Slate Money Money Talks: The Student Loan Paradox
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Apr 15, 2025 Jillian Berman, assistant managing editor at MarketWatch and author of 'Sunk Cost,' dives deep into the complexities of the U.S. student loan system. She discusses how well-intentioned policies have led to crippling debt for many students. Berman highlights the challenges faced as loan repayments resume post-pandemic and critiques the Public Service Loan Forgiveness program. She also explores the historical shift in educational funding and the impact of socio-political changes on tuition, posing tough questions about the true value of higher education today.
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Blame for the Student Loan System
- Policymakers are mostly to blame for the broken student loan system due to its design and lack of reimagining.
- Lenders and middlemen also share blame for bending the system to their advantage, not borrowers.
Student Loan Repayment Resumption
- Student loan repayments resumed in fall 2023 after a COVID pause, with interest accruing again.
- An "on-ramp" delayed harsher consequences like credit score drops and wage garnishments until recently.
Reduced Support for Borrowers
- The Trump administration is reducing services for student loan borrowers, like funding for support contractors.
- This could lead to longer wait times and less outreach to struggling borrowers.
