Once again, Mitt Romney exhibits a pale pastel view of the free market. Education, just like healthcare, has experienced sharp inflationary pressure due to unlimited government loans and subsidization. Over the past two decades, the federal government has colluded with Big Education lobbyists to create a circuitous cycle of pouring more and more taxpayer dollars into higher education. The more the government subsidizes student loans, the more education providers raise the cost of tuition, which engenders an even greater need for subsidization so students can afford the astronomical costs. Repeat and rinse as necessary.
In 2007, the Pelosi Congress lowered the interest rates for subsidized Stafford Loans made to undergraduate students from 6.8% to 3.4%. This was supposed to be temporary, but much like every temporary stimulus measure, it was designed to force reauthorization after each expiration date. After all, who would dare oppose “raising” the interest rates on student loans?
House Republicans rightly opposed the extension, but now that Mitt Romney has publicly voiced his support for Obama’s education stimulus, it will place undue pressure on conservatives. In classic pale-pastel style, Romney said that he wished for the new spending, estimated at $6 billion per annual extension, to be offset with spending cuts elsewhere in the budget. Romney lacks the fortitude to oppose the extension on its merits, irrespective of the cost. The reality is that this government intervention provides no incentive for universities to slow their tuition increases, and quite the contrary, it incentivizes them to keep raising the price.
One would expect Romney to learn the lessons of the housing and healthcare bubbles and how government third-party payer inexorably raises their prices. Then again, Romney created his own healthcare bubble in Massachusetts, so you can say that he is quite consistent.
Conservatives believe that the entire Department of Education must be abolished, yet Romney wants to extend a Pelosi-era DOE loan program! Folks, this is going to be a long election year for conservatives….
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