debt is the next big financial crisis we are facing. Even if we act now, we are looking at some very sobering statistics about the growth of student loan debt already. That should prompt, again, action now to prevent the doubling of the interest rate and longer term action to control the costs of higher education and the ability of families to respond to those costs.
Student loan debt continued to rise throughout the recession. In fact, one of the ironies of the recession is people can't find jobs; they are going back to college to get more training and sometimes they are going back to college because that is what they can do. So the irony, of course, is we are adding to the student debt. In fact, today, student loan debt is the second largest outstanding balance after mortgage debt. It eclipses credit card debt. It is the second largest outstanding balance in our economy behind mortgage debt. Borrowers are struggling under that debt.
The Federal Reserve Bank of New York recently reported that 17 percent of student loan borrowers are more than 90 days past due on their payments--a large increase from under 10 percent in 2004. So in roughly a decade, we have seen an increasing amount of students unable to shoulder the burden of their debt. Even worse, if we consider that 44 percent of student loan borrowers are not in repayment--these are people who statutorily don't have to start paying--the effective delinquency rate rises to more than 30 percent. That is stunning.
This is affecting also the lives of these young people at a time when they are beginning to establish or are hoping to establish households. A recent Pew Research Center survey illustrates what is happening. As the percentage of young adult households with student loan debt climbed from 34 percent in 2007 to 40 percent in 2010--again, a huge increase in debt--the share of younger households owning their home has declined sharply from 40 percent in 2007 to 34 percent in 2011. Home ownership, which is one of but not the only measure of the American dream, is also one of the strongest supports of the American economy, but it is rapidly being priced out of the reach of young students because of their student debt. They literally can't qualify for mortgages.
Car ownership shows a similar trend. In 2007, 73 percent of households headed by young adults owned or leased at least one vehicle. By 2011, that figure dropped to 66 percent.
Students are caught literally between a rock and a hard place. Huge financial debts for their college education prevent them from buying homes, buying cars, and prevent this economy from growing as it has in the past because of new households, young households coming into the marketplace, buying homes and buying cars and starting families.
We can't do away with education. It is more important each day in a global economy. We have to deal with this issue of rising costs. The cost of attending college has increased by more than 550 percent since 1985. Let me repeat that: 550 percent. That is rising faster than gasoline, health care, and other consumer items. It is skyrocketing. Again, the universities, the colleges, education leaders at every level--Federal, State, and local--have to begin to respond to this rising cost of education. But keeping student loans affordable and interest rates low is one part of the solution, particularly this immediate crisis facing us by July 1.
The Federal Government should price student loans based on our actual costs of operating the student loan programs. We should set the student loan interest rates in a way that minimizes the cost for students while covering most of the cost for the taxpayer. The Federal Government provides student loans to increase the number of Americans who can obtain college degrees. We do not and should not run these programs to generate revenue. They should be to increase the capital--the human capital--of our country. I plan to introduce legislation to set student loan interest rates based on the principles of keeping costs low for both students and taxpayers.
Providing more grant aid through Pell grants and other programs is another way to tackle these college costs. However, if college costs continue to rise at the current rate, students relying on the Pell grant will continue to lose ground. We need States and institutions to partner with us to make college affordable. Again, it has to be a cooperative effort.
With respect to the Pell grant, I have talked about the loans, but the Pell grant is just an outright grant of funds to the student without the need to repay. It was for a long time the backbone of our Federal support to students in college and families trying to put their children through college.
In 1976 the Pell grant maximum was $1,400. That was enough to cover 72 percent of the cost of attendance at a public 4-year college. In fact, in those good old days, with a Pell grant and a summer job and a little help, you were usually able to emerge from college after 4 years without a huge debt, and you could start your family and buy your car at a younger age.
In 2010 the maximum Pell grant was increased to $5,550, but that is only enough to cover 34 percent of the cost of attendance at a public 4-year college.
In my State, we have been particularly hard hit by this recession and economic downturn, and students and families are feeling this pressure of increased tuition and higher fees at schools and colleges acutely. They need these resources, and we have to ensure that they get these resources.
As I indicated, I am planning to introduce legislation to strengthen our higher education system and student aid programs by reestablishing a strong Federal-university-State partnership for college access and affordability and by requiring institutions to assume more of the risk in the student loan programs and to do so in a way that I think will vindicate our best principles and our soundest economic rationale.
