It’s strangely difficult for people to understand that if you provide more money for something, the price rises – that is to say, if the money supply increases in a supply-constrained world, prices go up.
The number and ease of getting loans for college is directly responsible for the rise of tuition prices. This is where this lack of comprehension comes up the most often. More money for roughly the same product is one widely-accepted definer of inflation.
I don’t feel well today so this post isn’t perhaps as cogent as it could be, but when money (via credit or other means – all money is fungible, remember) floods a market where the product isn’t getting more abundant, or isn’t getting more abundant faster than the demand is rising, prices go up and up.
Eliminating college loans outright isn’t the answer. But just wanted to point out the should-be obvious fact that the more easy money we provide to students, the more colleges will charge if they are allowed to do so.
Remember the housing bubble? Yeah. Same thing.