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In Opposing Student Debt Relief, Susan Rice Breaks With Her Family History

Lois Ann Dickson was the daughter of Jamaican immigrants; her father worked as a janitor, her mother, as a maid. She was valedictorian of her high school and earned Phi Beta Kappa at Radcliffe. In 1959, Dickson, who by marriage became Lois Rice, joined the College Board as an executive, where she lobbied for financial assistance for students entering higher education. At the time, it was known as the Basic Educational Opportunity Grant, and in 1972 it found a sponsor in Rhode Island Sen. Claiborne Pell.

The Pell grant provides thousands of dollars to eligible recipients toward the cost of tuition, without having to be paid back. Rice both pressed for its establishment and testified numerous times before Congress to ensure that it not only remained in place, but grew as cost burdens for students grew. In obituaries upon her death in 2017, Rice was called the “mother of the Pell grant,” and according to Pell’s grandson, “it would not have come into existence without her, nor survived in the decades since without her passionate advocacy.”

In addition to being the mother of the Pell grant, Lois Rice was also the mother of Susan Rice, who serves today as head of the administration’s Domestic Policy Council. In public remarks in November, Rice called expanding the Pell grant “the cause of my mother’s life,” and said that bringing down the costs of higher education was critical to strengthening the working and middle classes.

It is therefore notable that Rice, according to Politico, has emerged as a major impediment to the cause of student debt forgiveness, the subject of a fervent debate inside the White House. The Prospect has confirmed that Rice and her Domestic Policy Council have not favored any debt cancellation by executive action, which is legally permissible under the Higher Education Act. Advocates working on the student debt issue have been aware of Rice’s opposition for close to a year.

While the Pell grant may at one time have provided opportunity for families of modest means, the soaring cost of college tuition has made it grossly inadequate.

The purpose of the Pell grant, Rice’s mother’s great cause, was to offer access to higher education that was not conditioned on a family’s financial condition. Its architects believed that having a basic grant, instead of a costly loan that would follow the graduate decades into the future, was vital to expanding educational opportunity. It was the foundation of a student financial aid package.

Unfortunately, that foundation has grown rickety in the 50 years since the basic grant was established. While the Pell grant may at one time have provided opportunity for families of modest means, the soaring cost of college tuition has made it grossly inadequate. This has led to an explosion in student lending, with detrimental consequences for student borrowers and the broader economy.

Nearly 1 in 6 Americans carry student debt, totaling over 45 million people. Research from the New York Federal Reserve has shown student debt to have a measurable negative economic effect, as debt-holders delay major purchases of homes or cars because of having to service student borrowing. The student debt crisis has led to calls for cancellation of some or all federal loans, as a prelude to figuring out a different means of financing higher education that doesn’t put such a burden on the backs of college attendees.

President Biden campaigned on forgiving $10,000 in student debt, but he never endorsed cancellation through executive action. At other times, he has been hostile to the concept of using executive authority, which practically speaking is the only way student debt forgiveness will get done given a closely divided Congress. Biden explicitly dismissed the idea of canceling up to $50,000 in student debt at a CNN town hall last February, saying that it would expend resources to reward Ivy Leaguers rather than “young children who … come from disadvantaged circumstances.”

For what it’s worth, research from the Jain Family Institute’s Marshall Steinbaum shows that student debt cancellation would be progressive. Moreover, the true cost of forgiving student debt for the government is contested, with made-up numbers and rough estimates obscuring the real economics of the matter.

The president has repeatedly extended the student loan payment pause instituted at the outset of the pandemic; it’s now scheduled to expire this May. Rice’s Domestic Policy Council, according to Politico, wanted Biden to hold firm and have student loan payments resume in February, arguing that it was important to “prudently manage” the program. That was the position of the administration before progressive advocates made some noise. Eventually, Rice and the DPC went along with the decision to extend the payment pause.

The payment pause extension, however, just kicks the can down the road to May, when a decision must be made all over again.

Rice, whose political career prior to getting the Domestic Policy Council position was largely in the area of foreign policy, certainly recognizes at an individual level the burdens faced by people suffering under large amounts of student debt. Just a couple of weeks ago, she tweeted from her personal account about a GoFundMe appeal for a couple facing medical difficulties. In addition to their doctors’ bills, the fundraiser reads, “the student loan and mortgage crises left the couple facing over $400,000 in debt, along with their continuing monthly living and medical expenses.”

