In today's Wall Street Journal, Secretary of Education Arne Duncan contributes a piece entitled "Banks Don't Belong in the Student Loan Business." What he opposes is federally subsidized bank loans and I'm with him on that. Subsidizing student loans is no better policy than subsidizing home loans. Where we part company is in his approval of direct government loans, which he wants to increase so that more students can "realize the dream of getting a college education." As I have frequently pointed out, a college degree is what many students want. Relatively few dream of education. Low-cost loans entice large numbers of young people who gain little if anything in the way of lasting knowledge and skills into college, where they pile of debts they'll have a hard time repaying once they get into the labor force and get a job that most high school kids could do. Besides that, nothing in the Constitution authorizes the federal government to lend money for this or any other purpose.
- December 18, 2009