Kline to urge action on student loan rates during national address

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Minnesota Republican Congressman John Kline will focus on the federal student loan rate that's expected to double July 1 during the weekly Republican national address Saturday.

According to the Star Tribune, Kline's office indicated he will urge President Barack Obama to press Senate Democrats to negotiate a deal that would stop the interest rate for new federally subsidized Stafford loans from increasing to 6.8 percent.

The House already passed Kline's bill that would tie interest rates to 10-year Treasury notes. Now, the Senate has a little more than a week to act before the increase goes into effect.

USA TODAY reports a bipartisan coalition of senators is working on a compromise to create a three-tier loan-rate system for undergraduate, graduate, and PLUS loans which would be tied to the interest rate on a 10-year Treasury note and would be locked at the initial rate for the life of the loan.

As the deadline looms, there have been several opinions on what the next move should be.

The L.A. Times editorial staff says "tying interest rates to the federal government's low cost of borrowing is the right way to go. The Senate should pass its own version of the president's proposal, then work out the differences with the House without delay."

USA TODAY's editorial board agrees that interest rates should be tied to market conditions, "rather than congressional whims," and suggest more money should be available in direct Pell grants.

Minnesota college graduates walk off campus with an average debt of $29,000, while the collective student debt in the U.S. amounts to $1 trillion.

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As chairman of the House Education and the Workforce Committee, Rep. John Kline has challenged President Obama every turn. But it's his stance on Stafford Loans for college students, which could double on July 1, that has sparked a national debate. The Star Tribune looks at how this debate is reverberating across the Minnesota and the nation.

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