When Donald Trump was selecting his cabinet, all of his picks must have had to meet a requirement of being some of the world's worst people asked how far they were willing to go to hinder progress and then simply hired them off of that. One of these is clearly his Secretary of Education Betsy DeVos who Slate recently published an article about titled: "Betsy DeVos Is Wasting No Time Screwing Over Students Who Borrow Money for College." The article shows how DeVos is giving predatory debt collectors the okay to go after students who are delinquent with their student loans, lifting previously placed Obama era protections for those students.

DeVos' first suspicious move

The writer of the article refers to the $1.3 trillion dollars worth of the student debt burden and reminds readers that the former Obama administration added reforms to protect students from debt collection predators, who mislead or use price gouging. He said that he noticed on two occasions since she's been the Secretary that she's rolled back these reforms and adds that they could all lead to potential Conflicts Of Interest, which is likely one of the requirements mentioned that one has to have to work for the Trump administration, as almost all of his picks have been "grilled" in their confirmation hearings about varied conflicts of interest. One Blasting News article refers to one of President Trump's recent picks where it provides some examples of when the Office of Governmental Ethics succeeded in forcing some of them to withdraw their considerations.

Slate's senior business and economics correspondent Jordan Weissmann, the writer, referred to a letter from the Department Of Education in March which talks about the "Dear Colleague Letter (DCL) GEN 15-14 that it issued on July 10, 2015." The new letter which is written by Lynn B.

Mahaffie Acting Assistant Secretary Office of Postsecondary Education and published on the Department's website said that the DCL from last year referred to Federal Family Education Loan Program (FFELP) loans and not Direct Loans. The DCL referred to the Higher Education Act where it says that when a student receives a default notice, the agency sending it cannot add fees to payments owed within 60 days from when the notice is sent.

The new letter that was sent out to those collection agencies referred to court case Bible v. United Student Aid Funds, Inc when the Department was asked for their views on the case that was challenging the assessment of collection costs in May of 2015, a few months before the DCL was created. The Department states in the letter that they're withdrawing that DCL because they want the matter to be debated in public before they consider enforcing it.

Conflicts of interest with loan agency

But this is unlikely because Weissmann provides an update from those agencies in response to DeVos' changes. He referred to a Bloomberg article which reported that the collection agencies didn't take the bait and that they did not bring back those penalties.

Obviously, Weissmann expressed that this was good as it allows the Obama era reforms to continue a little longer. The connection he makes with DeVos and her conflicts of interest is with guarantee agencies which were banned under the Obama administration for reportedly slapping -- as an example -- 16 percent fees for students to pay back these loans. In one case he notes, $4,500 had to be paid first in order to get a student's loan up to snuff.

He also mentioned that the involvement of these guarantee agencies was initially used under "the government’s old, bank-based student lending scheme" which, even though they were discontinued in 2010; there are still billions of dollars in outstanding loans owed.

It says that until January, for-profit college lobbyist Taylor Hansen ran the agency that charged $4,500 dollars worth of fees called United Student Funds before he became an adviser for DeVos. The day after the Department of Education withdrew the DCL in March, Hansen resigned from the agency. Sen. Elizabeth Warren and other lawmakers apparently noticed this and made some noise and the Department denied that there was a connection. In the Blasting News article referred to earlier, the Trump cabinet pick seems to have done a similar thing years ago when she left her position as a legislature, taking a consultant role the next day after she left. Is this a pattern for those who engage in conflicts of interest?

Bringing back business to predatory loan agencies

But then he refers to a piece by the New York Times titled: "DeVos Halts Obama-Era Plan to Revamp Student Loan Management" when it reported that in the first half of April, DeVos signed orders that got rid of the Department's attempts to better streamline the process of handling the bulk of 1.3 trillion in loans. The article says that the project would have dealt with one vendor and would have been one of the biggest government projects outside of the military. The Slate article also says that this new system would have in fact prevented borrowers from defaulting on their loans. The question now would be, does DeVos have a better way to manage those loans?

It would appear that her solution would be to continue to rely on the labyrinthine system of farming out loan servicing to vendors like United Student Funds. The Obama era restrictions that the Department used to place "great weight" on vetting loan vendors with shady records was also struck down by DeVos, which is also of some concern to her critics. DeVos' excuse for this change was that the project would simply cost too much -- unless she is using this as some kind of leverage for protection, while enabling predatory lending agencies.
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