Reforming Higher Education: A Few Student Loan Links

Although I haven’t come to any policy views of my own at this point on the question of student loan debt, I wanted to flag a couple of links to discussions of the issue.

  • The New York Times has a good FAQs-style summary by Ron Lieber in today’s Business section.  Highly recommended for coming up to speed on the basics of the new programs; informative and well-organized.
  • Politico’s Tim Mak has a roundup of the arguments underway in the blogosphere about what it means, whether it is a good idea or not, whether it is fair, how much it assists borrowers and who bears the ultimate burdens of the program.  There’s lots of argument via the links.
  • At NRO, Annie Hsiao says this is a bad idea, for lots of reasons, but also adds some interesting discussion – not seen very much in the arguments over, basically, whether it does much for a student’s loan payments – over the use of the proceeds from the Federal government borrowing at near-zero and lending to students at 6.8%.
  • David Inviglio at The Atlantic says it won’t make much difference to the average monthly repayment – less than $10 a month, he says.
  • Finally, Instapundit points us to a Chronicle of Higher Education article that points in the same direction as Inviglio, that it won’t make much practical difference, but then offers his own Insta-proposal, which I am mulling over (partly in relation to a book chapter I am writing on asset securitization and the Dodd-Frank requirement that mortgage originators hold onto a certain percentage of the mortgages as “skin in the game”):

Here’s my plan [says Glenn Reynolds]: Make the loans dischargeable in bankruptcy, but not until 5 years after graduation. Then put the educational institutions that got the money originally on the hook for 10% of the loans. Watch the dramatic change in institutional behavior.

(I’m opening this to comments, as I’d welcome links to other interesting takes on these question.  Please keep discussion civil, focus on trying to think through policy, and avoid rants.  Thanks.)