Here we are on the verge of another government sponsored bubble. What the feds did to the housing market, they’re doing to college education. Do easy credit, low interest rates, and soaring prices sound familiar? It should. Just turn around and look at your overvalued house.
Barack Obama announced in his weekly address, that he wants Congress to prevent interest rates on federally funded student loans from doubling in July; at the same time, he wants to come up with a solution to make college education affordable:
In America, higher education cannot be a luxury. It’s an economic imperative that every family must be able to afford. That’s why next week I’ll be visiting colleges across the country, talking to students about how we can make higher education more affordable – and what’s at stake right now if Congress doesn’t do something about it. You see, if Congress doesn’t act, on July 1st interest rates on some student loans will double. Nearly seven and half million students will end up owing more on their loan payments. That would be a tremendous blow. And it’s completely preventable.
This issue didn’t come out of nowhere. For some time now, I’ve been calling on Congress to take steps to make higher education more affordable – to prevent these interest rates from doubling, to extend the tuition tax credit that has saved middle-class families millions of dollars, and to double the number of work-study jobs over the next five years.
This kind of rhetoric reminds me of the Clinton-era affordable housing initiative. And guess what? The results are about the same. Last year, outstanding student loans passed the trillion dollar mark. Do you hear that bubble being stretched?
Of course, big government politicians like Barack Obama, seldom see the consequences of their actions. Their policies have flooded universities with easy cash. As a result, tuition has skyrocketed. Soon, we’ll witness a tsunami of bankruptcies, and the taxpayers will suffer another round of debt forgiveness spankings.
Source: http://www.whitehouse.gov/photos-and-video/video/2012/04/21/weekly-address-calling-congress-prevent-student-interest-rates-dou#transcript
http://www.thenewamerican.com/culture/education/11298-student-loan-debt-reaches-1-trillion
http://nces.ed.gov/fastfacts/display.asp?id=76
http://politicalcalculations.blogspot.com/2012/02/rising-unaffordability-of-college.html
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