In a nationwide survey, LendEDU asked students whether they were planning to use any loan money to help pay for travel or lodging for Spring Break. What they found was that nearly 31% said yes. That translates into nearly 2.4 million students, who will be using at least some of their student loan money to help pay for drunken revelries in Miami, Daytona, Cancun, the Bahamas, or wherever else college kids go for Spring Break.
The survey also found that substantial numbers of students admit to using student loan money for things other than education: 24% say they’ve used some of the money to pay for alcohol, a third for clothing or to eat out, 7% to pay for drugs, and 6% to gamble.
“Considering the severity of the student loan crisis in the United States, this number is severely disappointing,” the report notes.
Disappointing is putting it mildly.
What this actually means is that taxpayers could, in effect, end up paying for these raucous college parties. And the thanks for this is due largely to President Obama’s decision to nationalize the student loan program.
As IBD noted recently, the amount of student loan debt on the federal government’s books has shot up by 125% since 2008. The entire increase is due to the fact that Obama nationalized the student loan program in 2010, cutting out private lenders and having the federal government lend the money directly to students.
Obama presented this as a big money saver, but he also loosened the requirements on paying back student loans so much that the program became known as the “Obama Student Loan Forgiveness” program.
The impact has been to inculcate financial recklessness in an entire generation of students, who feel they can pile up debt, spend much of it on things other than education, and then have taxpayers bail them out. (LendEDU found that half of students expect their debts to be forgiven.)