Owing Uncle Sam
It seems like such a small step, and obvious, too:
Students and families who borrow money to help pay for college will see sweeping changes as a result of federal legislation approved by the House on Sunday night.
Although the bill was focused mainly on health care, it contains key provisions involving loans for higher education — including the Stafford Loan for students and the PLUS Loan for parents.
Under the bill, all such federally backed loans will be issued directly by the U.S. government, through the colleges and universities themselves, effective July 1.
See, up to now, a significant number of loans have been handled through private entities, so although the money came from or was backed by the federal government, they took a couple of percentage points of interest to process paperwork (as Neil Downing puts it). All the change — somehow passed along with the healthcare power grab — does is to cut out the middle man. But from a statist’s point of view, just about everything and everyone is a “middleman”; all rights and activities ultimately come from the government. When statists’ wish to engage in some form of charitable activity (by their definition), the most efficient way will always be through the bureaucracy that controls everything.
I can offer testimony that college loans are like an entry drug to debt. With a bachelor’s degree becoming a baseline for jobs that have no practical need for higher education, the loan used to acquire one is like a mortgage for your career, and the government now holds every string. The government approves the loan. The government enforces laws related to debt. And, as President Obama has made clear, owning the debt, the government can opt to forgive it for those who enter preferred occupations, such as “public service.”
We were already heading into an era of new indentured servitude over debt. We now know to whom we’ll be indentured: Uncle Sam.