President Joe Biden’s illegal student loan “forgiveness” is exorbitant, costing taxpayers another $1.2 billion in just the past few weeks. In sum, it is likely to be the most expensive set of unsanctioned actions the administrative state has ever taken, costing more than half a trillion dollars in unappropriated, unapproved spending.
The costs don’t stop there. A looming human cost may be even higher — one generated by the universal incompetence of those running the Department of Education.
Every family knows the only way to access student loans and grants is through filling out the Free Application for Federal Student Aid, which the Education Department administers. What many parents don’t know is that right now the Education Department cannot process FAFSAs, and more troubling, it cannot say with any certainty when it will be able to do so. That means students won’t know how much aid they qualify to receive until after the normal college enrollment decision deadline.
It’s a failure so significant even Sen. Bernie Sanders (I-VT) and more than 100 of his Democratic colleagues in Congress have expressed their dismay about the situation.
Hitting FAFSA deadlines is an annual and relied-upon task, much like Social Security getting payments out the door. It simply has to happen.
So why isn’t it happening this year? Almost certainly because of the Biden administration’s obsessive focus on implementing politically motivated student debt schemes, in spite of being told not to, quite forcefully, by the Supreme Court. Education officials claim they are “resource-constrained,” but that’s nonsense. They’ve simply redeployed staffers who should be working on the FAFSA to work instead on “forgiving” student loans.
This is wholly avoidable and flatly unacceptable.
The department has failed in its management of the student loan program every step of the way, leaving students and schools in the lurch. Those most negatively affected by the department’s ineptitude are lower-income students who rely on financial aid package information to compare schools and make a selection based on what they can afford. For too many students, this information may come too late and deny them the ability to enter college at all.
This means the Department of Education is failing the students it is meant to help the most.
Though government is rarely good at executing things well, failure, or even mediocrity, isn’t a given. While I served as secretary, we developed and launched a new FAFSA website and mobile app without missing processing deadlines or whining for a supplemental appropriation. We just got the job done.
And the current failures aren’t limited to FAFSA. Last month, taxpayers learned the Education Department failed its financial audit for the second year in a row. The department’s independent auditor, KPMG, determined it had “materials weaknesses” in its financial statements, largely stemming from improperly accounting for the costs of running the student loan program and particularly the loan cancellation plans.
The government student loan portfolio exceeds $1.6 trillion, making it a larger consumer lender than Bank of America, J.P. Morgan, or Capital One combined. If any of these other large financial institutions failed its audit two years in a row, there would be severe consequences. For the Education Department, however, it’s just another failure without consequence.
These layered failings are further proof the federal government should not be running a monopoly operation with student aid. Total federalization of student loans, passed in 2010 as, of all things, a “pay-for” for Obamacare, has led to higher tuition costs, significant politicization, and worse outcomes for borrowers.
There’s a better way. Federal Student Aid management should be taken away from politicians. It should instead be managed by an independent board with deep financial expertise — and a fiduciary responsibility to taxpayers. Private lenders should be welcomed back into the market, with a goal of offering better loan terms and rates for student borrowers. And importantly, there should be a paradigm shift in thinking: Instead of trying to get everyone to take a student loan and attend college, let’s first ensure college is actually the best path for a student to achieve his or her personal and professional goals.
The Department of Education’s failures keep accruing, and students keep suffering as a result. Congress must take charge and clean house.
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Betsy DeVos served as the 11th U.S. secretary of education and is the author of Hostages No More: The Fight for Education Freedom and the Future of the American Child.
