As you may know by now, college financial aid may change in 2010 under our new President. Obama financial aid will involve students getting their loans directly from the government and bypassing the private sector.
One of the problems with this is that one entity will now be deciding the fate of millions of students and that entity is the US government no less. What task does the government do well and why should we assume they will be able to effectively dole out loans?
Under the Obama student loans proposal, all competition would be gone. That is never good as competition is the one thing that keeps costs down and makes companies do their best. One reason why the government fails at so many things is because there is no competition. Have you ever been at the DMV or some other government office where you have to shake your head at the incompetence? That is because there is no other company competing against them. There is only one DMV and so we are totally at their mercy as we can't go anywhere else to get our licenses.
College students need loans and they need to understand the process to get them. They also need an unbiased assessment of their financial situation to determine whether they get a loan. Finally, they need to be evaluated based on need only and not the color of their skin or politics.
No matter what party is in the White House, will there not be accusations of racism and favoritism levelled again the government by some students who have been turned down? Will parents not think that the government is biased against their ethnicity and do we want the government being the sole deternimer of our fates like this?
Obama student loans is a bad idea from my perspective as it makes the government bigger and it takes out all competition. This country is split 50/50 right now politically as shown by the last two elections and this is something that is just going to fan the flames and make people more upset.
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