Steve Chapman on Obama's Deficient Student Loan Plan
The more the government does, the less reason students have to demand cost control, and the higher tuition will climb.
The government normally doesn't care whether anyone accumulates large bills for home improvement, a new car, or exotic vacations. But Barack Obama feels no hesitation in concluding that the cost of higher education has placed "too big a debt load on too many young people." Therefore, something must be done.
Obama wants to let some five million borrowers cap their monthly repayments at 10 percent of their income and, after 20 years, be relieved of any remaining balance. But forgiving these debts would add to the expense inflicted on taxpayers without doing borrowers much good in the meantime, according to Steve Chapman.
Thinking that more federal aid will make college affordable is like believing that a dog can catch its tail if it goes faster. One reason colleges charge so much more today is that federal aid makes it easier for students to cover the bill. The more the government does, the less reason students have to demand cost control, and the higher tuition will climb, writes Chapman.