by Bob Luddy March 22, 2019
President Trump’s recent budget proposal calls for reforms to the federal student loan program, so that colleges that “accept taxpayer funds have skin in the game through a student loan risk-sharing program.” Certainly, a change in the student loan program is long overdue.
Recent research reveals that more than a quarter of students default on at least one student loan within 12 years of entering college. Shockingly, almost half of black students default (49%). While each default reflects a profound personal crisis for a former student, the aggregate data tell us that the government’s student loan program is terribly broken.
Student loan debt is the worst kind of debt in the burden it places on young adults. Once in default, debtors are subjected to aggressive and persistent collection efforts. They often face wage and tax garnishments, and the debt is almost impossible to discharge, even in bankruptcy. The $1.5 trillion student debt load is often cited as a major reason that college-educated millennials defer marriage, children, and home purchases..........To Read More.....