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Obama's New Student Loan relief Program Ignores the Real Problem – College Costs

Analysts: Obama Student Loan Policies Ignore the Real Problem – College Costs

( – As President Obama prepares to roll out new student loan relief programs through executive order on Wednesday, policy experts say actions taken by the administration to date have not targeted the root problem – the rising cost of college tuition.

The president plans to announce steps he will take to assist people struggling to pay off their student loans. They will not require congressional authorization.

The announcement in Denver will take place on the final day of Obama’s three-day trip through western states. It also comes at a time when many of the Occupy Wall Street protesters are demanding forgiveness of student loans.

“I don’t think he would go as far as student loan forgiveness, but even if it’s just increasing federal subsidies, it’s problematic for a number of reasons,” Lindsey Burke, an education policy analyst for the conservative Heritage Foundation, told

“Any time you increase subsidies for student loans you are saying to the three-quarters of people who did not graduate from college that you are going to put the burden of paying for college on their backs – even though they did not attend college,” she said.

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Whatever you subsidize, you get more of.

As Ron Paul says here:

Ron Paul: End U.S. student loans

O'bailout wants votes as was discussed on the Judge last night:

The law cannot make a wicked person virtuous…God’s grace alone can accomplish such a thing.
Ron Paul - The Revolution

Setting a good example is a far better way to spread ideals than through force of arms. Ron Paul

Stop gov't intervention.

Eliminate subsidies, eliminate gov't loans, eliminate gov't regulations.
Return it to the free market,and let the market rule.
As it becomes clear that there are many who would like to go to college, but lack the money, colleges will be created for low tuition, to serve that market.

The first step is to make it so only people who can afford it can go to college. Then, the pressure comes on the market to produce lower-cost alternatives to serve the larger market segment below that. If everybody gets guaranteed loans for whatever the outrageous cost might be, then the cost will never go down.

Precisely.This is similar to

This is similar to Health care costs/Health Insurance

The more loans and grants issued, the higher the cost will be to go to college.

Why is this so hard for DC to understand?

How to reduce the high cost of college? Any ideas?

Business has been able to take advantage of computers and the internet to reduce costs and increase efficiencies. Why can't colleges and universities do the same? Its been years since I was in college, so many of you here in school now will have better incite into this. Why can't much of what's done in a classroom be done on line? Rather than one professor speaking to a traditional class of 30-100 students, have the class online and speak to 5,000? Some things can't be done online, like lab work, so time in the school for some subjects can't be virtual, but it would seem a virtual classroom would greatly increase efficiency and substantially reduce costs.

It just seems the colleges could reduce costs and serve more students by changing the traditional way things are done. The problem with this is the schools may not have any incentive to reduce costs, and most bureaucracies don't like change.

I would be interested in any input anyone here has.

Its real simple

How do we reduce the cost of college......reduce demand !

Costs versus Prices

College tuition (prices) will continue to rise as long as the students' money keeps coming in. Yes, it might help prices somewhat if they reduced their costs too, but why should they reduce tuition when there are little to no price pressures to do so? Now, if colleges can reduce costs but they don't have to reduce prices, they simply pocket much of the difference (or apply it towards lobbying costs for their favorite legislators).

It's just like how Congress will not reign in Federal spending until the Fed turns of the printing press.

While commercial and residential real estate goes dormant, have you noticed that the 90% of the new construction going on in this country consists of government buildings, medical care buildings, and university buildings? Your tax dollars at work.

Subsidized student loan financing creates an education bubble,

much in the same manner as the housing bubble was created. People who would be unable to purchase without subsidized financing are able to enter the market, demand increases, and prices rise. The recent economic downturn has made many recent graduates underwater on their education loans, that is the value of their education and ability to obtain employment is far less than the debt from student loans. Due to changes in bankruptcy law, students have a much harder time walking away from the bad "investment" and declaring bankruptcy.

Just what were they thinking?

I wonder what they were thinking when they changed the bankruptcy laws regarding student loans? Could it be they could see this student loan bubble forming and wanted some governmental protection? Maybe we need to start asking some questions?

Here's a link with some history of the changes

I might begin to examine why the changes were made by asking "Cui bono?". Top of my list of suspects would be lenders and the higher education establishment, and ultimately central planners who have found another way to make individuals dependent upon government.