Unlike almost every other type of loan, federal student loans are set in stone even if rates change for the better. That might not constitute a crisis if college cost what it did in the seventies. But with middle class wages flat for decades, the soaring cost of education has become a mammoth debt dilemma dragging down an entire generation.
In short, we are taking money from middle class students and handing it to the worst of the one percent. Sen. Warren's plan is to make up for lost revenue from student loan refinancing by making sure millionaires do not pay a lower tax rate than their assistants.
She is not the first to propose refinancing for federal student loans. Nor did she come up with the idea of the "Buffet Rule," a minimum tax on millionaires that The Joint Committee on Taxation estimates would raise $47 billion over 10 years, or an average of just under $5 billion per year. President Obama first proposed the tax in 2011, naming it after the acclaimed Warren Buffet, who notes that many millionaires pay a lower tax rate than their assistants.
Sen. Warren's step forward was combining the two. Suddenly, members of Congress worried about lost revenue no longer have an excuse. And those who oppose fair taxes now have to explain why they care more about hedge fund managers than middle-class families trying to pay for college.
We can save Americans thousands of dollars. Put money back in the pockets of families who invested in education. Create jobs from the middle class out. And do it without adding a dime to the deficit -- simply by putting in place a fair tax code and then allowing people to refinance federal student loans.
If we can refinance a flashy new sports car at today's low rates, we should be able to do the same for our student loans.