But the worst part is, it allows colleges to keep raising their tuition rates far above the inflation rate year after year after year with the assurance their customers can get all the credit they need to buy their product at any cost. Thus the colleges become overpriced and bloated.

Maybe? Again, it's worth looking at the actual numbers involved. DoE's budget for student loans is about $52 billion - and some amount of that is going to be "appropriate" (not bloating) financing for college education. Meanwhile, total college expenditures in the U.S. are about $670 billion per year. Even if some federal lending is too permissive, it's going to be a percentage in the low single digits of annual college spending. More significantly, that number is much lower than it used to be - back in the early 2000's, it was closer to $100 billion per year (though skewing more towards loans than grants), and federal student financial aid peaked in around 2011-2012.

So if colleges are overpriced and bloated, federal student lending is not likely to be a very significant factor.

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