Friday, February 5, 2010

Sallie Mae and other Student Lenders Claim Taxpayers won't like Saving $80 Billion over 10 years by cutting them out of the Middle. Yeah, Right.

They must really think we're idiots!

Taxpayers are demanding government cut spending in big ways so Americans can keep more of their hard earned money. So the following plan does just that by taking the expensive private middleman out of student lending, completely:

NY Times: The money that would be saved by cutting out the private-industry middlemen — about $80 billion over the next decade, according to a Congressional Budget Office analysis — could instead go toward expanding direct Pell Grants to students, establishing $10,000 tax credits for families with loans, and forgiving debts eventually for students who go into public service … shift tens of billions of dollars in expected savings to early learning programs, community colleges and the modernization of public school facilities.
Now that's smart savings…or maybe not?

Four months ago, it appeared all but certain Congress would succeed in overhauling the student loan business and ending government subsidies to private lenders. President Obama called the idea a “no-brainer” …But an aggressive lobbying campaign by the nation’s biggest student lenders has now put the plan in peril. The student loan industry is seeking to cast the administration’s plan as an ill-conceived government takeover that could put thousands of people out of work at private lending centers … at a time when unemployment is hovering around 10 percent.
That's right, THOUSANDS of people, at a time when the nation just lost 8 million jobs in the last year. Funny, no one seemed concerned when TENS OF THOUSANDS would have lost their jobs had the two biggest automakers gone out of business.
Jamie Gorelick (a lobbyist for the lending industry) said, “I would think that the White House would prefer not to make senators vote for something that is going to be very unpopular in their states — and for good reason.”
I'm sorry, did she just say Americans would be unhappy saving $80 billion, getting a $10,000 tax credit, expand early learning programs, fund community colleges and modernize schools? That it would be "very unpopular?"

Representative George Miller, pretty much summed up what I was thinking, with this comment:

“If people want to lose $80 billion on the taxpayer’s dime for the very narrow interests of Sallie Mae, I guess they can decide that, but it makes no economic sense to me.”

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