The Cloture vote held today on Elizabeth Warren’s “Bank on Students” Emergency Loan Refinancing Act failed, falling short of the required 60 votes by six. The 56–38 vote means the bill, which would allow borrowers to refinance at lower interest rates, will not be brought to the floor for debate. Only three Republicans, Senators Collins, Corker and Murkowski, voted to move the bill forward. The sole democratic vote against came from Senate Majority Leader Harry Reid as a procedural maneuver.
Elizabeth Warren introduced the bill last month saying the $1.2 Trillion in outstanding student loan debt constituted an emergency that requires immediate action. Under the burden of debt, borrowers are unable to move forward with their lives and cannot purchase homes, cars and other consumer goods, creating a drag on the economy. The bill would provide some relief to the more than 40 million American who have student loan debt by allowing them to refinance their federal student loans, some with rates as high as 9 percent, at current, lower rates.
“You can refinance a home loan. You can refinance a car loan. You can refinance business debt. Why not allow the 44 million people in America to refinance their student debt? ...We will revisit this, it will get done.” — Sen. Al Franken
The contentious part of the bill is the implementation of the “Buffet Rule,” which closes tax loopholes for wealthier Americans. Called the “Fair Share Tax,” it requires taxpayers with annual incomes in excess of one million dollars pay the difference between their total income tax liability and 30 percent of their adjusted gross income. Sen. Lamar Alexander called the bill a political stunt, and debate would waste time that could be better spent dealing with pressing Veterans Affairs issues. He urged his colleagues to vote “no” on the Motion to Proceed.
Speaking on the Senate floor before the vote was held, Sen. Warren said that if the Republicans want to change the bill, they should offer amendments, but they should not block it. She notes that the Congressional Budget Office (CBO) estimated that over a ten-year period, the “Bank on Students” Act would reduce the federal budget deficit by $22 billion. She urged Senators to bring the bill to the floor for debate to addresses what she sees as an urgent issue.
“Who does Washington Work For? Does it work for those who can hire lobbyists to make sure that every single loophole in the tax code is protected for them, or, does it work for young people who are trying to get started in life?” — Sen. Elizabeth Warren