The guarantee is the only reason the loans are made. Otherwise, you're lending a lot of money to someone with no income and no assets, and no one will want to make that loan.

They'd actually have to underwrite on the basis of the value of a degree -- yeah, no one is going to lend money to the same people who wouldn't be able to repay their loans after graduation. That's good!

This is a slippery slope though. This effectively turns universities into career-training centers. Eventually enrollment in less-profitable subjects, like dance and art, will decrease, forcing colleges to drop it from their programming.

Then suddenly we have a society that does not appreciate art or dance or whatever other subjects were dropped.

This is the slippery slope - creditors get to decide what others know and learn and pay attention to. Knowledge is no longer widely available - the experts (professors) might still teach at a college, but will be forced to either pivot or leave when the university slashes their programs. They could teach privately or for free, but I am guessing the number of students who they would normally teach drops significantly.

This is not a problem. Tooo many kids graduate with degrees in which they cannot find decently paying jobs, so they end up in a different field altogether. Why have that initial non-starter in the first place and place them into a career that has better potential in the first place?

Once there are too few people in the arts, demand will incentivize more people to get into that field.

Moreover, don't we currently have a problem where we don't have enough students going into STEM?

Is this really a problem though? Wouldn't arts programs simply move to being something offered to and studied by those wealthy enough to do so? I'm genuinely curious.

> Eventually enrollment in less-profitable subjects, like dance and art, will decrease, forcing colleges to drop it from their programming.

If this is the goal, then the far simpler solution is for the government to explicitly budget a set number of grants for the most promising students in those fields to study specific subjects that supposedly have social value but low economic returns.

It certainly doesn't make sense to subsidize loans for hundreds of marginal students to study "business administration" or "hospitality" at a tier four regional college to get one brilliant dance major at Carnegie Mellon.

Far more efficient for the government to say "we have 800 fully funded dance scholarships, 4000 art history scholarships, 2000 classics scholarships, etc. We're going to assign these scholarships to the most promising graduating high school students in these fields. And the scholarships will only be paid for top-tier universities that have demonstrated consistent excellence in these areas."

That would by far subsidize a much higher level of cultural discourse at a tiny fraction of the cost of the current student loan system.

> Then suddenly we have a society that does not appreciate art or dance or whatever other subjects were dropped.

The assumption that you need a college degree in art to appreciate art is kinda ... out there.

> This effectively turns universities into career-training centers.

It's no change. That was already the premise of underwriting non-dischargeable loans.

> Then suddenly we have a society that does not appreciate art or dance or whatever other subjects were dropped.

Again, no change. If they were valued enough to support an expensive college degree, career prospects would be less dim.

> This effectively turns universities into career-training centers.

Isn't that the case already? Aren't most university students looking to increase their career prospects? Wasn't that the whole point of telling generations of kids to go to college, so that they'll get better jobs?

If the program turns out successful students, I don't see why not? If the program turns out unmarketable skills, sure, charge through the roof and steer kids away from a useless degree.

Good. Accelerate and force the "everyone must go to college" issue. Revert it to scholarship-only (plus the rich dunces who can afford full tuition).

And then the colleges will have to reduce prices or go out of business.

University employees are, unfortunately or not, consistent one party voting blocs. Cuts to them are highly unlikely.

Why not? I'm a university employee. Grad student, so maybe skewed a bit (are we talking about more permanent administrative employees? They I guess have different interests, since they aren't transient like me).

1) I'm going to, absent some massive political shift, vote for Democrats for the rest of my life anyway. So, they don't really have to play for my vote.

2) Playing around with boring stuff like tweaking market forces around by changing how loans work is sufficiently indirect that blame can probably be dodged.

3) We're all aware that the current system is pretty bad, a new solution that at least purports to be an attempt at something better can be sold to me pretty easily.

3a) Keep in mind that, at least in the STEM departments, the instructors are there for essentially irrational reasons -- they could make much more money in industry. At least some of the motivation is to produce interesting science and help students, paycheck be damned. Changes that hurt the last while helping the first two will probably be accepted with only minimal grumbling as long as they aren't too painful.

+1. Defaults exist for a reason - they force the lender to think about whether someone can pay off a debt or not, and we got here by giving everyone a loan, whether they could pay it off or not.

This create market driven dynamics in which degrees basically are tailor made for industry. This approach disincentivizes pure research for scientific purposes.

You're saying companies DON'T want researchers?

In any case, if there is a specific need for specific research, I'm sure the gov can figure out a way to incentivize particular useful tracks which the market ignores. Grants programs, etc.

Companies value people who can apply the scientific method (experimental design, data gathering, data analysis, etc). They hire people who have acquired this specific knowledge often through grants. Whether these subsidies lead to application of the specific knowledge gained through the grant underwriting process is debatable. Companies will hire people who studied something that requires the scientific method for which there is maybe no market, and make them apply that approach to things for which there is a market.

There is a tension between the two purposes universities have: To train students and to do research.

I want both, but I have a hard time disapproving of more focus on training students, as they are the true customers of universities.

A future where universities looked more like community colleges situated next to research institutes, rather than weirdly blending the two, could be neat.

Have people really interested in teaching rather than research teach the 100/200-level courses. The scientists next door can teach seniors and juniors, and show up for guest lectures.

> This create market driven dynamics in which degrees basically are tailor made for industry. This approach disincentivizes pure research for scientific purposes.

Good, there is nothing wrong with all that. Degrees should exist so people find jobs in the real world. Research can be funded by the government itself. Absolutely no need for government backed student loans in either cases. People who want to go to private universities can get a regular bank loan, that's how it works in the rest of the world. The US system is unique and predatory.

Pure research for scientific purposes is done by Ph.D. students and is already funded by research grants. Student loans are not part of the equation here.

This is the correct answer