Senate Reaches Student-Loan Deal

    Following the Democrats' weekly strategy session, Senate Majority Leader Harry Reid, D-Nev., talks to reporters about House legislation that includes the extension of the payroll-tax cut and a provision to speed up approval of the controversial Keystone pipeline that would run from Canada to Texas, at the Capitol in Washington, Tuesday, Dec. 13, 2011. (AP Photo/J. Scott Applewhite)

    J. Scott Applewhite / AP Photo

    Both President Obama and Mitt Romney weighed in, legislators met in smoky backrooms, and—for once—it looks like we have a compromise. Senate leaders said Tuesday that the parties have agreed to a deal that will keep interest rates on student loans fixed at 3.4 percent for another year. With no federal action, interest payments would have doubled. “We basically have the student-loan issue worked out,” Senate Majority Leader Harry M. Reid (D-Nev.) told reporters Tuesday, while Senate Minority Leader Mitch McConnell (R-Ky.) emphasized that the president had been “largely uninvolved" in the negotiations. Although the deal's exact details have yet to be worked out, it's possible that the extension will be funded by raising premiums on pension insurance.

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