Originally Posted by La literatura
So . . . do we allow student loans to be dischargeable in bankruptcy in an attempt to get schools to lower spending, or hold off public funding to the school (which will just have the schools raise student fees). Or dry up the loan process, which will cause the public to complain about lack of education opportunity.
The student loans are owed to the government, not the schools, right? Or are guaranteed by the government anyway, right? So discharging it in bankruptcy doesn't change the economics from the school's point of view.
Federal guarantees of all student loans should discontinue. It's really that simple, unfortunately. It's having a massive distorting effect, and driving up the cost of college education for everyone, largely negating the benefit it was supposed to confer. Loans may be cheaper, but because it's driving up demand exponentially, and eliminating payment risk, colleges are just jamming it to students in the form of massive tuition increases.
Some scholarship / grant programs can certainly remain to help those who are incapable of funding from paying, but otherwise, eliminate it.
Of course, this will hit the middle class the most. Those who are wealthy pay their way, and those who are poor get need-based grants. But that's not really different than what goes on now.
Without the feds standing behind everything, EVERYONE needs to analyze what a college degree is "worth". Banks or colleges who give loans, and students who take them out. The pool of college applicants will (and should) shrink, especially as to less worthy degrees.
Frankly, there is no reason that a history student should have the same tuition cost as an engineering student, nor that a history teach gets paid the same as an engineering teacher. The market DEMANDS that they not be treated equally, because they just ARE NOT worth the same. Yet the professors get paid the same, and the students pay the same, when they are demonstrably, measurably, PROVABLY not equally valuable.
Whole system is ****ed up.
Whatever, this is all pie-in-the-sky. None of this will happen. Eventually, maybe, when a college tuition and loan takes an average of 40 years to repay, people will wise up. Until then, forget it.