It seems sometimes that special interest legislation for pet projects and personal preferences of Congressional members is out of hand. In these cases, there is a disconnect between what’s good for Congress compared to the needs of taxpayers. But when it comes to student loans, a new report reveals that many members of Congress have as much skin in the game as students, graduates and parents dealing with increasing amounts of educational debt. Will this common ground on student loans affect the debt crisis?
This research was released by The Center for Responsive Politics which states its mission to be “the nation’s premier research group tracking money in U.S. politics and its effect on elections and public policy.” The public policy in question in this case is the interest rate attached to federally subsidized student loans and the research revealed 41 members of the House plus five Senators count student loans among their financial liabilities. The total owed on student loans by members of Congress was estimated to be between $1.8-$4.3 million.
The bulk of the debt was taken out to finance their own educations, but a smaller percent was attributed to financing the education of children or spouses. Among the House members that owe student loan debt, the split is 22 Democrats and 24 Republicans. This is very good news – making this a bi-partisan issue. If ever there was a time for politicians to let their personal needs reign supreme, it is on the student loan issue. We need some leadership on making student loans easier to tackle. I don’t want to encourage a dangerous precedent of cherry picking legislation for personal benefit, but since that’s likely business as usual in the halls of Congress, isn’t it time the rest of us benefited from their self-interest?
Here are some Congressional student loan highlights from the research done by OpenSecrets.org:
$$$ Most in student loan debt (individual) – Rep. Raul Riaz (D-CA) owes between $151,000-$300,000 – this son of immigrant workers obtained his bachelor’s at UCLA and then a medical degree plus two other degrees from Harvard.
$$$ Most in student loan debt (overall) – The top 10 most in debt House members are a blend of six Republicans and four Democrats who collectively owe between $845,000-$2,060,000 in student loans!
$$$ Most hypocritical committee – Rep. Virginia Foxx (R-NC) said last year she had “very little tolerance” for those who end up with high student loans – her committee (House Education and Workforce) has four Republican members that together owe between $95,000-$250,000 in student loans.
What’s interesting too is who is owed by the Congressional student loan debtors versus student loan debtors at large. Here are the top 5 lenders for Congressional borrowers:
#1 Sallie Mae
#2 US Department of Education
#4 American Education Services
The bulk of borrowing by members of Congress and the public at large is done with Sallie Mae, but the public list of top 5 student loan lenders is strictly private, where it looks like Congress has more in Federally subsidized loans. Here are the top 5 lenders for student loan borrowers at large:
#1 Sallie Mae
#2 Wells Fargo
#5 Chase Bank (operating under various other names now)
The best case scenario is that, regardless of their personal interest in the student loan arena, Congress will vote this year to keep Federal loan rates low and will consider allowing student loans to be rolled up into bankruptcy proceedings. The levels of student loan debt are high, climbing and increasingly in deferment. That alone should have our lawmakers sitting up and taking notice. Unfortunately, it often takes a personal stake in an issue to get Congress moving and this time, at least, it seems they’ve got some skin in the game. Let’s hope they vote in their (and all student loan debtors’) best interests!
If you owe student loan debt and don’t have the luxury of lobbying Congress for help, no worries! There is expert advice available to help you optimize and manage your student loan debt so you can take care of your obligations without going under! For details of who in Congress owes how much in student loans and to which borrowers, check out the full list below: