Dr. Richard Vedder, Director of the Center for College Affordability and Productivity and Professor Emeritus of Economics at Ohio University, wrote an Aug. 25 article for National Review on “Subsidized Decline:
Federal tuition-support programs harm students, colleges, and the economy.”
“A political storm is brewing in Washington over the consequences of rising college costs, but few politicians are talking about the causes of the problem, particularly since a major perpetrator of it is Washington itself. Using his exquisitely honed rhetorical skills, President Obama panders to his political base by suggesting that the solution to ever-mounting student-loan debt lies in easing repayment terms; Senator Elizabeth Warren proposes lowering interest rates for many past borrowers,” he wrote.
“The reality is, however, that the single biggest cause of this financial problem, and a contributor to many other weaknesses in our economy, is the dysfunctional, byzantine system of federal financial assistance for college students. College-aid programs have grown rapidly over the last several decades, with annual federal assistance in the form of grants, loans, tax credits, and work-study now totaling $170 billion a year, compared with about $10 billion (in today’s dollars) in 1970. These programs were designed to make college more affordable for all and to increase the proportion of college graduates coming from lower-income groups. On both counts, they have failed.”
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