Education Secretary Denies Govt Takeover of Student Loan Programs Will Hurt Private Sector, Cause Job Loss
Friday, March 26, 2010
By Penny Starr, Senior Staff Writer
Friday, March 26, 2010
By Penny Starr, Senior Staff Writer
Arne Duncan, U.S. Secretary of Education. (AP photo)
(CNSNews.com) – Secretary of Education Arne Duncan said a provision in the House budget reconciliation bill to nationalize college loan programs would not hurt banks and other financial institutions that will be partly cut out of the process in favor of “direct lending” from the federal government.
Free market analysts, however, said the proposal would kill thousands of private-sector jobs – work that would be assumed by federal employees. And Republican lawmakers said that, under the plan, the government will charge students more for the loans to help pay for the nearly $1-trillion health care bill, which was signed into law on Tuesday, Mar. 23.
When asked by CNSNews.com on Tuesday about industry estimates that thousands of people could lose their jobs if the law goes into effect on July 1, 2010, as expected, Duncan said the private sector would still benefit because some banks will get government contracts to “service” the loans.
"Actually, all of the sources of the loans – a hundred percent of that -- will be done by the private sector, not by us,” Duncan said. “So that’s not our
Free market analysts, however, said the proposal would kill thousands of private-sector jobs – work that would be assumed by federal employees. And Republican lawmakers said that, under the plan, the government will charge students more for the loans to help pay for the nearly $1-trillion health care bill, which was signed into law on Tuesday, Mar. 23.
When asked by CNSNews.com on Tuesday about industry estimates that thousands of people could lose their jobs if the law goes into effect on July 1, 2010, as expected, Duncan said the private sector would still benefit because some banks will get government contracts to “service” the loans.
"Actually, all of the sources of the loans – a hundred percent of that -- will be done by the private sector, not by us,” Duncan said. “So that’s not our
