Cato: Aid fuels tuition inflation

Student aid fuels tuition inflation by encouraging “students to demand stuff they otherwise wouldn’t” and enabling colleges to raise their prices, argues Neal McCluskey on Cato @ Liberty.  He links to a list of studies that show schools “capture aid money rather than becoming more affordable.”

The Senate has reached a bipartisan deal on student loans, reports CNN.  “Under the compromise measure, undergraduate students would pay a rate of 3.85% next year on subsidized and unsubsidized Stafford loans. The plan would cap rates on loans to undergrads at 8.25%, for graduate students at 9.5% and parents at 10.5%.”

POSTED BY Joanne Jacobs ON July 18, 2013

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