About 11 million students this year are expected to have lower interest rates, saving the average undergraduate $1,500 on interest charges on this year’s loans.
Boehner called it “a good day” and a fine example of what Washington can accomplish when petty partisanship is put aside.
“With the stroke of a pen, we’ve now officially taken the politics out of student loans,” he said.
Obama cast the student loan deal as just the first of many measures the U.S. needs to make college affordable as a higher-tech economy makes advanced training and education a necessity for many workers.
“The cost of college remains extraordinarily high. It’s out of reach for a lot of folks,” Obama said, calling it a burden as well on families who have to balance other priorities, like buying a home, with helping fund their children’s educations. “We’ve got to do something about it.”
To that end, Obama said he’d be looking to the same coalition of political forces that came together on student loans as he pursues further steps.
White House officials have said Obama plans to lay out a broad and aggressive strategy in the coming months to tackle the spiraling cost of a college education. Even as they passed the bill weeks earlier, congressional officials were already talking about a broader approach to curbing fast-climbing costs and perhaps scrapping the deal when they take up a rewrite of the Higher Education Act this fall.
Rates on new subsidized Stafford loans doubled to 6.8 percent July 1 when Congress couldn’t agree on a way to keep them at the previous 3.4 percent rate. Without congressional and presidential action, rates would have stayed at 6.8 percent.
The compromise is a good deal for all students through the 2015 academic year. After that, interest rates are expected to climb above where they were when students left campus in the spring, if congressional estimates prove correct for 10-year Treasury notes.