Much like the government manipulated housing bubble that nearly felled the U.S. economy when it collapsed, the government controlled student loan industry could be on the same catastrophic path.
In a recent report, the U.S. Department of Education’s National Center for Education Statistics showed that in the 2011-2012 school year, the federal government provided 71.4 percent of full-time college students some form of taxpayer-funded aid, as reported by CNS News.
On average, CNS News noted, these college students received $10,500 in federal aid during the year.
Which equates to student loan debt that totals almost $1 trillion, double what it was in 2007. Debt that is now higher than credit card and auto loan debt and is second only to mortgage loan debt, based on a study by the Federal Reserve Bank of New York.
For perspective, when President Obama signed the Health Care and Education Reconciliation Act into law in March 2010, the federal government took control of student loans, allowing students to borrow directly from the U.S. government.
And the Democratic Party continues to politicize the issue as Obama prepares to embark on a bus tour on which he’ll propose ways to “fundamentally rethink and reshape” the higher education system in the United States.
All the while, a growing undercurrent on the left advocates for student loan forgiveness, going so far as to imply that there is a racial component at play with the burden falling heaviest on young people of color.
“81 percent of African-American students have debt, while only 64 percent of white students do,” said Chris Hicks, an activist for Jobs with Justice, a far-left group closely tied to organized labor, as reported by Red Alert Politics..
A sentiment that is supported by Rep. Charles Rangel, D-N.Y., who recently said “we shouldn’t even be charging young people to go to school.”
“Do you know how much they pay for college in France?” Rangel asked in July. “Zero. I don’t think we should be paying for college at all,” he added.
Pull this off and every student carrying loan debt will be forever grateful to the Democratic Party — which makes for yet another very reliable voting bloc. An effort that will cost taxpayers at least $618.5 billion, which is the outstanding balance on direct student loans at of the end of July.