The New America Foundation's Jason Delisle and I are hard at work on a 5,000-word piece that discusses fair-value accounting (FVA) and how it applies to issues such as student loans, public pensions, and private retirement accounts. In the meantime, here is a selection of my previous work on student loans and FVA.
"The Unknown Cost of Student Loans" is the foundational document that describes what FVA is and how it changes the cost estimates of student loans and other credit programs. It contains a numerical example of how budgeting works under the current system versus FVA. Though consumed with immigration work last April, I put this report together after-hours, getting it out just in time for the student loan debate in Congress.
"How Government Uses Accounting Tricks to Hide the Student Loan Swindle" is the companion op-ed that I had published in Forbes while the Congressional debate was ongoing. It's a less quantitative explanation of FVA, with application to both student loans and public pensions.
"The Student-Loan Deal: A Mixed Bag" describes how the debate was resolved in Congress. I reiterate my opposition to any federal involvement in student loans but note that the legislation at least pegs the subsidy to market interest rates.
"Attention, Elizabeth Warren: Students Are Already Free to Refinance Their College Loans" debunks the popular talking point that allowing students to refinance their college loans with the government is a matter of leveling the playing field. In fact, students are as free to refinance with a private lender as homeowners and businesses are. The trouble is that students are already getting a great deal on their loans due to government subsidies, and no private lender wants to take full responsibility for unprofitable loans.
"What ‘Profits’? Rolling Stone’s Matt Taibbi Misunderstands Student Loans" and "Sorry Slate, There’s Still No Such Thing as Federal Student-Loan Profits" criticize articles in the popular press for being entirely premised on the idea that student loans earn a profit for the government, even though FVA indicates they come at a cost.
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