As expected HR5715 has cleared Congress and is headed down Pennsylvania Ave to the White House. In this contentious election year, our elected delegates sure are looking busy; passing all this useless legislation and all.
This is an attempt to demonstrate to the voting and taxpaying public that Congress "did all they could" to avert the looming student loan crisis. When it all hits, they'll say: "Well, our hands were tied, we did absolutely everything we could." Except, that is, for fixing the problem that they created.
Today, Ben Bernake, the esteemed Chairman of the Federal Reserve System, said in a response letter to Chris Dodd: "Congress may well wish to revisit the question" of whether setting hard subsidy levels for loan providers is the best approach, Bernanke said in the letter.
"You may decide that a more market-sensitive approach -- flexible enough to provide a wider spread during times of market stress and a narrower one during normal times -- could provide a more robust structure," he wrote (from a Reuters story out today).
What?!?!?!?! Congress could have acted hastily to put into place some inappropriate legislation and thus contributed to the student loan mess that they're desperately trying to fix? Can't be. We anxiously await Chris Dodd's response to the response. But seriously, we breathed a great sigh of relief at the sanity and logic that Mr. Bernake points out. When the criticism comes from the Wall Street Journal, Congress gets all testy. But Mr. Bernake....they'll take that a little more seriously. CollegeLoanSearch gets plenty of anonymous hate mail from what we suspect to be Dept of Education servants as well; we're apparently way off the mark in our assessment of the situation. But the issue will now be brought to light. It gets more interesting each day.
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