House ends aid to ACORN, reforms student lending

House lawmakers on Thursday went one step further than their Senate colleagues and voted to block all taxpayer funding of ACORN, the community organization that has recently fielded criticism for its business practices.

The measure, passed handily as part of a sweeping overhaul of higher education finance, now heads to the Senate, which voted earlier this week to strip ACORN of its transportation and housing dollars.

“Today’s overwhelming bipartisan vote to stop all federal funding of ACORN is a victory for American taxpayers," said House Republican Leader John Boehner (R-Ohio). "Of course, it is only the beginning.  We need to keep up the fight to end taxpayer funding for this troubled organization."

Republicans have always lamented ACORN's relationship with the federal government, but they became more vocal in their criticism following the release of a series of videos last week in which the organization's employees offer advice to a couple disguised as a pimp and a prostitute. Shortly after, the Census Bureau became the first to sever its ties with ACORN. A number of lawmakers have also demanded hearings and investigations into the organization's business practices.

“House Republicans have worked tirelessly to sever ACORN’s ties to the federal government," Boenher said of Thursday's outcome. "Though today’s vote indicates that the writing’s on the wall for ACORN, President Obama must indicate whether he will join the Congress in taking decisive action to break all government ties with this corrupt organization."

(Read more after the jump.)

The ACORN vote, however, overshadowed the equally important bill to which it was attached: On Thursday, lawmakers also passed a serious overhaul of the student lending industry.

Under current law, the federal government guarantees about 97 percent of all risk student lenders assume through the Federal Family Education Loan Program (FFELP). But the bill that passed the House on Thursday would end those subsidies and permit the Department of Education to offer loans directly, effectively shutting companies like Sallie Mae out of the federal loan industry.

The change, lawmakers said, is motivated in part by fluctuations in the market, which have rendered some student loans insurmountable.

"The status quo student loan program that takes taxpayer money and gives it to private lenders and then rewards them to take a risk, not with their money but with ours, doesn't make any sense," Rep. Roberts Andrews (D-N.J.) said on Wednesday during floor debate.