The leather-clad Nick Gillespie and Reason.tv take a look at why forgiving student loans is not a good idea.
1. They are voluntary. No one stuck a gun to junior's head and forced him to get a loan. Also, the terms of the loan are known to all vested parties. There are no surprises.
2. The loan amounts are not over-burdensome. Given the fact that the unemployment rate among college grads is half that of the national average, a starting salary of $50,000 (national average) paying down a loan at a clip of $290/month (national average) should not send you to squattting at your local Obamaville.
3. Bailouts are just not sound policy for banks, for students... for anybody. And this remains a great point of departure between the OWS set and the tea party. To hear some (many?) in OWS, it seems they are not so much chapped that Wall St. got bailed out as a matter of principle or poor policy but that they did not get their bailout as well.
There is a misplaced sense of nobleness in their assumed impoverished state that believes they "deserve" a bailout more than the "fat cats" of Wall Street.
The tea party has been consistent in that it is wrong to eliminate a moral hazard, be it in the financial sector or in student loans, where wealth and property are involuntarily confiscated in order to paper over the mistakes of others.
Bailouts do absolutely nothing in guarding against the eventuality of the need for more bailouts in the future.
H/T: Hot Air
Wednesday, November 23, 2011