Negative Impacts of Federal Student Loans and Grants

13 Pages Posted: 18 Mar 2020

See all articles by Barry Clark

Barry Clark

The Calhoun Review; Liberty University

Date Written: February 20, 2020


Federal involvement in higher education via Federal student loans and grants has raised the overall cost of education, reduced the value of higher education and diminished the quality of education. It has increased the supply of students, causing institutions to spend great effort in recruiting students and making compromises in terms of quality in order to accommodate them. Finally, it has created an oversupply of degree-holders in fields the market did not value highly, to begin with, further devaluing the worth of higher education to the degree-holder; particularly in light of the long term cost of repaying loans relative to the employability and earnings potential.

Keywords: Student loans, education

JEL Classification: H52

Suggested Citation

Clark, Barry, Negative Impacts of Federal Student Loans and Grants (February 20, 2020). Available at SSRN: or

Barry Clark (Contact Author)

The Calhoun Review ( email )

Abbevile, SC
United States


Liberty University ( email )

1971 University Blvd
Lynchburg, VA Lynchburg 24515
United States

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