HC Bill Could Affect Students Loans

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Part of the controversial health care reform bill could change how students get loans for college.

Democrats unveiled last-minute additions to the bill, Friday, including a measure to make the government a "one stop shop" for student loans.

If it passes, students would no longer get federally guaranteed loans from private banks and other lenders that charge fees.

Supporters estimate the savings will be about $60 billion over a decade -- money they plan to then use to increase Pell grants and other college programs.

"We pay banks $8 billion a year in subsidies to loan the government's money," Democratic Rep. George Miller of California said. "We're going to take that $8 billion and we're going to recycle it on behalf of the students, on behalf of their families, as they struggle to pay for education."

Republicans, however, say the legislation would kill jobs, hurt the economy and offer too much government control.

"We've got a crowd in the White House that believes that if you can find it in the Yellow Pages, the government ought to be doing it," GOP Sen. Lamar Alexander said. "And in a breathtaking way, they're basically saying 'here's a chance for another Washington takeover.'"

Critics also say the government does not have the manpower to take over the high volume of loans handled by the private sector.

 

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