The real issue with Student Loans is that the price of the education doesn't seem to match current market trends for the jobs. For example if the lawyer market is saturated the price for law school should reflect that saturation by being cheaper. High demand jobs should cost more since you're nearly guaranteed to profit from that education meaning the lender is more likely to get their money back. In my opinion, if you're a dumb ass lender that's your fault and the courts shouldn't back your dumbass decision to lend the money.
No, that's just a case of kicking the can--you'll get students with degrees that aren't worth it, a lifetime problem for them. The cost to the student should go
up in the saturated fields--reduce the number of students that take that route.
I have no knowledge of how the student loan industry actually works so I'm guilty of blowing hot air here. Degrees that aren't worth it are degrees in markets where the jobs are in low demand. It makes no sense for something in low demand to cost more than something that is in high demand. High demand jobs means business' would offer high pay to compete for talent and students who take out loans for those jobs have a higher chance of finding one in their field and thus being able to pay the student loan. It's not kicking the can, it's knowing your market. But who cares about knowing the market when you don't have to? If you don't have to worry about where the payments for the loans will come from then you don't price based on the market you price based on the courts or insurance (or whatever backs it). I'm of the mind that as a business if your product sucks it makes sense to lose money. In the case of student loans, the schools set the price and the lender seeks a profit on top of that price. It's on the school for charging too much for the degrees, the lender for basing their loans on school prices that don't match market trends and the borrower for accepting that overpriced rubbish. All of this should play out in the markets and not in the courts where consumers are forced to pay for a useless product.
A simplistic reduction of how college budgets work, and there's some stereotypical confusion about the "product" and the "customer" of a university system. Are less popular degrees the same thing as less useful degrees? Is the worth of a degree about the number of jobs you can get with that degree, or how much money you make if you do get one of the jobs? Is "demand" the demand by students for certain majors and classes, the demands their parents make of them, the demands industry makes of the colleges, or the demands civil society needs and requires from the system? How do we balance private against public against semi-private education? How do we balance the different needs of different types of colleges serving different populations? Is a college solvent because it offers lucrative degreees that primarily benefit students, or is it solvent because it offers popular programs that drive up enrollment and therefore state apportionment, even if the classes themselves aren't vocationally related? Should we avoid complex degrees such as those in STEM fields because they are unpopular and expensive to offer compared to a relatively "cheap" liberal arts degree (which has no labs, field trips, small class sizes, etc)? What about CTE courses such as technical skills (welding, construction, electronics) that are similarly expensive to offer, but get jobs for students alost right out of the gate, even if it costs the college money to have that program? My college offers two programs - administration of justice and fire control - that are enormously expensive, absolutely don't make back their budget, and due to their demanding and competitive nature end up washing out most of their students before they get a degree, but have incomparable worth to society. We need police, firefighters, park rangers, and so forth, so doesn't it make sense to subsidize them even if they make little money for the school or for the students? Yet this will drive up loan debt, since those programs also result in more students with loans they can't immediately pay back, and are also especially attractive to lower class students who are more likely to take out loans in the first place. Should they be expensive programs, since employability of graduates is high, or cheap, because graduation is unlikely? Cheap, becuase the jobs you get with them aren't lucrative, or expnsive, because employment is almost certain?
Looked at one way, my most popular classes, which are various sections of a well-liked elective on world religions, are also the most injurious to students; taking my course will cost them (possibly loaned) money and not directly contribute to any later job. But on the other hand, viewed from a college budget perspective, it's very inexpensive for me to teach a popular class which always fills and requires no special space or materials from the college, compared to a shop class with eight students that needs much special equipment, produces toxic waste that must be carefully disposed of, and is never taught at full capacity for lack of student interest. You could argue that the shop class is
needed more than my class, both by society (which needs skilled workers) and by the students (who need jobs). But
my class helps pay for
that class, because unlike a shop teacher, I make thousands of dollars for the school in apportionment with every class I teach, more than repaying them for my salary. Indeed my entire department has some of the fewest majors, but one of the highest work efficiencies. Without the liberal arts offerings to balance out expensive CTE courses, not just the tuition but particular course fees for those CTE courses would go up... making them even less popular and thus more expensive and financially inefficient than they already are. Meanwhile your model would make a degree in my field extremely cheap, since there isn't a lot of direct demand for our graduates, even though from a budgetary perspective, making your most financially productive programs/departments cheaper to the students makes no sense at all, as our whole
raison d'etre disappears if the college isn't making money off of us, and we're most lucrative of all when we aren't teaching our majors, but merely offering classes to students in other majors. Meanwhile, the Department of Education has its own role to play: for instance, currently we have a $10,000 grant that is contingent on getting butts in seats for those CTE courses, which the Trump administration has favored. Accepting that grant money, but jacking up the cost of tuition for those very employable degrees, could result in criticism if not actually legal penalties, since the whole point of the inititative was to make those necessary degrees cheaper for the college to offer and for students to afford, and to promote the number of graduates in those programs generally, a number that more expensive tuition would tend to reduce.
There is no golden bullet when it comes to higher education. Indeed, ultimately, schools don't "set tuition" as such. They have an influence on it, but how schools get funded is much more complicated than just tuition payment --> classes --> degree, especially when you start factoring in the role of government grants & programs, and private loans.
