Student loan cut directly affects SIUC
October 26, 1995
By David R. Kazak
A Democratic victory in the Senate and a Republican victory in the House topped a full day of voting in Congress as each house tackled their respective budget proposals.
Both budgets cut (or save, depending on which political party is speaking) more than $10 billion dollars in educational programs, all of which would affect SIUC and students.
Advertisement
Sen. Paul Simon, D-Ill., attempted to restore most of the cuts in the Senate budget proposal, including Simon’s direct student loan program, which was capped at 20 percent of the total federal loan volume.
The Simon Amendment, also sponsored by Sen. Edward Kennedy, D- Mass., was narrowly defeated 51-48.
Another amendment, presented by Sen. Nancy Kassebaum, R-Kan., was the same as the Simon/Kennedy amendment with the exception of the elimination of the 20-percent cap. That amendment passed unanimously.
The Kassebaum Amendment eliminates a proposed .85-percent loan volume charge universities would have had to pay to the government, reduces a proposed increase in PLUS loan interest rates to their current 3.1 percent rate and restores the government interest subsidy during the 6-month grace period after a student.
Simon said the vote today has caused mixed feelings.
Some of the worst parts of the cuts are eliminated, Simon said. But it still leaves the 20-percent cap on. These would mean many of the schools which now participate in the direct loan program would have to leave the program.
The double-edged Democratic Senate victory was tempered with a House Republican victory, were the GOP defeated a Democratic alternative budget proposal 358-72.
Advertisement*
The Coalition Budget Proposal, headed by Rep. Bill Orton, D-Utah, contained no cuts to educational programs.
Orton spokeswoman Samantha Woolsey said despite its defeat, the proposal will lay the foundation for negotiations after an expected presidential veto of the GOP budget proposal.
We think this is a real alternative to the Republican budget, Woolsey said. Its priorities are much closer to what the people want. It just makes more sense.
Brian Lott, spokesman for Rep. Jerry Costello, D-Ill., said the alternative proposal, although good in its intentions, did not have a chance of passing.
The Republicans are just too unified, he said.
The two proposals must be combined into one proposal before it is again voted on by the House and Senate. After that vote, it then goes before President Bill Clinton, where he is expected to veto it.
The combining process may present more problems for Simon’s direct student loan program because although the Senate has let the program exist with a 20-percent cap, the House proposal eliminates the program all together.
I have no idea what is going to happen, Simon said. The usual practice is to combine the two proposals, splitting any differences.
But Simon said it might be better if the direct loan program were eliminated outright rather than limited to just a 10-percent participation rate.
Advertisement