Sunk Cost: Who’s to Blame for the Nation’s Broken Student Loan System and How to Fix It

MarketWatch reporter Berman debuts with a meticulous investigation into how Americans have come to owe approximately $1.7 trillion in student debt. She notes that the crippling burden is a far cry from what post-WWII policymakers envisioned when they espoused the belief that “access to higher education would improve... the nation at large.” Berman lays out how that well-intentioned goal was hijacked by “bad actors” almost from the get-go, with “scam schools” popping up immediately in the wake of the 1944 GI Bill. While congress tried to deal with the situation (not least by establishing the college accreditation program), the loopholes that allowed scam schools to proliferate remained due to industry lobbying. Then, in the late 1950s, the Eisenhower administration came up with the idea of a nationwide scholarship initiative that was watered down to a loan program by Congress, whose members expressed fear that the “non-needy” would receive funding if there were no expectation of repayment. These twin issues—industry lobbying and a focus on individual need—are what set the stage for slashed federal education funding in the ’80s and the subsequent explosive growth of scam schools and skyrocketing tuitions at reputable schools, Berman writes. She persuasively argues that neutering the lobbyists and reasserting that accessible higher education is a societal good, not an individual perk, are the only ways to fix the system. The result is a rigorous and lucid account of an opaque bureaucratic history. (Apr.)