I think it's a huge mistake to make it such that the student loans couldn't be discharged.
But I wonder: were people taking on debt that they couldn't handle with the intent of declaring bankruptcy later? Or perhaps was this sold as a way to decrease the cost of lending? What was the case for making this change?
If you track where the money went, I'd say it's education institutions' lobbying.
Loans should only be given to those who stand to create more value than the loan itself.
I still believe education is valuable, but not every degree is worth the loan - and with non-dischargable loans, the lender has no incentive to check if the loan makes sense for the degree.
The traditional fear with making student debt dischargeable and market-based is that lenders will ask for your parents to co-sign.
And that'll be no problem at all for middle- and upper-class families where the parents have savings and good credit, but bad for orphans and kids from poor families.
Of course, the current unlimited-loans system that has let costs spiral out of control has problems too, albeit different ones.
How do you suppose they were planning on discharging student loans everyone knew couldn't be discharged outside of truly extraordinary situations? It strains credulity to suppose that they made such a plan with this legal battle in mind.
But I wonder: were people taking on debt that they couldn't handle with the intent of declaring bankruptcy later? Or perhaps was this sold as a way to decrease the cost of lending? What was the case for making this change?