More on the Student Lending Scandal

Anya Kamenetz, author of Generation Debt, has more on the college loan scandal:

So as part of Cuomo's still-ongoing probe into lenders' relationships with financial aid offices, 6 schools have agreed to reimburse students $3.27 million, Citibank is donating $2 million to a financial-industry education fund, while 29 New York State schools have simply signed codes of conduct without admitting wrongdoing.
To address some of the questions raised in the comments, I do see the quick payoff as an admission. If not overtly confessing guilt (and I agree that most lenders probably didn't break the law, as now written), it's an acknowledgment that both schools and lenders would rather that students and taxpayers hear as little about lender practices as possible. The money, frankly, is peanuts. This is an $85 billion industry which once sued the Secretary of Education. If the lenders wanted to, they could easily create a legal fund to defend themselves and every single one of the 100 schools involved.
Taking as a given the power of market forces to deliver the best prices to consumers in most circumstances, I think the incentives in the current system are messed up. Currently your financial aid officer is like a financial adviser who works on commission. He's going to try to sell you the financial products that give him the best commission, as well as making you happy.

And Fred's got more on New York AG Andrew Cuomo's investigation in the comments to my last post.

On a related note, I've been meaning to write about this, but seem to have lost it in the shuffle. New York Magazine is running a piece about a wonderful feature of our new economy:being young and lacking health insurance.

Young Democrats consistently list health care and education costs as two of their highest priorities when deciding how to vote, and health care is also listed (with Iraq) as an issue that Congress should act on in the next two years. Candidates need to be hitting these issues hard when addressing young audiences - with solid proposals, not just platitudes - and questions about both of these issues should be put to the candidates by reporters on the trail and in the debates. We need to know where they stand.