WASHINGTON - With the average cost of college soaring 40 percent over the last five years, Democrats are hoping to relieve millions of loan-saddled graduates by halving interest rates on their student loans.

The House will vote Wednesday on a proposal to cut the rate on federally subsidized loans from 6.8 percent to 3.4 percent.

But the bill - expected to be another political victory for the Democrats' 100-hour legislative agenda - is limited in scope.

It focuses only on subsidized Stafford loans for undergraduates and would not take full effect for five years.

In addition, unless the measure is renewed later, the fixed rate of 3.4 percent would only apply to such loans for six months before returning to the original rate...

Michael Dannenberg, director of the Education Policy Program at the New America Foundation, said the federal government has wasted "billions of dollars" each year on excess lender subsidies.

"Financial aid should be helping students, not banks," he said...

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