Rep. John Kline (R-MN), the top Republican on the U.S. House Education and Labor Committee, today expressed new doubts about pending legislation to eliminate the private sector’s role in student lending, arguing that the bill’s massive new entitlement spending initiatives may cost taxpayers far more than expected. Kline’s comments come after the Obama Administration’s Office of Management and Budget issued new figures showing proposed changes to the Pell Grant program will result in billions more in new spending.
“The American people deserve an honest accounting of how their money is being spent,” said Kline. “These new figures from the Administration raise serious questions about the cost of this rapidly moving legislation and its consequences for our exploding deficit.”
The Democrats’ proposed legislation, H.R. 3221, was introduced on July 15, 2009, and brought to a vote in the Committee less than one week later. Since that time, the Congressional Budget Office has uncovered billions in potential hidden costs to taxpayers that would come if the bill’s elimination of private sector student lending does not generate as much federal revenue as expected.
Adding to concerns about the bill’s cost are new figures released yesterday by the Obama Administration’s OMB projecting an additional $27 billion in spending on Pell Grants as a result of changes proposed by the Administration. The revised figures reflect changes in projected enrollments and economic forecasts, factors not taken into account in the cost estimate of legislation currently pending in Congress.
“The deficit is soaring, a substantial portion of the so-called savings in this bill may never materialize, and now we learn it will spend billions more than expected,” said Kline. “The more we learn about this bill, the more obvious it becomes that there is nothing 'fiscally responsible' about it. These new figures are yet another reason Democrats should slow down and consider the consequences of the plan they're recklessly rushing through Congress."
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