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Sallie Mae: A Conservative Jobs Program

President Obama's student loan reform has mostly escaped attention because Democrats packaged it along with health care reform. But it's a BFD in its own right. Under the old system, the government would backstop private loans to students, creating a no-lose income stream for banks. The reformed system cuts out the middleman, saving tens of billions of dollars for the government. I call that a win. Conservatives, though, convinced themselves that defending subsidies to private lenders was some kind of free market crusade. National Review's Stephen Spruiell thinks student loan reform is a failure because those lenders now have to lay off employees:

Jobs Created or Saved Destroyed

Sallie Mae closes call center in Killeen, Texas, eliminating 500 jobs, in the wake of the Democrats' student-loan "reform," which was packaged with the health-care reconciliation bill.

Pass the bill to find out what's in it.

Well, yeah. When you cut back on a wasteful government subsidy, some of the beneficiaries of that waste will lose their jobs. Wasting tens of billions of dollars on loan subsidies in order to support call center jobs is a very, very inefficient way to boost employment. It's funny to see conservatives turn into bleeding hearts when the victims are banks.