About | HeinOnline Law Journal Library | HeinOnline Law Journal Library | HeinOnline

HRD-93-20R 1 (1993-04-29)

handle is hein.gao/gaobackhq0001 and id is 1 raw text is: 


    (1         United States
GAO            General Accounting Office
               Washington, D.C. 20548

               Human Resources Division
               B-249663
                                                                      149083
               April 29, 1993

               The Honorable William F. Goodling
               Ranking Minority Member, Committee on
                 Education and Labor
               House of Representatives

               Dear Mr. Goodling:

               Previously, I we discussed the potential savings to the federal
               government from converting the Federal Family Education Loan program
               into a direct loan program. We estimated that, properly implemented,
               direct lending could save about $4.7 billion in its first 5 years, in
               present value terms. A February 22, 1993, report by the
               Congressional Research Service (CRS) contended that (1) direct
               lending would neither increase national income nor necessarily achieve
               greater savings than those attainable from modifying the current
               guaranteed program and (2) federal administrative costs could absorb
               whatever interest savings direct lending generated.2 This letter
               responds to your request that we evaluate these contentions.

               Our methodological approach differed from that of CRS. Consistent
               with a public welfare analysis, CRS focused on the national income
               increase associated with student loans. CRS reasoned that since
               guaranteed and direct lending would provide the same loan volume,
               both programs lead to equal increases in educational investment and



               1Direct Loan Debate (GAO/HRD-93-15R, Feb. 8, 1993); Student Loans:
               Direct Loans Could Save Billions in First 5 Years With Proper
               Implementation (GAO/HRD-93-27, Nov. 25, 1992); Direct Student Loans
               Could Save Money and Simplify Program Administration (GAO/T-HRD-
               92-8, Oct. 29, 1991); and Student Loans: Direct Loans Could Save
               Money and Simplify Program Administration (GAO/HRD-91-144BR,
               Sept. 27, 1991).

               2Congressional Research Service, Federal Family Education Loans:
               Reduced Costs, Direct Lending, and National Income, Number
               93-247 E, February 22, 1993.

                               GAO/HRD-93-20R Comments on CRS Direct Loan Report


                                            0 '    ~       ~ O./ /063

What Is HeinOnline?

HeinOnline is a subscription-based resource containing thousands of academic and legal journals from inception; complete coverage of government documents such as U.S. Statutes at Large, U.S. Code, Federal Register, Code of Federal Regulations, U.S. Reports, and much more. Documents are image-based, fully searchable PDFs with the authority of print combined with the accessibility of a user-friendly and powerful database. For more information, request a quote or trial for your organization below.



Contact us for annual subscription options:

Already a HeinOnline Subscriber?

profiles profiles most