Direct college student loans cost the U.S. government billions of dollars
Back in the mid ‘90s, when the Education Department first started its current Direct Loan program for college students, the program was expected to turn a profit for the U.S. Treasury. The initial estimates were that it would bring in $114 billion over the next quarter century. Now that were here, that estimate turns out to be wrong…way wrong. The Government Accountability Office discovered the program has actually cost the government $197 billion. The reasons for that giant difference are pretty complex, so Federal Drive Deputy Editor Jared Serbu talked with the lead author of a GAO report that examined the Direct Loan program: Melissa Emrey-Arras, GAO’s Director of Education, Workforce, and Income Security Issues.