Senator Warren on the job

From (emphasis mine):

U.S. Sen. Elizabeth Warren said Saturday she is shocked that the federal government is earning an estimated $66 billion in profits from student loans originated between 2007 and 2012.

The Democrat from Massachusetts was reacting to a Government Accountability Office report Friday. A previous Congressional Budget Office report estimated that the government will pocket an additional $185 billion in profits on new student loans made over the next 10 years.

‘‘This is obscene. The government should not be making $66 billion in profits off the backs of our students,’’ Warren said in a statement. ‘‘This report reinforces what we already knew — instead of investing in our children and their futures, the government is squeezing profits out of our young people and adding to the mountain of debt they will spend their lives struggling to repay.’’

Warren and eight other U.S. senators committed to wring government profits out of student loans and address a $1.2 trillion in outstanding student loan debt they say is crushing families and putting a strain on the economy.

‘‘We cannot bury our heads in the sand and pretend the profits don’t exist, or use accounting tricks to make them disappear,’’ Warren said. ‘‘It’s time to end the practice of profiting from young people who are trying to get an education and refinance existing loans.’’

Yes, the government is running a significant deficit and should be looking for additional revenue sources but treating student loans as a profit center is just gross.

UPDATE:  Continue reading

Warren/Taibbi 2016?

Matt Taibbi, Justice Department’s New Get-Tough Policy Is, Well, Not:

I don’t want to sound like a broken record, but . . . the latest ploy by the government to insist it is “getting tough” on Wall Street is beyond laughable…

The [recent NY Times] article worried desperately over the issue of whether or not the Japanese subsidiaries [of UBS] would keep their licenses after these guilty pleas.  [Note:  UBS itself got off scott-free in a non-prosecution settlement.]  As is often the case – I’ve personally heard this excuse about a dozen times coming from DC types – regulators are terrified of repeating an Arthur Andersen situation, i.e. punishing a company and seeing massive job losses as a result…

The Arthur Andersen case [,i.e., their 2002 conviction which put them out of business and resulted in 28,000 people being laid off,] has become like Wall Street’s magic mantra – you hear the name whispered anytime any company gets in trouble. This is a tactic straight out of Blazing Saddles, with banks essentially taking themselves hostage, putting guns to their own heads as they creep sideways out the door: “Back off! Prosecute us and all these jobs will die!”

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Weekly Digest – November 25, 2012

Economics (Sorry, no good news this week.)

Politics Continue reading

Selected Readings – October 15-November 11, 2012


Elizabeth Warren: