Student Loans and Uncle Sam

Will the Democratic Congress use “reconciliation” to shove their version of health care reform down the throats of an unwilling electorate? That’s the issue grabbing all the headlines these days.

But a recent Wall Street Journal editorial points out that the majority in Congress is also ready to use reconciliation to sneak another government takeover through Congress, this time with little fanfare. The legislation would ban private lending companies from issuing federally backed student loans.

The Journal opines that universities are none too pleased about this because when it comes to customer service and in making sure borrowers don’t default on their loan, the feds don’t stack up well against private companies.

Ostensibly, by taking over student loans, the government plans to save money. But according to the Journal, the planned savings of $67 billion will be overtaken by $77 billion in new spending. No wonder Congress wants to pass the bill before the public catches on.

More disturbing is that this is yet more evidence that the administration and Congress are bent on increasing the government’s power at the expense of the private sector.

So why should you and I, or any Christian care?

We’ve talked often BreakPoint about the danger of debt—for individuals and the government. This new takeover will place additional burdens on future generations, who will pay the bill for the government’s largesse. But this episode points to a more fundamental issue: freedom and the proper role of government.

I’ve said it until I’m blue in the face, and I’ll say it until I’m purple: The biblical view of the role of government is to preserve order, restrain evil, and promote justice. Government has no legitimate interest in running car companies, the healthcare industry, or taking over student loans.

The Reformers understood this, and called it “sphere sovereignty.” Every institution—family, church, private associations, government—have legitimate roles to play in a justly ordered society.

In Catholic social teaching, it was called the principle of “subsidiarity,” recognizing that the interests of individuals are best served by the institutions closest to them. For example, which institution, the University of Virginia or the federal government, knows how best to serve students attending UVa?

In both the Protestant and Catholic traditions, government should perform only those functions which can’t be performed by these “intermediate structures.”

There is little these intermediate structures and voluntary associations haven’t done in building our nation. The great French observer of American life Alexis de Tocqueville marveled at American society—that individuals and communities could come together to promote culture and the arts, to run schools, hospitals, charities and more. Nowhere in the world did he see such vitality.

But today, we’re seeing a concerted effort by the federal government to expand its reach and power at the expense of local government and these intermediate structures. Pressures that are building against the church are very much involved in this.

This not only flies in the face of solid Christian teaching, but the same Alexis de Tocqueville warned that doing this would lead to soft despotism. So we Christians must keep speaking out.

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