Conrad drops support for North Dakota provision to avoid controversy

Senate Budget Committee Chairman Kent Conrad (D-N.D.) has asked House negotiators to scrap a provision in the reconciliation package that would have benefited his home state.

Conrad had won a carve-out for the Bank of North Dakota that would have allowed it to continue making student loans even after Congress passed a student lending overhaul.

The student lending legislation, paired with healthcare reform in a budget reconciliation package, was expected to make the federal government the originator of all student loans.

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Conrad had attempted to preserve the Bank of North Dakota’s student loan portfolio by arguing that it did not deserve to be replaced by the federal government because it is state-owned, the only such entity in the country.

Republicans pounced immediately, calling the carve-out the “Bismark Bank Job.” They hoped to make it as controversial as other deals Senate Majority Leader Harry Reid (D-Nev.) struck to pass healthcare reform through the Senate in December.

GOP aides said it was the latest example of deals such as the “Cornhusker Kickback”, the “Louisiana Purchase”, and “Gatorade”.

After watching the Republican message machine win political points through the healthcare debate, Conrad decided it was not worth jeopardizing House votes.

“I called over to say take it out,” Conrad said. “There’s no sense in having a distraction on a bill this important.”

Conrad lamented that the debate over healthcare reform has become so political that it has become very difficult to discuss a proposal on policy grounds.

“You can’t have a debate on the merits around here,” Conrad said.