Student debt is high because of liberals crazy loan program allowing colleges to charge

let's not erroneously blame just the liberals. Bankers and govt lapdogs are mostly responsible. Tuition is extra high bc govt got involved. Govt got involved bc bankers "paid" them to get involved.

We can argue the extent to how high it should be, but I personally do not get the debt outrage pertaining to college

College is an investment....investments require initial funding that may or may not be recouped and then some.

Businesses and individuals go into debt all the time for long run increases in returns (wages in the case of college graduates)

The argument against college debt is essentially arguing that investments should not require initial funding. That goes against basic economic and financial structures

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We need a leftist to come in and say something dumb to perk up the thread.

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The righties here have the market cornered on saying something dumb in threads. It’s why this place is such a riot.

Federal Student Loans should be limited to the in-state cost of attendance to the most expensive public school in that state.

The Federal Government should not be guaranteeing loans for private school or out-of-state tuition.

Really shouldn't be guaranteeing them at all, but I will concede that point for now).

Here’s a solution:

Massively expand the use of income share agreements

LINK

“With traditional student loans, lenders provide students money. After they graduate, they pay back the loan plus interest in monthly payments spread over years and decades.

ISAs are different. It's not even a form of debt. Instead, investors such as private investment firms or a college endowment pay for students' tuition. Then, when the students enter the workforce, they surrender a percentage of their post-college salaries for a time, generally no more than 10 years.

If graduates get good jobs with nice salaries, those investors can make out quite nicely. They could earn as much as 2.5 times the amount they provided the student. But investors also assume the risk that the graduates could end up at low-paying jobs or, worse, unemployed.

In that sense, it's kind of like venture capital for college students. If they do well, the investors do well, but both sides have risk. And since it is the universities that are forking over the bulk of the financing for ISAs, they have an extra incentive to ensure that their product - a four-year college education - is valuable.

"It is a very interesting alternative because it is predicated on expected future income of students and their success," Tonio DeSorrento told Business Insider. "It doesn't look at the asset value, wealth, income level, or the student or his parents. It is truly based on expected outcomes."

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Massively expand the use of income share agreements

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Would the smart kids with an interest in REAL fields of study simply obtain a loan, rather than entering into modern indentured servitude, leaving only the Basket Weaver majors in your market ... and eventually forcing the investors OUT of such a crappy market?

You mean something dumb like Bernie's "FREE COLLEGE FOR ALL" which means AUBURN could charge $50 grand for 9 month's of tuition books and fees and another 30 for housing since gubmint is paying the bill. And it all falls back on us good ole tax payers. So FREE ain't CHEAP!

The issue is that the government backs the loans. That means that lenders have no risk. Since lenders have no risk, they don’t take any precautions when lending the money. They don’t evaluate the lendee to ensure this is a good investment. They don’t demand accountability for what the money is spent on. No matter what, the bank gets paid, so they lend whatever is asked.

Because the lendee will get whatever they need from the bank, no questions asked, these consumers become less sensitive to price. Tuition can go up or down, but demand is relatively uneffected because they get however much they need in loans no matter what. This unhinging of demand from price means that universities are no longer accountable for their prices, and no longer accountable for what they spend that additional money on. In most cases, universities have invested that money into administrative bloat, new dorms, and lavish resort-style aminities.

Basically, the federal government’s policy of backing student loans combined with their policy of not allowing banks to likit access to loans based on grades or major has created a market that is completely desensitized to price, completely divorced from accountability, where the costs fall exclusively on the consumer who likely had no idea what they were getting nto at 17-18 years of age.

Milton Friedman was the first to write about this system

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"[Investors] could 'buy' a share in an individual's earning prospects: to advance him the funds needed to finance his training on condition that he agree to pay the lender a specified fraction of his future earnings. In this way, a lender would get back more than his initial investment from relatively successful individuals, which would compensate for the failure to recoup his original investment from the unsuccessful."

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