Give the collection headache to private business, and pick up cash in the process. That's how two senators want part of the federal loan portfolio handled. Congress should heed them.

Practically any sale of federal real estate invites the charge that it denies our grandchildren an inheritance. That criticism isn't always valid, but it makes privatizing of public land unlikely.Nevertheless, not all privatization is politically impractical. For instance, it's hard to imagine serious objections to the proposal offered by Sen. Frank Lautenberg, D-N.J., and Sen. Daniel Patrick Moynihan, D-N.Y. They want to sell off some debts owed the government.

There's good private-sector precedent for their plan. Troubled corporations sell unneeded assets and call in "receivables." Why couldn't Washington do likewise? It's in financial straits and has a load of assets in the form of uncollected loans. Why not sell them to professional collectors?

Washington's "loan assets" are greater than the combined debts owed to Chase Manhattan and Bank of America. In other words, its portfolio is massive.

At the same time, government's collection competence is limited, to put it generously. Everybody has read reports of wealthy professionals who've gone years without repaying student loans.

The total portfolio of uncollected debt is $257 billion. Lautenberg and Moynihan propose a test sell-off of about a tenth of those assets - $8 billion in rural housing loans in each of the next three years.

There would be an immediate budget boost. Selling those loans would give government $24 billion directly, as well as $6 billion in savings from lower interest payments on a reduced federal debt.

The only losers would be those who owe. They'd start hearing from collectors who are serious about collecting.

This experiment is long past due, and deserves speedy congressional approval. The loss for recalcitrant debtors would be a gain for everybody else.