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Comment by kyrra | Hacker News Reader

The issue is back in 2009, the US government started backing student loans, so they were guaranteed loans. There was also no loan limit on these. This is allowed universities to charge more and more money, in the fed was happy to back these loans.

This is led to bloat within universities. See: https://stanfordreview.org/stanfords-administrative-bloat-is...

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This is the correct answser if the a ton of money suddenly becomes available for something the price of that thing will increase because the amount of the thing hasn't changed. You see this most especially in colleges because we've established a price floor by promising every student 5k and then promising them more loans on top of that.

Then we make the loans non-dischargable and there is no real reason for a university to every place any limit on what they charge for tuition since the customer who is buying the product is not the customer paying for the product.

Your timeline is incorrect. Student loans were federally guaranteed for decades up until 2010.

1991 MIT won a supreme court case that allowed them to raise tuition as much as they wanted as long as they gave out cost breaks to students that would not be able to pay that much, this qualified MIT to be taxed as a charity and pay nothing in taxes. Other schools followed and jacked up tuition. They still are. It is all a grift. Even in the 90's the freshman class at MIT paid more than enough to fund all the teaching needs of all the other classes along with their own. Realistically, if student loan forgiveness happens, it needs to be pulled from the college endowments that the tuition stuffed into.

This system also obliterates the middle class and penalizes saving money while rewarding irresponsible behavior.

It essentially makes the system be "tell us how much money you have, and that's what the price is for you".

If you spend 18 years saving money for your kid's college, or they work and save during high school, the university just takes all that money. If you spend it all instead, you'll get more "financial aid" to lower the price.

Which, if you're a socialist school administrator is great news. No one keeps any money, everyone leaves school equally poor and dependent on the state, regardless of their previous labor or financial responsibility.

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