Sunday, December 6, 2009

Student Loan Hijinks

The House recently passed a bill which would reform our Rube Goldberg student loan system.

This should be the most uncontroversial bill in the history of government.

Gail Collins, take it away:
Let us stop here and recall how the current loan system works:
1) Federal government provides private banks with capital.
2) Federal government pays private banks a subsidy to lend that capital to students.
3) Federal government guarantees said loans so the banks don’t have any risk.
And now, the proposed reform:
1) The federal government makes the loans.
Wow. You really do wonder why nobody came up with this idea before.
Back to the Washington Post article:

A bill that cleared a House committee Tuesday would largely remove private lenders from the federal student loan industry, generating an estimated $87 billion savings over 10 years to fund more government grants and loans.
The Student Aid and Fiscal Responsibility Act of 2009 would eliminate an entire category of student loans issued by private lenders and subsidized by the federal government, vastly expanding direct lending by the government starting next July. Democrats would use the savings to fund a $40 billion increase in federal Pell Grant scholarships over 10 years, $10 billion in community college upgrades and $8 billion in pre-kindergarten changes, among other uses.
Republicans opposed to the legislation say it amounts to a federal takeover of student lending.

Read that last line again, because it's a perfect example of

A) How dumb the Republicans are, or

B) How dumb they think you are.

This whole program is just a huge giveaway to private lenders, who charge us a fee to lend our money to students, when we could just do it ourselves. These lenders make money on the loans, but if the loans go bad, we end up paying.

In all fairness, they do have one actual argument besides just yelling "Government Takeover" in a crowded Tea Party:
Republicans say colleges and universities will be hard-pressed to switch from subsidized to direct government lending.
They say that the conversion will be too hard to do; financial aid offices are just too used to working with these private lenders.

Whatever happened to American Exceptionalism? Didn't our goverment put a man on the moon? Are you telling me that the same people who think our government can build a brand a new country from scratch on the other side of the world in Afghanistan can't figure out how to process their own fucking student loan applications?

That's just unpatriotic.

No comments:

Post a Comment