If the word "loan" is in the name of the financial product, you are expected to repay. At some point we need to be upfront with high school graduate and tell them it is a bad idea to go study art history at a $40k a year no-name private college.

If the choice is between not going to college vs. earning a degree, statistically you earn more simply by having a college degree, regardless of the major. Bachelor Degree holders, on average, earn a million dollars more during their life time than those who only have a high school diploma. Even if you are accounting for lost earning potential, cost of tuition, supplies etc... your still talking about hundreds of thousands of dollars more earned than if you were to not achieve a degree. If you are talking in relation to going to university for a STEM degree vs. going to school for art history, you could certainly argue that STEM will will always make more. But I would still recommend young people go to school over not. Even if it is something 'useless'. Either way you slice it, the data indicates that encouraging youth to go to college is still worth it. Even with how expensive college is.

Median Lifetime Earnings: https://www2.ed.gov/policy/highered/reg/hearulemaking/2011/c...

Cost of School and Lost Earnings vs High School Grad: https://trends.collegeboard.org/sites/default/files/educatio...

BLS on Pay by Education https://www.bls.gov/opub/ted/2015/more-education-still-means...

Totally agree. If they want to do so, I would certainly recommend a young person get a degree regardless of whether it is STEM or not. I just wouldn't give someone a huge loan to study a low earning major at a expensive private college. That is just setting them up for a mountain of debt they are unlikely to be able to pay off.

That's not true at all. A loan has a priced in risk of default.

The National Mortgage Lenders Association defaulted on their mortgage. Many business and corporations, large and small, go bankrupt and discharge debts. Only individual consumers get trapped in non-dischargable debt.

>I thought the point of student loan is to grant it to anyone regardless of if they can repay?

No, the student is supposed to pay back his loan regardless of major.

The reason we have student loans is under the traditional credit system someone without a job and a credit history isn't going to get a loan at all.