Posts Tagged ‘student loans’

Monday Medley

What we read without asking for Congressional approval…

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Monday Medley

What we read while pitching A-Rod high and inside…

Against Student Loans

Senator Elizabeth Warren, one of the few American politicians willing to challenge the current financial system, has introduced her first bill in the US Senate. With student loan rates set to double from 3.4% to 6.8% on July 1, the Bank on Student Loan Fairness Act would temporarily reduce those rates to 0.75%, which is the same rate that banks borrow money from the Federal Reserve.

There’s certainly something nice about the symbolism of this bill: Highlighting the discrepancy between the rates offered to financial institutions and rates offered to students investing in an education illustrates the inequities of the financial system. When Senator Warren frames it as a choice between students and banks, it’s clear which side you should be on. And since the bill has no chance of passing, that symbolism is important. But the spirit of the bill is misguided, because the problem with student loans is not that they are too expensive, but that they are too cheap. Continue reading