reform

Don’t Let Them Kill Student Loan Reform

Armand Biroonak — Thu, 11 Mar 2010 15:36:41 -0500

Something so simple, so easy: end tens of billions of dollars in bank subsidies to the private lending industry and return much of the savings back into the hand of students, with the Department of Education providing loans to students directly. A no-brainer right? Well reform may be a no-go, if six Senate Democrats have their way.

Senators Ben Nelson (D-Neb.), Bill Nelson (D-Fla.), Blanche Lincoln (D-Ark.), Tom Carper (D-Del.), Mark Warner (D-Va.), and Jim Webb (D-Va.) all have expressed concerns about student loan reform (known as the Student Aid and Fiscal Responsibility Act) and urge for alternative proposals in order to protect lenders and jobs in their states. Fair enough, job losses –especially now –are never a good thing. However, even with reform, private lenders (that employ only around 30,000) will still play a big role in servicing loans –so job losses will be minimal or even increase with greater loan volume looking down the road. Click here for more common myths about student loan reform.

And how about the concern for students too? Students cannot afford to wait any longer, they need help now. Under reform legislation, the Pell Grant maximum would increase, thus allowing thousands more students to become eligible for aid. And making college affordable could not come at a better time. The average student debt has ballooned to over $23,000. Take a look at the increase in tuition over only the past two years at state universities for those Senate Democrats that stand in the way:

Univ. of Nebraska: over 11%
Univ. of Florida: 30%
Univ. of Arkansas: 7%
Univ. of Delaware: 16%
Univ. of Virginia: 14%

So who are some members of Congress really siding with? Students? Or Banks? Help make your voice heard here and tell the Senate to finish what the House already did, and pass student loan reform NOW!

Hundreds Rally For Comprehensive Health Care Reform

Sonal Shah — Wed, 27 Jan 2010 13:01:34 -0500

An emergency rally for health care reform was held yesterday at noon outside the U.S. Chamber of Commerce.

The rally staged by SEIU, the NAACP, USAction, Campaign for Community Change, the Campaign for America’s Future, Americans for Democratic Action, United States Student Association, Capital Area ADAPT, Democracy for America, and Health Care for America Now had a very clear message – health care for all Americans now!

As one speaker said, it is time that President Obama and Congress step up to the plate. They have been given an opportunity to change a broken health care system, and this opportunity cannot be wasted.

Another speaker echoed the crowd’s sentiment, health care reform is not a Republican issue or a Democratic issue – it is a human issue. And what Americans need is comprehensive health care reform, not diluted legislation filled with compromises from fearful poll-conscious politicians.

Roger Hickey, co-director of the Campaign for America's Future, is pictured standing behind Leslie Boyd with a picture of her son whose story she brought to DC.

Leslie's son Mike died at the age of 33 because he didn't have health insurance. When Mike went to the doctor’s office they would simply write in his records, “patient needs a colonoscopy but can’t afford it." When Mike was finally admitted to the hospital, he had Stage 3 cancer. Mike’s life was cut short by a health care system that did not provide him the medical care he needed, because he couldn't afford health insurance.

Mike's story is one of many told by the courageous supporters that attended yesterday. In turn, each participant bore witness to the devastation caused by an out-of-control corporate bureaucracy and insurance company greed.

Insurance companies were recently revealed to have "laundered" millions of dollars through the Chamber of Commerce to kill reform, while at the same time professing to support reform. In 2009 alone, the group spent almost $145 million on lobbying against legislation that would help working people in America.

After the rally, protesters blocked the entrance to the U.S. Chamber of Commerce, which stands directly across from the White House. The crowd had a clear message - it is time for President Obama to stand up for the people and against the lobbyists.

Finish health care reform now, if we don't, the corporate lobbyists win.

Student Loan Industry: We Are NOT Dead Yet

Armand Biroonak — Fri, 13 Nov 2009 18:21:21 -0500

Recently the Secretary of Education, Arne Duncan, advised college financial administrators that with the likely passage of the Student Aid and Fiscal Responsibility Act (SAFRA) in the Senate, universities nationwide should prepare to switch over to federal direct lending of student loans. SAFRA already passed by the House, would end the Federal Family Education Loan program (FFEL) that doles out billions in wasteful federal subsidies to private lenders. In response to the Secretary, banks and their allies in the Senate made it known that they are alive and ready to battle to keep their profits, that reform is in no way a done deal.

