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Interest Rates Soar – The Consequences?

The nation has turned apoplectic about the increase in student loan rates that took effect on July 1 due to Congress, once again, not doing their job in actually legislating and doing the country's business. Is it any wonder why American rank this Congress lower than any public or private organization in the nation's history?

But let me add a devil's advocate view: maybe a rise in interest rates is not all that big of a deal. We already know that there is approximately $1 trillion dollars of outstanding student loans. We also know that millions of graduates are unemployed, underemployed, and/or living with their parents because of crushing student loans.

Maybe we have made student loans too easy to obtain and too cheap to resist?

I'm a strong believer that a nation that can "borrow" a trillion dollars for a war in Iraq can -- and should -- invest more in sending their best and brightest to college on minimal, if any, student debt. But, if a rise in interest rates makes some students take applying for scholarships more seriously, and forces them to live a more frugal lifestyle in college, and maybe even forces a rethinking of career goals, then perhaps there is silver lining to this debacle.

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