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The Government and Your College Degree

There is no doubt: It’s tough to get a college education these days.

The cost of higher education has gone up more than 500 percent since 1985, meaning that the idea of paying your own way through college is, unfortunately, a quaint, but outdated dream for most people. The average student loan borrower has over $29,000 worth of debt and the total student loan debt is $1.2 trillion.

It’s not looking great for our generation. Clearly, student debt is a problem that demands a solution.

The Government Solution

One solution that people are talking about right now is the Bank on Students Emergency Loan Refinancing Act, which would lower the interest rates on student loans.

Even the name, “Bank on Students,” sounds appealing. What could be wrong with making it easier for students to pay back their loans?

Unfortunately, lowering interest rates doesn’t solve anything. In fact, it encourages, and makes it easier for students to take out more loans to pay for college. That means more students in greater debt. More students affording and going to college encourages colleges to raise their prices. We’re back in the same position we were before, except college prices just went up.

That’s a bad deal for students in the long run. This seemingly harmless government-driven reform is an easy fix that fails to bring about a real solution—reform that actually lowers tuition.

A Better Solution

Have you ever wondered why college tuition has gone up so much in the first place? We’ve already touched on one reason—in granting more aid to students, government has disincentivized colleges from keeping costs affordable.

Another reason is the accreditation process, the government’s “seal of approval” for education programs.

[pq]Rather than jump at the easy solution, let’s learn to think through the best solution.[/pq]

While accreditation might seem like a great way to insure standards, all it really does is force educators to go through an expensive and time-consuming process to meet government requirements. Standards remain low, but the process significantly raises tuition and keeps many good programs like study abroad programs, internships, or online courses out of the market.

Rather than making it easier to pay off loans, let’s make college cheaper so that students don’t have to take out those loans in the first place. If we put less weight on the accreditation process, we would have better, more affordable programs available to students. The market would quickly separate the good programs from the bad, much more effectively than the government ever could. The road back to affordable education will not be as easy as throwing more money at it, but it will be much longer-lasting.

It’s Not about What to Think. It’s about How to Think.

Please don’t think that I’m suggesting that accreditation reform will solve all of our problems. The student loan crisis is complicated, and getting government out of higher education is not a quick, easy, or complete answer.

But I would like to encourage you to think of the unintended consequences of seemingly harmless ideas. Often, you’ll find that these “quick fixes” don’t get at the root of the problem. Finding a long-term solution takes a lot of thought, research, and often small-scale experimentation.  Rather than jump at the easy solution, let’s learn to think through the best solution. It will be harder, but the results will be better for everyone.