NYT The Caucus: Student Loan Bill Opposed by Group Packed With Ex-Clinton Aides

[BurtWorm]

http://thecaucus.blogs.nytimes.com/2010/03/12/student-loan-bill-opposed-by-group-packed-with-ex-clinton-aides/


By DAVID M. HERSZENHORN

“This wasteful spending was first identified by President Bill Clinton,” Representative George Miller, Democrat of California and chairman of the Education and Labor Committee, declared on Thursday at a news conference in the Capitol.

Mr. Miller was explaining why he believed there was an urgent need for an overhaul of federal financial programs that have long enriched private, for-profit student lending companies.

The government pays the private banks a fee to make risk-free loans using taxpayer money. The loans – already guaranteed by the federal government – are then sold back to the government. President Obama has put forward a proposal to end the program, and to instead rely on the existing government direct lending program that accomplishes the same but eliminates the profit for the middlemen. The savings would be used to increase Pell grant scholarships for low-income students.

But just a few minutes after Representative Miller had invoked Mr. Clinton’s name, the Glover Park Group, a powerhouse consulting firm founded by a cadre of former Clinton aides, was aggressively at work fighting the president’s proposal on behalf of an unnamed client.

The firm quickly attacked the effort by Mr. Miller and Senator Tom Harkin, the Democrat from Iowa and chairman of the Health, Education, Labor and Pensions Committee, to include the financial aid legislation in an expedited budget package along with final revisions to the Democrats’ big health care legislation.

“Miller and Harkin Push a Bill Doomed to Fail while Rejecting Bipartisan Solutions,” a Glover Park operative, Tim Miller, wrote in an unsolicited e-mail message to reporters. “While Miller and Harkin misguidedly storm forward with a bill that is doomed to fail, colleges and students are being denied the immediate benefits that would result from bipartisan, comprehensive student loan reform that could be passed with a few enhancements to the legislation.”

...

Founders of the Glover Park Group include Joe Lockhart, Mr. Clinton’s former press secretary, as well Carter Eskew, Mr. Clinton’s old media consultant. Other high-level Clinton aides at the firm include Susan Brophy, who was deputy assistant to the president and deputy director of legislative affairs.

...

[Hannah Bell]

1. Student loans used to be below-market. I was shocked in the 90s to learn students

were paying market, & sometimes above-market rates.

Graft, graft, graft, off the public purse. Shame on the Clinton faction for blocking remedies.

[depakid]

3. People who were able to consolidate last year are paying record low rates

And there was another window similar to that back around 2004, I think.

Current students are pretty well screwed though.

[Hannah Bell]

4. define: "record low" -- then compare with student loan rates before 1980.

when most students, actually, didn't even have to take out loans.

[Kat45]

5. My student loan in the seventies, direct from the govt, was at 3%

That was a NDSL (National Direct Student Loan). I don't know when those disappeared. Later in the seventies when I went to grad school, I got a GSL (Guaranteed Student Loan) through a bank. Perhaps that was an early version of what they have now? That loan was at 7%. What are the loan rates now? I have no idea.

[dmr]

2. Harkin & Miller ought to slam the door in their faces

I think both are cantankerous enough to do it.

[BurtWorm]

6. kick