Who’s To Blame For Student Loan Policy Getting Worse?

I of course agree entirely with Paul* and Erik on the merits of the new student loan plan, but I respectfully disagree with them on the politics.

Let’s consider this, from Bernie Sanders, who cast a symbolic vote against the bill and criticized it on the merits (both fine with me):

“What I don’t understand,” Mr. Sanders said, “is when you have a Democratic president, a Democratically controlled U.S. Senate, why we are producing a bill which is basically a Republican bill?”

The question answers itself if you consider the missing institution here. Sanders’s question would be highly relevant, and Obama’s support for the compromise passed by the Senate indefensible, if absent congressional action the baseline would be the status quo ante of a fixed 3.4% rate. But that would not be the baseline; if Congress does nothing, the rate doubles.

Given this, the only reason to place the responsibility for this deal on the White House and Senate Democrats would be if you think that House Republicans would react to an ultimatum by showing their commitment to bipartisan comity and fair policy and passing a liberal Senate bill. If you believe this would work, let me say that I evaluate House Republicans very differently than you do.

Given that I believe that House Republicans will act the way they’ve consistently acted rather than seeing the light and living up to David Broder’s fantasies about them, I think to hold debtors hostage by doubling their interest rates until House Republicans do the right thing would be completely irresponsible. Reid and Obama were right to take the best deal they could get.

*In comments, Paul clarifies that he blames the House GOP for the deal, but argues that progressives should (as Warren and Sanders did) continue to emphasize that it’s a worse deal than it might appear. Let us celebrate our agreement with the addition of Old Chub to a mug.