In other contexts, Rice has supported debt cancellation, in particular the Education Department’s overhaul of the Public Service Loan Forgiveness program, which has been mired in dysfunction for years and barely followed through on its promises to cancel loans after ten years of payments for those who take public-service jobs in government or public schools.

For months, the administration has claimed to be “studying” its legal authorities for debt cancellation. The Education Department memo on its authority was 100 percent redacted, while a Justice Department memo has been produced but not released, per The Washington Post.

Another way to talk about student debt cancellation is to say that it converts a loan into a grant, providing a stronger foundation for financial aid to promote the important goal of accessible education for all. This was Lois Rice’s argument for Pell grants for decades.

Her daughter does not appear to agree.

Biden’s Pick for FDA Could Squeak Through With Help From Pharma-Funded Republicans

In 2015, then-deputy commissioner at the Food and Drug Administration Robert Califf worked closely with pharmaceutical and medical device lobbyists on an industry-backed bill designed to accelerate the approval process for new drugs. Califf attended frequent meetings with individuals from Johnson & Johnson and other drug companies, as well as Pharmaceutical Research and Manufacturers of America (PhRMA) CEO Stephen Ubl, then at trade group AdvaMed, helping to jointly write legislative text that would become part of Republican Rep. Fred Upton’s (Mich.) 21st Century Cures Act, according to a report from InsideHealthPolicy based on a review of internal emails and documents.

When the 21st Century Cures Act passed the House, PhRMA’s Ubl released a statement praising it for including “reforms which enhance the competitive market for biopharmaceuticals and drive greater efficiency in drug development.” The bill relaxes some methodological standards for drug trials, for example by setting up a way for drug companies to submit “real world evidence” about their products’ safety and effectiveness, rather than information from double-blind randomized clinical trials.

Watchdog group Public Citizen blasted Califf’s ties to industry in 2016, as he was facing confirmation to become FDA commissioner. “The attitudes he has developed over his decadeslong history of extensive financial ties to pharmaceutical and medical device companies leave him all too willing to promote the interests of regulated industries over those of public health and patient safety,” the group said in a blog post. “These entrenched attitudes do not befit the position of FDA commissioner.”

After leaving the government in 2017, Califf went to work as a consultant and compensated board member for several health industry companies including Cytokinetics, Bitterroot Bio, Centessa Pharmaceuticals, and Boehringer Ingelheim Pharmaceuticals. Since 2017, he has also worked as an advisor for Google and Alphabet’s life sciences research company Verily, according to his financial disclosure. He also returned to a job he held before his stint in the Obama administration at Duke University, where he told Time in 2015 that his salary was contractually underwritten by pharmaceutical companies including Merck and Bristol-Myers Squibb.

Califf’s nomination was quickly celebrated by the pharmaceutical industry.

Califf has also amassed millions of dollars worth of pharmaceutical company stocks. His holdings include shares worth up to $500,000 in both Amgen and Bristol-Myers Squibb, up to $250,000 in Gilead Sciences stock, more than $2 million in Cytokinetics stock and options, and up to $5 million in Centessa stock options.

Now, Califf may be about to spin through the revolving door once again and take a job as the commissioner of the FDA, a position he held for nearly a year during the tail end of the Obama administration. President Biden nominated Califf in November for the position, and a vote by the Senate Health, Education, Labor and Pensions (HELP) Committee to send his nomination to the Senate floor is scheduled for Jan. 12.

Califf’s nomination was quickly celebrated by the pharmaceutical industry. “Congratulations to Dr. Robert Califf for being nominated as the next commissioner of the U.S. Food and Drug Administration,” lobbying group PhRMA said in a statement. “It’s vital that we have a commissioner who understands the important role the FDA plays in promoting public health and providing science-based oversight of our nation’s medicine supply.”

But Califf’s confirmation is not certain. Democratic Sens. Joe Manchin (W.V.) and Richard Blumenthal (Conn.) have said they will vote against confirming Califf because of his ties to the pharmaceutical industry, and Sen. Ed Markey (D-Mass.), who voted against Califf in 2016, also appears to be leaning no. HELP Committee members Maggie Hassan (N.H.) and Ben Ray Luján (N.M.) have told reporters that they are undecided or have qualms. Vermont Independent Sen. Bernie Sanders, also a HELP Committee member, has also vowed to vote against Califf’s confirmation. “At a time when the American people pay the highest prices in the world for prescription drugs and as drug companies continue to be the most powerful special interest in Washington, we need leadership at the FDA that is finally willing to stand up to the greed and power of the pharmaceutical industry,” Sanders said in his statement opposing Califf’s nomination.

