{"id":3546,"date":"2007-01-18T01:35:00","date_gmt":"2007-01-18T01:35:00","guid":{"rendered":"http:\/\/brianjnoggle.com\/blog\/?p=3546"},"modified":"2017-12-07T13:23:25","modified_gmt":"2017-12-07T19:23:25","slug":"government-to-help-students-reduces-number-of-student-lenders","status":"publish","type":"post","link":"https:\/\/brianjnoggle.com\/blog\/2007\/01\/18\/government-to-help-students-reduces-number-of-student-lenders\/","title":{"rendered":"Government, To Help Students, Reduces Number of Student Lenders"},"content":{"rendered":"<p><a href=\"http:\/\/www.forbes.com\/feeds\/ap\/2007\/01\/17\/ap3337755.html\" target=\"_new\">The rah-rah<\/a>:<\/p>\n<blockquote><p>The Democratic-controlled House voted overwhelmingly to cut interest rates on need-based student loans Wednesday, steadily whittling its list of early legislative priorities.<\/p>\n<p>The legislation, passed 356-71, would slice rates on the subsidized loans from 6.8 percent to 3.4 percent in stages over five years at a cost to taxpayers of $6 billion. About 5.5 million students get the loans each year.<\/p><\/blockquote>\n<p>The short term fix that will have unintended, and startlingly unforeseen, consequences:<\/p>\n<blockquote><p>The House bill aims to reduce the $6 billion cost by reducing the government&#8217;s guaranteed return to lenders that make student loans, cutting back the amount the government pays for defaulted loans and requiring banks to pay more in fees.<\/p><\/blockquote>\n<p>Let&#8217;s see, Congress has just:<\/p>\n<ul>\n<li>Cut the profitability by limiting the upside (the interest) that lenders can make.\n<li>Increased the risk by cutting out the government &#8220;insurance&#8221; against default.  Instead, those defaults will have to be covered with the reduced margin for error (the interest; profitability is just unused margin for error).\n<li>Increased fees that the lenders have to pay to have access to lowered profit potential and increased risk.<\/ul>\n<p>That&#8217;s the sort of fiscal and economic thinking that comes from not having to balance your checkbook.<\/p>\n<p>So in 20 years, when student loans are harder to come by, the poor students will have to enter the workforce with naught but a high school education and, to those who can afford it, an Associates degree.  To struggle, not make it very far, and vote Democrat.<\/p>\n<p>Just kidding.  The same people who strangle the privatesque solution today will determine that education is a right, like health care, and the government&#8211;they&#8211;should be the ones to fund it and mete it out.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>The rah-rah: The Democratic-controlled House voted overwhelmingly to cut interest rates on need-based student loans Wednesday, steadily whittling its list of early legislative priorities. The legislation, passed 356-71, would slice rates on the subsidized loans from 6.8 percent to 3.4 percent in stages over five years at a cost to taxpayers of $6 billion. About [&hellip;]<\/p>\n","protected":false},"author":3334,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[29],"tags":[],"class_list":["post-3546","post","type-post","status-publish","format-standard","hentry","category-news"],"_links":{"self":[{"href":"https:\/\/brianjnoggle.com\/blog\/wp-json\/wp\/v2\/posts\/3546","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/brianjnoggle.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/brianjnoggle.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/brianjnoggle.com\/blog\/wp-json\/wp\/v2\/users\/3334"}],"replies":[{"embeddable":true,"href":"https:\/\/brianjnoggle.com\/blog\/wp-json\/wp\/v2\/comments?post=3546"}],"version-history":[{"count":1,"href":"https:\/\/brianjnoggle.com\/blog\/wp-json\/wp\/v2\/posts\/3546\/revisions"}],"predecessor-version":[{"id":18314,"href":"https:\/\/brianjnoggle.com\/blog\/wp-json\/wp\/v2\/posts\/3546\/revisions\/18314"}],"wp:attachment":[{"href":"https:\/\/brianjnoggle.com\/blog\/wp-json\/wp\/v2\/media?parent=3546"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/brianjnoggle.com\/blog\/wp-json\/wp\/v2\/categories?post=3546"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/brianjnoggle.com\/blog\/wp-json\/wp\/v2\/tags?post=3546"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}