The student loan system lies in the special place that brings in the worst of private and government sectors. General loans work pretty well out there: Loan co

The student loan system lies in the special place that brings in the worst of private and government sectors. General loans work pretty well out there: Loan costs are aligned with loan risks, because nobody wants to loan money to those that can't pay. But student loans are guaranteed by the government, so for all intents and purposes, anyone can get a loan, whether they'll be able to pay it or not. At the same time, it never goes away, and it's given to people who probably still live with their parent. They bear a bigger risk than I do with my mortgage, but they might get tens of thousands of dollars in debt without deciding on a major first! What really makes this pernicious is that, since everyone gets access to the loans, in practice, this means college can be far more expensive than it'd be otherwise: Without all the loans, most colleges would have to be cheaper. Same thing if colleges also bear the risk of non-payment. And it's not as if this money is being spent enriching teachers: It's mostly administration and facilities. So now we have a system where everything is very expensive, and most students get huge loans that they can't afford, and where ultimately, the taxpayer will end up having to foot the bill: The only winners here are the universities themselves. Just think of what this is doing to medical schools and law schools: They know that even the poorest student will be able to max out on their loans! So dropouts, and in the case of law school, graduates that went to the wrong school end up in a worse situation than they would have been 30 years ago. The country must choose: Either stop giving money to private colleges, and just focus on good, cheap, no loans, public universities, or let people pay for their own college with no guaranteed loans: Less people will even go to college, but those that do will afford it, because colleges would have to adapt to lower budgets. Guaranteed loans to pay for expensive, private universities? This just makes sure that millennials will end up worse off than their parents for the first time since the industrial revolution.