So many people are in massive debt from student loans, unable to pay them off which made it easy for politicians to try and bribe people with debt relief to buy votes.
But that debt relief would come at the expense of hard working Americans who didn’t take out student loans or who already worked hard to pay theirs off.
It doesn’t make sense that their taxes should cover a bad purchase when the institutions that offered the bad product get off scott free, especially when so many of them sit on billions of endowments.
Student loans were protected from bankruptcy to prevent someone from gaining an education and simply declaring bankruptcy to avoid paying back the loan.
That covered one side of the moral hazard but left the other side where colleges and universities were free to charge whatever they wanted for degrees that had no chance of ever paying enough to pay back the loans.
I want to propose a student loan lemon law where after certain conditions are met (time, financial hardship, disability etc.) if the loan can’t be paid off it would be the receiver of the student loan money’s responsibility to cover the balance of the loan.
I believe if these institutions were actually held liable for their bad loans it would force them to not only revalue the cost structure of an education but also help prevent people from getting useless degrees.