While the Patient Protection and Affordable Care Act (PPACA) has dominated the headlines, the Student Loan program entitled the Student Aid and Fiscal Responsibility Act has eluded the pens and printers of mainline media. Signed into law in March 2010, SAFRA was included in the reconciliation health care bill. This student aid bill discontinued guarantees on private loans and immersed government into direct college loans. One of the reasons that government decided to make direct loans was to avoid benefiting private loan companies at the expense of taxpayers.
When government makes ‘business’ decisions, usually overlooked are the ramifications of their deliberations that become laws. In the case of student loans, the guarantees on private loans may have been a pretty good investment considering that delinquency by student debtors (called forbearance as a diversion by government) has now reached $125 billion in 2014. This is money that Mr. & Mrs. Unsuspecting Taxpayer will almost certainly be paying. This result helps prove the liberal precept that it is better for government (taxpayers) to incur losses than for private companies to earn profits.
The student loan program now exceeds $1.2 trillion and is greater than credit card debt or auto loan debt – and growing rapidly. One of the important reasons that student loan debt has grown so fast is that virtually anyone can get one. These loans are so artificial that student borrowers can manipulate and postpone payments to suit any real or imagined predicament. And the government accepts almost any ludicrous reason to offer forbearance while adjusting payment dates to make loans appear current instead of delinquent. Our paternal government is teaching young men and women how to elude accountability and responsibility just as elected, appointed and career government workers are able to avoid culpability.
In February 2013, the President spoke of the general details of a preschool program that would include four-year-old children. Assuming about three million children of that age were enrolled at a cost of $4,000 yearly; the federal budget would increase at the rate of about $12 billion.
Just last spring the President mentioned that he will be developing a rating system for the 7,000 colleges and universities in the US to help students select an institution of higher learning. Why is such a rating system needed when several private organizations already publish such data? The most important element of learning and advancement for graduates of high school and college is the drive, motivation and inspiration applied by individual students.
The President will reportedly include in his State-of-the-Union address this year a provision for offering (by government as proxy for Mr. & Mrs. Earnest Taxpayer) tuition-free two-year community college educations. A reasonable estimate to send nine million high school grads to their community college would cost about $34 billion annually. By controlling four-year-olds through college years the government is galvanizing into the cognitive retention of students, parents, teachers, school boards and university trustees the notion that government employees and officials are amazingly knowledgeable, highly educated and more astute than the average citizen voter.
As most of us have painfully learned, government is not the solution; government is the problem (as Ronald Reagan said). Candidates listen to the people and upon getting elected, set up their own objectives or ‘goals.’ These goals are then transformed into broad, sweeping declarations of job growth, elimination of hunger, higher pay for ‘the middle class,’ free educations and peace. When these declarations, called promises, don’t come true, the elected officials switch the focus to blaming others or ignore the facts and start talking about inequality or the name of a football team.
A federal government that can’t balance a budget, lacks the ability to create reasonable goals, refuses to accept accountability and rejects the willingness to live by the same financial, ethical and social standards as those who elected them is comprised of a perilous bunch of malcontents. We are being led down the dead-end path of low expectations and government dependence. Placing our total educational system in the hands of big government is the rough equivalent of entrusting our most prized sheep to a wolfpack.
– Dick Baynton
