Rep. Ron Paul (“The truth about my student loan plan”) is upset that headlines have portrayed his budget plan “as immediately getting rid of student loans.” But it’s unclear from his logic why this would be bad.
As the congressman explains, Education Department loans caused the increase in education prices. If the loans were eliminated, colleges would be forced to lower prices to a level people could afford. If this is true, why wait until students accumulate more debt to end the program?
Worse than the debt itself is the type of debt. Education Department rules prevent students from settling these loans in bankruptcy, which means they’re stuck with them for decades. Eliminating this rule alone would help former-students and wouldn’t pin the taxpayers—many of whom never had the chance to go to college—with the debt.