The Folly of Free College?

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The Folly of Free College?

President Biden has proclaimed that canceling at least a portion of the $1.6 trillion in student debt held by 44 million Americans is part of his economic recovery plan.  During the campaign, he supported at least $10,000 per person in federal loan forgiveness, while other leaders in the Democratic Party, including Sens. Schumer and Warren, called for the cancellation of up to $50,000 per person.

This contrasts sharply with the Trump administration’s policies which imposed a methodology that curbed debt cancellation under a federal program known as “borrower defense to repayment.”  That program, which began in 1994, provides federal loan relief to students whose colleges "lied" to get them to enroll.   The Trump administration also scrapped an Obama-era overhaul of the law that made it easier to seek forgiveness and accused opposing lawmakers of wanting “blanket forgiveness for anyone who raised their hand.”

The Trump administration’s refusal to process applications for months, delay of the Obama rule, implementation of the subsequent partial relief formula and the widespread denials resulted in a spate of lawsuits.

In October, the Biden campaign said that the Obama-era update of the borrower defense rule would be revived.  That will require lengthy rulemaking at the Education Department.  But in the meantime, the Biden administration is likely to clear out much of the backlog of borrower defense claims using a more generous methodology for approval and loan forgiveness.

The Trump administration has also expressed opposition to another policy backed by Biden: Tuition-free college.  Former Secretary of Education Betsy DeVos has called the policy “a matter of total government control” and “a socialist takeover of higher education,” with ominous predictions about how it will reshape the sector...

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