These are the kind of decisions that add to working people's economic burden, and it's nothing more than political payback for a very powerful interest group. Huffington Post:

TAMPA, Fla. -- The U.S. Treasury Department on Thursday praised a move, already panned by Sen. Elizabeth Warren (D-Mass.), to increase the amount of money the federal government pays its student loan contractors.

In a speech here to consumer rights advocates, Deputy Treasury Secretary Sarah Bloom Raskin said her colleagues at the Education Department had recently boosted the amounts paid to companies that handle borrowers’ monthly payments in hopes that better financial incentives will drive them to improve their customer service and work harder to help borrowers avoid costly loan defaults. These companies include Nelnet Inc. and Navient Corp., the former loan servicing arm of student loan giant Sallie Mae.

What Raskin neglected to mention Thursday is that taxpayers will fund a bump in pay for the student loan servicers even if their performance does not improve.

In September, under withering questioning from Warren, a top Education Department official conceded that the companies will get more money regardless of any changes they make to their operations. At the time, the senator was incredulous.

“Let me get this straight: You break the law. You don't follow the rules. You treat the borrowers badly," Warren said of the loan servicers. "And you all just renegotiated the contracts to make sure that across the portfolio, [loan servicers] are going to make a little more money if nothing changes?"

"The idea of the renegotiation was to help the borrowers, not to make the servicers richer," Warren told William Leith, chief business officer for the Education Department's Office of Federal Student Aid, which handles student loans.