Hey, to each their own, I guess. But I'm not the only one who's a little bit surprised to hear about this:
The Obama administration plans to make the government the sole provider of federal student loans, ending the participation of private lenders in the program. Under a plan unveiled in the administration's budget, subsidies to private lenders would be eliminated, and the government would use the savings estimated at $47.5 billion over the next decade to help bolster the Pell grant program for low-income students. If approved by Congress, the plan would effectively end government-guaranteed loans to students by banks and other private lenders—lending that has totaled $56.7 billion in the current school year, and has been the primary source of college financial aid since the program was launched in the 1960s.Look, I'm not one of those 'Obamunist' types, but, eh...that sounds rather remarkly socialist-leaning for a Centrist, pragmatic president, if you ask me.
[ UPDATE: Byron speaks:
Eh. I think you know my politics pretty well Walker (e.g., i'm not a loony left socialist), and I think this is actually a really smart policy.First of all, just because the government is kicking private lenders out of the federal loan business doesn't mean that students can't get private loans. You can still go down to your local bank and get a private student loan that has nothing to do with the government of the United States. That right still remains. This only deals with Stafford and Plus loans that are taxpayer-funded, but administered by a private company.Previous, if you were to get a federal loan, the federal government wouldn't just lend you the money. It would give it to a third-party private company for the administration, upkeep, and collection of the loan. That's just inefficient. It adds a third party to a transaction that should really only involve two parties. By adding that third party, it drives up the cost of administering the loan, by adding a whole other layer of bureaucracy to it.It's stupid to have primary companies administer these government loans just to have it look privately-run.And now that he points that out, I see something that I should have caught before, and must have skimmed over previously, Whoopsie. ]
5 comments:
Eh. I think you know my politics pretty well Walker (e.g., i'm not a loony left socialist), and I think this is actually a really smart policy.
First of all, just because the government is kicking private lenders out of the federal loan business doesn't mean that students can't get private loans. You can still go down to your local bank and get a private student loan that has nothing to do with the government of the United States. That right still remains. This only deals with Stafford and Plus loans that are taxpayer-funded, but administered by a private company.
Previous, if you were to get a federal loan, the federal government wouldn't just lend you the money. It would give it to a third-party private company for the administration, upkeep, and collection of the loan. That's just inefficient. It adds a third party to a transaction that should really only involve two parties. By adding that third party, it drives up the cost of administering the loan, by adding a whole other layer of bureaucracy to it.
It's stupid to have primary companies administer these government loans just to have it look privately-run.
That's a really good, Byron. I guess I hadn't really given that enough thought when I was posting.
Your source blog was/is utterly wrong about it.
I was going to leave a snarky comment at her site about being accurate instead of alarmingly hyperbolic, but I'm too lazy.
Hey, I was too lazy to fact check. I totally understand.
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