The student loan situation/bubble will have to be addressed sooner, rather than later. Something is very wrong when young people are taking on six-figure debt for a bachelor’s degree.
We need to find out what the heck colleges and universities are doing with all the extra money they’ve been raking in over the past couple of decades. Like health insurance, tuition costs have been skyrocketing, but there is little (if anything) to show for these increased costs.
“But at least at public colleges and universities — which enroll three out of every four American college students — the main cause of tuition growth has been huge state funding cuts.”
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Like others have mentioned, I also believe that the availability of these huge student loans are behind the increased costs as well. Like housing during a credit bubble, the price of education will rise during a credit bubble as more money is made available to spend on it. Student loans should be hard to get, have very low annual (and total lifetime) limits, and loan amounts should match what a student can be expected to reasonably afford given his/her particular major.
