That damn liberal media strikes again!

>> Tuesday, March 30, 2010

That damn liberal press. Here's a headline from the left-wing mainstream mass media (specifically, MSNBC) that caught my eye (full article here):

Yeah, pretty left-wing, alright. You can just see the socialism seeping out of your browser. Scare quotes around the word "fixes"? Really? And then there's the second part of the headline: "Measure cuts banks out of the student loan business, costing them billions." Not, "Student loan reforms will save taxpayers estimated sixty-eight billion over next ten years," not, "Government bailouts of student loan defaults to end," not, "Pell Grant program strengthened; community colleges to benefit," not, "College graduates' financial burdens to be relaxed," not....

Well, you get the idea. Oh no, pity the poor banks: they had a swell deal where student loans were guaranteed by Federal subsidy if struggling college grads went into default, a win-win deal that allowed participating banks to reap interest from subsidized student loans at absolutely no risk to themselves (interest that was supplemented by direct payments from the Federal government if necessary to keep consumer rates low), a system that was inefficient and was a direct handout to private enterprise from the taxpayers' pockets, and here's a headline that seems, to my eyes at least, to strongly imply that we should be morally offended on bank shareholders' collective behalf that the gravy spigot is being shut off at the well.

Let's be blunt: fuck that noise.

Y'know, I was able to go to college and law school because of subsidized Federal loans, loans which I'm repaying and expect to pay back fully. I'd like to think that, on top of that, the investment the government has made in subsidizing the interest and guaranteeing the loan is repaid in having a productive member of society who pays taxes and makes his corner of the country a little better and brighter than it might be if he was an unemployable bum, a career which I probably could have aspired to had I wanted (I certainly was too apathetic in high school to be scholarship material, and my parents weren't in a fiscally sound position at the time; the simple fact, I'm afraid, is that I went to college at least partly because I could easily borrow money to do so). (I kid, in part, about the "bum" business: perhaps, had I not gone to college, the whole musician/actor thing would have panned out... but probably not, let's be honest; I was never terribly good at either.)

I also have to say something else about those loans: that when I graduated from law school--UNC, a bargain, then a top-25 law school but one where the annual tuition cost a third of the annual tuition at the next cheapest in-state law school of similar caliber (Wake Forest)--and went to work as an Assistant Public Defender, practicing law on behalf of the poor, I was not in a position to pay back my loans and easily could have defaulted. I eventually benefited from an in-state public interest law loan repayment program and a refinancing that made my debt manageable, but my initial repayments represented roughly one-third of my monthly take-home paycheck, and the refinancing occurred after I'd been unable to make one, possibly two monthly payments; a cap of ten percent annually of my annual income, one of the reforms the President signed into law today, would have been a huge boon to start with had it been available then.

But aside from the personal benefits, let me be clear about something else: I fully believe government should fully pay for a secondary education for any person who wants one. Educated people make better choices and can contribute more to civilization under any metric you might point to: they have more taxable potential, more revenue creation potential, create more interesting pieces of culture, have more potential for inventing new technologies, etc., etc., etc. They even make better bankers.

So I see taking out the middlemen and the assorted accompanying reforms as being good things, and admit my personal and political biases accordingly. A list of them is buried in the article linked to above, underneath the headline, and let's be honest about that: the headline is not only the first thing you read (and liable to color your entire sense of the article that follows), but for those who skim the news it may well be the only part of the article they read.

Which means that a lot of people will see the news and think, ah, here's a left-wing President and liberal Congress discriminating against banks. Which might be nice if only it were true, is what I think myself, but in fact what you have is a center-left President and centrist/center-right Congress simply saving the American taxpayer money in various ways while ending what can only be described as a corporate handout. Of course this will cost lenders billions: because the American taxpayer was giving banks billions he probably didn't even know he was generously gifting them with and probably would have been sort of pissed about if he had.

It's funny: last week my friend Janiece worried that she was reading too many liberal blogs and relying on too many liberal news sites and asking about conservative ones she could look to for balance. Which is great, and frankly typical of the kind of "question everything" open-mindedness that I consider to be a staple of true liberalism; but what I thought was funny though not-helpful, and sort of said there a little bit but not as much as I would have liked, is that the mainstream press is so center-right-to-right wing already that she doesn't really need to change all that much. Mother Jones isn't going to report that banks are going to lose billions, at least not without an evident sense of glee and an emphasis on the good that education lending reform is going to do for consumers, taxpayers and educational institutions. The headline you see up there would be unthinkable in a publication as left-wing as the right and Fox News purport the MSM to be.

But this is what the right is talking about, anyway, when they point to the liberal media elites: big corporations sticking up for the corporatist status quo and tsking under its breath at the rare actual stabs at liberalism from a government that loves to subsidize the private sector in all sorts of ways, including the example of corporate welfare that the President and Congress are ending today. Keep that in mind, maybe, the next time the right starts bitching about the "liberal press."


Eric Tuesday, March 30, 2010 at 4:13:00 PM EDT  

I'm adding a comment here instead of in the main post because I'm not sure where to fit it in: I actually find it a little offensive that the lending reforms are described as "costing" banks billions. That's true, I suppose, from a certain meaning of "cost"; the problem is that banks were getting a Federal handout, which is ending. Saying that ending the handout is "costing" banks billions is an awful lot like saying welfare reform in the '90s "cost" some recipients whose benefits ended however-many-dollars, i.e. it's not a phrasing anybody would have actually used, even an unrepentant, unapologetic pro-welfare state lefty like myself who believes in a Federal safety net for the poor and unemployed. Yeah, cutting benefits "cost" the poor a lot of money by not-giving them money they'd previously been receiving; but what they lost wasn't something they had otherwise, much as changing lending practices isn't actually taking money out of banks' vaults.

The more I think about that part of the MSNBC story, the pissier I get about it. I hope I've made the point clearly enough I don't need to say much more about it. Thanks for reading if you made it this far.

John the Scientist Tuesday, March 30, 2010 at 6:31:00 PM EDT  

You know, for once I agree with you about something economic.

WTF is going on these days?

Steve Buchheit Tuesday, March 30, 2010 at 6:46:00 PM EDT  

Just wait until the whole, "Since more people have insurance, the government is going to reduce direct payments to hospitals to cover the indigent/charity cases, and the money given to states which is then given to the hospitals to cover the same thing," side of the HCR starts kicking in. Of course it'll be spun to say we're killing healthcare, instead of saving the taxpayer money and a justification of the HCR bill to reduce government involvement in healthcare.

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