E&W Blog

The following op-ed was published online at AOL News on March 17, 2010.

Imagine a bill that dramatically increases the power of the federal government in Americans' lives. It expands the federal bureaucracy to administer a vital service. Democrats argue it will save money over time because the federal government is more efficient than the private sector -- yet the American people are suspicious of these claims.

This legislation will require the federal Treasury to increase its borrowing from China and our other foreign creditors by hundreds of billions of dollars over the next few years. Terms like "public option" have been used to describe a government-run alternative to the private sector, but the ultimate -- and obvious -- goal all along has been a complete government takeover.

If you think we're talking about health care, you're right -- sort of. But you're also wrong. The bill we're describing is a government takeover of student loans. And it has the potential to pass Congress this week by way of a vote on health care.

If you're confused, you're not alone.

For months, the American people have been bogged down in the intricacies of a divisive health care debate. They have cried out for Congress to hit the reset button and start over on commonsense, bipartisan solutions that will bring down health care costs without upending one-sixth of the U.S. economy. Democrats have steadily and stubbornly refused, moving ahead with a legislative gambit the likes of which could never have been envisioned by the framers of our Constitution.

This week, the health care debate is barreling toward its inevitable conclusion -- a defining vote that will tell Americans whether their elected officials put people first, or government. Yet with the public's attention firmly focused on what this vote means for their medical care and coverage, far too few realize that it will also have major consequences for how they pay for college.

For the past several weeks, Democrats have been shuffling elements of their health care plan like pieces on a chess board, gaming out various moves to eke out a victory in the face of overwhelming public opposition. Yet unbeknownst to many, the latest game piece in the Democrats' plan is a government takeover of student lending that will eliminate the private-sector choice and competition enjoyed by students and schools for more than four decades.

Since 1965, the federal government has ensured that students have the means to pay for college by offering a federal guarantee on privately financed student loans. Known as the Federal Family Education Loan (FFEL) program, this public-private partnership guarantees access to billions in financial aid for college students each year while keeping the bulk of the long-term debt off the government's books.

The benefits of this partnership are obvious: Innovation and competition in the private sector produce better benefits, lower costs and superior customer service for students and schools. For these reasons, the FFEL program has consistently been the choice of colleges and universities.

The alternative to the FFEL program is a government-run student lending model known as the Direct Loan program. Direct Loans are financed with borrowing from -- and by -- the U.S. Treasury. With annual borrowing in the federal student loan programs reaching $100 billion, the program has the potential to significantly increase our national debt as borrowers pay back their loans decades after taking them out. And if borrowers don't pay, taxpayers will be left holding 100 percent of the liability.

Perhaps it's fitting that Democrats would attempt to overthrow private sector-based student lending by tucking it into a plan that has been widely panned as a government takeover of health care. Both proposals vest untold power with federal bureaucrats. Both proposals are built on the shaky assumption that private-sector choice and competition can be eliminated with no cost to consumers. And both proposals began with the promise of a "public option" that ultimately would transform into complete government control.

As Congress careens toward a vote on health care, the parallels between these two policies cannot be ignored. It would be tempting to refer to this bill as two government takeovers for the price of one, but unfortunately, the cost for students, patients and taxpayers will be much, much higher.

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