Smaller Government Means Taxpayer Handouts to Private Corporations

Did you ever wonder what “small government” meant to a Republicans? Surprisingly, it doesn’t really mean saving taxpayer money, but instead, it means giving that same taxpayer money to private corporations. Tricky isn’t it? How else can you explain the following from Edweek.org:

A major overhaul of the federal student-loan program would be used to help finance a significant boost to early-childhood-education programs and school facilities, under a bill approved yesterday on a partisan vote by the House Education and Labor Committee.

The legislation would scrap the Federal Family Education Loan Program, under which the government subsidizes private lenders to make federal loans. (“President’s Education Aims Aired,” Feb. 28, 2008.) Instead, starting in July of nextyear, all loans would originate with the direct-lending program, in which students borrow right from the U.S. Treasury.

The change would save about $87 billion over 10 years, according to the nonpartisan Congressional Budget Office. A portion of that savings, $10 billion over 10 years, would be used to create a competitive-grant program to help states boost the quality of their early-childhood programs, serving children from birth through age 5, the bill says. The bill also includes more than $4 billion to help school districts revamp school facilities, including making them more environmentally efficient.

It sounds fiscally smart. It saves taxpayer dollars. So what’s to dislike about saving $10 billion bucks over 10 years? If you said private business couldn’t get their hands on the money, you must be a Republican.

But Rep. John Kline of Minnesota, the top Republican on the panel, called the student loan changes a “government expansion initiative that crowds out the private sector in the name of a bigger, more intrusive federal government.” And he said the new initiatives created under the bill, including the early-childhood program, would mean “perpetual new entitlement spending.”

So are you better off saving taxpayer dollars by not paying banks to give student loans out, or is it unfair for the government to save the cash and do it itself?

Only your ideology can answer that.