Congress Hears Arguments for and Against Bank-Based Lending

There were few surprises in Thursday’s Congressional hearing on the president’s plan to end the bank-based, guaranteed-loan program and shift all student lending to the government’s direct-loan program.

On one side were the Democrats, who argued that the plan would bring stability to a system that has been severely shaken by the credit crunch and free up billions of dollars for the Pell Grant program.

“We can either continue sending billions to banks and