Congressional Democrats needed to make a lot of compromises to make student lending reform happen. The biggest concession was probably the decision at the beginning of this month to make student loan reform part of the reconciliation to the health care bill in the first place. But the Democratic leadership made other compromises to their original bill in an effort to secure support. Inside Higher Ed’s Doug Lederman has a great article in USA Today summarizing everything happening with regard to the student aid component of the health care package. Among the components:
Stripped entirely from the final version of the legislation were billions of dollars to extend a cut in the student loan interest rate past 2012, $8 billion for early childhood education, and an overhaul and expansion of the Perkins Loan Program that was designed to reward institutions for their success in graduating low-income students.
The measure also lowers the sights of the administration’s plan to create a new $3 billion College Access and Completion Fund to prod states and institutions to innovate; instead, it would put $750 million toward the existing College Access Challenge Grant Program.
Negotiation is obviously an indispensable part of the political process, though it’s unlikely that the early childhood money or Perkins reform is going to return soon.
The most dramatic compromise is the exemption allowing the Bank of North Dakota to persist in loaning money directly to students. The concession (seemingly in opposition to the entire spirit of the student loan reform bill) was necessary to secure the backing of North Dakota Sen. Kent Conrad, chairman of the Senate Budget Committee.
