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Federal Student Loans: Biblical Perspectives On Debt

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This thesis contends that government intervention in the form of student loans, while well-intentioned, presents significant economic challenges and conflicts with biblical ethical principles concerning debt and stewardship. It will analyze the economic rationale for government involvement, assess the sustainability of current student debt levels, and examine the biblical perspectives on debt. The Evolution of Federal Student Loan Programs: For over 60 years, the federal government has played a significant role in helping students finance higher education through loans and loan guarantee programs1. Here's a brief overview: 1. Origins (1958): The first federal student loans were issued directly to borrowers under the National Defense Education …show more content…

3. What is the difference between a'smart' and a'smart'? Sallie Mae (1972): Lawmakers established the government-sponsored Student Loan Marketing Association (Sallie Mae) to facilitate liquidity in the loan market. Sallie Mae originated federally guaranteed student loans under FFEL and worked as a servicer and collector of federal student loans. 4. What is the difference between a.. Direct Student Loan Program (1992): Research suggested that issuing loans directly to borrowers would be more cost-effective than loan guarantees. In 1992, lawmakers piloted a direct student loan program, eliminating the "middleman" of FFEL lenders and related subsidies. 5. What is the difference between a'smart' and a'smart'? Transition to Direct Lending (2010): In 2010, the FFEL program was ended for new loans, and the federal government fully transitioned to direct lending. Concerns about limited borrowing opportunities during the Great Recession partly drove this move. Challenges and Implications: While government involvement has expanded access to credit, it has also led to rapidly rising student …show more content…

Biblical Perspectives on Education and Debt From a biblical standpoint, education is valued as a means for personal growth and empowerment. Proverbs 1:5 advises, "Let the wise hear and increase in learning, and the one who understands obtain guidance." Education is a tool for betterment in life, resonating with many biblical teachings about wisdom and personal development. Regarding debt, the Bible presents caution. Psalms 37:21 notes, "The wicked borrows but does not pay back, but the righteous is generous and gives." The biblical caution about debt underscores the need for responsible lending and borrowing practices, a principle that can extend to government-issued student loans. Economic Analysis of Education Externalities The justification for government intervention in higher education often revolves around positive externalities: benefits that educated individuals contribute to society, which are not fully compensated in private markets. These include higher productivity, better civic participation,

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