Halving Student Loan Interest Rates Is Unaffordable and Ineffective
Reducing interest rates on student loans does not increase college access for prospective students, but merely subsidizes loan repayments after college. The new congressional majority’s 100-Hour agenda to halve the 6.8 percent interest rate on subsidized student loans is unaffordable and ineffective. The measure could cost $18 billion over five years. At a time when federal student financial aid spending has already surged 400 percent since 2001, loan consolidation costs are set to soar.