Student loans for pre-school?

As if the student-loan crisis wasn’t bad enough, now there’s a proposal to create a market for loans for pre-school. The idea comes from New York City Mayoral candidate Christina Quinn.

Think Progress describes the program this way:

[The] pilot program will offer low-interest loans to families with children between the ages of two and four who have an annual income of $80,000 to $200,000. Parents will be able to get loans of up to $11,000 and make interest-only payments until Kindergarten. The loans will be available to 40 families in the first year.

Quinn’s pilot program is aimed at helping parents afford the cost of childcare, which in New York is $14,000 a year on average, making it the least affordable state. The competition for preschool in New York City is also fierce, as there were 28,817 applicants for 19,834 slots in 2011. In some neighborhoods, applicants for free preschool programs outnumber slots by eight to one.

The impulse to help more families get their children into early-childhood is a noble one. The value of pre-school in social, intellectual and emotional development is well-documented. And with just 28 percent of four-year-olds enrolled in state-funded pre-schools across the country, it’s clear that some children are falling behind, right from the start. Access to pre-school is toughest for middle-class families, for whom the ever rising costs have become, for many, prohibitive.

But student loans [maybe they’d be more aptly called “toddler loans”] don’t seem like the answer. College loans help you get a higher education, which ostensibly yields higher lifetime income, which ostensibly makes your loans more valuable and easier to pay back. What’s the up side of a toddler loan for pre-school? Not much. Yes, it could help your child attend a better quality pre-K program, but there’s no direct economic payoff. Neither your kid nor you will be making more money because he/she graduated from kindergarten. So, that toddler loan just adds to the cost of pre-school and to your overall financial liabilities.

There is, of course, an obvious solution—one that doesn’t involve banks, interest rates more privatization of things that should be publicly funded:  Universal, state-funded pre-school.

As Think Progress concludes:

Instead of focusing on subsidizing loans, state governments could follow the examples of Oklahoma, Georgia, West Virginia, and others in offering universal access to preschool. And President Obama has proposed a plan that would bring such access to all families. A universal program would not just benefit children and their parents, but it would have significant benefits for the economy and society at large.