According to current figures, the United States has $1.3 trillion outstanding in student loans. An estimated 25 percent of that amount is delinquent, meaning that students are behind in their payments by $273 billion.
How could this have happened? It used to be that banks administered the student loan program. Though loans were guaranteed by the federal government, the banks still had underwriting guidelines to determine the risk of getting their money back. During the Obama administration, that was changed so that now the government administers the program. Anyone can get a loan and the money goes directly to the student, not to the school.
As a result, many students are paying their rent with it or their living expenses and going on spring break at the expense of the U.S. taxpayer. This is another entitlement program.
Does it make sense for someone to acquire student debt in excess of a $100,000 while working toward an education degree? How are they going to pay back that debt? As usual, the government doesn’t think about that. It charges into a program with a fistful of cash and throws it around like Floyd Mayweather at a strip club.
This program is a perfect example of how much contempt government agencies have for the American taxpayer. This is one of the swamps the Trump administration is going to have to drain.