First interest rates, then tuition costs?
TEXT OF STORY
Scott Jagow: Interest rates on government-backed student loans are about to fall to 6 percent from 6.8. Congress mandated the lower rates last fall. It doesn’t sound like a whole lot, but this is only the beginning. Here’s Nancy Marshall Genzer.
Nancy Marshall Genzer: Next week’s interest rate cut is the first of four that’ll eventually chop rates for government-backed loans in half to 3.4 percent. Congress has also increased grants for needy students. A House committee even put together a snappy YouTube video explaining the new benefits:
YouTube Ad: Skyrocketing college costs leave many students feeling alone when trying to pay for school — those lonely days are over.
So why isn’t everybody happy?
Travis Reindl: We’re really dealing with the symptom of the problem, which is the price of a college education.
That’s Travis Reindl of “Jobs for the Future.” He says Congress has taken a good first step, but it’s time to focus on tuition. Democratic Congressman George Miller of California is behind new legislation that would keep state tuitions down by encouraging states not to cut their education aid as federal aid increases.
George Miller: We’re trying to make sure that as we put more money into the system, the states don’t simply jack up the cost of that education with tuition and fees.
Miller’s bill would also set up a new Web site making it easier for students to compare tuitions.
In Washington, I’m Nancy Marshall Genzer for Marketplace.
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