by nathan, Mon Feb 20, 2006 at 05:29:27 PM EST
As noted a few weeks ago, the Bush administration's proposed 2007 budget includes huge cuts to student loan programs totaling $12 billion. These cuts will make it harder for middle class students to go to college, and will increase the interest rates on existing loans people are struggling to pay off.
Calls to Congressman Mike Ferguson's offices to see if he supports these cuts have gone unanswered for more than two weeks. Staffers from both the Washington, DC and Warren, NJ offices are unable to give a direct answer to a number of calls seeking an answer. Not one person who called the office has received a written response, either.
We may now have figured out why. One of the side effects of the reduction in funding for student loans noted above is that interest rates for existing college loans are likely to rise, creating a windfall for companies that process and manage student loans.
This includes companies like the College Loan Corporation owned by Cary Katz of Poway, California and the Student Loan Consolidation Center (now Goal Financial) owned by Ryan Katz of Alexandria, Virginia. The two are brothers in their mid-30s who started their companies in the past 10 years and now manage more than $7 billion of student loans nation-wide.
What does this have to do with Mike Ferguson and his position on student loans?
The Katz brothers and their wives have contributed $18,500 to Ferguson between 2002 and 2005. That's an average of more than four grand a year in Ferguson's campaign coffers from two families from California and Virginia.