The History of Student Loans & the Scam it becameSubmitted by Crabacado on Fri, 07/19/2013 - 06:44
A look at the 55-year history of federal student loans: By Connie Cass via AP
(Some excerpts/takeaways, then link to full story)
-Why did Uncle Sam get into the college loan business?
The short answer: Because the Russians launched Sputnik...
-Taxpayers took the risk; bankers got the rewards.
-To keep money flowing to college students, Congress gave the Education Department power to step in and buy private loans from lenders.
-Uncle Sam took over. Now, the entire federal student loan program belongs to Washington.
- The Federal Reserve prints money for free, gives it out at near 0% interest and by the time a student receives a loan, his or her interest rate is around 7-10%
-Students who go into public government careers can have their loans forgiven or discounted.
Student Loans 101: Why Uncle Sam is your banker