February, 2025
Lincoln — On top of firing seventeen federal inspectors general in January, President Trump and his DOGE team have now moved to end much of the work of the Institute of Education Sciences (IES, an independent component of the Department of Education), and to eliminate the Consumer Financial Protection Bureau (CFPB).
If the pronouncements of Nebraska's congressional delegation and top state elected officials are to be believed, my fellow Nebraskans are widely supportive of this "move-fast-and-break-things" approach to end federal fraud, waste, and abuse. But is that support justified?
I worked at IES for over four years, 2001-2005. I'll share my actual experiences working there, then revisit the question of what is going on with the Trump and DOGE purges. My conclusions are much different from what Nebraskans are being told by their information sources and elected officials.
As an independent researcher at IES, with a strong anti-fraud ethic, I wrote one of my first papers on the behavior of higher education institutions in response to federal student aid programs, to see if the programs were effective and that they were not being exploited. I used IES's NPSAS database in a natural experiment methodology. One of the findings was that schools too often put private loans into low and middle income students' financial aid packages, rather than federal Stafford loans with their better terms. This was the era of close relations between schools and private lenders, often with kickbacks and favors. I brought the findings to the attention of professional associations and consumer groups which worked to end the practices.
Another finding from the paper was that Pell grants were being wastefully packaged by many schools in a way that undermined their intended benefits for the lower-income. I circulated these findings within the academic research community; they have since been used to inform many subsequent papers.
I would not have been able to do this work without the NPSAS database, which Trump has now targeted for elimination.
In another research effort begun at IES, which wound up on the front page of the New York Times, I used financial statements and SEC filings of federal and state student loan secondary markets to identify a scheme to defraud the government of billions of dollars in illegal subsidies. Among my first partners in this effort was the agency's inspector general. I would not have been able to complete this research without the outstanding work of Patrick Howard, Helen Lew, and Howard Sorensen at the IG's office.
After the CFPB was created, its staff investigated one of these student loan entities with a history of fraud and abuse, discovering new schemes against veterans, borrowers in forbearance, and taxpayers. In 2024, CFPB debarred the company from further federal loan servicing contracts and required it to repay $120 million.*
The point of recounting these examples is to illustrate how IES, NPSAS, CFPB, and the IGs fight fraud, waste, and abuse.
Why would anyone want them out of the way? Would it be to make plundering the trillions in loan assets controlled by the Department of Education easier? Well, yes. Eliminating watchdogs and their tools is not about saving money, it's about paving the way for even greater exploitation of federal taxpayers.
I can identify billions at the Department of Education that should be cut, but they won't be touched by Trump and DOGE because they are eyeing them for themselves and collaborators.
Nebraskans: were you born yesterday? If not, contact your elected officials and protest.
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* Whether borrowers and taxpayers have actually received relief as of February, 2025, is not clear, because DOGE has frozen CFPB activities.
