Apologies to the Three Little Pigs. New Republic provides "inside baseball" account on the opposition to student loan reform bill in the Senate:
Game over? Not quite. In a testament to the sway that student lenders exercise over the Senate, it's not clear that Democrats have the 51 votes necessary to pass the bill in its current form. Ben Nelson, the staunch friend of lending companies, is against it—as are Blanche Lincoln, Mark Begich, Jeff Bingaman, and Tom Udall. And Senators Bob Casey, Arlen Specter, Bill Nelson, Mark Warner, Jim Webb, and Mary Landrieu are all said to be wavering because their states contain student loan companies. Many are searching for a way to keep lending companies involved in the process—an anguished Senator Casey even held a field congressional hearing in Philadelphia this week [details on hearings available here], hoping to clarify his thoughts on the issue — and they'll be tempted to back some of the numerous pro-lender amendments that will be offered once the bill is open for floor debate. (Even in the House, Democrats couldn't prevent a mass revolt until they watered down the legislation by exempting existing state-based non-profit lenders from subsidy cuts.)
On that front, NASFAA News reported that a delay is likely to stretch the legislation out until November or December:
"All of this means that a final bill may not be ready or signed until November or December. That would leave an estimated 3,100 schools currently in the FFEL program six months to convert into the Direct Loan program. Even if the Democrats’ bid to eliminate FFELP by passing a bill is unsuccessful, they may still be able to accomplish their goal by not extending the Ensuring Continued Access to Student Loans Act (ECASLA). It is unknown how many FFELP lenders will be able raise capital for new loans when the Department of Education’s authority to purchase FFELP loans under the ECASLA expires in July 2010. Additional legislation is required to extend ECASLA, and Democrat leaders have said they will not pass such legislation."