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Low Student Loan Rates Not the Point

Republicans, candidates and the party alike, have a serious problem with young voters. The national party has conducted extensive research into how to solve the problem and it has already taken some promising steps in the right direction on several fronts, including digital strategy. The latest messaging meant for young donors coming from the RNC and Republicans in congressional leadership positions on student loan rates, however, is not only antithetical to the principles of conservatism, but will also prove ineffective in appealing to young voters.

Senate Republicans are justifiably frustrated at their Democratic colleagues’ inability to come to an agreement on student loan rates, which are poised to double on July 1 if a deal isn’t reached. Inexplicably, Senate Democrats have even rejected a proposal that President Obama set forth in his budget earlier this year.

Today the RNC gathered a small well-dressed group of young people that consisted of what their own official Twitter account described as interns, with handmade signs that appeared made with the same posterboard and markers, to protest the likely scenario of student loan rates doubling this summer. The protest may have been designed to appear organic, but the picture that emerged instead came across as quite staged. It seems Republicans believe that messaging on this Democratic failure will somehow endear them to young voters struggling under the weight of ballooning student debt.

Unfortunately for both the RNC and students, stopping a raise in rates wouldn’t solve the problem for the majority of students struggling not with the interest payments on their loans, but the principal. The ease with which students have taken out more loans than they can conceivably pay back after graduation is at the heart of the crisis. Making more money available at less cost would actually make the crisis worse for students and for an already bankrupt federal government, which has no business in the student loan business in the first place. Today the Wall Street Journal explained

The skyrocketing cost of a college education is a classic unintended consequence of government intervention. Colleges have responded to the availability of easy federal money by doing what subsidized industries generally do: Raising prices to capture the subsidy. Sold as a tool to help students cope with rising college costs, student loans have instead been a major contributor to the problem

In truth, America’s student loan problem won’t be solved by low interest rates—for many students, the debt would be crippling even if the interest rate were zero.

If we want to solve the very real problem of excessive student-loan debt, college costs need to be brought under control. A 2010 study by the Goldwater Institute identified “administrative bloat” as a leading reason for higher costs. The study found that many American universities now have more salaried administrators than teaching faculty.

The RNC’s populist message, which would do nothing to solve the student loan crisis, is unlikely to even register with most young voters. Few are even aware of the rates on their student loans, both when they take them out and when they graduate. The information isn’t even that easy to obtain: I spent over half an hour myself today figuring out the rates on each of my four federal loans to see how they compared to the rates currently being discussed.

The Republican Party has the right idea in trying to craft a message that appeals to young voters. What would not only resonate more, but also actually help them would be a plan to bring down costs, much like what Texas Governor Rick Perry has proposed with a $10,000 degree. Innovative solutions to bring down costs like Perry’s, not partisan demagoguery, is the future of the GOP’s outreach to younger voters. 


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