Recently, twenty-four states and the District of Columbia filed a lawsuit challenging the Trump administration’s rule limiting federal student loans for borrowers earning graduate degrees in certain healthcare fields.

Following the filing of this suit, Andrew Gillen, a research fellow at the Cato Institute’s Center for Educational Freedom, released a statement:

“This lawsuit is ostensibly an attempt to help graduate students, but if successful, it will ultimately cost them dearly for two reasons. First, if the lawsuit is successful, students will take out more debt. In particular, expanding the definition of professional programs allows those students to take out $200,000 in debt instead of $100,000. Second, colleges will respond to a lower debt limit by reducing prices. We know this because colleges responded to increased debt limits by raising prices in the past and because some programs have already cut their prices in response to the lower limits today.

“The bottom line is that this lawsuit would leave the intended beneficiaries worse off. A court would force the Department of Education to refer to more graduate students as professional, and all it would cost them is an extra $100,000 in student loan debt. I wouldn’t take that deal, and neither should graduate student nurses (undergraduate nurses are unaffected by both last year’s reconciliation law and this lawsuit).”

To speak with Gillen on student loan reforms, contact Christopher Tarvardian.