Opinion
Arne Duncan Makes a Case for Direct Student Loans
By
Feb 26, 2010, 11:09

Arne Duncan writes on WaPo this week:

For too long, bankers have gotten a free ride from the U.S. Department of Education.

Under current law, taxpayers provide as much as $9 billion each year to subsidize guaranteed student loans issued by banks. The banks earn profits on the interest; if students default, taxpayers take the loss, not the banks. In other words, working Americans pay while bankers get rich.

Meanwhile, educators, engineers and computer scientists -- the backbone of the new economy -- face crushing debt from six-figure college tuitions. A study of national postsecondary student aid found that in 2008, two-thirds of college seniors graduated with debt averaging more than $23,000. That number will rise as public and private college tuition costs escalate.

The banks have had plenty of help with government bailouts and other subsidies while working families and students are increasingly squeezed...Watch the Video, and read the rest of the article, Direct student loans: A better way to invest in education >>