Even with these Democrats voting no, however, Califf may be able to squeak through and find the votes he needs to be confirmed because four Republican HELP Committee members have already told reporters that they plan to cross the aisle and vote for him. Each of these Republicans have entrenched pharmaceutical industry ties themselves, according to research provided by the Revolving Door Project and a Sludge analysis of campaign finance and financial disclosure data.

HELP Committee Ranking Member Sen. Richard Burr (R-N.C.) has told reporters he will vote for Califf and praised the former FDA commissioner at his hearing last month. “Dr. Califf’s unique perspective as a former FDA commissioner coupled with his understanding of partnerships with the private sector and academia that assist in fueling innovation will be vital if confirmed as the next FDA Commissioner,” Burr said in his opening statement.

Burr announced in 2016 that he is retiring at the end of 2022, but he has still received at least $173,600 from pharmaceutical and health products industry PACs since 2017, according to OpenSecrets. The industry has given his campaign and leadership PAC more money since 2017 than any other industry, including maximum donations from the PACs of companies including Abbott Labs, Merck, AstraZeneca, and Pfizer. Over the course of his entire Senate career, OpenSecrets says that Burr’s campaigns have taken in more than $1.6 million from the pharmaceutical and health products industry, including donations from company PACs and employees in the industry. That total makes Burr the third-largest Senate Republican recipient of money from that industry ever.

Burr, who is being investigated by the SEC for possible insider trading after dumping stocks following a confidential covid briefing in February 2020, has also sought to profit from personal financial holdings in the industry. A 2020 review of his trades by ProPublica found that Burr and his wife bought and sold up to $1.1 million worth of stock in companies that make medical devices, equipment, supplies, and pharmaceutical drugs.

Another Republican HELP Committee member that plans to vote for Califf, Sen. Tommy Tuberville (R-Ala.), is also an investor in many of the drug companies whose main trade association has applauded Califf’s nomination. In 2021, Tuberville bought and sold stock in Johnson & Johnson, Merck, Regeneron, West Pharmaceuticals, and Bristol-Myers Squibb. Some of these transactions were only disclosed by the senator months after they were made, a violation of the STOCK Act that requires financial transactions of members of Congress to be disclosed within 45 days. His annual financial disclosure shows holdings in several pharmaceutical and medical device companies as of the end of 2020 that he does not appear to have sold since, including Pfizer stock worth up to $150,000, investments worth up to $50,000 each in AmerisourceBergen, Abbvie, Allergan, and Eli Lilly, and smaller stakes in Zoetis, Edwards Lifesciences, and Novo Nordisk shares.

Sen. Susan Collins (R-Maine) has also told reporters that she is voting for Califf. Collins has benefited from $541,000 in contributions from the pharmaceutical and health products industry over the course of her career. The senator’s husband, former lobbyist Thomas Daffron, has up to $100,000 invested in the stocks of drug companies Johnson & Johnson and Merck, according to Collins’s 2020 annual disclosure. Collins’s 2020 campaign was chaired by pharmaceutical company lobbyist Josh Tardy, whose clients in Maine have included Eli Lilly and PhRMA, according to a report from Beacon.

HELP member Sen. Roger Marshall (R-Kan.), who says he will support Califf, has taken $102,000 in campaign contributions from the pharmaceutical and health products industry since first running for congressional office in 2016. His pharmaceutical PAC donors have included PhRMA member companies like Amgen, Pfizer, Boehringer Ingelheim, and Teva Pharmaceuticals.

If Califf’s nomination gets out of the HELP Committee, he is expected to easily be confirmed by the full Senate. His last confirmation in 2016 was approved by a vote of 89-4, with seven not voting.

https://prospect.org/power/bidens-pick-for-fda-robert-califf-could-squeak-through/

Great discussion with @mehdirhasan & @MichaelEMann about #DontLookUp.

The film is about the need to accept scientific facts & act on them – and it's about our media/political system ignoring, frovolizing & distorting such facts to pad profits & fuel a destructive culture war. pic.twitter.com/UCz25LgMSr

— David Sirota (@davidsirota) January 6, 2022