Fight Over Student Loan Reform Isn’t Opening K Street’s Spigots — Yet
The Obama administration’s push to phase out subsidies for private student loan companies and replace them with more efficient direct lending from the government is causing some serious agita among big banks that fear lost business, as The New* *York Times reported last week.
But curiously enough, the large student loan firms’ eagerness to protect their turf hasn’t yet prompted them to hike lobbying spending. During the first three months of this year, Sallie Mae — the nation’s largest private lender — spent $1.28 million on lobbying, according to a Washington Independent analysis of first quarter reports filed this week. That’s nearly $400,000 less than the company paid for lobbyists during the same period last year.
Meanwhile, Nelnet, another huge private lender, spent exactly as much on lobbying in the first quarter of 2009 as it did during the first quarter of 2008: $170,000.
Could it be that student lending’s private sector players just have less to work with this year? Sallie Mae’s stock lost more than half its value last year as the global financial meltdown crippled the market. Even its political action committee has contributed less to members of Congress during early 2009 than in a similar stretch of 2008.
But Nelnet [appears to have exceeded](http://www.zacks.com/commentary/10501/Top+Performer+for+Thursday:+Nelnet,+Inc.+(NNI)+) analysts’ expectations with its performance even after the economy fell into crisis. Why aren’t these companies mobilizing with lobbying spending to match the Obama administration’s promised threat to their interests? We may have to wait until K Street next opens its books in July to know the full story.