The White House is weighing a measure that would require colleges and universities to take a financial stake in their students’ ability to repay government loans, an effort that could squeeze loan availability to students and reduce defaults, the Wall Street Journal reported. For several months, Trump administration officials have been discussing enacting such a mechanism or making a push for one in Congress as part of a broader effort to combat rising college costs. In the administration’s budget proposal released on Monday, officials made brief mention of a “request to create an educational finance system that requires postsecondary institutions that accept taxpayer funds to have skin in the game through a student loan risk-sharing program.” Such a proposal could be included in a coming executive order addressing higher education, several officials said. A draft of the order isn’t final and the specifics of exactly how a skin-in-the-game provision would work haven’t been laid out. It also isn’t clear whether the White House will back an administration proposal or urge Congress to take one up. The order the White House is preparing, expected in coming weeks and led by the president’s daughter Ivanka Trump, will likely touch on several hot-button issues in higher education, including a possible provision tying federal research dollars to rules about free speech on campuses, these people said. Leaders on the Senate and House education committees are also currently negotiating a possible reauthorization of the Higher Education Act this year, the sweeping 1965 law that governs higher education and student loans. Should a risk-sharing proposal come up in Congress, it would likely be included in a larger reauthorization package.
