Wednesday, July 18, 2007

No on Nelson-Burr

The Senate version of the House financial aid bill passed last week, currently up for a vote, contains an adulterating substance.

According to FutureMajority,

Ben Nelson (D-NE), whose home state is also home to Nelnet, one of the biggest corporate lenders, is trying to weaken the Senate version of the bill and return $3 billion of that to the lending industry so they can continue to line their pockets with corporate welfare.

What I’m hearing is that the cloture votes on Iraq and the DOD reauthorization are going to fail, and the Higher Education Access Act of 2007 will be brought to the floor instead, with voting to be scheduled for today or tomorrow. Right now, Republicans supposedly have 3-6 Democrats willing to side with lenders on the Amendment, so they are likely to see it pass [killing Fair Payment Assurance

Here’s what you can do:Call your Senator and urge them to vote YES on S. 1762, and NO on the Nelson-Burr Amendment. The Capitol Switchboard can be reached at (202) 224-3121, and the operators can tell you who your Senators are.

According to a factsheet put out by Campus Progress,

*The Nelson-Burr Amendment would give $3 billion in corporate subsidies back to banks, which could fund 588,000 maximum Pell Grants.

They say they're giving lenders back the cash to protect competition for lenders and borrower benefits, yet
*according to, lenders spend less than 0.1 percentage point of their subsidy on benefits for borrowers, and
*according to Sallie Mae herself, less than 10% of borrowers manage to take advantage of the advertised repayment benefits.
*The student loan market is already highly consolidated. The current subsidies don't stop Sallie mae from cornering the market. The DoE recently pointed out more than 900 colleges where 80 percent of the college’s federal student loan volume is held by a single lender.

update from the PIRGs:

Analysis of the Nelson-Burr Amendment to S. 1762

The Nelson-Burr Amendment cuts $4.2 billion from need-based aid to low-income students over the next five years and gives the bulk of it to for-profit student lenders.

The Nelson-Burr amendment reduces aid for the neediest students by $290 a year, or nearly $1200 over their 4-year college career.

The amendment lowers the subsidy reduction for-profit lenders from .5% to .35% and pay for it by cutting $4.2 billion from the Promise Grant program.

The Nelson-Burr amendment takes grants away from low-income students and give it back to banks including:
$800 million to Sallie Mae over the next 5 years.
$160 million to Nelnet over the next 5 years.[1]

The Senate bill reduces less from private student lenders than both the President’s Fiscal Year 2008 budget and the House reconciliation bill. The Nelson-Burr amendment would cut back on subsidies even further at the expense of the more than 5 million students who receive Pell Grants every year.

U.S. PIRG urges Senators to vote against the Nelson-Burr Amendment to S. 1762

[1] Based on current loan holdings.


Anonymous said...

I'm almost conviced that people in general are so stupid that they deserve to be debt slaves.

Smoke and mirrors. They are too stupid to realize.

You got to wonder, what if these stupid people didn't have to worry about their debt? How dangerous that might be?

I'm almost convinced that these people's mind must to be confined within thoughts of debt. It could be that as long as they are too busy worrying about debt, they may not come up with some dangerous ideas.

If they really desire, infomation is there. The answer is there, but they rather enjoy dealing with smoke and mirrors. I don't understand why. It could be that they want to be controlled. It could be that they want to be debt slaves.

Maybe, I was wrong to assume that they want to be free like I desire. Maybe, I should just leave them alone.

Anonymous said...

Yup, in reality, I think that the real driving force of debt based money system is greed and fear, two sides of the same coin, of everyone from super rich to very poor. I'm pretty much convinced that debt is our self-imposed financial prison as well as our way to confin our minds within thoughts of finance and debt.

I'm pretty much convinced that without the driving force of gree and fear from everyone, debt based money system cannot function. When people are driven by generosity and courage, we would naturally have a different money system.

Anonymous said...

You might find this article interesting:

Anonymous said...

oops, the correct link is:

Anonymous said...

last try: WSJ