Early this month, GOP lawmakers proposed the Responsible Education Assistance Act, a measure that would cap the amount of money students could borrow and limit the amount of interest borrowers could accumulate on federal student loans after 10 years to help them more effectively pay back their loans.
"One of the biggest drivers of increases in college costs are these subsidized PLUS loans that the federal government provides directly to borrowers," explains Lindsey Burke, director of The Heritage Foundation's Center for Education Policy. "This will start to try to ratchet that down a bit, to cap it more modestly."
According to the federal government, PLUS loans can help pay for education expenses not covered by other financial aid. They are granted to eligible parents and graduate or professional students through schools participating in the Direct Loan Program.
But because the federal government provides most student loans, Burke says taxpayers are saddled with payments in default.
"It's been relatively recent that the federal government has become almost the sole provider of student loans," she notes. "What makes forgiveness so permissive is that when you have this massive student loan forgiveness, it ends up shifting that burden onto the taxpayers."
The Washington Free Beacon reports, however, that Republican lawmakers do not expect the measure to advance to the House floor as long as Democrats are in control.
