Romney’s plan to move backwards on education

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The New York Times ran a report last week on President Obama, who enjoyed the enthusiastic backing of most young voters four years ago, having more trouble rallying support this year. The combination of a weak recovery and dysfunctional mess in Washington has tempered the youthful passion that helped propel Obama into office in the last election.

But the next question is whether the president’s challenger, Republican Mitt Romney, is in a position to win over many of the young people who may be open to outreach. If education policy makes any difference at all, the former governor is hardly trying.

The quote didn’t generate much in the way of attention, but consider this line Romney delivered in a recent speech in Virginia.

The key phrase: Romney wants young people to “get as much education as they can afford.” That’s not really the way American society is supposed to work – if you’re a young person who’s bright, works hard, and wants to further you’re education, your public leaders and public institutions aren’t supposed to say, “Sorry, you’re not wealthy enough to pursue educational opportunities.”

But that’s Romney’s message in a nutshell. Indeed, in March, the GOP candidate explained his intention to cut Pell Grants and encourage students who struggle with tuition costs to “shop around” until they can find a college they can afford.

And then, of course, there’s Romney’s plan for the student-loan system, which he intends to make worse, on purpose, in order to boost bank profits for no reason. It’s arguably the most scandalous element of Romney education agenda, and most voters probably aren’t aware of how absurd it is.

As we’ve discussed before, one of President Obama’s under-appreciated accomplishments was his reform of the student-loan system – under the old model, the student-loan industry received billions in taxpayer subsidies to provide a service the government could perform for less. Americans inexplicably paid banks to make guaranteed loans to students.

As Rachel explained on the show a while back, in 2010, Democrats removed the middleman, streamlined the process, saved taxpayers a ton of money, and helped more young people get college degrees.

Romney’s main goal when it comes to higher ed is to bring the middleman back. The Boston Globe had a good piece on this yesterday, explaining that Romney’s plan would likely “cost taxpayers tens of billions of dollars over a decade without saving students money.”

The prime beneficiaries, critics say, would be banks and loan companies that stand to reap a financial boon through subsidies to make nearly risk-free, government-backed loans. They are the same firms that benefited from the system that existed for decades before 2010, when President Obama required that the government issue all federal student loans.

“The old guaranteed loan program was rife with lobbyists and will go down in history as a system that existed far longer than it needed to simply because it was enriching private companies,” said Jason Delisle, director of the Federal Education Budget Project at the New America Foundation, a nonpartisan think tank. Inviting private lenders back into the program, he said, appears misguided: “What’s in it for students or taxpayers? Nothing.”

The private lenders that benefited from the old system – SLM Corp., NelNet Inc., and College Loan Corp. – have donated generously to Romney’s presidential campaign, while giving nothing to Obama.

Imagine that.

Jason Delisle, who identified himself as a Republican voter, also told the Globe, “On this issue, Romney is just ridiculous. His campaign staff doesn’t have any new ideas, so they said, ‘Let’s just go back to what we were doing before the Obama administration came into place.’ ”

And keep in mind, depending on how Romney would implement this policy, the real effects would likely mean fewer loans for fewer students. Under Obama, officials are taking the money that was unnecessarily going to bank profits and making it available to those who wouldn’t otherwise be able to afford tuition. If we revert back to the old system, that almost certainly means taking money from students and converting it back into bank profits.

The Republican presidential hopeful recently said, “I don’t see how a young American can vote for, well, can vote for a Democrat.” Yeah, it’s quite the mystery.

Mitt Romney

Romney's plan to move backwards on education

Updated