Federal Income-Based Repayment Plan Encourages Skyrocketing Law School Tuition

What is truly scary about this clever scheme to milk the taxpayers is that it could quickly catch on at other universities, at a cost of hundreds of billions of dollars…

by Hans Bader on August 13, 2013

A recent item in The Washington Post explains “how Georgetown Law gets Uncle Sam to pay its students’ bills,” averaging $158,888 over three years, taking advantage of perverse incentives in a federal student-loan program. A federal income-based repayment plan forgives the student loan debt of law students who go to work for the government or a “public interest” law firm 10 years after they graduate, as long as they pay a small percentage of their income in the first ten years after graduation towards paying off part of their student loans. Typically, much of those law students’ loans are not paid off by the end of 10 years, and thus are forgiven at taxpayer expense. But Georgetown has figured out a way to take things even further and make taxpayers pick up the entire tab through creative accounting. Under its Loan Repayment Assistance Program, a student can get his law degree “absolutely free of charge,” and entirely on the taxpayer’s tab. As the Post notes……. To Read More…..