I've heard those concerned about the direction of the country lament that students are rarely if ever taught economics. We learn about the value of money and some basic math concepts, but rarely are K-12 students encouraged to think through the idea of the time-value of money or to understand basic issues like supply and demand. Even in most colleges, economics is rarely a requirement so many of our supposedly most highly-education citizens graduate with degrees, but without a picture of how money works in the real world.

As Charlotte noted yesterday, the Obama Administration seem intent to compound that problem by creating a tutorial in how economics is not supposed to work.

In the real, sensible world, when someone gives you a loan–assuming we all accept the intrinsic value of money and time–then you are supposed to have to pay back that loan, with interest. Otherwise, why would that lender give you the loan and take the risk you may not pay it back?

Yet students are learning from the Obama Administration that when the government gives you the loan, at least, it's really not a loan at all, but a bribe to encourage you to behave how the government wants. You don't actually have to pay the loan back, just be sure not to make too much money, never make paying off your loan a priority, and eventually the debt will just go away.

For those of who have had, and paid back, student loans, this is rather infuriating. After getting my masters degree, when I was working on the Hill and then at a think tank for a pretty modest salary, I can remember eagerly transferring money each paycheck to try to pay off my loan as quickly as possible. My primary goal was to get out of debt. When my now-husband and I married we worked hard to pay off all student loans so that we could be debt free and better positioned to get a mortgage.

Friends who went to law school who would have preferred the more comfortable hours and personally-fulfilling work of a government job took nightmarish positions at those notorious, slave-shop, big law firms. It wasn't glamorous, the hours were killer, but they were making huge dollars. Being rich or becoming a partner wasn't even a goal—they just wanted to pay back the enormous loans they took out to fund their education. This was the payback. They wanted to get out from under this obligation and do it as quickly as possible.

The message sent by student loan forgiveness is destructive to the borrower as well as the rest of us. It's telling students that they don't have to worry if their decisions make no financial sense. They don't have to try to find good-paying jobs even if that means putting loftier dreams on hold. This is a lesson that the next generation will take with them as they consider other big purchases, and will a lasting impression that it's really not that big a deal to borrow more than you can pay back.

As Charlotte notes, just as disturbing as the moral hazard this creates and the message it sends students is that such massive taxpayer subsidies tell colleges that there is no reason for them to try to find ways to control costs. Keep building expensive unnecessary buildings and employing administrators and professors that really don't add value to the school. Who cares? It's the classic third-party payer problem—colleges and students will make the transaction, but with little regard to cost or what makes sense, because they aren't so involved in the yucky process of paying the tab.

When we look at our global economic woes—from what's happening in Greece and through out Europe, to our state and local pension systems and millions of Americans in underwater mortgages—you would think a top priority would be building an appreciation that moving forward, if our credit system is going to work, people should only borrow money and make payment promises that they can keep.

Too bad the Obama Administration, with this push to make paying back student loans unnecessary, is sending the opposite message and encouraging a continued ethic of irresponsibility.