The Washington Times - June 26, 2013, 01:10PM

Senate Majority Leader Harry Reid signaled Wednesday his chamber is nowhere close to striking a deal on student-loan rates, which are set to double on Monday.

House Republicans are pressuring Senate Democrats to act before existing rates on subsidized Stafford loans expire and jump from 3.4 percent to 6.8 percent.

SEE RELATED:


Their chamber already passed a measure that would tie the rates to Treasury notes, a solution that dovetails with President Obama’s.

However, several senators within Mr. Obama’s own party say they want to extend existing rates until debate next year on the Higher Education Act. They say Senate Republicans are blocking their efforts to reach a deal by refusing to put a cap on rates, a main sticking point.

“There is no deal on student loans that can pass the Senate because Republicans continue to insist that we reduce the deficit on the backs of students and middle-class families, instead of closing tax loopholes for the wealthiest Americans and big corporations,” Reid spokesman Adam Jentleson said. “Democrats continue to work in good faith to reach a compromise, but Republicans refuse to give on this critical point.”

A spokesman for Senate Minority Leader Mitch McConnell, Kentucky Republican, said chamber Democrats are holding up the process by flouting their leader in the White House.

“As a result of their obstruction, interest rates on some new student loans will increase next week,” the spokesman, Don Stewart said, adding: “Why Senate Democrats continue to attack the president’s plan is a mystery to me, but I hope he’s able to persuade them to join our bipartisan effort to assist students.”

Mr. Obama, who traveled to Africa on Wednesday, has said he would veto the House’s version because it does not lock in rates for the life of the loan.