WASHINGTON -- Eight days after the interest rate on new, federally subsidized student loans increased to 6.8 percent, the two parties in Congress seemed further away than ever on a compromise that could retroactively undo the increase. A bipartisan coalition of Senate Republicans, Independents and Democrats have put forward a bill for market-based interest rates that has much in common with President Obama's plan, but the Senate Democratic leadership would rather extend the current 3.4 percent interest rate for another year -- a proposal that's a nonstarter with Republicans in the House and Senate.
The Senate will vote on the one-year extension bill today.
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