Student Loans to Cost at Least $35 Billion More Than Expected

Jonathan Robe:


Buried in a new Congressional Budget Office report is the revelation that the CBO now thinks federal student loans will add $35 billion more to the deficit in the next ten years than it previously thought. “The Budget and Economic Outlook: Fiscal Years 2013 to 2023,” released this week, details the changes in the CBO’s baseline projections for the federal deficit for the coming decade.
The CBO scores student loans as a “net negative subsidy”; this means that student loans will bring in $35 billion less of a profit, thus increasing the deficit by that amount.