Citing a Washington Post story in which Secretary of Education Margaret Spellings admitted that her department "had some responsibility" for "confusion" over subsidy rules that allowed student loan companies to receive hundreds of millions of dollars in payments at taxpayer expense, and that she would not seek a reimbursement from the companies, Chris Dodd today called on Secretary Spellings to seek a reimbursement from the companies, worth hundreds of millions of dollars.
"It's completely unacceptable for Secretary Spellings to acknowledge the fact that these overpayments were happening, apparently for some time, and yet refuse to seek a full accounting of these improper payments or a reimbursement," said Dodd. "This is exactly why the American people are frustrated - their government is no longer working. It's time to make government work again and get results for the American people."
In his education plan unveiled in August, Sen. Dodd called for an end to the outdated corporate subsidies for banks and an increase in competition for lower interest rates on student loans by requiring banks to compete in a federally run auction to offer federal student loans. As a result, excessive profits at the expense of the taxpayer will be eliminated and redirected to student aid so that college is more affordable for young Americans and their families.
"At a time when it's clear that a college education is becoming more and more necessary, it's unconscionable that the Department of Education is allowing hundreds of millions of dollars to go unaccounted for, increasing the cost burden of a college education for all Americans," Dodd said.
You can read more about Sen. Dodd's education plan at http://chrisdodd.com/issues/education.
