Education Failures

Every month I write a check for college loans to the U.S. Department of Education. Directly to them. My rate is a usurious 6.8%. Now, the people who are underwriting this are declaring moral victory by slapping some restrictions on payment on these same usurious loans--rather than lowering the rate--that will demand that the taxpayer pick up the additional costs of the loans.

The Obama administration announced the expansion of a program, beginning in December 2015, that allows borrowers to cap their repayments at 10 percent of monthly income (no matter how much they borrowed) and even forgive those loans after 20 years (10 years if they work for a nonprofit or for the government). Taxpayers will pay $7 billion in the first year alone. Companion legislation before the Senate that would make taxpayers the primary refinancing bank for higher-interest student loans would soak the public for an additional $58 billion over 10 years. More, there is this weird reverence for nonprofit or government work, work that does not really participate in the productive economy other than to regulate it, criticize it, feed off it and generally annoy it.

“(W)e think this is something that would be fantastic for the economy,” said Education Secretary Arne Duncan.