Most of the student loan debt is owed to private creditors and it is the federal government that insures these loans. If a student doesn't make payments, the lender gets a guaranteed bailout by the government (no need for congress to step in like they did for the banks and auto companies). Basically, all the lenders are incentivized to give out as much money as possible, which incentivizes universities to raise tuitions, all because the US government decided to give lenders free money to play with at the cost of those who take on the debt and the ones footing the bill, which are usually the same people.