Main Street

Win-Win vs. No-No

Congress is about to enter the final stages of a legislative process that would allow it to pass both substantial health care reforms and fundamental improvements to the nation’s student loan programs at the same time.

Passing health care reform would make medical coverage available to more than 30 million more Americans while reducing premiums, making health care more accessible and affordable while expanding help for lower-income families, making prescription drugs more affordable for seniors, and eliminating the worst insurance company abuses.

Passing student loan reform — a bill known as SAFRA (Student Aid and Financial Responsibility Act) — would make more college loans available to more students at lower costs, increase Pell Grant scholarships, expand college access to more students, increase support for community colleges and minority-serving institutions, all while saving money by ending the huge, needless subsidies paid to banks and private lenders.

I’d say that’s a Win-Win.

By essentially combining these two reforms into one reconciliation bill it will only need 51 votes in the Senate. And, as Ezra Klein has reported, according to the Congressional Budget Office (CBO) it will reduce the federal deficit by $130 billion in the first ten years, and another $1.2 trillion in the subsequent ten years.

I’d say that’s another Win-Win.

But oh the frantic chorus of “No-No!” from the Republican Congressional leaders and their banker buddies. “Government takeovers,” they yell repeatedly, attacking both health care and student loan reforms. They oppose health care reform because they say it creates “government subsidies for entitlement programs.” Ahem. That just means they’re against helping more lower-income families get affordable health coverage.

And the hypocrisy is thick. Get this: they oppose the SAFRA student loan reforms because they want to protect the tens of billions of dollars in federal subsidies currently going to a broken entitlement program for private lenders and big bankers.

What would happen if student loan reform is not passed?

Source: Center for American Progress

A half-million students would face Pell Grant cuts. Eight million students would face 60% cuts in education aid.

But if it does pass, it would redirect the $61 billion the government would otherwise use to subsidize banks and private lenders in the next ten years to instead fund a 100% Direct Loan program — a program that would still be serviced by private lenders, but without the billions in bank subsidies.

The Center for American Progress just produced and posted a very informative, brief video that answers many of the key questions about SAFRA’s reforms.

Health Care for America Now! has a handy link to connect you to Congress. Tell Congress to pass health care and student loan reform now.

It’s Win-Win vs No-No.

Tags: Education, health care reform, SAFRA