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Here's How We Solve Impending Student Loan Disaster

The opinions expressed by columnists are their own and do not necessarily represent the views of

For those of you who are unaware, America is facing a student loan disaster. The facts are frightening. Student debt is now in excess of $1.2 trillion. Yes, TRILLION. To put that in perspective, student debt is more than the total of all of America’s credit card debt.

Now comes the really bad news.

Twenty-five percent of those with student debt are in delinquency or default…that is, right now American taxpayers are on the hook for $300 billion, or approximately $1000 for every man, woman and child in this country.

Yes, you, your spouse and your 4-year-old child who has yet to start pre-school are each saddled with $1000 in student debt.

But wait, it’s much worse. The New York Fed reports that of those who are paying their student loans, fully 71% are only paying interest… potentially leaving the taxpayers on the hook for the other $600 billion in principal. That means your 4-year-old child already owes $3000 in student debt even before starting pre-school. If this doesn’t frighten you, it should.

Well, I have the solution. Read on.

Liberal politicians have complained that “for-profit” educational institutions that are not delivering the education and jobs they have promised should be required to pay back the tuition and fees to the students they have failed. This is one time I agree with them.

But why doesn’t this apply to EVERY educational institution?

Is there any difference between “Joe’s Auto Body Repair Institute” or “Mary’s Hairstyling College” failing to adequately train its students so they can get a job…versus Harvard University failing to adequately train its students so they can get a job…versus a public university failing its students?

When any of these institutions take a student’s money, they are entering into an implied contract to educate that student to be better positioned to survive in the “real world” and be able to repay what it costs to get that education.

So, my solution…

Every educational institution, whether it be Joe’s or Mary’s or Harvard or Ohio State, is ultimately on the hook to repay a portion of the student loan, if the student is unable to.

One could easily argue the college should be on the hook for the entire loan. But let’s be fair and reasonable. The college should certainly be responsible for half of that loan, while the student should take personal responsibility for the other half. The student needs skin in the game too- to force them to get out of their parents’ basement and fight for a job. No one gets a “free ride.”

There is nothing better than a market-based solution to get positive results. These universities are not forced to take a student’s money, but if they choose to do so, this solution will rightly make them responsible and motivate them to adequately educate/train their students and assist them in getting jobs upon graduation.

Remember much of this money comes from loans provided by the federal government. Why should colleges get to take this “easy money” from the government, then let students stiff the taxpayers? Taxpayers are the ones whose tax money made the loan possible in the first place. They should be protected from losses by the colleges accepting these loans.

This solution would mean forcing colleges of all kinds to tailor their curriculum to “real world needs and demands.” At colleges from Colorado State to Harvard this would undoubtedly mean being truly helpful to their entering students by, for example, directing more of them to science and computer majors, than art history or “ethnic studies” majors.

This would not only benefit the students, but benefit America and the economy as a whole, as they would be training and educating students with skills that would actually help America grow and thrive. It would mean each college would have to create a truly robust job placement department, focused on real world needs and demands.

Think how totally depressing it must be for a bright, motivated young person to spend four or more years pursuing a degree that their ivory-towered instructors and so-called “guidance counselors” encouraged them to pursue, only to graduate with $100,000 or more in debt and find there are no jobs for what they have studied.

Is it any wonder one out of twelve college students have not only considered, but actually made a suicide plan?

Eliminating this terrible outcome for so many young people is perhaps just as important a reason to enact the market-based solution I’ve proposed, as saving America’s taxpayers from this exploding student loan disaster.

It’s time our higher educational institutions, controlled by corrupt progressive elites, are forced to focus on results, what is best for their students, and what is good for America, rather than simply continuing to feather their own cushy lifetime jobs and lifestyle- all provided by easy-to-get government loans that students aren’t paying back.

Oh and this would have one more real-world result: Professors who teach one or two courses a week and publish one book a year that no one reads (except their adoring mother) would no longer make $200,000 a year (let alone the $400,000 Senator Elizabeth Warren made at Harvard Law School). Colleges would have to do the same thing every small business owner does- live within their means, cut non-performing employees, lower salaries and reduce pensions.


*Tuitions would go down dramatically.

*Parents of students would have more money for retirement, instead of working until they die to pay off their kid’s student loan.

*Taxpayers would be off the hook for billions.

*Colleges would join the real world and make sure their customers (i.e. students) get their money's worth. Maybe the Harvards of the world would have to dip into their $15 billion endowment funds to pay back taxpayers, on behalf of their customers (students).

Everyone wins.

This is the simple, commonsense way we solve the impending student loan disaster. Brought to you by a successful small businessman, not a government bureaucrat.

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