Some of the biggest private student loan companies have joined together to form a “grassroots” campaign against SAFRA, called Project Student Choice. They even have a Facebook page chock full of misguided information to lure student support. While this past week, Chase and Ed America –among the largest student loan companies –announced that they see no reason to stop providing loans under FFEL. In other words, they are confident that the Senate will not pass reform legislation, so no need for stockholders or colleges to prepare for the move. Ed America also made explicit their support of preserving the status quo with their endorsement of Republican Senator Lamar Alexander's (TN) plan that extends the life of FFEL. The company goes on to claim , “We want to put STUDENTS back into student loans.” Or put directly, preserve their profits.

Lenders have friends in the Senate too. Democrat Ben Nelson (NE) recently sent a letter in defense of the student loan industry, chastising Secretary Duncan’s announcement to colleges. The senator complained the Department of Education’s actions “may be seen as clouding the debate” and that this is “spreading alarm in order to promote the government-run Direct Loan program.”

Not surprisingly, Nelson’s top contributor is the troubled student lender Nelnet Inc. Nelnet is the same company I wrote about recently, who is being sued by the federal government, accused of defrauding the government nearly $300 million with their participation in FFEL. This is on top of Nelnet’s previous settlement with the Department of Education worth hundreds of millions for fraud in 2007.

Unfortunately, SAFRA and the historic reforms it provides by ending billion dollar corporate giveaways are on hold in the Senate at the moment. Until health care legislation is passed, the Student Aid bill joins the queue with other important bills awaiting Congress’ attention. With that said, this is no moment for progressives to take a cat nap. This longer than expected window of time only means that big banks and lenders can resurrect from the dead and build support in the Senate to kill reform legislation that jeopardizes their precious profits, at the expense of student and taxpayers.

Visit the Campaign for College Affordability and tell your Senator to put Students over Banks! by supporting the Student Aid and Fiscal Responsibility Act.

Dept. of Ed's 'Race to the Bottom?'

Armand Biroonak — Thu, 27 Aug 2009 15:17:58 -0400

The Obama administration realizes that our education system is lagging, but the recently announced ‘Race to the Top’ initiative may not be the solution. The Department of Education’s ‘Race to the Top’ puts up for grabs almost $5 billion of federal dollars to states that devise innovations and demonstrate improvements in K-12 education. This program is a good start in theory, but the fine print promotes broad, sweeping changes that are cause for concern.

First, to be eligible, states are required to link performance with testing. This is similar to the failed No Child Left Behind policy that focused too much on student assessment, and too little on broader factors and gains, when gauging school quality. For those who forgot, NCLB showed little gains in student progress, with schools forced to teach to the test and tests emphasizing low level skills.

The President of the National Education Association, Dennis Van Roekel voiced added concerns that, “A 'Race to the Top' can quickly turn into a 'Race to Judgment.' We need to offer incentives so that our best teachers teach the students most in need of assistance, not incentives to teach students most likely to score highest on a standardized test.”

The other main provision requires states to lift caps on charter schools –this is equally troubling. Charter schools have not shown to improve the quality of education, nor do they prove competitive to the public alternative. In fact, the Department of Education found that public school children have higher reading and math scores compared to charters’.

The ‘Race to the Top’ hopefully will not become a ‘race to the bottom.’ Yet it is hard to believe that real change will come if failed, recycled ideas to reform are continued. For sure, federal investment that reward innovation should be applauded and expanded, however policies of the former administration should not be. True reform allows program flexibility for our public schools, while improving teacher skills, emphasizing advanced level curriculum, and building school-family-community partnerships.


Just to showcase how far behind America is, take a look at the following statistics; According to OECD, the U.S. ranks 18th in secondary education completion. Consider top performance and quality, we rank well below average in math and far behind the rest in science.

With F-22 on Endangered List, a Signal for Progressives?

Armand Biroonak — Tue, 21 Jul 2009 21:11:53 -0400

Facing a stern veto threat from President Obama, the Senate voted to strip funding for the F-22 Raptor jet on Tuesday. The contentious vote came after the House authorized F-22 funding, and amid weeks of pushback between Administration officials and members of Congress – the former looking to rein in wasteful defense spending, the latter backed by the defense lobby. Although I caution against proclaiming the F-22 dead just yet– the bill heads for reconciliation later this year – its potential demise may bode well for progressives to push harder for future Pentagon reform.

