"It must have been frustrating for officials at the Congressional Budget Office to read Sen. Lamar Alexander's op-ed in Sunday's Washington Post. In the column, the Republican Senator from Tennessee mistakenly cites work done by the CBO to argue that a bill Congress is currently considering to eliminate the Federal Family Education Loan (FFEL) program in favor of direct lending would 'overcharge' students for their federal loans," Higher Ed Watch reports. "At issue is a July 2009 letter that CBO sent to Sen. Judd Gregg (R-NH) showing that the pending legislation would save the government $47 billion over ten years using private market estimates. As Senator Alexander correctly points out, that figure is considerably less than the $87 billion in savings CBO identified under official accounting rules, and it does indeed more accurately reflect the bill's true savings. But here's where he gets into trouble. Somehow the Senator came to believe that the $47 billion in savings is the result of the government earning money off direct loans by 'overcharging' students. The CBO letter, however, shows that all of the $47 billion in savings comes from eliminating subsidies to private lenders in the FFEL program. Yes, every last penny. That's because the estimate Senator Alexander touts actually assumes the government will not make money off of direct loans. In other words, Senator Alexander got it backwards."