What the new student loan rules mean for current and future borrowers

Cory Turner:

I think that is an open question, Geoff. That is the million-dollar question, the trillion-dollar question,whether or not reining in some of this — and, look, it was easily accessible money, especially for graduate programs.

Graduate students could essentially borrow up to the cost of their program. And so what we did see in recent years were a lot of large schools, both for-profit, but also private nonprofit, charging really an arm and a leg for graduate degrees, where it just wasn’t reasonable to expect that degree to pay off the amount of debt students were being asked to take out.

And the problem with that system in those cases is that it’s essentially the federal government taxpayers who are bearing much of the risk. So I think there is a lot of support, even bipartisan support, for reining in some of this graduate level spending.

The question is, will it really compel some of these schools, who you could argue were behaving irresponsibly, will it actually compel some of them to lower their prices and change their ways?