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school loans


Elizabeth Warren: Poster woman for progressivism

If ever there was a poster woman for progressivism, MA Senator Elizabeth Warren fills the bill.  Known as “Fauxahontas” for using fake indian credentials to cash in on minority preferences, she has taken the Ted Kennedy Senate seat from the hapless Scott Brown and is now on target to out-liberal the liberal Lion.

One of the more interesting things to do with her is to disect her thinking via reading what she has to say about certain subjects.  It gives  one a good peek behind the curtain and into the “progressive” mind.  For instance, here she is talking about the school loan program the government unilaterally took over:

Right now, in order to finance the United States government, we take in billions of dollars of profits for student loans, but permit billionaires to have enough loopholes that they pay at tax rates that can be lower than those of their secretaries.

This is a straightforward choice: We can take $75 billion and either way we’ll use it to protect tax loopholes for billionaires or $75 billion can be used to help students to refinance their outstanding student loan debt. It’s billionaires or students.

This particular quote is instructive in so many ways.  First, note how she makes the point that government “permits” billionairs to keep their money via loopholes.  Obviously she believes that’s something that shouldn’t be permitted, but more importantly in infers a belief that everything you earn belongs to government.  The student loan program is simply an excuse for taking it if she has her way.  If it weren’t that, it would be something else.  But bottom line she believes government has a right to that money in the name of  … well you call it – fairness?  Equality?  Whatever.

Secondly, what is the problem right now in terms of the cost of schooling?  The price is to high.  How does one get the price down?  Competiton.  That and you don’t subsidize the cost and lay off the cost of that subsizidation on students.  If there is limited competition and vast subsidization, what is the incentive for colleges and universities to cut costs to compete for students?

That’s right, none.  So what the government program that she wants to tax billionaires for is doing is helping to sustain, maintain and grow the higher education bubble.

Heritage’s Brittany Corona, a research assistant in education policy, has criticized the federal government’s involvement in the student-loan business, citing, in particular, the unknown long-term costs to taxpayers.

“Continuing to expand higher education subsidies through subsidized federal student loans and grants does nothing to put pressure on colleges to lower costs,” Corona warned. “In fact, access to easy money does the opposite, enabling universities to raise prices, knowing students can return to the federal trough for more financing.”

Sound familiar at all?  Have we had previous experience with this sort of nonsense in the last 5 or 6 years?

When this bubble pops and collapses, I’m sure the Warren’s of the world will find some “private” boogyman to blame it on.  But in reality, it will again be a government program that fueled the expansion of the bubble and the eventual collapse.

And the students?  Well, they’ll still be on the hook to pay for their overpriced education for the rest of their lives, regardless of the interest rate.

~McQ

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