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Keep loan rate low; Congress needs to find a way to agree on how to finance vital college aid

In America, higher education is seen as the route to the better-paying jobs. And in a knowledge-based, global economy, a college education is more important than ever.

So, why are Democrats and Republicans turning the effort to prevent the student loan interest rate from doubling on July 1 into a political fight?

House Republicans and Democrats both favor legislation to keep the interest rate low, but can't agree on how to finance the subsidy's $5.9 billion cost.

The Republican-led House passed legislation to extend the 3.4 percent rate for one year on subsidized Stafford loans. The president has threatened to veto the measure because it would finance the low student loan rate by raiding the Prevention and Public Health Fund, a program created as part of the president's health care reform act. The White House says the fund would benefit women, in particular, providing for hundreds of thousands of screenings for breast and cervical cancer.

House Speaker John Boehner said the money would simply come from "one of the slush funds in the president's health law."

Democrats would prefer to see the money come out of the deep pockets of oil and gas companies, and offered a bill that would maintain the Stafford loan rate by ending tax subsidies for those industries.

If nothing is done and the interest rate jumps to 6.8 percent, another $1,000 will be added to each student's loan debt. That increase would be one more step in putting college out of reach of low- and middle-income families. "Financial aid" isn't what it used to be. The grants and scholarships available don't keep pace with rising expenses. Financial aid today is largely federal loans, which a student (or his parents) must pay regardless of whether they get a degree or not.

The average Pell Grant, for example, has increased from $929 in 1979 to $3,706 in 2009, about a 300 percent increase, according to the Center for Economic and Policy Research. The center notes that the grants are falling far behind tuition increases. Over the same period, tuition has gone up 548 percent at two-year colleges, 620 percent at four-year private colleges and 807 percent at four-year public colleges.

Today, student debt outpaces Americans' total credit card debt. The Federal Reserve Bank of New York says the average student borrower owes $23,300. With tuition continuing to increase, the outlook is grim.

The Republicans have accused Obama of trying to make political hay out of a non-issue, because no one wants the interest rate to rise. Meanwhile, House Minority Leader Nancy Pelosi calls the Republican plan to take the money from the president's health care law "another assault on women's health."

The loan dispute is just the latest example of Washington gridlock. Here's an issue that both sides agree on, but they can't agree on how to fix the problem. The warring parties have a chance to show the nation that compromise is possible, and help keep education costs from escalating further out of control.