Submitted by Alex Hamilton (not verified) on April 10, 2008 - 9:56am.
Funny isn't it that the PLUS Loan Auction provision that passed Congress caps lender bids at current law--in other words, it really isn't an unfettered exercise in determining what it will take for the market to offer federal student loans. The reality is that the market, if left to operate, might set the subsidy rate higher than current law to ensure a reasonable rate of return. But that would be illegal. Speaking of market pressure, what market pressure applies to the Direct Loan program--what holds the government accountable for efficiency, economy and performance?
Not really an auction
Funny isn't it that the PLUS Loan Auction provision that passed Congress caps lender bids at current law--in other words, it really isn't an unfettered exercise in determining what it will take for the market to offer federal student loans. The reality is that the market, if left to operate, might set the subsidy rate higher than current law to ensure a reasonable rate of return. But that would be illegal. Speaking of market pressure, what market pressure applies to the Direct Loan program--what holds the government accountable for efficiency, economy and performance?