I look forward to working with Chairman Harkin. He has been a leader on these issues for so many years, both as the chairman of the HELP Committee and chairman of the Appropriations subcommittee. We want to start by preventing, obviously, the doubling of student loans by July 1. That is step 1, but it cannot be the last step.
Mr. President, with that, I yield floor.
Madam President, I ask unanimous consent that the order for the quorum call be rescinded.
Madam President, I rise to speak today in opposition to the Cruz amendment, which would prohibit any funding in the continuing resolution from being used to carry out the goals of the Affordable Care Act.
The broad scope of this amendment clearly indicates that anything anticipated under the Affordable Care Act would be subject to defunding, and that is a broad category of activities. In fact, we already have seen the Affordable Care Act produce demonstrable positive results in my State of Rhode Island, and those results could be eliminated or reversed.
For example, because of the Affordable Care Act, there are protections in place today for children with preexisting conditions to ensure they are no longer denied coverage. There are over 15,000 children who have a preexisting condition who could have been dropped from insurance coverage prior to the enactment of the Affordable Care Act. Their parents and other adults--approximately 200,000 Rhode Island adults also living with preexisting conditions--will gain protection from being dropped from coverage beginning in January. We began with children, and now we are expanding it to adults. If we don't do that, then we are going
to have a whole category, a huge segment of my population who may lose access to insurance, and the inevitable result will be that they will go to expensive emergency rooms, and they will cost all of us more money. Rather than saving money and dealing with the deficit in a responsible way, this will just add to our deficit problems and deny people health care.
The law, the Affordable Care Act, included new tax breaks for small businesses to make health insurance more affordable. Small businesses have been able to access a tax credit of up to 35 percent of their health care costs every year since 2010. Beginning in 2014, these businesses may receive a tax credit of up to 50 percent of their health care costs for any 2-year period. Again this support under the Affordable Care Act could be jeopardized or eliminated under the proposed amendment.
Also in jeopardy are discounts on covered brandname and generic prescription drugs for seniors who have reached the prescription drug coverage gap known as the famous or infamous doughnut hole. Already in Rhode Island, seniors have saved--individual senior citizens of Rhode Island have saved $20.5 million as a result of these discounts since the law was enacted. These discounts will continue until the coverage gap--the doughnut hole--is eliminated in 2020. The Cruz amendment will stop that. Essentially we are telling seniors go back to the time of the doughnut hole, more money out of your pocket at a time when you can afford less and less for prescription drugs.
Many of my colleagues on the Republican side say they support these aspects of the Affordable Care Act, yet this amendment would effectively do away with them or cast so much doubt or confusion that they would not be effectively implemented. We have to, I think, continue to effectively implement the Affordable Care Act, not only in terms of providing access to quality care for all of our citizens but because within the Affordable Care Act were significant efforts to improve health care efficiencies. Indeed, through these reforms, we were able to extend the Medicare Program by, I believe, 8 years, to 2024, in terms of our funding models. All of that would be jeopardized by this amendment.
There are some other examples, too. For example, the Affordable Care Act would reauthorize funding to help immunize uninsured and underinsured children and adults. Every year my State of Rhode Island receives $3 million to immunize this population. Funding for immunizations is critical for the child and the family, but it also benefits all of us, because if you can immunize 75 to 95 percent of the population, immunologists and health specialists will tell us we are all protected through something that is technically known as herd immunity. It makes sense, if you have a sufficient number of people who are vaccinated against the disease, when an outbreak occurs the likelihood of it spreading is diminished dramatically. This is another example of a public health initiative under the Affordable Care Act, which, if it is repealed or defunded, will leave us all vulnerable to diseases. That is not a benefit, that is a detriment to all of us.
We have to, again, I think, consider other aspects of the Affordable Care Act. One other aspect I wish to mention is the critical area of health care workforce programs, programs that help train doctors and nurses. Many of these programs are funded in the continuing resolution and they, too, would be either eliminated or so uncertain as to be unreliable for the institutions. In my home State, colleges and universities, such as at the University of Rhode Island, are using these programs to help train a new generation of health care professionals, not just physicians but physician's assistants and nurse-practitioners. Indeed, what we are seeing, because of the Affordable Care Act, is a refocus to more emphasis on family practitioners, primary care that is less expensive and more effective over the long term in terms of prevention--all that would be jeopardized under this proposed amendment.
