Colleges and universities have been selling potential students a bill of goods for decades, assuring them that a college education was the ticket to economic success, and the more you paid for higher education, the bigger the payoff in increased earnings down the road.
That may have been true 40 or 50 years ago. But for most students today, college has become a luxury for upper-middle class and rich families who can afford the cost of a four-year degree. It’s either paid for by daddy — who doesn’t really mind his kid majoring in journalism or environmental justice — or by taking out loans to get a degree that will never allow the graduate to make enough in salary to pay them back.
And the colleges just keep raising the price of a four-year degree because their nanny — the federal government — doesn’t mind the increased costs. It’s a vicious circle of creating a need, offering a false solution, and then increasing the cost of that solution, which creates a need because fewer and fewer young people and middle-class families can afford college at today’s prices.
Everything was hunky-dory as long as the pool of college-age students willing to mortgage their future kept growing. But with college enrollments cratering, colleges are now going to be forced to cut costs or raise tuition substantially. Which do you think they’re going to choose?
The biggest problem with Biden’s student loan forgiveness program isn’t the immorality of transferring the debt burden from those who can afford it to those who can’t. It’s not even that the idea is unconstitutional and unfair.
The biggest problem with the loan forgiveness plan is that it’s an invitation to create another student debt crisis in a few years because absolutely no reforms of any kind to any of the government programs handing out student loans have been proposed by Democrats.
Schools have gotten a free pass to inflate their prices, hiding behind debunked claims of declining state support. While schools talk up their contribution to affordability by touting generous “institutional aid,” far too often it’s more like a coupon for the financially secure who are unwilling to enroll without it than a scholarship for needy students. The result is a squeezing of middle-class families’ pocketbooks and increasing debt to pay for degrees that simply don’t pay off.
This is unsustainable.
The nation’s borrowing crisis cannot be solved by ad hoc student loan debt jubilees on the eve of Election Day. Just last month, House Republicans presented the president a bold blueprint to fix the student loan crisis his party created. In response, the Biden administration charged each taxpayer $2,500 – including those who never set foot on a college campus – for a plan that will put outstanding student loan debt right back where it is today in a few short years.
This is not a loan problem. This is a government problem. While just 30% of student loans are given by the government, more than 92% of the current student loan debt is from government loans.
Related: Biden’s Student Loan Bailout: A Trillion Dollar Clusterfark Waiting to Happen
This is a problem that needs to be addressed before students take on another $1.6 trillion in debt that they’ll never be able to pay back.
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