Thanks, but no thanks, Sen. Kent Conrad of North Dakota is telling House Democrats over a sweet deal for his home state. He's asking House leaders to pull the plug on a Dakota-friendly provision in the health care package.
The item is on page 145 of the reconciliation bill, and has nothing to do with health care. Instead, it involves an overhaul of the federal student loan program, which is a controversy in itself but was added to the reconciliation by Democrats looking for budget sweeteners.
The overhaul would eliminate federal subsidies for private lenders — except for (here comes Conrad) the Bank of North Dakota.
There is some logic to the exemption. The Bank of North Dakota is the only state-owned bank in the country, and depositors' money is protected by North Dakota, not by the Federal Deposit Insurance Corporation. Conrad notes that the bank holds and services its loans; common practice among lenders is to pass them along to third parties.
Perhaps most compelling, Conrad says the bank's default rate — that is, the percentage of loans in which Washington would end up paying — is one-quarter the national average.
But if you don't believe in exemptions at all, those arguments don't work. And these days, few people on Capitol Hill believe. Conrad's conclusion: "Rather than see the excellent reputation of the Bank of North Dakota damaged, I have asked to have the provision removed."
Presumably the House will follow his wishes, as lawmakers wrangle over more than a dozen targeted provisions in the health-care legislation.