Hey, students: You don't owe that

We’ll have to wait until Friday to see how slowly the U.S. economy expanded in the second quarter. But today Team Obama will tell Congress about its latest proposals to spread the wealth around—specifically from private lenders to the people who owe them money on student loans. The goal is to create new ways for borrowers to avoid repayment.

Even though nearly 90% of defaults are occurring on loans backed by the taxpayer, last week the Consumer Financial Protection Bureau rolled out a new report on purported flaws in the private market. To underline the absurdity of focusing on private loans, the White House’s own budget is forecasting default rates above 20% on some types of federal loans issued in fiscal 2013. That means defaults could be in the titanic range above $20 billion. All of the private firms probably won’t issue half that amount in total loans, never mind bad loans. …

While we don’t doubt Mr. Obama’s sincere impulse to redistribute money, the timing of this effort suggests it is one more election-year pander to the young voters who showed up for Mr. Obama in 2008 but may be less enthusiastic this time. Unemployment among Americans age 20-24 hit 13.7% in June, up from 13.3% in January. So first the President made a big deal over cutting student loan interest-rates to save a few bucks, and now he’s telling young voters he’s making it easier for them to avoid repaying at all.