The cost of higher education has accelerated at an alarming rate in recent years. It’s no news that students have taken on unprecedented amounts of debt to finance their higher education. Recent graduates are struggling mightily with this debt burden after graduation. I understand this predicament all too well. My wife and I recently paid off nearly $160,000 in student debt.
Through its lending practices, our government has contributed to inflating tuition prices and has set students up to be trapped under student debt.
- Government student loan lending – without loan qualification standards – has allowed nearly everyone to qualify for a student loan. A one trillion dollar student debt bubble has inflated over the past two decades as a result.
- Knowing everyone will receive assistance, colleges and universities have been enabled to raise tuition prices at a rate that outpaces inflation. Our government financing higher education is the driving force behind unreasonable tuition increases.
- American tax payers are paying nearly $38 to collect $1 of student debt as defaults spike. This is perhaps the strongest indication yet that our government financing higher education is a flawed approach.
The problem is clear and my solution is straightforward. We must start to scale back our government lending program. Privatizing student loan lending will result in responsible lending only to those students who have a high likelihood of being about to repay their debt. For this approach to work we must also allow student debt to be released during bankruptcy, similar to consumer debt.
The outcomes of a scaled back government student loan lending program will benefit nearly everyone
- Fewer students in the future will be trapped under burdensome student debt.
- The cost of higher education will normalize as tuition becomes connected to the return on that investment. Higher education demand will only exist for programs at a cost that makes economic sense.
- Federal bureaucracy will be eliminated as the size of our government student loan lending program shrinks. Our government will no longer spend an absurd $38 to collect $1 of student debt.
As a representative in Congress, education reform at all levels would be a top priority of mine. Join me, as we limit government student loan lending for the benefit of all.