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America, Welcome to the Poorhouse: What You Must Do to Protect Your Financial Future and the Reform We Need by Jane White

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Chapter 7How Sallie Mae Lobbied Congress and “Enticed” Colleges to Offer Its Loans

Just as the mortgage industry managed to make homes more expensive through the use of expensive mortgages such as ARMs and interest-only loans, Sallie Mae, the dominant lender in the student-loan market, has made college more expensive by lobbying for interest-rate subsidies, and by attempting to elbow the low-cost federal government lending program out of the market.

It also profits by its ability to collect debt in just about any circumstance—whether or not the graduate can repay the loan. In a 2006 60 Minutes piece on Sallie Mae, Lesley Stahl interviewed Alan Michael Collinge, who graduated with degrees in aerospace engineering in 1998 but had a tough ...

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