Robert Shireman, a senior adviser to Secretary of Education Arne Duncan, says he expects the default rate, which reflects the early part of the recession, to continue to rise. “When people are facing a job loss, figuring out how to pay their student loan is not No. 1 on their list,” he said.

That’s right. For better or for worse, the last thing on many people’s minds at this time is their student loans. Like Mr. Shireman reports, if you’re losing your job and you’re at risk of going into default on your mortgage, then the last thing that you care about is paying back a student loan that is ten, fifteen, or twenty years old!

But you’ve got to make those payments, folks. Student loans are among the few pieces of debt that cannot be discharged in a bankruptcy filing. Further, the government can (and will) garnish your wages if you default on your student loans.

All of this gets back to a point that I’ve made a few times in the last few weeks on this blog – that one of the best ways to stimulate the economy would be to cancel some, if not all, student loan debt for existing borrowers. And this point is related to something else that I think many of us stunted by student loan debt understand that the rest of the people out there don’t get yet – namely that even with all of the stimulus plans and other money being pumped into the economy, those who have a great deal of student loan debt are not going to be able to contribute to the economic recovery.

Now, if there were only a few of us, then the effect wouldn’t be so bad. But the number of people with out of control student loans is growing and that is not a good thing for the economic recovery…

For example, in his acceptance speech last night, Obama said:

I’ll invest in early childhood education. I’ll recruit an army of new teachers, and pay them higher salaries and give them more support. And in exchange, I’ll ask for higher standards and more accountability. And we will keep our promise to every young American – if you commit to serving your community or your country, we will make sure you can afford a college education.

Sounds good to me. However, I wonder about a few things…

First, what does “invest” in early childhood education mean? Are you going to provide universal pre-K education? Can someone show me the statistics stating the overwhelming need for this service? I’m sure it will help many Americans, but can we see some demographic information?

Second, one does not recruit an army of teachers out of thin air. Further, if Obama has ever been to New Jersey, then he would know that the New Jersey Education Association union has a death grip on the education industry in our state. In other words, they’ll lovingly accept his offer of more support and higher wages, but the moment he talks about accountability they’ll throw him out and mount a massive campaign against him. It’s funny…New Jersey’s teachers WANT to be challenged and prove that they can succeed in educating ALL students, yet their union fights against accountability. Unreal.

Finally (and I know this better than anyone else), American makes no promise to its young people that if you serve your community, then you’ll be able to afford a college education. Sure, we make a promise about being educated if a person serves in the military, but we make no promise about an affordable educating if one serves their community. Imagine the massive government bureaucracy that would be needed to pay for a program like that…

The only other comment that I would make about Obama’s speech and the direction that his platform is headed in general is that services cost money. I’m completely behind Obama’s statement that federal taxes should be cut for 95% of Americans. That’s great if you ask me. However, many federal dollars which are collected through taxes are filtered back to states and large cities to pay for certain services. If there is less tax revenue at the federal level, then one of two things will happen. One, services will be reduced at the state and local levels because the funding will no longer be there. Two, taxes will be raised at the state or local levels to maintain services.

Personally, I think state and local taxes will go up if Obama’s plan goes through. And I think that’s the way to handle it because I’m a big believer in state’s rights in our federal system. Of course there is always the option of cutting services and programs that are a waste of money…or getting out of Iraq…so that the country’s expenses are reduced. But I haven’t heard a politician talk about ideas like that this election season!