Dr. Richard Vedder
Dr. Richard Vedder, Distinguished Professor Emeritus of Economics at Ohio University, wrote the “pro” side of a column in the Daily Astorian headlined “Pro-Con: Should colleges foot the bill when students default on loans?” His column, run in many newspapers, was headlined “Taxpayers shouldn’t get stuck with a $1.5 trillion loan default tab.”
U.S. colleges and universities admit many students who have very dubious prospects of graduating and/or of earning sufficient amounts of money upon finishing college to be willing or able to repay their loan obligations.
Why is this the case? Colleges, hungry for the tuition revenue students provide — and often for additional state government assistance tied to that enrollment — often knowingly admit students with very low prospects for graduation. There are zero incentives for schools not to admit these individuals, but positive inducements to accept them.
Comments