The F-22 jet labeled by experts as an “expensive weapon in search of a mission” has never seen the battlefield. Designed for a Soviet threat that no longer exists, the F-22 has been stuck in continuous, costly modernizations in preparation for “the next fight.” To date the F-22 program has cost over $65 billion, with a single F-22 costing $350 million. The jet’s latest modernization program alone faces cost overruns of over 200 percent, worth billions.

It has a dismal performance record. For every hour in the sky, the plane requires more than thirty hours of maintenance, placing its hourly cost to fly at more than $44,000 – far higher than any other warplane it replaces. The Undersecretary of Pentagon Acquisitions even stated that its mission capable rate is “troubling.”

Secretary of Defense, Robert Gates, too voiced strong opposition to the F-22, but his recent comment on why the cut was necessary is most striking:

“Every defense dollar diverted to fund excess or unneeded capacity – whether for more F-22s or anything else – is a dollar that will be unavailable to take care of our people, to win the wars we are in, to deter potential adversaries, and to improve capabilities in areas where America is underinvested and potentially vulnerable... If we can’t get this right – what on earth can we get right? It is time to draw the line on doing Defense business as usual.”

It may be a stretch to call Gates’ statement progressive, but it does mark a fundamental shift in the direction of the Pentagon. This is why progressives should build on this momentum and continue calling for future cuts to wasteful defense programs– that certainly are abundant. Faced with collapsing infrastructure, failing schools and a broken health care system, progressives know that we no longer can afford to put off these priorities, while writing a blank check to the military industrial complex. What is the value of maintaining the strongest military in the world if we are defending an empty shell?

To be sure, cuts to the F-22 are small compared to the gargantuan Pentagon budget, but the amount is not miniscule. To grasp perspective, here is an idea of what we could achieve by redirecting just the F-22’s $1.5 billion:

Provide 280,400 students the maximum Pell Grant (at $5,350) for the upcoming school year.
Hire over 31,500 new teachers.
Deploy an extra 630 police officers to each state nationwide.
Nearly double bus transit investment.

Congress Breaks with Administration, Protects Defense Lobby

Armand Biroonak — Mon, 06 Jul 2009 16:57:34 -0400

Ignoring earlier recommendations of the Secretary of Defense, Robert Gates, the 2010 defense bill throws funding lifelines to failed weapons systems slated to be cut. Resisting the call to reform, the House Armed Services Committee showcased their protection of the defense lobby instead. Already Obama has promised to veto their bill moving through the Senate, making for quite a fight if cuts are not restored.

The National Defense Authorization Act passed by the House and now in the Senate provides $680 billion in 2010 for defense related activities—of which $180 billion is set aside for weapons acquisition. Members of the House Armed Services Committee—responsible for the bill and voting unanimously in support of it—asserted their reasons for opposing key cuts outlined by the Obama administration:

Chairman of House Armed Services, Rep. Ike Skelton (D-MO), painted a rosy picture of the bill’s objectives by affirming:

“This year’s defense bill promotes our main policy objectives: restoring military readiness; eliminating waste and recovering savings through acquisition reform; and maintaining robust oversight of the Department of Defense.”

Yet, provisions in the bill shun expert military opinions. Gates opposes the bill’s continuation of the F-22 program and the Navy’s Top Officer criticized the bill’s plan to alter the development of the already delayed, expensive F-35 jet program.

Ranking Member, Rep. Roscoe Bartlett (R-MD):

“The Administration is gently slapped in this bill for its failure to provide Congress with the standard analyses required to justify significant changes in several major programs. In addition to ballistic missile defense cuts, these include cuts in the Joint Cargo Aircraft (JCA), Future Combat Systems (FCS) and the F-22.’”

However, Bartlett only needs to go as far as the numerous GAO reports that point to the ballooning costs and unproven design of programs to understand why the Administration called for cuts or reduced funding. The Future Combat Systems is conservatively estimated to cost $160 billion and faces significant deficiencies in development.

The F-22 Raptor has been called “an expensive weapon in search of a mission.” Designed for a Soviet threat that no longer exists, the jet has constantly been re-modernized for decades. Facing cost overruns of over 200 percent, it is the most expensive fighter jet ever made. The Undersecretary of Pentagon Acquisitions even stated that its mission capable rate is “troubling.”

