Student loans: Do Republicans really think program is socialist?

Stafford loans, as the largest student-loan program, represent a major source of funding for US college students, alongside savings and work income (theirs and their parents'), and grants or scholarships. Many borrowers are already paying a 6.8 percent rate. But without action by Congress, those who qualify for subsidized Stafford loans would see their rate double to that level on July 1.

Obama said the change would be like "a $1,000 tax hike for more than 7 million students across America."

The back-and-forth between Republicans and Obama has built from there. 

Andrew Biggs, a scholar at the conservative American Enterprise Institute, argued in Friday's Wall Street Journal that the weak job market imposes an even steeper financial burden on college students.

"Roughly two-thirds of lifetime wage growth occurs in the first decade of employment, when individuals build their skills and match them to the right jobs.... If we assume that unemployment today is one percentage point higher than it could have been given more effective policies [than Obama's] today's new college graduates on average will lose around $40,000 in inflation-adjusted income over the next 15 years," Mr. Biggs wrote.

That money, he said, could repay the average $25,000 loan balance of student borrowers.

Some economists say it's doubtful that Republican economic alternatives could have brought unemployment down by an additional percentage point.
 
Obama, meanwhile, has tried to attack Republicans with their own words – though by leaving some important ones out. When talking to students at the University of North Carolina recently, Obama described one member of Congress as saying she has “very little tolerance for people who tell me they graduate with debt … because there’s no reason for that.”

Rep. Virginia Foxx (R) of North Carolina actually said, "I have very little tolerance for people who tell me that they graduate with $200,000 of debt or even $80,000 of debt because there’s no reason for that" – a statement appears to be more a caution against imprudent borrowing than borrowing at all. Representative Akin said he also felt "misquoted" by Obama, and added that it would be "more reasonable" to preserve the low interest rate than to let it double, according to a report in the St. Louis Post-Dispatch. 

Obama said Friday that he expects the Senate will vote next week on a bill to prevent the interest-rate hike. He sought to pressure House Republicans, commenting that they "are saying they’re only going to prevent these rates from doubling if they can cut things like preventive health care for women instead."

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