Elizabeth Warren has filed her first piece of legislation in the Senate, and its subject is no surprise. Warren, who campaigned on a platform that called for relieving the many unfair burdens she says are sinking middle-class Americans, is sponsoring a bill to dramatically lower the interest rate on student loans for one year while the government figures out a long-term reform to the student loan system.
The rate on federally-subsidized Stafford loans is set to double on July 1, from 3.4 percent to 6.8 percent, if Congress takes no action. Warren’s bill would go much further than simply freezing the rate; she would lower it to 0.75 percent, the same rate — not coincidentally — that the Federal Reserve currently charges banks for short-term loans. “If the Federal Reserve can float trillions of dollars to large financial institutions at low interest rates to grow the economy, surely they can float the Department of Education the money to fund our students, keep us competitive, and help grow our middle class,” Warren said in a May 8 floor speech introducing the bill, a populist pitch that has racked up more than 160,000 views on YouTube.
One problem with tackling the cost of higher ed at the loan-and-financing end of the equation is that it does nothing to put the brakes on inflation in higher ed. Indeed, many think the easy availability of student loan money only fuels further run-up in the sticker price colleges and universities charge. A new report from the New England Center for Investigative Reporting says Massachusetts higher ed institutions have been bulking up with new administrative positions at a rate twice as fast as they’ve added research or teaching faculty.
A Globe editorial on Saturday picks up on the concern that “rock-bottom” interest rates might only “exacerbate the bubble in higher-education pricing.” But the paper says Warren’s bill isn’t likely to contribute much to such a problem, as it applies only to Stafford loans, which are capped at $8,500 a year, it would only cover new loans, and the near-zero interest rate would only apply for a one-year period while Congress works out a long-term fix.
As such, says the Globe editorial, the bill is more symbolic than substantive, “designed to address a short-term problem while drawing greater attention to the broader and troubling crisis of student debt.” Grandstanding with a “mix of populist rhetoric and subterfuge” is how Jason Delisle of the New America Foundation put it.
Everything from figuring out incentives that will push colleges to slow tuition inflation to the role of massive open online courses may figure in the effort to address trends in the cost of higher ed that many say are not sustainable.
However you characterize Warren’s bill, what’s clear is that she has only laid down a marker on, not offered a solution to, one the signature issues on which she says the middle-class is “getting hammered.” Whether we look back at it as so much grandstanding or the beginning of a long, Ted Kennedyesque march to grind away relentlessly at an important, but vexing issue, is the challenge facing the state’s new senior senator.
–MICHAEL JONAS
BEACON HILL
A bill in the House that would mandate installing cameras in school buses to catch drivers who don’t stop for buses is getting mixed reception by communities who like the idea but not the cost.
Foxwoods’ bid for a Milford casino raises eyebrows in Connecticut.
MUNICIPAL MATTERS
A Globe editorial says the recent dust-up involving the Boston Fire Department chief and his deputy chiefs warrants an independent review.
In terms of white and Hispanic populations, Springfield holds the dubious distinction of being the most segregated metro area in the US.
Saugus negotiates a lower trash tipping fee with Wheelabrator, saving the town $170,000, the Item reports.
A lobster company sues to block a proposed hotel in Gloucester, the Gloucester Times reports.
Bourne wants to fine owners who allow properties to fall into extreme disrepair.
NATIONAL POLITICS/WASHINGTON
Liberal groups and journalism organizations complain they were also scrutinized more closely by the IRS, NPR reports (via WBUR). The Atlantic notes that the surge in tax exempt applications the agency has cited to explain its scrutiny of Tea Party groups never actually materialized.
The Washington Post examines how far the Obama administration went to track down a leak of North Korea information.
ELECTIONS
Must viewing and reading for mayoral wannabes and political junkies: Former Boston city councilor Larry DiCara and Northeastern University’s James Sutherland discuss the piece they wrote for the current issue of CommonWealth on Boston’s changing voter demographics in this “Face to Face” video conversation with CommonWealth’s Michael Jonas
Ed Markey and Gabriel Gomez ramp up their campaign activities — and agree to a June 5 debate — in their race for US Senate. The Herald’s Joe Battenfeld accuses Markey of campaigning from a hiding spot.
John Nucci, one-time Boston city councilor and school committee president, now flacking for Suffolk University and penning a column for the Herald on the mayor’s race, has some trouble distinguishing between communities that are part of and outside of Boston.
Virginia’s gubernatorial contest lurches even further to the right.
BUSINESS/ECONOMY
Yahoo pays $1.1 billion for Tumblr, the Wall Street Journal reports. Buzzfeed notes that most Tumblr users weren’t even alive when Yahoo was founded. The New York Times compares the rich takeovers of Tumblr and Instagram.
Drought spreads through the high plains.
EDUCATION
Bridgewater State University is eyeing a satellite campus at a Yarmouth elementary school scheduled to close in June.
A shortage of school superintendents is pushing communities to pay top dollars to attract and keep candidates.
HEALTH CARE
The Globe reports that, in a concession to the insurance industry, the Obama administration is foregoing in the national health care reform system some aspects of the Massachusetts overhaul that served as its inspiration that have allowed consumers to make more informed, cost-effective choices.
TRANSPORTATION
The investigation into Friday’s train collision in Connecticut continues, NECN reports.
The national center that tracks reports of UFO sightings says there’s been a marked increase coinciding with the rise of drones in the skies.
ENERGY/ENVIRONMENT
A wind turbine testing facility in Charlestown is almost breaking even, WBUR reports.
Santa Rosa, California, is using its wastewater to help produce electricity, Governing reports.
The Interior Department unveils new rules for fracking on federal land, Governing reports.
Local bee colonies are disappearing at an alarming rate.
CRIMINAL JUSTICE
Judy Clarke, the chief defense lawyer for accused Marathon bomber Dzhokhar Tsarnaev, is a seasoned defender of some of the countries most notorious killers.
A Brockton man who was released from prison last fall after his drug conviction was tossed out as part of the fallout from the Annie Dookhan drug lab scandal was charged with murder in the fatal shooting of another Brockton man last week.
The Wall Street Journal notes the difficulties law enforcement agencies are having enforcing laws against driving under the influence of marijuana.
MEDIA
Here is what the photo assignment desk looks like in the Twitter age.