Ranking Member, Rep. Todd Akin (R-MO):

“This bill is a decent one, given the fiscal restraints that President Obama and the Democrat Congress have imposed on the Department of Defense. We should be spending more on the defense of our nation, but this is a reasonable start.”

Spend more on defense?? Akin must have missed the facts; the U.S. spent more in 2008 on defense than the next 45 highest spending countries in the world combined. And accounts for 48 percent of the world's total military spending. Or that defense spending consumes over one-third of total government spending.

As shocking as it may be that Congress so flagrantly ignores the facts—it is no surprise. The defense lobby heavily finances some of the most ardent defenders of these weapons programs. Skelton enjoys hefty financial support from nearly every top defense company. One of Lockheed Martin’s top congressional recipients is Rep. Saxby Chambliss—among the most vocal for continuing F-22 production.

LOOKING FORWARD:

Gates’ call for cuts may be a small step to curb immense Pentagon spending, but even this tiny reform may be squashed. A few battles are sure to take place both within and outside Congress this month as the defense bill moves through the Senate. Obama issued a veto threat against the legislation—a first for his presidency—while defense reformers Sens. Levin and McCain affirmed they will “fight on the floor” against the F-22. Of course those in Congress whose priorities fall with big industry rather than reality will be ready to battle as well.

Defense Reform Bill Marred by Lobbyists

Armand Biroonak — Fri, 24 Apr 2009 16:52:57 -0400

The Weapons Systems Acquisition Reform Act sponsored by Senators Carl Levin (D-MI) and John McCain (R-AZ) was intended to improve the Pentagon’s acquisition process, fraught with nearly $300 billion in cost overruns on 95 major weapons systems. By establishing an independent overseer, improving organization and strengthening accountability to manage costs, this legislation was the first (refreshing) sign of defense reform. Yet, the latest efforts by the defense lobby have weakened the bill significantly.

Although the bill will not reach the Senate floor until next week, hints of a watered-down version are reported by Congressional Quarterly. According to CQ:

“The committee changed a provision that would establish a director for independent cost analysis, limiting his role to programs managed by the Office of the Secretary of Defense and excluding those managed by the military services, cutting his portfolio by about half. Also, under the bill, his estimates would not be verified by outside groups.”

With the remainder of oversight in the hands of the Pentagon, the chances of improving the acquisitions process are slim. For years the GAO has made recommendations to DOD, producing little success. Research and development costs have increased 40 percent from initial estimates, with average schedule delays of close to two years.

“The committee expanded the Pentagon’s ability to bypass a new requirement that programs include competitive prototyping. The original version allowed a waiver for “national security” considerations, but the committee added the option of a waiver if the cost of competitive prototyping is too high.”

Besides avoiding complete competition, the Pentagon’s ability to grant exemptions to programs will not control costs. Take the Missile Defense system—it was exempted from standard baselines and traditional oversight to allow for flexibility in development. What occurred were delays and skyrocketing costs at $10 billion annually, with nearly every missile system failing in testing. Furthermore, the language of what constitutes an exemption is so vague, there is a risk that it is applied to numerous programs.

And there is more:

“A third provision altered by the committee would change the bill’s ban on one company providing “systems engineering and technical assistance” for a weapons program while also being involved in the development or production of that weapon, a potential conflict of interest.”

This is a root cause of the failed acquisition process, contractors too often have a hand in every part of a program’s production, knowing that 1) in the absence of strict oversight, there is more incentive to continue program development than meeting cost and delivery targets; 2) lax testing and performance measures allow for even failed products to move forward from development to production.

The Acquisitions Reform Act will not solve every problem, but does lay the groundwork for institutional change in the future—but not in the bill’s current form. The defense lobby has been ready for this fight against reform, and if they get their way, the current system of astronomical waste and inefficiency will surely continue. The bill should be on the floor of the Senate by next week at the earliest, whether amendments are added to strengthen the bill remain to be seen.

CQ article by Josh Rogin, "Amendments May Delay Acquisitions Overhaul," 22 Apr. 2009.

Read my blog about the failures of Pentagon reform here.

Building Blocks for Reform: Achieving Universal Coverage with Private and Public Group Health Insurance

Alex Lawson — Sat, 13 Dec 2008 09:33:07 -0500