Democrats Look to Resurrect College Aid Reform

ADVERTISEMENT

By Jim Kuhnhenn, Associated Press Writer

WASHINGTON (AP) — Congressional Democrats want a stalled overhaul of college aid programs to get strapped onto a fast-track health care bill, giving both Obama administration priorities a better chance of passage.

The student loan measure would be the biggest change in college assistance programs since Congress created them in the 1960s. The bill would end federal subsidies to private lenders and have the government originate all loans to needy students.

Democrats in the House and Senate were working to incorporate the legislation, which passed the House last September but got bogged down in the Senate, into a single, expedited budget bill that could pass in the Senate with a simple majority.

After a presidency marked by stalemate, the strategy would give President Barack Obama the best opportunity to achieve simultaneous victories on two of his top priorities in a single, swift act of Congress.

Consolidating the college aid package with health care would create a double sweetener for Democrats. It would make it easier to pass the college aid plan in the Senate, where it seemed unable to muster 60 votes to overcome procedural hurdles. And it would give House Democrats a popular incentive to ease their anxieties over voting for health care changes.

The health care bill "is a controversial, difficult bill for a lot of people," said Rep. Robert Andrews, D-N.J. "The more things that you can go home and say were in the bill that are sort of universally popular, yeah, it helps."

Sen. Tom Harkin, the chairman of the Senate Health, Education, Labor and Pensions Committee, said lawmakers had an opportunity for a "twin victory" by joining the student loan measure to the health care package.

And White House spokesman Robert Gibbs said the budget package, known as a "reconciliation bill," would be a means to pass the student aid plan. "This is an important reform for the president," he said.

To ease the way for the far-reaching health care legislation, Democrats have had to resort to a fast-track process. The House would pass an already approved Senate version of the bill, then use a separate measure to make changes more to their liking. Under the special process, Senate Democrats could approve that second "fix-it" bill with a simple majority.

Momentum for linking the health and college aid measures increased Thursday when the Senate parliamentarian ruled that any budget package that made budgetary fixes to health care would also have to include adjustments to legislation under the jurisdiction of Harkin's committee.

By ending subsidies to banks and other private lenders, the original House bill would have saved $87 billion between 2010 and 2019, with the money used to provide needy students with Pell Grants. But colleges have been shifting to more direct government lending, already reducing the subsidies paid by the government to private lenders. As a result, the savings for 2011-2020 are now estimated at $67 billion.

At the same time, a spike in higher education enrollment caused by the bleak job market has created a massive shortfall in the Pell Grant program.

The student loan plan also would pay for construction at K-12 schools and for new preschool programs.

House Education and Labor Committee Chairman George Miller, D-Calif., said the student loan measure would have to undergo adjustments to address the new, smaller savings picture, likely reducing the size of the grants and other spending. He said Democrats would also address the Pell Grant red ink.

The bill initially envisioned using the subsidy savings to increase the maximum Pell Grant by $1,400 to $6,900 over the next decade. That number would have to be adjusted.

Adding the student loan measure in the Senate could cost Democrats a vote or two, but with the party controlling 59 votes, it can afford some erosion. Even a 50-50 split in the Senate would spell success for Democrats because Vice President Joe Biden would cast the tie-breaking vote.

Republicans broadly oppose both the student loan measure and the attempts to link it to the health care package.

"I'm not sure the public thinks this current debate is about that issue," said Senate Republican Leader Mitch McConnell, R-Ky. "And it would show again the lengths to which they were willing to go to have the government expand its tentacles into absolutely everything."

___

Associated Press Special Correspondent David Espo contributed to this report.

Copyright 2010 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.

Show Comments

Back to Top