Submitted by smd51000 on February 11, 2008 - 7:11pm.
I think your view on student loans does not go far enough. The government and non-profit loan system does not work. If the government is going to back the student loans if a person cannot afford to pay, then why doesn't it just do that and alleviate the burden of repayment from those who cannot afford to pay. The rules preventing discharge of government and non-profit student loans are too strict.
As it stands now, you can only discharge student loans if you are physically unable to work. That criteria brings with it the underlying assumption that you can make enough money to repay the debt. If the education does not lead you to a better job then the ones you could have had without the education, then you will have a difficult repaying the debt. There is a naive assumption that all liberal arts and classical education is a good investment, when actually it amounts to financial consumption.
It is the traditional educational institutions, not the for profit institutions, that are really causing the bulk of the student loan debt crisis. The true problem is not just the large load of private debt. It is the large amount of non-profit and government debt. All forms of student loan debt should be treated as consumer debt because education is consumption not investment. All colleges and universities should be required to get their graduates jobs for the rest of their lives or refund the tuition money.
If the education is not profitable for the student, then the student should not have to pay for it.
New America should have a new view on student loans
I think your view on student loans does not go far enough. The government and non-profit loan system does not work. If the government is going to back the student loans if a person cannot afford to pay, then why doesn't it just do that and alleviate the burden of repayment from those who cannot afford to pay. The rules preventing discharge of government and non-profit student loans are too strict.
As it stands now, you can only discharge student loans if you are physically unable to work. That criteria brings with it the underlying assumption that you can make enough money to repay the debt. If the education does not lead you to a better job then the ones you could have had without the education, then you will have a difficult repaying the debt. There is a naive assumption that all liberal arts and classical education is a good investment, when actually it amounts to financial consumption.
It is the traditional educational institutions, not the for profit institutions, that are really causing the bulk of the student loan debt crisis. The true problem is not just the large load of private debt. It is the large amount of non-profit and government debt. All forms of student loan debt should be treated as consumer debt because education is consumption not investment. All colleges and universities should be required to get their graduates jobs for the rest of their lives or refund the tuition money.
If the education is not profitable for the student, then the student should not have to pay for it.
Sean M. Donahue