Another year older and deeper in debt. Thanks, big government.
The Wall Street Journal writes about the latest trend of a lender offering vulnerable borrowers plenty of rope to hang themselves:
“Some Americans caught in the weak job market are lining up for federal student aid, not for education that boosts their employment prospects but for the chance to take out low-cost loans, sometimes with little intention of getting a degree.”
The weakest recovery since World War II is one big factor driving people who cannot find work. But now that the federal government has taken over student lending, its policies are at the center of the problem, the paper reports. Low-rate student loans cover not just tuition and books but also living expenses. Getting student loans is easier than borrowing from a bank because, as the paper reports, “the government performs no credit checks for most student loans.”
The result is ominous:
“Take Ray Selent, a 30-year-old former retail clerk in Fort Lauderdale, Fla. He was unemployed in 2012 when he enrolled as a part-time student at Broward County's community college. That allowed him to borrow thousands of dollars to pay rent to his mother, cover his cellphone bill and catch the occasional movie."