A new piece out today by the New America Foundation indicates that by exploiting a loophole in financial aid regulations, Georgetown Law can charge $158,000 for a law degree. And taxpayers pay the whole thing.
As Jason Delisle and Alex Holt write:
Under Georgetown’s Loan Repayment Assistance Program , students take out Grad PLUS loans to cover the full cost of attending law school (around $75,000 per year, which includes living expenses). After they graduate, they enroll in Income-Based Repayment. If they work in government or non-profit jobs, Georgetown pays 100 percent of their loan payments for 10 years, after which IBR’s loan forgiveness wipes away the remaining balance. The students pay nothing for their education.
On the surface, it seems like Georgetown Law is taking a loss on students who go into public service. But the truth is far more sinister. Georgetown loses little if any money from this scheme because the school simply includes the cost of the loan repayment program in its tuition. And since the federal government issues loans for whatever amount Georgetown charges, students just take out more loans to cover that cost.
Law students can end up getting a really expensive law school education, and never paying a dime.
Of course, exploiting legal loopholes is precisely what good lawyers are supposed to do. Why pay more money if you don’t have to?
As New America put it, however, “see the problem? Neither Georgetown nor its students are financing the program. You are, as a taxpayer by providing them with access to unlimited loans and unlimited loan forgiveness.”
But this avoids addressing the question of whether or not taxpayers should be paying the cost for a public interest lawyer’s legal education. (About about 10 percent of Georgetown Law students appear to work in government or non-profit jobs.) IBR and the public interest work provision are designed so that graduates working in low-paying government or non-profit jobs can avoid crushing student loans. That’s because they’re serving the public.
Sure, Georgetown public interest lawyers are getting a free education, and taxpayers are covering the cost, but that’s how it’s supposed to work. Taxpayers are supposed to pay.
The problem might not be that students don’t pay, but that Georgetown is still charging so much money, and has no incentive to charge less. [Image via]