WASHINGTON — President Barack Obama on Friday renewed his call for the government to stop backing private loans to college students and replace them with direct financial aid to young people.
Obama’s plan to eliminate the Federal Family Education Loan program could save $48 billion for taxpayers over the next decade, but critics warn it could turn the Education Department into a national bank. Lenders and some college officials oppose the proposal.
“In a paradox of American life, at the very moment it’s never been more important to have a quality higher education, the cost of that kind of education has never been higher,” Obama said at the White House. “. . . Yet, we have a student loan system where we’re giving lenders billions of dollars in wasteful subsidies that could be used to make college more affordable for all Americans.”
