President Barack Obama would veto a measure proposed by House Republicans to extend lower interest rates on federal student loans because it would take money from a health care fund that benefits women and children, House Minority Leader Nancy Pelosi said Friday.
The White House later issued a statement saying Obama's senior advisers would recommend a veto if the House measure, set for a vote Friday, eventually were to win approval by both congressional chambers and reach the president's desk.
"Women, in particular, will benefit from this Prevention Fund, which would provide for hundreds of thousands of screenings for breast and cervical cancer," the White House statement said. "This is a politically motivated proposal and not the serious response that the problem facing America's college students deserves. If the president is presented with H.R. 4628, his senior advisers would recommend that he veto the bill."
House Speaker John Boehner, R-Ohio, proposed the student loan measure this week in the face of a high-profile campaign by Obama that rallied college students -- a key component of the vital youth vote in November -- to pressure Congress to act.
In addition, certain Republican presidential nominee Mitt Romney pinned Boehner and congressional Republicans in a corner by coming out in favor of the lower student loan rates this week.
A proposal by Senate Democrats would pay for extending the current lower rates by ending some tax loopholes for corporations, a move opposed by Republicans. The House plan would instead take the money from a fund in the 2010 Affordable Care Act detested by Republicans.
The spokesman for Boehner, Michael Steel, labeled the issue a "fake fight" on Friday, saying Obama was willing to veto the student loan bill to protect what Steel called a "slush fund" that the president's budget proposed cutting.
"It's a simple as this: Republicans are acting to help college students and the president is now getting in the way," Steel said.
Rep. Judy Biggert, an Illinois Republican who is the House bill's sponsor, noted that 149 Democrats voted to use money from the same health care fund to pay for extending the payroll tax cut. She added that "Democrats were in favor of raiding the slush fund before they were against it."
Asked about that at an earlier news conference, Pelosi said Democrats weren't happy about taking money from the fund for the payroll tax measure and now want to ensure that rest of the money stays in the fund.
On the House floor, Pelosi said House Republicans were forced by Obama's publicizing of the issue to reverse their previous opposition to keeping the interest rates on federal student loans at the current 3.4% instead of letting them double to 6.8% on July 1.
She said the House budget proposal by Rep. Paul Ryan, R-Wisconsin, called for allowing the interest rate to double in July, and that House Republicans have backed the plan as recently as last week.
The House measure would eliminate the Prevention and Public Health Fund, Pelosi said, accusing Republicans of protecting tax subsidies for the oil industry while wanting "mom and children to pay the price."
On Wednesday, Obama took on Boehner by name, telling students at the University of Iowa a spokesman in the speaker's office believed the president's focus on student loans is an effort to "distract people from the economy."
The president told a rowdy audience, "Now think about that for a second, because these guys don't get it." He told the cheering crowd, "If you do well, the economy does well. This is about the economy. What economy are they talking about? You are the economy."
A few hours later, Boehner announced a Friday vote on the House measure and hit back at the president saying, "This week the president is campaigning and trying to invent a fight where there is none and never has been on this issue of student loans."
On Tuesday night, Democratic Sens. Jack Reed of Rhode Island, Tom Harkin of Iowa and Sherrod Brown of Ohio introduced a Democratic proposal. It would freeze the current interest rate for one year and pay for it by closing a loophole on "S corporations," a tax structure Democrats say can be used to avoid paying Social Security and Medicare taxes.
The Republican proposal in House also extends the current rate for one year, but it covers the cost by dipping into the health care fund intended to promote wellness, prevent disease and protect against public health emergencies.