Washington — In an e-mail message titled “Students Deserve Better,” the Democratic National Committee is asking college students who backed Barack Obama in the 2008 election to send letters to Congress in support of his plan to end the bank-based guaranteed-loan program.
“You know how important financial assistance is for students across America who dream of a brighter future,” the message says. “That’s why we need your help to fix a broken system.”
It continues, “The special interests — bankers, lenders, and their lobbyists — are lining up against this plan. … Stand with the president now.”
President Obama’s plan would shift all loans to the government’s direct-loan program and use the savings to make Pell Grants an entitlement, with the maximum award indexed to inflation.
Now it is up to the committees to decide whether they want to seek those savings through the elimination of bank-based lending, or through less-drastic changes in the student-loan system.
Lenders, in the hope that Congress will consider a middle ground, are pushing several counterproposals. —Kelly Field