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Originally published May 30, 2013 at 12:00 AM | Page modified May 30, 2013 at 12:04 AM

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Obama drawing attention to new student loan debate

The government's subsidized student loan program, a marquee issue for President Barack Obama last year as he courted young voters on the campaign trail, is back on the White House agenda one month before a scheduled interest rate increase. But Obama's push to avoid the increase is far more low-key than it was in the election year.

Associated Press

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WASHINGTON —

The government's subsidized student loan program, a marquee issue for President Barack Obama last year as he courted young voters on the campaign trail, is back on the White House agenda one month before a scheduled interest rate increase. But Obama's push to avoid the increase is far more low-key than it was in the election year.

The president will host college students Friday at the White House as he calls on Congress to keep the rates from doubling on July 1. But faced with a similar deadline, Obama by this time last year had launched a full-throated campaign to pressure Republicans to act, delivering speeches at college campuses and high schools in presidential battleground states.

Congress eventually extended the rate for one more year. Obama and his aides often point to their effort as an example of how they can mobilize the public to force lawmakers to act.

This year, Obama has been less confrontational, proposing a student loan plan in his budget and waiting to see what developed in Congress.

Last week, the House passed legislation that would link the rates the financial markets by pegging them to fluctuations in 10-year Treasury notes. The White House threatened to veto it if that's the version that lands on his desk. The Senate has yet to act.

Obama's proposal also would link the rates to the financial markets - a step opposed by many liberals. But Obama's plan, unlike the Republican proposal, would lock in the rates for borrowers. The Republican plan would set a cap.

"While we welcome that House Republicans have paid some attention to this issue this year, their proposal unfortunately does not meet the test," White House spokesman Jay Carney said Wednesday. "It fails to lock in low rates for students while also eliminating a safeguard that provides middle-class families most in need with lower interest rates for student loans."

Rep. John Kline, R-Minn., chairman of the House Education and the Workforce Committee, has said his proposal has a number of similarities to Obama's plan and has described his proposal as a starting point for negotiations.

Some Democrats are seeking a two-year extension of the current rates until Congress takes up a higher education bill later. Republicans have rejected that proposal - expected to cost taxpayers $9 billion - as costly and irresponsible.

Obama's event on Friday comes as Congress prepares to return to Washington after a weeklong Memorial Day recess that has given Obama a respite from triple controversies, including an admission by the Internal Revenue Service that it singled out conservative groups for special scrutiny during the two previous election cycles.

"It's obvious that the White House would love nothing more than to change the subject from its growing list of scandals, but scheduling this PR stunt reeks of desperation," Brendan Buck, a spokesman for House Speaker John Boehner, R-Ohio, said in a blog post Wednesday. "Picking a fight out of thin air where there's policy agreement isn't going to get the White House out of trouble, and it certainly doesn't do anything to help students facing a looming rate hike."

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