Yesterday, the House of Representatives approved an overhaul of the student loan industry, eliminating a private student-loan system with government subsidies and replacing it with a new system which provides for government distributing loans directly to students.
By getting rid of the middle man, the CBO estimates this new bill will save $61 billion over the next ten years. More importantly, about $36 billion of those savings will be put into Pell grants. This means that, for the foreseeable future, there will be a steady and reliable source of financial aid for those students who need it the most. Arne Duncan, the U.S. education secretary, said, “Tonight’s vote in the House is a big victory for America’s students.”

Of course, their are two sides to every story. Opponents of the bill say that this is just another example of government unnecessarily taking over private business. They envision an unwieldy government machine taking over an efficiently running private system and worry that this flies in the face of free markets, competition and free choice…all principles this country’s economic culture was built on.

What do you think? Savior to the students who need student loans most? Or does the bill sacrifice their options in order to help push through the health care bill?