Obama’s Student Loan Takeover Adds $52 Billion to Deficit According to 'Fair Value' Accounting, Says CBO (Congress, Barack Obama)

[Jadex]

(CNSNews.com) -- The student loan overhaul legislation signed into law by President Barack Obama on Tuesday could add $52 billion to the deficit between 2010 and 2020 when the cost of the market risks and administrative expenses of the loans are taken into consideration, the non-partisan Congressional Budget Office (CBO) reported.

CNSNews.com - Obama’s Student Loan Takeover Adds $52 Billion to Deficit According to 'Fair Value' Accounting, Says CBO (http://www.cnsnews.com/news/article/63560 - broken link)

Well uh yeah. Doesnt look to good

[Ceece]

I'm not seeing it. I'll admit I'm no accountant but regardless of the costs of administration this report says;

The savings from implementing the President's proposal to replace FFEL loans with direct loans decline from a total of $ 62 billion over the 2010-2020 period under FCRA accounting to $40 billion on a fair-value basis.

So while under fair-value accounting the savings isn't as much, it's still substantial.

[HappyTexan]

This sentence at the end of the OP article sums it up nicely due to items not taken into account:

"Nevertheless, the study indicated that under the “fair-value” and FCRA assessments, the government guaranteed loan program ends up being more expensive."

[NSHL10]

Guess the head of the CBO should be prepared to receive the same letter the CEOs of companies that called into question what Obama Care will really cost received.

How dare you question the Mighty Wizard of Ob?

[sanrene]

See, this is why the democrats were so intent on rushing these bills through without proper scrutiny and analysis.

[Ceece]

Originally Posted by HappyTexan

This sentence at the end of the OP article sums it up nicely due to items not taken into account:

"Nevertheless, the study indicated that under the “fair-value” and FCRA assessments, the government guaranteed loan program ends up being more expensive."

Why would the OP article be believable when the actual study it is quoting says otherwise?

AGAIN:

The savings from implementing the President's proposal to replace FFEL loans with direct loans decline from a total of $ 62 billion over the 2010-2020 period under FCRA accounting to $40 billion on a fair-value basis.

:eople are stupid::

[HappyTexan]

No people are not stupid. That article linked by the OP points out what is missing from the government reports that they did not take into account.

[Ceece]

Originally Posted by HappyTexan

No people are not stupid. That article linked by the OP points out what is missing from the government reports that they did not take into account.

No, the article linked in the OP is what I quoted. There was nothing that wasn't taken into account, it's a matter of two different accounting methods. That's all. And even then it still saves $40 billion.

[HappyTexan]

The one that produce the "good" numbers is the government mandated one.
The more realistic one that takes "risk" and "administrative expenses" is the other one that will increase the deficit.

But that's ok..the fuzzy government numbers are what sold it to the American people.

[MiamiRob]

why the hell should the Government be paying money to banks to gauge students in the first place? If they are going to loan money to students let them do it themselves instead of paying a bunch of greedy freaking bankers who manage to destroy their credit in the first place if they fall behind!