The Obama administration plans to make the government the sole provider of federal student loans, ending the participation of private lenders in the program.
Under a plan unveiled in the administration's budget, subsidies to private lenders would be eliminated, and the government would use the savings estimated at $47.5 billion over the next decade to help bolster the Pell grant program for low-income students.
If approved by Congress, the plan would effectively end government-guaranteed loans to students by banks and other private lenders—lending that has totaled $56.7 billion in the current school year, and has been the primary source of college financial aid since the program was launched in the 1960s.
I only found out about this after the release of the youtube video, which basically tells you all you need to know about this issue:
For some reason this whole expansion of the government into practically every single area of our lives brings to mind the old Heinlein saying, "There's no such thing as a free lunch"--and at some point the American public is going to be pretty upset at the price they have to pay for all these "services" provided by government.
And when I say 'price', I am not necessarily talking about money.