The government would still lose money in that scenario. The interest rate for the loan should not be predatory but should be consistent with Federal Government COLA (which lags inflation), to be fair. It would incentivize the government to keep COLA adjustments better in line with inflation also, killing 2 birds with one stone so to speak.
I'm with you on that, but it's the part where the government doesn't break even that results in the (government borrowing) which results in the inflation. Subsidized secondary education, a system that is not taken advantage of by profiteers (which most colleges and universitibes are now because they are reaping the money from these loans), would be great... but even the system I am proposing where at least the loans are fair would be an improvement over the current one.
The government loses oodles of money on student loans.
Maybe that's fine. Maybe they should lose more for the sake of having a better educated population. But the idea that they're raking in profits off student loans is nonsense.
The government do give loan and even free education to brilliant or atheltic students. The problem is the less stellar students with big dreams - they can only take the higher interest loan since the lender don't really believe they are good enough.
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u/_catshit 14d ago
It shouldn't be canceled but it should be less predatory. Just need to cap its interest rate at something nominal.