Wednesday, June 6, 2012 | 3:35 p.m.
House leaders are calling on President Barack Obama to skip his stop in Las Vegas tomorrow, where he’s planning to announce a new executive order concerning student loan repayment, and return to Washington to help Congress work out a compromise on student loan interest rates instead.
“We urge you to consider canceling tomorrow’s Las Vegas rally and instead work with us so that we can extend these rates before they expire,” House Speaker John Boehner and Majority Leader Eric Cantor wrote in a letter shared with press Wednesday afternoon.
Last week, Republican leaders in the House and Senate sent the president a letter outlining a possible way forward on lowering student loan interest rates. Since efforts to pass both Democrat and Republican-sponsored student loan offsets failed in the House and Senate, Republicans proposed using pieces of President Obama’s own fiscal 2013 budget — tweaked slightly — to offset the $6 billion estimated cost of freezing interest rates at 3.4 percent for the next year.
The president still hasn’t responded to their suggestions as he heads to Las Vegas on another “We Can’t Wait” trip, where he’s expected to chide Congress for being slow to act on student loans. He is also expected to announce a new initiative to more clearly and fully explain income-based repayment options to borrowers.
“We cannot understand why you, without having responded to our latest offer, would schedule a campaign-style event in Nevada tomorrow to discuss student loan rates,” Boehner and Cantor wrote.
A White House spokesman did not immediately issue a response to the letter upon request.
The President is scheduled to speak on student loans at UNLV tomorrow afternoon, where he will also discuss the specifics of a plan to better inform current and graduating students of existing repayment options that calculate monthly payments on the basis of a borrower’s income.
The current law on income-based repayment was adopted under the Higher Education act and caps monthly repayments at no more than 15 percent of a borrower’s income. Last fall, the president passed an executive order that lowered that cap to 10 percent of a borrower’s income. The lower ceiling is supposed to kick in for any borrowers who contracted their student loans directly through the Department of Education by the end of 2012. For everyone else, the 10 percent cap kicks in by 2014.
A majority of student borrowers — 25 million of the approximately 36 million student loan holders, according to White House officials — borrow directly through Department of Education programs.
“Given the gridlock in Congress, it doesn’t hurt for an incumbent to be running against Washington,” said one Nevada Democratic strategist. “That’s something you’re going to see from frankly anybody that is paying attention to the way that voters feel in this current political climate.”