In a comprehensive 2017 study, the Federal Reserve Bank of New York found that 60 percent of federal government student loan subsidies end up raising tuition. In other words, an additional dollar of federal government student loan subsidies means 60 cents higher tuition and only 40 cents benefits to students.
Further, the money that universities get from that higher tuition has mostly been wasted on hiring administrators—college employees that neither conduct research nor teach courses. Between 1993 and 2009, administrative spending at colleges rose by 60 percent, 10 times as much as faculty spending. This means that colleges have been using higher tuition to expand school bureaucracy, not to increase quality of education.
Daniels made this tuition freeze possible by slashing the university’s operating budget and pioneering the “Degree in 3” program, which allows students to take a heavy course load and graduate in three years, saving tens of thousands of dollars. The former Indiana governor has also expanded options for online and technical education, as well as interest-free financial aid.
Solutions
Reduce Administrative blout and costs to the students
Interest free financial aid
Colleges and/or regulating bodies require less courses for a degree. Remove filler and repeat courses.
Jobs that historically used on the job training instead of certificates such as billing in a hospital should return to on the job training rather than placing the burden of a school loan on individuals who live paycheck to paycheck and struggle to pay school loans back.
Stop predatory lending.
Forgiveness calculations should start from the first day of graduation.
Repayment options and forebearance options should not compound or capitalize interest on the loan making it impossible to pay off under dire economic times.
Stop taking advantage of well educated professionals only hiring them as part time adjunct faculty that are paid very poorly - less than those who don’t have an education to pay back school loans on. If people cannot get proper employment to pay back school loans due to this type of predatory hiring they cannot pay back loans.
Decades ago many jobs or positions could be obtained by going to reasonably priced seminars or conferences to earn the knowledge required for the position. This should be another option rather than costly college certificates or degrees that often require too many courses with high costs. We should encourage the return of this model for jobs that do not require a more extensive education to perform.