Hello! — the whole point of federal programs is to handle issues that DO cost loads of money (lest federal involvement not be needed in the first place). Mercedes-Benz runs a fine car company, and yet “puts loads of money into it”; so? Rather than being seen as a failure, the amount of money a company puts into its programs is typically seen as a good thing and actually drives, not thwarts, investment. Why would — or should — we expect anything different from government?

The real question is, can the private sector do the same thing as government, but more effectively and less expensively? Hmmm…when the private sector took over banks, well, one scandal after another required the government to come back in and clean up the mess with a costly bailout. What about when the private sector took over Air Traffic Control? — airline safety plummeted. What about when the private sector took over the US Postal Service? — costs went up (way up, over and over), and performance went down. Like clockwork. When the private sector takes over a monopoly, like the ATC or Postal Service, profit, not performance, is the guiding motive — whereas with the non-monopolistic example of Mercedes, competition spurs performance.

The whole notion of “big government” and its perils is a myth planted and routinely stoked by right wing friends of big, unfettered business (the “big guy”) and its usurious lenders as a means by which to undermine efforts of governmental controls (regulation) that would, in this case, make student loans more affordable for us, the “little guy”: the right wing sees every measure in our favor as coming out of its profit; the “public welfare” and other moral angles don’t mitigate this simple perception of theirs.

It’s not the size of government that matters, but the efficacy of it: is it doing the right thing, and doing it effectively and efficiently (and size by itself has nothing whatsoever to do with efficiency)? And it’s not the idea of government at fault here, but the people who happen to be presently running it: if you keep voting for the friends of the credit industry (like President Bush and enough like-minded members of Congress), then don’t complain about the failure of Democrats to remedy the matter.

(Besides, the private sector IS in the student loan business!!! The very reason we’re b*tching about federal student loans is that private loans are so uncompetitive that they don’t even draw our attention. Think, people: what kind of rates do you expect will apply to private student loans where, unlike with the examples given here of cars and boats, everyone is expected to be eligible regardless of income and credit history?)

Uh, Jonathan…what does the size of government have to do with this? It’s not the size at play here, but the partisan make-up of congress: Republicans continually nix Democratic efforts to make college affordable — in this case, to further reduce loan rates (not an opinion; check the voting record for the last year — as well as presidential veto threats to pro-student bills finally passed by the newly-Democratic House). Without the government handling this, there would BE no student loan system. And what loans WERE made available to students would be from the private sector. And — use your head people — private sector loans for needed items are NOT as cheap as those for discretionary items like cars and boats (remember, mortgages, by contrast, ARE based on federal rates and not an example of “small” government, whatever that means). When the private sector runs loans for non-discretionary items like education, without federal guidance, well…check out the rates the private sector offers students on consumer credit — WELL above 20%. What’s sad is that, based on some of these posts, people can leave college with a big student loan but no indication of having received an education.

It didnt stay at 0.21 for long…and remember that 6.8 is still better than 5% + 2.3 1 year ago. Looking at long term I think 6.8 (just a nudge above mortgage rates) was better.

And before you make quick judgements, also remember this. We are in a recession. When we come out of this (2 – 3 years), your T-bill will probably be higher (probably around 3-4%)