President Donald Trump's administration will soon offer an exclusive contract that will give one company the right to service billions of dollars of outstanding federal student loans now handled by four companies, officials said on Friday.
The U.S. Education Department, led by Trump pick Betsy DeVos, said the streamlining will save money and increase efficiency. But critics said student borrowers could suffer because a single company would be granted a monopoly, with no incentive to provide better customer service.
Prior to this there were four student loan companies competing with each other, which means now there will not be an incentive for just one company to give students better deals on student loans.
But there's more.
Remember how Donald Trump has insisted that by being able to sell insurance accross state lines insurers will lower their prices because of the competition? So if competition lowers prices, why is he giving the contracts for student loans to a monopoly?
Because it was a lie.
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