Congress is reducing spending on student loans. (If you subscribe, the WSJ has a better article.) I'm opposed to student loans, but Congress is doing this backwards, making things worse instead of better.
The money savings come from raising interest rates on the loans. So young people will be burdened by even bigger debt repayments than they already are.
Congress should, instead, save money by lowering the amount of money that students can borrow. This would force colleges to cut costs and maybe discourage some students from unnecessarily attending college.
Unlike all other forms of debt, student loans cannot be discharged in bankruptcy. So student borrowers make a deal with the devil in which they can ruin their lives forever because they are never allowed a fresh start if they borrow beyond their ability to repay.
You say you are "opposed to student loans." I'm curious about this. Have you written more on your views of the subject? Do you prefer student loans to Pell grants? Or do you discourage any government spending for higher education? Do you favor subsidies that affect institutions but not individuals? Can government pay schools for research? Does the government have any interest in furthering generic research done at universities? I'm curious to hear your thoughts, perhaps in another post.
Posted by: Bradley Ross | December 22, 2005 at 04:29 PM