Posted on 07/17/2009 11:24:21 AM PDT by DFG
Anyone who still doubts that Obamacare would lead to a government-run health-care system should take a look at Obama’s plans for student loans. Those plans got a big boost this week when Rep. George Miller, the California Democrat who chairs the House Education Committee, introduced legislation to replace federally subsidized private lending with a government-run program, leaving only a sliver of student lending to the private sector and completing a journey to nationalization that began 44 years ago. Compromisers take note: This journey also involves a detour onto the “public option” turnpike.
(Excerpt) Read more at article.nationalreview.com ...
The interest on student loans would be a huge revenue generator for the government. Why let private investors have all that loot?
Especially after you sell the public a defective product and rig the system so they can't even discharge the debt through bankruptcy court as would be possible with a failed business?
Loaning money to students for their college education might not be the best idea. A better idea might be to make a certain level of college education free, as with community colleges.
Actually it’s not the loaning of money that bothers me so much as the Federal Government doing it. Privately supplied money is fine.
In any event let’s not give the students a seemingly free ride through school as it doesn’t cultivate disclipine and they’re stuck with a lot of debt, or the lender just writes it off. Nuttin good anywhere here.
You do realize that for the entire time the student is in school all interest is deferred on Stafford loans, so there is no money coming in at all for as long as the student stays in school. And currently the gov is only servicing 20% of student loans... they can’t handle a sudden increase of 80% and they don’t have the money to lend.
I see nothing wrong with that. Prior to this law, many students would take out tons of money in loans and then have them discharged via bankruptcy. Of course, they were still able to walk away from this with the education they received. As other posters have pointed out, education is not like other forms of collateral that can simply be taken away should a borrower default on a debt.
As for students amassing tons of debt getting worthless degrees... I really can't feel much sympathy. Like any other investment, a borrower should make sure that a degree in basketweaving, Outer Mongolian literature or Conversational Sanskrit is worth it before taking the plunge.
I am willing to bet that for most student loan borrowers, like myself, the payback process wasn't that big a deal. We came out far, far ahead jobwise compared to what we owed in student loans.
can you think of any better way for Dems to ingratiate themselves to the electorate than dangling loan forgiveness schemes around election time?
U of AZ's student costs were rising 8% per year, about three times the rate of inflation, and the conclusion was that cheap student loans were the culprit.
The lower rates enabled students to take out even bigger loans, the college had the gubmint-guaranteed money in hand, so they had no incentive to keep costs down.
When Pelosi became speaker, first thing out of her mouth was to "make it easier" for students to attend college. As soon as she said it, I knew it was going to be even cheaper loans, which would accelerate the cost, and make the students beholden for even longer.
Beware when these idiots say "make it easier", you're gonna take another one in the shorts in the long run.
Your bank is going to give you a better rate based on the probablity that the loan will be paid back. Why shouldn't student loans operate the same way?
The fact of the matter is that we have a lot of people with worthless degrees who can't pay their loans back. It would be far better to let them discharge their loans through bankruptcy court, as was done in the past and whch would naturally lead to just the above type of system, rather than turn them into perpetual wards of the state like our political ruling class.
When you guarantee a one-size fits all, one-rate fits all student loan rate, you are guaranteeing that we have a surplus of worthless degrees and a shortage of worthwhile degrees.
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