New Trump Student Loan Policy Will Ensure Only Wealthy People Go To College
President Donald Trump and Education Secretary Betsy DeVos announced a proposal on Monday that has every chance of placing further obstacles in front of poorer American families in obtaining a college degree, according to ThinkProgress.
The White House laid out a plan encouraging Congress to adopt caps on the amount of money that students and families can borrow, marketing the proposal as a means of pressuring colleges to lower tuition costs.
But as ThinkProgress noted, there is scant evidence to support that such a plan would work, and “higher ed experts warned it would actually just make it harder for working-class families to compete with their richer peers on schooling.”
Speaking with the publication, Student Debt Crisis executive director Natalia Abrams said, “The fact that we have a two-track system for graduate and undergraduate education shows that we treat higher education as a commodity, and the borrowers as consumers, and that’s not how we should treat them.”
Abrams also noted that the recent college bribery scandal — which was revealed last week to have resulted in dozens of arrests and pulled in high-profile parents such as actresses Lori Loughlin and Felicity Huffman — is evidence that the government should get involved.
“I think with this whole college bribery scandal, we’re seeing that colleges are brands in their own right. When people are paying an extra million dollars to send their kids to a college on top of the yearly costs,” she said.
How would lending caps harm poorer and middle class families while leaving the wealthy relatively unscathed?
The immediate costs of higher education will fall on students — a move that will be easily absorbed by those with greater financial resources — leaving the less financially fortunate to make up the difference with personal loans, if they can.
“Their inevitable struggles to make the often-usurious payments on such loans, will allow lawmakers to simply shrug and click their tongues about personal responsibility,” ThinkProgress wrote. “Especially since those new defaults won’t be hitting the government’s own balance sheet.”
For those at the very bottom of the economic ladder, who are more likely to struggle obtaining even predatory type loans, college would simply become inaccessible.
The proposal also suggests opening Pell Grant funds to more providers, meaning it could “allow even an 8-week course to tap into Pell funding that was initially intended to prop up low-income students’ access to two- and four-year undergraduate programs with a clearer historical link to sustainable employment and earnings opportunities,” ThinkProgress said.
This move would not be surprising, considering the efforts DeVos has already made to prevent or undo Obama-era regulatory measures “that aimed to reshape business models and rein in profiteering by the kinds of companies that made her family’s fortune.”
“What Trump and Devos are doing with education is just unwinding the little bit of good that Obama did at the end of his term,” Abrams said. “It’s all about helping big business and hurting borrowers and students.”