[Cabs-talk] Fwd: [Nabs-presidents] House bill would kill subsidized student loans

[Angela fowler]

Could someone please explain to me how having the government totally fund
studen loans saves the tax payer money, particuarly since the program would
also fund things which have nothing to do with college?  
--------- Original Message --------
From: California Association of Blind Students Mailing List
<cabs-talk at nfbnet.org>
To: Cabs-talk at nfbnet.org <Cabs-talk at nfbnet.org>
Subject: [Cabs-talk] Fwd: [Nabs-presidents] House bill would kill subsidized
student loans
Date: 09/17/09 13:28

> 
> 
> saw this and  thought it would be good  for us as students to see.
> 
> ---------- Forwarded message ----------
> From: Jim Reed <jim275_2 at yahoo.com>
> Date: Thu, 17 Sep 2009 11:56:27 -0700 (PDT)
> Subject: [Nabs-presidents] House bill would kill subsidized student loans
> To: MAB List <mt-blind at nfbnet.org>, NABS mail list
> <nabs-l at nfbnet.org>, NABS presidents
<nabs-presidents at nfbnet.org>, Dan
> Burke <burke.dall at gmail.com>, Kiira DeVries
<kmusiclover at gmail.com>,
> Cody Greiser <cgreiser at msn.com>, Ashley Gross
> <shattered_jewelrybox at hotmail.com>, Sam Herbert
<me at samherbert.com>,
> Cindy Letcher <cletcher at bresnan.net>, Jim Marks
> <blind.grizzly at gmail.com>, Mike Mooney
<mooneymike at hotmail.com>
> 
> House bill would kill subsidized student loans     LIBBY QUAID |
> Posted: Thursday, September 17, 2009 9:25 am
> 
> 
> 
> 
> The House is poised to vote to push private lenders out of the federal
> college loan business and massively expand the government's own lending
> program.
> 
> 
> Following a day of debate, House lawmakers were expected to approve on
> Thursday a student aid bill that has widespread support, including from
> the White House. The measure will then go to the Senate, where its fate
> is somewhat less certain.
> 
> 
> Putting the government in charge of all federal loans would save
> taxpayers an estimated $87 billion, according to the Congressional
> Budget Office. The CBO says the figure could be much lower, $47
> billion, when administrative costs and market conditions are
> considered.
> 
> 
> The money would boost Pell Grants for needy students, increasing the
> maximum grant by $1,400 to $6,900 over the next decade. It also would
> pay for a new college completion fund, community college reforms and
> more college aid for veterans.
> 
> 
> No student in this great country of ours should have to mortgage their
> future to pursue their dreams," said the bill's sponsor, California
> Democratic Rep. George Miller, chairman of the House Education and
> Labor Committee.
> 
> 
> Yet the money also would be spent on things that don't help pay for
> college, such as construction at K-12 schools and new preschool
> programs.
> 
> 
> And while the measure would increase Pell Grants, it would do nothing
> to curb college costs, which rise much faster than Pell Grants do.
> 
> 
> As consumers, college students probably wouldn't notice much difference
> in their loans, which they would get through their schools. Broadly
> speaking, the bill doesn't do much to make loans cheaper or help pay
> them off.
> 
> 
> It does keep interest rates for need-based federal loans from jumping
> from 3.4 percent currently to 6.8 percent as scheduled in 2012. Rates
> for most other loans would remain at 6.8 percent.
> 
> 
> Still, the bill's changes to federal college aid programs would be the
> most sweeping since their creation in the 1960s and would fulfill a
> campaign promise by President Barack Obama.
> 
> 
> The measure would end the subsidized loan program under which private
> lenders made $56 billion in government-backed loans to more than 6
> million students last year, compared with $14 billion in direct loans
> from the government.
> 
> 
> The bill would also shorten the labyrinthine college aid form, which
> Obama proposed to eliminate altogether when he ran for president.
> 
> 
> Republican critics argue it is wrong to put the government in
> near-total control of student lending.
> 
> 
> Ask yourselves whether another government takeover is what we need
> right now," said Minnesota Rep. John Kline, senior Republican on the
> Education Committee.
> 
> 
> Many also worry about job losses in their districts. Private lenders
> employ more than 30,000 people whose jobs depend on the subsidized loan
> program, and the industry says many would be laid off.
> 
> 
> Employees of Sallie Mae, the biggest student lender, have been trying
> to involve local leaders in the issue and recently held a series of
> town hall meetings and petition drives in Pennsylvania, Florida,
> Delaware, New York and Indiana.
> 
> 
> The Reston, Va. -based lender has about 8,500 employees in the program
> and probably would lay off about 30 percent of those workers. It still
> will have contracts to service federal loans.
> 
> 
> Democratic Rep. David Wu of Oregon said lenders still could make all
> the loans they want. What will not happen anymore is making those
> student loans with taxpayer subsidies," he said.
> 
> 
> Under the measure, Pell Grants would rise slightly more than inflation
> over the next decade, increasing on average by about 2.6 percent
> yearly, according to the bill's sponsors.
> 
> 
> However, the grants would still depend on annual spending bills and
> could rise less than promised, as has happened in the past.
> 
> 
> Obama originally proposed to take Pell Grants out of lawmakers' hands
> entirely, making the program an entitlement like Social Security and
> Medicare, which would have cost an estimated $117 billion _ more than
> lawmakers have to spend.
> 
> The problem with political jokes is they get elected.
> 
> 
> 
> 
> 
> 
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