The government passed the healthcare legislation a couple weeks ago. Within hours, democrats presented a reconciliation bill that would make the spending outlined in the reform bill legal. Because reconciliation is used for budgeting and finance purposes, the dems threw student loan reform into the reconciliation.
Up until now, the federal government has backed the loans given to students though independent lenders. The loans were government guaranteed, but the lenders did all the detail work. The government provided the guarantee with our tax dollars while the banks made and serviced loans at really low rates.
The news clips I've heard about it report that the government is cutting out the middle man - the banks - and handling the loans themselves in order to save money on fees. Instead of outsourcing student loans to the experts, the loan industry, our federal government has absorbed the lending market for student loans and created a whole new government agency.
Now you can only get student loans through the government.
Back to the basic question: What does government do RIGHT that makes us think it can handle student loans?
Follow up question: How much will the government take-over of student lending increase the government size? What about federal debt?
Blatant trickery, a move disguised as student loan reform turns out to increase government dependence.
Obama even recommended that workers who stay employed with the federal government for 10 years or more should have their student loans disolved. Another incentive for good government worker-bees.
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