Gotta love it, now your tax dollars will go to paying for others to go to college. Granted it has been going on for a while, but at the same time the banks set requirements for the loans. Now, Obama wants to take out the middleman and let the government just hand the money to kids so that the country will have the greatest number of college graduates.
Okay, here is my problem with his plan. A lot of kids are not college material and would do better finding the best path for them to take. It may be a technical school or it could be that they jump right into the job market. The other thing is that it ends up devaluing the college degree. How many kids are now being passed through college the same way they were passed through high school. I have seen people with college degrees that could not write a work related report that was grammatically correct. I know I make goofs in my posts, but nothing compared to how badly these college graduates wrote emails and such. I am also reminded of one other thing, remember how much money computer programmers made before Y2K because they were in such demand? Then, everyone wanted to be a computer programmer because that was where the money was. Now, it still is a great industry for employment but not with the money of the 90s because there is not the demand anymore. It is all about supply and demand and value of the degree.
But, back to the fact that he sees taking out the middle man and just handing the money to the kids. First of all, he is taking more away from the private sector and making it the responsibility of the public sector. Second of all, this ends up taking away the profit the private sector would make that impacts other aspects of banking and finance. We won’t discuss unemployment because in this case I think it would end up to being a wash with more jobs in the public sector even though the private sector would lose jobs.
Finally, here is a blurb from the article in USA Today
Obama wants to end the decades-old, dual system the federal government uses to advance loans to students to pay for college.
Under that system, students at some colleges borrow directly from the government, while others get loans from banks, non-profits or state agencies who in turn receive subsidies from Washington.
The president’s proposal would switch the federal student loan system entirely to direct lending from the government.
By the way, once I heard that one of the reason why college tuition has gone up so much is that the more money that the feds give colleges the more that they charge in order to get more money from the feds.