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What if the Treasury Dept. Handled Student Loans?

The departure last week of James W. Runcie, who was chief operating officer of the Federal Student Aid office in the U.S. Education Department, sparked headlines — but one paragraph in his resignation letter flew relatively under the radar. Mr. Runcie wrote to his colleagues that senior managers in the office had met with officials in the U.S. Treasury Department to discuss “transferring all or a portion of FSA to Treasury.” The shift could provide “some value,” he said, “but it will certainly divert critical resources and increase operational risk in an increasingly challenging environment.”

The idea to move student aid out of the Education Department — specifically the roles of collecting and managing student loans — has been rehashed several times over the last few decades, but its re-emergence raises questions about what would change if it happened.

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