Should we scrap public tuition aid to students altogether?
Whether or not you believe rising student loan debt constitutes a crisis, opinion writers are coming out of the woodwork with ideas on how to combat this impending maybe-doom.
Today, the University of Chicago’s Luigi Zingales writes in the New York Times: “To avoid the next credit bubble and debt crisis, we need to eliminate government subsidies and link tuition financing to the incomes of college graduates.”
The piece continues:
The best way to fix this inefficiency is to address the root of the problem: most bright students do not have any collateral and cannot easily pledge their future income. Yet the venture-capital industry has shown that the private sector can do a good job at financing new ventures with no collateral. So why can’t they finance bright students?
Investors could finance students’ education with equity rather than debt. In exchange for their capital, the investors would receive a fraction of a student’s future.
Forget for a moment the question of whether college debt is an actual bubble in the common usage of the term. Is this author’s larger point—that the taxpayer should not be on the hook for a college educated workforce—a sound one? Moving away from the practical limitations of this idea, do you agree with the implication that college education is a private gain only, and not a public gain as well?
This post originally appeared on EWA’s now-defunct online community, EdMedia Commons. Old content from EMC will appear in the Ed Beat archives.