Warnings On Student Lenders Unheeded-Bush Aides Derailed New Rules in 2001

[RamboLiberal]

Source: Washington Post

The Bush administration killed a proposal to clamp down on the student loan industry six years ago following allegations that companies sought to shower universities with financial favors to help generate business, according to documents and interviews with government officials.

The proposed policy, which Education Department officials drafted near the end of the Clinton presidency and circulated at the start of the Bush administration, represented an early, significant but ultimately abortive government response to a problem that this year has grown into a major controversy.

Now, as the $85 billion-a-year student loan industry faces an array of investigations into questionable business practices that some officials believe could have been curtailed by the 2001 proposal, the Education Department has embarked on a new effort to set rules for the industry to prevent conflicts of interest and other abuses. If approved, the rules would be implemented in summer 2008, a few months before Bush leaves the White House.

The abandonment of the 2001 proposal underscores what some consumer advocates and Democratic lawmakers believe is lax federal oversight of the financial aid system by a department they say is too cozy with the industry. More than a dozen senior department officials either previously worked in the student loan business or found high-paying jobs in the sector after they left the agency.



Read more: http://www.washingtonpost.com/wp-dyn/content/article/2007/04/30/AR2007043001930.html?hpid=topnews

[rodeodance]

1. fox keeping an eye on the henhouse again huh?--

[progressoid]

2. Good God, is there nothing these people haven't fucked up?

[tanyev]

3. No Company Left Behind.