College Finance: Why Student Loans Should Be Pay as You Go
The proposal would save an estimated $43 billion over a decade. Predictably, the higher-education lobbyists oppose ending the subsidy, and so do advocates for student borrowers.
While I consider myself an advocate for student borrowers, I wholeheartedly support ending the subsidy -- and even taking it a step further. I think that we should end in-school deferment periods on student loans and also require students to make full payments on their debt while they're still enrolled.
If the federal government starts requiring students to begin paying off their loans as soon as they borrow the money, we might see the birth of a newfound prudence in borrowing. Students might opt for cheaper schools, take part-time jobs to avoid loans and maybe even make more of an effort to graduate on time.
Zac Bissonnette's Debt-Free U: How I Paid For An Outstanding College Education Without Loans, Scholarships, Or Mooching Off My Parents was called the "best and most troubling book ever about the college admissions process" by The Washington Post.