(AP Photo/Jose Luis Magana)

Betsy DeVos policy benefits staffer's family — while hurting struggling student borrowers

Taylor Hansen used to lobby for for-profit colleges, but resigned immediately after it was signed


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Matthew Rozsa
March 21, 2017 12:59PM (UTC)

Secretary of Education Betsy DeVos, who has long been criticized for lacking experience and being part of a family of right-wing super rich political donors, just reversed an Obama era directive — and in so doing lined the pockets of one of her advisers, who was hired on a temporary basis and resigned last week.

The DeVos memorandum on Thursday, titled "Withdrawal of Dear Colleague Letter (DCL) 15-14," will allow guaranty agencies to charge individuals with student loans fees equivalent to 16 percent of their total balance regardless of whether the debtor agrees to pay off their debt within 60 days. Although this decision will hurt individuals who are financially struggling and are finding it difficult to pay off their loans, it will help the family of Taylor Hansen, a former lobbyist representing for-profit colleges.

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Taylor Hansen's father, Bill Hansen, is CEO of the guaranty agency Strada Education Network, formerly known as United Student Aid Funds Inc. The firm was involved in a prolonged legal battle against the Department of Education — a lawsuit over this policy that has now been rendered effectively moot — but the policy change could add as much as $15 million to Strada's yearly profits.

Taylor Hansen resigned from the Department of Education on Friday, one day after DeVos released her memorandum.

Hansen's presence in DeVos's department has also been criticized because many for-profit colleges are opposed to the gainful employment rule, which withholds federal financial aid from colleges whose student loans are so steep that their graduates cannot earn enough to pay them off. Both of these issues prompted Sen. Elizabeth Warren, D-Mass., to send a public letter to DeVos about Hansen, arguing that his "recent employment history clearly calls into question his impartiality in dealing with higher education issues at the Department of Education, and raises alarming conflicts of interest concerns."


Matthew Rozsa

Matthew Rozsa is a breaking news writer for Salon. He holds an MA in History from Rutgers University-Newark and is ABD in his PhD program in History at Lehigh University. His work has appeared in Mic, Quartz and MSNBC.

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