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Committee hears competing views on student‑loan reforms, Parent PLUS and accountability for colleges
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Summary
Witnesses told the House Education and Workforce Committee that U.S. higher education faces affordability and accountability problems. AEI and other witnesses urged caps and repayment reforms; Democrats warned mass cancellation and other unilateral executive actions would not solve underlying problems.
The House Committee on Education and Workforce heard competing assessments of the U.S. higher education finance system and possible reforms to federal student aid and institutional accountability.
Why it matters: Members and witnesses agreed higher education faces price and value concerns, but they disagreed on causes and remedies. Witnesses from conservative‑leaning organizations emphasized institutional spending and excessive borrowing; Democratic members emphasized preserving access and protecting borrowers and veterans from predatory institutions.
Preston Cooper, senior fellow at the American Enterprise Institute, testified that higher education “can be a great investment for students. But all too often, that investment does not pay off.” He estimated that “Between 2018 and 2022, I estimate that at least $37,000,000,000 in Pell grama and $86,000,000,000 in federal student loans flow to degree programs that do not lead to a return on investment for students.” Cooper also cited a Congressional Budget Office projection that taxpayers could lose $223,000,000,000 on newly originated student loans between 2025 and 2034 if repayment and borrowing remain unchanged.
Members and witnesses discussed the Parent PLUS and Grad PLUS programs. In a later exchange, Cooper said, “The Parent PLUS program is a predatory loan program,” describing high interest rates, fees and uncapped borrowing that have grown substantially and concentrated at a relatively small number of institutions.
Several members urged Congress to consider measures in the College Cost Reduction Act and other bills that would limit unconstrained borrowing, reform repayment, and hold colleges accountable for outcomes. Cooper characterized the College Cost Reduction Act as a three‑pronged approach: “Reforming the student loan repayment system, imposing sensible caps on borrowing, and holding colleges accountable for how well they serve students.”
Democratic members pressed witnesses on protections for veterans and students harmed by predatory institutions, noting that some federal benefits (for example, GI Bill tuition assistance) cannot be retroactively recovered if misused by an institution and that strong enforcement mechanisms are necessary to protect those students.
Ending: The hearing produced no enactments. Members on both sides signaled interest in legislative changes to reduce borrower risk and improve institutional accountability, but also deep disagreement about the role of mass loan cancellation and the balance between access and fiscal sustainability.
