Student Loan Debt Forgiveness Plans Cost $21.8 Billion

That’s right, according to the President’s new budget proposal, his student loan forgiveness plans are costing American taxpayers even more than expected.

Politico reported yesterday that the $21.8 billion shortfall is, “apparently the largest ever recorded for any government credit program.” Yikes. And since this a government credit program, it will be added on to the deficit directly. No need to seek Congressional approval.

But there is a bigger issue at hand here. These plans provide less incentive for students to be responsible when taking on such debt, and more incentive for colleges to keep raising tuition. As Reason reports:

“…it’s a sneaky way to transfer the cost of college away from the people who actually reaped the benefit—the graduates—and onto the backs of the taxpayers.

It also vastly distorts the true cost of college by dispersing the bill among so many different entities, which in turn gives colleges a free hand to jack up the price. They can charge as much as they want for tuition: their customers don’t pay, all Americans do.”

Here at the Campaign for Liberty Foundation we encourage young people to make responsible decisions when deciding to take on student loan debt.

To help ease that burden, we created the Ron Paul Scholarships. Last year our top award was $10,000! Apply here today.