Obama Student Loan Plan Wins Support in House

[babylonsister]

Obama Student Loan Plan Wins Support in House

By DAVID M. HERSZENHORN
Published: July 10, 2009


WASHINGTON — The chairman of the House Education Committee has dismissed a last-ditch plea from the private student loan industry and is throwing his support behind President Obama’s plan to end the role of private banks in the federal education lending systems.

Mr. Obama’s plan remains deeply contentious in Congress, and still faces strong opposition from private banks that for decades have earned big profits for handling federal student loans.

But after mulling the issue for months, Representative George Miller, the California Democrat who is chairman of the Education Committee, now plans to introduce legislation next week that would rely on direct government lending to replace the federally subsidized loans made by private banks. Administration officials who have reviewed drafts of the legislation said that it substantially adopts Mr. Obama’s proposal.

In a conference call with reporters this week, a number of private-loan industry officials, as well as leaders of some private nonprofit lenders, warned that Mr. Obama’s plan would eliminate competition and create chaos for colleges and students that now use private lenders as they are forced to switch to a fully government-run system.

The industry had urged Congress and the White House to consider its own alternative.

But Congressional Democrats, the White House and officials at the federal Education Department have now rejected that plan, contending that it was based on accounting tricks and would pour $15 billion into the banks’ coffers that Mr. Obama would direct to the Pell grant program for low-income students.

“It’s unfortunate that a small number of lenders are using legislative gimmicks to mask the fact that their proposal would divert $15 billion into their own pockets at the expense of students,” Mr. Miller said in a statement. “This cynical stunt is another reminder that our federal student loan programs need major reforms to ensure they operate in the best interests of students and taxpayers.”

The president’s proposal, first outlined in his initial budget in February, would save the government roughly $87 billion over 10 years, according to the Congressional Budget Office — money that the White House says should be used to aid impoverished students.

more...

http://www.nytimes.com/2009/07/11/education/11educ.html?hpw

[Kdillard]

1. Great news. The House is terrific now get the Senate in line. :)

[Windy]

3. I have to be honest, I've about had it with the senate.

We need to get Baucus, Bayh, Nelson, Landrieu, et al out!

[Kdillard]

4. Yep and I do undertsand that they may be representing districts

that are not progressive but still right is right and I hope they get it together and support this bill.

[napoleon_in_rags]

2. How can anybody oppose this sort of thing? Rec'd.

I mean you want to talk about being penalized for success as the right wing claims the government does to the wealthy? Look at these predatory banks, making sure they drink up any profits of those who worked hard in college. The whole economic system in this country is slanted towards those who do nothing but play numbers games with money. Good for Obama.

[rockymountaindem]

5. Woo hoo!

That's great.

[ellisonz]

6. GOBAMA!

:fistbump:

[liberal N proud]

7. Finally some help

It's too late to help our oldest, she is due to graduate in Dec. But maybe, just maybe we can get help for our younger daughter.

[DrToast]

8. This issue was so important that Obama used budget reconciliation for it

This has been one gigantic corporate handout of taxpayer funds. Obama made sure Ben Nelson couldn't filibuster it in the Senate.

[alcibiades_mystery]

9. "Slick, do-nothing demi-god!!!!!"

:eyes:

[CTLawGuy]

11. clearly in the pocket of big banks

wish I had voted for Nader...

:sarcasm:

[BlooInBloo]

14. Empty suit Hussein Obambi.

[bigwillq]

10. Good.

:thumbsup:

[ellie]

12. WOO HOO!

[politicasista]

13. Kick

Great news. :bounce: :kick:

[Cha]

15. This is glorious news for our

education of higher learning Department!

[scheming daemons]

16. Another promise kept, by a President who's keeping much more than he's breaking

What a great administration.

[Colobo]

17. Obama keeps bringing change to America.

[Odin2005]

18. WOOHOO!

:woohoo:

[SpartanDem]

19. K&R