White House retreats from student loan scam
By Alan Maass | May 10, 2002 | Page 2
THE BUSH administration was forced to retreat last week from a scheme to steal money from a federal student loan program to pay for tax cuts.
White House Budget Director Mitch Daniels floated the proposal during talks with members of Congress over what to do about a federal government deficit that could balloon past $100 billion this year--thanks most of all to George W. Bush's $1.3 trillion tax giveaway to the rich last year.
Daniels suggested eliminating a program used by millions of college students and graduates to consolidate education loans at a fixed, federally subsidized interest rate. Offering the consolidation loans at variable rates would make them less appealing, Daniels said--and save $1.3 billion.
Congressional Democrats exposed the scheme, embarrassing the White House into withdrawing it. But the controversy cast a spotlight on a deeper problem--the growing gap between soaring tuition costs and lagging increases in financial aid programs.
According to a study released last week by the National Center for Public Policy and Higher Education, "Only the wealthiest families have seen their incomes keep pace with increases in tuition. The lowest-income families have lost the most ground, and this is a major factor in their lower rates of college attendance."
The Bush gang may have retreated from its most recent proposal. But Washington will keep cutting away at programs that give working people access to higher education--because the priority for politicians is helping out their rich pals.