Just when it looked as if Congress had protected students and cut the deficit all in one stroke. Sallie Mae swoops in to defend their bottom line and says “to hell with students.”

In October, The Rearguard reported that the House of Representatives passed a landmark student loan reform package that removed $87 billion in wasteful student loan spending. All by allowing the Department of Treasury to make direct loans to students, thereby removing private loan companies from the process. This new loan program would have allowed millions of new students each year to qualify for student loans while at the same time returning millions of dollars to the federal treasury. Passage in the Senate has faced a difficult process since the bill was approved by the House. Obviously the financial institututions responsible for providing student loans at a massive profit would fight this measure. True to form, Sallie Mae has been engaged in massive lobbying.

Sallie Mae has already spent over a quarter-million dollars in national newspaper advertising in an attempt to sway public opinion against student loan reforms. In addition, over $3 million has been spent in lobbying efforts trying to kill the bill. Only the healthcare industry has spent comparable money on lobbying efforts in the same period of time.

More troubling, anti-student loan reform groups have hired PR firm Qorvis Communications to pay “experts” to write op-ed pieces to be published in the nation's news media arguing against these reductions. In recent years, Qorvis hired experts to propagandize the population into opposing investigations into the behavior and practices of AIG prior to the recent economic collapse. Sallie Mae and other student loan providers are doing everything in their power to oppose any reforms aimed at increasing efficiency in student loan programs.

References:
An email that Isaac sent a copy of to me from a student activist group who remained unidentified in the email.