A Federal College Loan Program Is Exacerbating the Racial Wealth Gap
“A new report from Rachel Fishman of the New America Foundation, a non-partisan Washington, D.C., think tank, highlights yet another federal government program that’s similarly widening the wealth gap: the Parent PLUS loan program. The Parent PLUS program was created in 1980, its primary goal to help middle-income families pay for college during an era of high interest rates and increasing tuition. The loans, which are not subject to the borrowing limits on other types of college loans, carry a higher interest rate than student loans and are typically used by parents only after other kinds of financial aid and loans (i.e., student loans, federal subsidized and unsubsidized loans, etc.) are tapped out.”