{"id":108563,"date":"2021-03-03T19:10:45","date_gmt":"2021-03-03T19:10:45","guid":{"rendered":"https:\/\/fin2me.com\/?p=108563"},"modified":"2021-03-03T19:10:45","modified_gmt":"2021-03-03T19:10:45","slug":"a-betsy-devos-holdover-is-still-in-charge-of-americas-student-loans","status":"publish","type":"post","link":"https:\/\/fin2me.com\/politics\/a-betsy-devos-holdover-is-still-in-charge-of-americas-student-loans\/","title":{"rendered":"A Betsy DeVos Holdover Is Still In Charge Of America\u2019s Student Loans"},"content":{"rendered":"

Advocates for student loan borrowers are pressuring President Joe Biden\u2019s administration to fire the head of Federal Student Aid, a Trump administration holdover they say has mismanaged an office that could be key in advancing Democratic goals to make college more affordable.\u00a0<\/p>\n

The pressure \u2015 already coming\u00a0from progressive Sen. Elizabeth Warren (D-Mass.) and American Federation of Teachers President Randi Weingarten \u2015 is likely to increase now that Education Secretary Miguel Cardona has taken office. The White House has said only Cardona has the power to formally oust Mark Brown, a retired Air Force general who then-Education Secretary Betsy DeVos chose to lead the office in 2019. DeVos appointed Brown to a three-year term that ends in 2022.\u00a0<\/p>\n

\u201cThese decisions will affect the financial futures of tens of millions of people,\u201d said Mike Pierce, the policy director at the Student Borrower Protection Center. \u201cAre they going to trust the guy who was Betsy DeVos\u2019 yes-man? That\u2019s crazy.\u201d<\/p>\n

The White House and Education Department declined to comment.<\/p>\n

Progressives have pressured Biden to forgive student loan debt en masse, but advocates also believe firing Brown \u2015 and picking the right person to succeed him \u2015 could lead to far better management of existing loan forgiveness programs, including the Public Service Loan Forgiveness Program, which is infamously difficult to qualify for.\u00a0<\/p>\n

\u201cThey need somebody in place that\u2019s going to hold the servicers accountable, and make sure the student loan program is working for borrowers,\u201d said Alexis Goldstein, a senior policy analyst at Americans for Financial Reform. \u201cI\u2019m just not confident Mark Brown is that person.\u201d<\/p>\n

<\/p>\n

Federal Student Aid is a relatively obscure office and its leader is not subject to Senate confirmation, but its responsibilities are massive.\u00a0<\/span><\/p>\n

The office employs one-quarter of the Education Department\u2019s workforce, oversees the Pell Grant program for low-income students, and is in charge of more than $1 trillion worth of student loan debt held by 45 million borrowers \u2015 a total that would make it the nation\u2019s fifth-largest bank.\u00a0<\/span>\u00a0<\/p>\n

And the office has problems to match its size. Progressives argue it is plagued by a revolving door of staffers who jump between working for FSA and working for large student loan servicers like Navient and Great Lakes, and they say it has failed to protect borrowers and hold loan servicers accountable. The office\u2019s struggles are well-known, and <\/span>even prompted DeVos<\/span> to propose spinning off FSA as an independent agency in 2019.\u00a0<\/span><\/p>\n

On his first day in office, Biden extended a pause on student loan payments until the end of September. The head of FSA could play a key role in shaping and determining whether the administration extends that breaks, forgives student debt, restarts the loan machine or takes another path altogether.\u00a0<\/span><\/p>\n

\u201cIt\u2019s incumbent upon FSA to be working really hard on a plan to make sure that transition happens smoothly and borrowers are able to get all they help they need when they come back into repayment,\u201d said Clare McCann, the deputy director of federal policy for the New America Foundation\u2019s higher education program.<\/span><\/p>\n

Two advocacy groups \u2015 Student Defense and the National Consumer Law Center \u2015 sued the Brown-led FSA last year for failing to stop wage garnishments for hundreds of thousands of borrowers who were behind on their loans during the pandemic, as required by the CARES Act. Warren has specifically cited the garnishment fiasco in her calls for a new agency head.\u00a0<\/p>\n

