Higher education bubble? What higher education bubble?

Robby Soave of The Daily Caller reports.

Student loans skyrocketed 463 percent under Obama

President Obama won two national elections in large part due to the hard work and support of struggling American college students, who believed his promised reforms would alleviate their financial difficulties and souring job prospects.

Five years later, under the president’s watch, cumulative student loan debt owed to the U.S. federal government has increased 463 percent.

CNSNews recently reported that student debt levels have deepened substantially–and at an accelerated rate–during Obama’s time in office. In fact, student debt increased 509 percent faster under Obama than under Bush.

The money is owed directly to the federal government, which has become the biggest player in the student loan game by effectively crowding out private lenders. JPMorgan Chase, for instance, stopped authorizing student loans last month, citing limited growth potential and the unstable debt situation.

“The feds pushed private lenders out of the federally supported student loan markets, so all the loans end up running through the federal government,” Rick Hess, director of education policy studies at the American Enterprise Institute, told The Daily Caller. “The problem now is everybody owes this money to the government.”

The problem is further complicated by Obama’s willingness to use debt forgiveness programs to absolve certain students of their obligations. The president has frequently championed and expanded such programs, which allow graduates to unload their debt burdens if they work for certain government agencies for lengthy periods of time.

The ultimate losers are American taxpayers, who are the unwitting underwriters of government-backed loans, said Hess.


 
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