The Economics of Student Loans and Higher Tuition

Economics is a subject (one of many) which I know very little about, so I found this article informative.

the federal government has now become the co-signer on nearly every student loan, even paying the loan's interest while the student is in school, and guaranteeing to lenders at least 98% of their principal should the student default. The government also guarantees private banks that they will turn a profit on student loans no matter how low interest rates fall.

The non-free-market economics of student loans affect tuition - I guess that is no surprise.

Unfortunately, by footing these bills and turning higher education into an entitlement, Congress itself is primarily responsible for isolating academia from normal consumer pressure by shielding most students (and their parents) from the true cost of higher education. That's why schools can keep ratcheting up tuitions beyond what any middle class family can reasonably afford to pay--because they know taxpayers stand ready to take up the slack.

Hmmm... I'm still learning about all this stuff.