The office also faced intense criticism after Great Lakes, a major student loan servicer, provided inaccurate information to credit agencies last year, hurting some borrowers\u2019 credit scores.<\/p>\n

<\/p>\n

Two advocates with knowledge of the situation said the administration is actively considering firing Brown, but that it was also possible the FSA leader would resign in the coming weeks in order to avoid a high-profile dismissal.\u00a0<\/p>\n

If Brown is ousted, progressives are wary of for-profit colleges or student loan servicers influencing who Biden and Cardona pick to replace him. <\/span><\/p>\n

Some progressives hope Mark Kaufman, a former Maryland banking regulator and Treasury Department official who worked closely with progressive Sarah Bloom Raskin during the Obama administration, would get the job.\u00a0<\/span><\/p>\n

But Kaufman is far from a lock. Some White House aides are pushing for Abigail Seldin, a former executive at the Education Credit Management Corporation who created an occasionally controversial tool to judge college costs, to get the job, according to one Democrat following the issue who spoke on the condition of anonymity to discuss intraparty dynamics<\/span><\/p>\n

Progressives are skeptical of Seldin\u2019s ties to ECMC. For years, the federal government has hired the Minnesota-based company to fight student loan debtors who try to discharge debt in bankruptcy, and borrowers and advocacy groups have repeatedly <\/span>accused the company of hardball tactics<\/span>.<\/span><\/p>\n

McCann and other advocates were hopeful about the chances for reform at the agency. They noted that Ben Miller, a former vice president for higher education policy at the Center For American Progress and an author of several white papers on reforming the agency, was set to serve as a senior adviser to the department\u2019s chief of staff.\u00a0<\/span><\/p>\n

During his confirmation hearing, Warren pressed Cardona on how he would run FSA.<\/span><\/p>\n

\u201cUnder your predecessor, [FSA] was on the side of greedy student loan servicers instead of borrowers,\u201d she said. \u201cWill you commit to developing a plan to reform FSA so that it works for student borrowers instead of for big corporations?\u201d\u00a0<\/span><\/p>\n

\u201cYes,\u201d Cardona replied.<\/span><\/p>\n

Now he has the chance.<\/span><\/p>\n

RELATED…<\/h3>\n

Source: Read Full Article<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Advocates for student loan borrowers are pressuring President Joe Biden\u2019s administration to fire the head of Federal Student Aid, a Trump administration holdover they say […]<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2],"tags":[],"yoast_head":"\nA Betsy DeVos Holdover Is Still In Charge Of America\u2019s Student Loans - Fin2me<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/fin2me.com\/politics\/a-betsy-devos-holdover-is-still-in-charge-of-americas-student-loans\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"A Betsy DeVos Holdover Is Still In Charge Of America\u2019s Student Loans - Fin2me\" \/>\n<meta property=\"og:description\" content=\"Advocates for student loan borrowers are pressuring President Joe Biden\u2019s administration to fire the head of Federal Student Aid, a Trump administration holdover they say [...]\" \/>\n<meta property=\"og:url\" content=\"https:\/\/fin2me.com\/politics\/a-betsy-devos-holdover-is-still-in-charge-of-americas-student-loans\/\" \/>\n<meta property=\"og:site_name\" content=\"Fin2me\" \/>\n<meta property=\"article:published_time\" content=\"2021-03-03T19:10:45+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/fin2me.com\/wp-content\/uploads\/2018\/07\/kKAxmodsDKvBBAcnyEkr.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1396\" \/>\n\t<meta property=\"og:image:height\" content=\"785\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Mark\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Mark\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"5 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/fin2me.com\/politics\/a-betsy-devos-holdover-is-still-in-charge-of-americas-student-loans\/\",\"url\":\"https:\/\/fin2me.com\/politics\/a-betsy-devos-holdover-is-still-in-charge-of-americas-student-loans\/\",\"name\":\"A Betsy DeVos Holdover Is Still In Charge Of America\u2019s Student Loans - 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