President Obama signed legislation to expand college access for millions of young Americans by revamping the federal student loan program in what he called "one of the most significant investments in higher education since the G.I. Bill."
A word of caution is warranted here. The student loan program could easily become a vehicle for youth enslavement by the US Government.
The share price of large-scale student loan originators like Sallie Mae, Citigroup, JP Morgan Chase and Bank of America would be undercut. Obama wants to move most student lending into the direct-loan program of the U.S. Education Department.
What happens if a student drops out of school or loses his job before paying off the student loan? Federal backed loans presently allow for some form of "Federal Loan Forgiveness".
To qualify for forgiveness there are some very stringent requirements, such as perform volunteer work, perform military service, teach or practice medicine in certain types of communities and/or meet other criteria specified by the forgiveness program such as working in the fields of public safety, law enforcement, early childhood education, public health, public education, public library or school library services, emergency management and the list goes on and on.
The new program run by the U.S. Education Department makes it easier for young people to enroll in higher education schools. However, it comes with heavy string attached. For one thing, U.S. Education Department is not a financial institution, nor is it a law enforcer. The law enforcer will become the IRS. The financial burden will be placed on treasury and its financial institutions. The U.S. Education Department will not be accountable for any of their decisions on how to award the scholarships.
U.S. Education Department will become a totalitarian institution beholden to its own policies and the people running the department. It resembles the Communist Ministry of Higher Education and this is the topic of this article.
Free education - Communist style
Some social background is required here. The communist system, by design, provided 100% employment for all fit to work. For the naive outsider this looked very noble and sure enough, many people benefited from it, not having to worry about providing for themselves and their families.
Since there was no private business anymore, if someone was unemployed, the only way to survive was by stealing from the government owned institutions. It was that simple. At least that was what the government feared and rightly so. Even so, theft of construction materials and just about anything not available through retail, would be smuggled out of factories or other institutions and sold on the black market. The gasoline for trucks, also owned by the government, had the gasoline dyed red. The truck drivers routinely would sell gasoline to private motorists, especially to motorcycle drivers. The government had to set up police check points on all main roads exiting towns and cities just to check for stolen gasoline, as well as to monitor the individual move of people.
The educational system was very strict. It was practically impossible to pass the examination without a good knowledge of the test subject.
High school was mandatory. Students were allowed to repeat a failing class just once. Students who failed to get a high school diploma were assigned to a trade technical school. The school was run like a boot camp. No disruption allowed and physical punishment was routine. By the time we were in high school, nobody dared to disrupt; they knew better. Even so, some teachers would smack you if you didn't do your homework or lacked the knowledge during the class test. Sick leave had to be approved by the on-site school doctor or nurse.
Upon graduating high school, we had two options: 1. Qualify and get admitted at a university or 2. Get drafted in the army which was mandatory (two years.)
High level education was only available as masters degree (5 years). There was no equivalent of a college. The equivalent of four year college was considered a trade school and didn't carry credits valid towards higher level school. In order to get a masters degree, you have to start from zero, regardless of how many years of trade school you accumulated.
One problem with this educational system was the very limited number of openings available each year. It was not uncommon to see 30,000 candidates competing for 300 seats at the medical school. The polytechnic engineering school were I applied there were 300 positions and 15,000 applicants. The admission process was very simple: Five days of written and oral tests. The admission faculty did not take into account the high school grades and its reputation. All high school curriculum's were identical across the country.
All technical universities in the country had the admission exam held exactly in the same days and at the same time. All subjects and questions were secret, delivered by individuals from the ministry of education minutes before the examination started. None of the examining professors were privy to the test in advance. Each test consisted of a four hour written, followed by an oral on a different set of subjects.
The 300 finalists (accepted) were the ones with the top average grade based on more than 30 grades accumulated during the admission exam. None of the tests had multiple choice answers. After the first year, 100 students of my class either dropped out or had to take all subjects over again, even if they failed just one class. Only 150 graduated with a masters degree in electrical / electronics degree after 5 years. The grading in those days was 1 to 10 with 6 the lowest passing grade. The 300 accepted averaged between 8.66 and 9.88 points.
You might wonder why I am getting into these details.
The point I am trying to make here is that this huge competition was due mostly to destruction of all private businesses that did not require talent of this caliber to stay in business. What happened with all the other 15,000 minus 300? They were drafted in the army for two years. After those two years, they would be back and try again either at the same school or a different one where was easier to get admitted. Otherwise, they would end up laborers working for the state owned factories living in misery.
Graduation and job assignment - The process
Upon graduation an average number using all the grades including the thesis was compiled and presented to a hiring committee. The committee consisted of representatives from different ministries who had job openings as defined by the national planning ministry. We were given the list of all openings, 150 jobs exactly as many as we were and invited to step up in front of this committee one at a time in the order of our grades with the highest grade first, to pick up the desired job until the list was exhausted.
Did we have the choice to decline any of the listed jobs? No, it was already established by the government the place where you were going to work for a minimum of five years. This was the free education guaranteeing you a job.
Unless you were connected, and many of my colleges were and so was I. We all took our assignments, reported to work to the assigned place and within one week we worked out a transfer to our desired place which was not even listed by the employment committee. We had to get ministry approval and we did.
Not everyone was that fortunate. At least we were engineers and most of the factories employing engineers were located in relatively large cities with a theater and some social activities available.
Doctors and teachers were the most unfortunate. They were assigned to small remote villages and had to stay there for five years. It was practically impossible to transfer even if they found a company willing to hire them. Remember ID national cards? That is how the government kept track of who and where these people were and made sure they stayed there.
Stalin used this strategy quite successfully. In 1968, while working for the Romanian Airline, I spent two months in Tashkent, Uzbekistan when it was part of the Soviet Union. This was a large maintenance facility for the Soviet made passenger aircraft. The engineering support department consisted of 35 engineers and technicians, all of them Russian; not even one Uzbek or any non-Russian.
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