House Resolution 365 (linked above) is something many of you out there may have never even heard of before. I will not lie, I just heard about it right before writing this blog because an old friend of mine on Facebook had posted a petition for others to sign to get this resolution moving. Although the Resolution does nothing itself to change any kind of law or reason inside Washington, the premise is simple: Pass this resolution to say that the Congress is supporting a forgiveness of student loan debt. While there are other parts to this resolution which you can read on your own and form an opinion on, for this blog I want to stick with why I believe a plan of action like this could, in the end, hurt America more than actually help America and its economic troubles.
In a time when the President wants to raise taxes on everyone in this nation, a Democrat sponsoring a bill that would forgive student loan debt seems to defeat the purpose of raising revenue, at least in my eyes. Students take out loans from the government and promise to repay them, and in turn the government makes money off of those loans. That is the way it is supposed to be, but we all know that these loans, many times, are not paid back and the government loses a lot of money on student loans. To forgive a large portion of the loans taken out by the young adults in this country because many cannot find a job is going much too far, and is taking away any kind of revenue jump you may be able to get out of the program in the future. If this was a one time sell-off where the government was getting out of the loan game, it would be much different. But this resolution would call on the President and the Congress to pass immediate legislation to make sure that the loans keep coming while those who are out of school and cannot find work would have their loans forgiven by the government.
There has to be a voice of reason here and I will try to be that voice. As a college student who racked up a lot of debt going to college and out of work, inside I would love for something like this to happen. That is my inner Liberal showing up, and I try to keep him bottled up as much as I can. All college students, no matter what political affiliation would love to see this, although that does not mean it is in the best interest of the people that it actually happens. If we are America, and America is made up of more than one person and our decisions will effect more than just ourselves, than we must think about what not paying our bills will do to the system as a whole. The argument is (according to Robert Applebaum, the creator of the petition [8] that now has more than 360,000 signatures) that forgiving these loans will give more money to those who are paying, hence it would spark an economic boom that all of us have been looking for. I tend to see it differently than that.
If you took a look at the petition, you will see how many signers there have been, and there are quite a few. Many people are going with their feelings on this matter and not their brains. Mr. Applebaum, who appears on the Democracy Now [9] website and refers to himself as a “recovering Republican” must not understand the way the world really works. The facts are this: that many of those people who are not finding work and are taking out the loans are not paying them back to begin with and will choose not to pay them back at all if the statistics keep in line with past statistics. An article from the Chronicle [10] back in July of 2010 shows that the government estimates of those who have defaulted on a student loan were drastically exaggerated to the point where we the people would think these loans were being paid back on time and money was being made on them. In fact, that opposite is the case. According to the Chronicle report, 1 in 5 loans that went into repayment as of 1995 ended up in default. If the loans are not being paid, then forgiving them does nothing but tell those who will not pay that it is ok to get a free education and allow other taxpayers to pay the bill for it. I have a hard time believing any Conservative out there would be for this.
We have to understand that these are loans, and if we take out loans and are not able to pay for them then we will go into default and it will hurt us for the rest of our lives, in many cases. Forgiving them to spark economic growth may sound really good, but when the loans are not being paid at all, the economic spark is not all as great as what it was made out to be. I for one, can understand those students who would like to see this because I am one of those students who have student loans and would love more than anything to get out of them. But I will not stand and cheer a plan that will ultimately hurt this nation more than it actually helps it just because my personal needs would be met. This is how this nation has got into the trouble it is in right now, by individuals thinking more of themselves than others around them. We need to really think about what this plan does for the country.
Obviously, it does not matter how many people sign this petition, it is not going anywhere. The resolution would mean almost nothing even if it were passed, and it would never get passed through a Republican House, especially during these times when the conversation would be front and center for all Conservatives to see. Even though it is not an issue that seems to merit any real reporting, I do believe that those who are pushing for a plan like this need to explain themselves further and tell America why it is fine to use other people’s money to get a free education when the education that was received has done nothing to better society as a whole. Those of us who look at the government handled loan program see that it has problems, and I for one am looking for solutions for those problems. I have some ideas that may spark some debate, so I will list them below.
1. End the government handling of the student loan program, allowing private banks to handle loans for colleges- This may not sound like a great plan for those Liberals out there, but what it will do, after a long and painful journey, will ultimately get many of the schools to lower their rates. If there are not as many students who can get loans to go to college and the college’s lose money and need to make up for what they are losing, the prices will come down to a manageable level where working a couple part time jobs could pay for it. This would also give the parents a stake in their child’s education, if they chose to go that route. While there could be small problems with this, it is only the beginning of a discussion on how to change things, not a solid plan that I have formulated over a period of time.
2. Reward the best and brightest young minds in America with money to move their education forward, and allow private industry to be more involved- We have some bright minds in this country and those minds, many times, are not being used for their true purpose. We have a failing space program but many young people who would thrive in that role. So, why are we not looking to our future to make our today much more bright? This does not mean the government itself should go out on a limb and put the best and brightest minds through school and hope that these students actually make enough to pay it back, but private industry could take a larger role, and I believe they would if the economic climate seemed much clearer than it is today. We are seeing the emergence of the private space industry today, and those companies will need the best and brightest minds of tomorrow to make it to where they want to go. It would not be a stretch for them to go to some of these kids, pay for their education, and contractually obligate them to stay for a certain amount of time. This could be done in many industries and is already being done in some circles, albeit on a much smaller scale.
What we need are solid plans and I am all for listening to everyone out there, and hearing their ideas on what they believe could be a fix to this system. The system is broken and the government should not be in the business of taking chances on just anyone, especially those who may show a tendency to quit when the going gets tough. If the private banking system wanted to throw their money around like that, it would be fine with America as long as they did not come looking for a bailout when the crap hit the fan, so to speak. The idea that we need to forgive and forget will do nothing short or long term for the country and is another Left-Wing idea that when looked at closely, as we have, does nothing for the system as a whole. There is no doubt the government is in the business of handing out money for those who do not deserve it, but forgiving that money after it was spent would bring many more problems the American people are just not thinking about.
