The big player in the student loan market is Sallie Mae (SLM).

Sallie was originally a small government sponsored enterprise (GSE) with good intentions. But it has now evolved into a giant government sponsored business (GSB). It's along the lines of Fannie Mae, Freddie Mac, etc...

The citizens of this 'capitalist' country have no idea how large these GSB's like Sallie Mae have become.

GSB's like Sallie Mae and Fannie Mae heavily influence the markets in which their private sector competitors & collaboraters have to co-exist.


FWIW, creative blends of government businesses and private ownership have been tried before.

The difference is, when it happened in other countries in the 20th Century, we used to call it Facism (Italy under Mussolini, Argentina under Peron, etc...)

Now we call it normal.

 

Fannie Mae and Freddie Mac are private companies that are traded on the NYSE.

 

And their loans are guaranteed by you, the American taxpayer.

In other words, they would be out of business if it weren't for the confiscation of your hard earned money, Real.

 

All true. And the proposal by the Obama administration will displace the current student loan bureaucracy with a streamlined direct loan process. I, for one, do not believe in creative blends of government and private business. The private business alsways seems to get the best deal.

Look at how the Bush family's banking interests profited from the FDIC insurance program and the following S&L bailout. Public money to the rich bastards who created the scandal in the first place.

 

Yes, you should also be extremely angry with Bawney Fwank for lying to you.

 

As is Sallie Mae (SLM).

Sallie, Frannie and Freddie make campaign donations and have PACS just like the other big businesses.

Bu the ARE government sponsored/supported. Their relationships with the government guarantee them large volumes of business and allow them to alter the marketplace in their favor, at the expense of their truly private sector competitors and the economy.

For some reason, we have come to accept and/or tolerate this bastardization of the system.

 

Yes, and that is the problem the Obama administration proposal fixes. I do not believe the government should be in the business of guaranteeing loans for private banks.

The entity that takes the risk should reap the rewards. In this case the reward would be more affordable student loans and the government benefits indirectly through a more educated workforce, lower crime, etc.

 

So basically, we agree the current student loan system is a hybrid, interim step to government control.

The difference is, you welcome government control with open arms, and I dread it from the depths of my soul.

As to the Bush bashing

BTW, you missed a perfect opportunity to criticize Barnie Frank, Chris Dodd and Maxine Waters, et al for their roles in the NYSE traded entities that you previously mentioned (Fannie and Freddie).

 

You'll have to excuse me, but I just spit coffee all over my monitor. It might be just me, but I've never seen a "streamlined" government run process.

 

It's not 'bashing' when it is directly relevant to the discussion and absolutely true.

In any case, the current Obama administration proposal gets rid of this awkward public/private student loan program and streamlines it with a direct student loan program. But conservatives will bash anything Obama does just because they hate Obama. He was able to win the Presidency because of how woefully inept the Republicans had proven themselves to be and the conservatives hate him for illustrating that so obviously.:o

 

Hey, we never would have had this awkward public/private hybrid student loan system if the conservatives did not see where the profit was for their banking buddies. The liberals wanted a direct student loan process from the beginning but the conservatives demanded that private banks get in on the action.

If Obama is able to pass this new streamlined student loan program in the face of huge pressure from banking interest lobbyists, it will be a real accomplishment.

The education problem in the U.S. is too important to leave to private greed. This is one of the prime reasons the U.S. has been falling behind economically. Obama wants to turn that around and be fiscally responsible at the same time. It's hard to be fiscally responsible when you are giving guarantees worth billions to powerful banking interests.

 

You're not the only. Only someone who wants/needs the nanny state would believe the gov't is more efficient than the private sector. Gov't is God to most of these people.

 

No, I don't know any liberals who view government as "God". If your criteria for "God" is that he is an entity that we can trust more than the individual then I think the conservatives fit that description better when they have no problems with the government spying on it's own citizens and believe the government should prosecute women who choose to have an abortion.

The inefficiency in the current student loan system is that the government pays for the profits of private banks while simultaneously bearing all the risk. It's ridiculous!

The efficiency from a streamlined direct loan process is due to ditching the complexities of a government/private partneship and removing the profit where there is no risk. This is a very good idea because higher education is critical to our nations future lest we be surpassed by countries like India who have very strong and efficient publicly funded education.

 

I hate to break it to you Real, but we have already been surpassed by many countries. All thanks to the money-pit known as public education. Your "very good idea" is a bad idea.

 

Although it's usually entertaining, I haven't read through the many pages in this thread, however, I do want to add some real life experience about student loans, based on what happened to me.

When I was about 22 years old, I decided to make a career change into the IT industry (this was around the dot com era, a very trendy time to jump into IT). I signed up to attend Computer Learning Centers (CLC) which was a nation wide technical training school. I applied for a student loan, but was turned down. Long story short, this was due to the fact that my parents made decent coin, so that affected me being able to get a loan. Basically, I'm supposed to go to mommy and daddy to get money for school, rather then getting my own loan since I was under the age of 24, so that's exactly what I did. As luck would have it, the school went out of business, just closed their doors up with out warning one day when I showed up for class. I was given two options, get my money back, or transfer what credits I had from this technical school to an accredited school. I decided to get my (well my parents) money back. This process turned into a huge fiasco. I was basically told that I might get my money back once all the loan companies, such as Salle Ma, (who wouldn't give me a loan) were paid back in full first. What BS that was!

I ended up calling a local reporter for a local paper and was interviewed about my situation. Once that was published, I received my money back in full days later. With that said, I feel what ever is in place now is not working. Not saying NoBama's plan is the answer, but I don't agree with the cost of college as it is now and the process of student loans and interest applied.

I'm fortunate enough to work for a good company now, who pays for my college and training in full, as long as I get good grades. I am still to this day continuing training and education, as I view it as unused\wasted money on my part if I don't use it.