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Tying the student loan overhaul to the healthcare overhaul bill, President Obama ensured that the Congress passes the bill assuring needy students of greater advantages. Private lenders will no longer benefit from federal subsidies with the congressional approval of the student loan program overhaul bill that ensured a great legislative victory for President Obama this week.

For the past forty five years, private lending for students with Federal subsidies was supported which came to an end with the passing of the bill following the landmark US healthcare reform bill.
Direct federal lending will be expanded considerably as middle men such as private lenders and bankers will be completely eliminated. They had hitherto enjoyed unquestioned benefits including no default risk and shield from taxpayers.

Needy students will be provided with Federal grants that will come from a projected savings of $61 billion over the next ten years. The money saved will also be used to fund other important Federal education programs such as supporting the historically black schools and the community colleges.

The measure was got through the Congress by the President’s fellow democrats in the House of Representatives and the Senate by expertly integrating this bundle of changes to the overhaul of healthcare. The package was signed into law by the President after lawmakers from both the chambers approved it.

According to a research survey conducted by the Opinion Research Corporation/CNN conducted among 1030 Americans, 64% of them approved the move. According to Keating Holland, polling director of CNN, there is a huge gap wherein only 52 percent of the Republicans approve the bill as compared to 92% of the Democrats. However, there is a positive view evident among members of both parties towards this proposal.

Understandably, most Democratic lawmakers and student groups support the student loan overhaul. Private lenders including Sallie Mae have been strongly opposing it. There will be a great reduction in student lending options according to critics who also went on to say that thousands of private lender jobs will be at stake which will affect the already ailing US economy that suffers 9.7% rate of unemployment.

The measure was also opposed by a host of Republican lawmakers. They argued that this was a Federal takeover that is unwarranted and will kill a successful program. A greatly diminished role will be played by the private lenders. They will just be involved with helping collect payments and service the loans. US workers will be servicing the direct Federal loans unlike the bank loans.

According to George Miller, the House Education and Labor Committee Chairman, precious taxpayer money will now directly benefit students and families instead of adding to the treasury of big banks. He went on to say that this move will help students greatly in paying for college and equipping them to survive in this highly competitive global economy.

This is indeed a great victory for the President and the Democrats as a whole who skilfully avoided any roadblocks by clubbing the student overhaul bill with health care reforms package.