There are countless other examples of not only interfering with health care access for a vast number of Americans, but actually setting back our efforts to reduce the deficit and to sustain programs such as Medicare. The burden might be particularly felt by seniors because one of the things that was most compelling in the debate about the Affordable Care Act was closing this doughnut hole. Seniors believe we have taken a positive step to do that. This would be an about-face for the seniors of America, causing them to see more and more costs in their limited budgets.
These are not the messages we want to give to seniors or families. I urge my colleagues to oppose this amendment.
I yield the floor and suggest the absence of quorum.
Mr. President, if we are still on the Inhofe amendment, is there still an opportunity to speak on the amendment before a vote is called or is the Senator asking for a vote immediately?
Is the Senator asking for a vote immediately or is there still an opportunity to speak?
I would like to, at the appropriate moment, be recognized to speak, respectfully, against the Senator's amendment.
Now is the time? Well, in that case, let me go ahead and speak.
Mr. President, Senator Inhofe is proposing a very sweeping amendment that would affect a rule the EPA has developed over the normal rulemaking process, with notice and comments over many, many, many months. It is scheduled to go into effect in May of this year. The amendment the Senator is offering, as I understand it, exempts all farms from this EPA oilspill regulation. Again, this rule is designed to prevent or significantly prevent the pollution of navigable waters by oilspills coming from agricultural operations.
One of the issues here is the definition of what appropriate farm should be exempt. As I understand the amendment, it is all farms. That includes large agribusinesses that have the capability not only of mitigating these hazards but also the resources to do so and, collectively, would contribute to environmental quality.
I know the agricultural community is concerned. And I know also this the type of very complicated legislation that is best resolved at the authorization level. The Senator from Oklahoma, I think, has already indicated there are bills pending, and these bills are much more finely attuned in nuance to address more specifically the problem rather than a total effective preemption from the rule for all farms.
So I would urge very strenuously that--and I know the intentions of the Senator from Oklahoma are to assist the agricultural community, but I do not think this is the place or the time, as we try very seriously to get a bill through by the end of the week, essentially, that will keep the government operating, to decide on these complicated authorization issues, effectively cutting out completely a very serious and detailed rulemaking process that the EPA has undertaken.
So I will urge my colleagues at the appropriate time to resist the amendment.
I will certainly yield.
I appreciate very much that clarification. But let me retain my time and then yield to the Senator from California.
I will yield.
I have the amendment, yes.
I believe the Senator is absolutely correct. There is no time extension. One could argue that as this CR runs out maybe this provision would run out. But the intent of the bill is clearly that there is no money to be expended for any implementation against any farm.
That is the language of the bill.
Well, I thank the Senator for bringing that to my attention because one point I would make--and I think Senator Inhofe does want to engage also--but one point I would make is that in this EPA rulemaking process there is a requirement to evaluate the cost and benefits with respect to the rule. In that sense, many of these issues have been addressed, and they have been done so in a very careful way.
Two, it has been done by listening to--in fact, requiring legally to take the opinions, the comments of many people, stakeholders from all sides. And then, frankly, the other cost and the traditional cost to protest a rule is not to legislatively eliminate it, particularly in an appropriations bill, but to contest the rule in court based upon the facts.
I believe I still have the time.
Let me make one point. This is a complicated rule that has tried to balance various equities--environmental protection, protecting the navigable waters of the United States, recognizing small farms or farms where in no way their oil could reach down to where it should be exempt.
Here, on the other side, is an amendment that is very broad, open ended--no funds, all farms. I think in this context, I would urge my colleagues to resist the amendment.
I think the Senator from Oklahoma wants to speak.
If I could reclaim the time.
Let me say, I think the Senator's comments are accurate in that because the CR terminates on September 30, then because it terminates, the CR, this language might go away. But the clear language here is not a--and I think that is the point the Senator from California made--is not a time-certain extension for the EPA to do something. It is: No funds, no farms. And I think there is a reasonable concern--that certainly I have--that this will not just be a deliberate delay of several months, but this is the intent to stop this law indefinitely, as this language was drafted.
I thank the Senator from Oklahoma, and I yield the floor.