House Financial Services Committee chairwoman Maxine Waters was brought up short Wednesday after she targeted banking chiefs over the student loan crisis, even though the federal government took over student lending in 2010.
At a hearing featuring a panel of seven bank CEOs, Ms. Waters ticked off figures on student loan debt and defaults, then asked, “What are you guys doing to help us with this student loan debt? Who would like to answer first? Mr. Monahan, big bank.”
Bank of America chairman and CEO Brian Monahan replied, “We stopped making student loans in 2007 or so.”
Ms. Waters replied, “Oh, so you don’t do it anymore. Mr. Corbat?”
Said Citigroup CEO Michael Corbat: “We exited student lending in 2009.”
She then turned to James Dimon, JPMorgan Chase chairman and CEO, who explained, “When the government took over student lending in 2010 or so, we stopped doing all student lending.”
At that point, Ms. Waters changed the subject, saying, “Thank you. What about small business?”
Conservatives chided Ms. Waters for the apparent blooper, with former Arkansas Gov. Mike Huckabee saying the exchange shows that “she knew nothing about student loans.” Fox host Maria Bartiromo tweeted that Ms. Waters “had no idea the government took over student loans.”
The Obama administration eliminated the federal guaranteed loan program in 2010, putting the federal government in charge of student lending with the idea of saving taxpayer dollars by “cutting out the middleman,” as President Barack Obama put it.
Afterward, student loan debt exploded from $154.9 billion in 2009 to $1.1 trillion at the end of 2017, according to Investor’s Business Daily. Current student debt is estimated at more than $1.5 trillion.