Obama to Lure More Students into Incredible Debt Loads
Mar 15, 2010 at 4:59 PM
I've referenced Mish Shedlock before (see here and here) when discussing college tuition hikes and the problems with the student loan system. Now, I'm doing it again, because he has a timely new post on the president's disastrous plans to expand the Pell Grant system and lure even more college students into ridiculous amounts of unnecessary debt. Shedlock explains:
If president Obama gets his way, still more money, up to $50 billion, will be thrown at the failed Pell Grant system. Pell Grants are based on a means test and the funding comes with no strings attached. The money does not have to be repaid. That alone should tell you the program is rife with fraud. And it is.
He quotes a New York Times article, which explains, “If these programs keep growing, you’re going to wind up with more and more students who are graduating and can’t find meaningful employment...They can’t generate income needed to pay back their loans, and they’re going to end up in financial distress.”
In short, further federal funding of these grants seems like a good thing in that it helps more students go to college -- but it's driving up the price of school for everyone and leaving students with debt loads they can't realistically repay and without viable job options. Shedlock's right when he concludes, "Rather than throwing hard earned taxpayer dollars at programs that invite fraud and make debt zombies out of students, it's time to kill the program entirely."