Private Lenders Oppose Saving Government Money and Helping People
We’ve written before about the Student Aid and Fiscal Responsibility Act, an excellent bill that would simultaneously save the government billions of dollars and increasing the financial aid available to students. I’m going to repeat that: This bill saves money and helps students graduate from college with less debt. Who could possibly object to that?
The financial industry, of course.
See, the bill saves money by cutting out the big lenders that currently act as middle men between the government and the students. The government subsidizes and guarantees the loans, and the lenders impose fees and high interest—even though, because the loans are guaranteed, they don’t face much risk. The big private lenders see that as their money. They don’t get that they’re supposed to be providing a service and helping kids afford to go to college. They’re only interested in how big a cut they can squeeze out of the student loan business.
So the lenders are waging a major lobbying effort against saving the government money and helping kids go to college:
“We haven’t left any stone unturned — we’ll meet with anyone who will meet us,” Mr. Remondi said in an interview. “We’re trying to identify at least 12 senators who would be helpful in this process.”
At the same time, Sallie Mae and other lenders have staged a series of town-hall-style meetings at their job centers around the country to help mobilize opposition to the White House plan and collect thousands of signatures for a petition drive in support of their own plan.
As Robert Borosage writes:
This is not a hard choice.
But money talks in the Senate bigtime. And Democratic lobbyists — like former Clinton official Jamie Gorelick — have no shame. Gorelick hilariously says the White House is reluctant to make Senators make a vote that “is very unpopular” in their states. This gives new meaning to the phrase “no brainer.”
Let your senators know you want student loan reform now.
Tags: Education, SAFRA, student loans
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