Expected to make $100 billion and then lost $200 billion. Where is the accountability?

Shocking, even if unsurprising.  From The True Cost of Federal Student Loans by Meghan Brink.  The subheading is The Education Department said the federal student loan program is generating billions in income for the federal government. A new report from the GAO shows that it is causing billions in lost revenue due to flaws in budget estimates.

In theory, the program is supposed to increase access to a university education for all citizens.  In theory, it was supposed to be cost neutral to the government or profitable.

In practice, and as with most such well-intentioned federal programs, it has not turned out that way.

It costs far more than projected.  It subsidizes universities which translate the windfall into bloated administrative staffs.  It shackles students to unsustainable debt burdens.  It subsidizes those who would already have attended university (the gifted poor and the middle class).  Those not gifted, end up with debt but no degree.  It is a shocking and tragic fraud on the Republic and a tragedy for many of the student participants.  And now it is becoming clearer that it is also a tragedy for financial rectitude and for taxpayers.

The Education Department projected that student loans would generate $114 billion in income over the last 25 years. However, a new report shows that federal student loans have actually cost the government $197 billion, a $311 billion difference.

The findings come from a Government Accountability Office report released today that undermines a narrative from the department that the federal student loan program is generating income. The study, analyzing data on student loans between 1994 and 2021, found that the Education Department greatly underestimated how changes to loan programs and borrower behavior have impacted the federal student loan balance.

It would appear that indeed, the dismantling of the Department of Education might in fact be beneficial to everyone concerned.