Taking out hefty student loans has become a normalized feature of college life. No doubt, this smooth routinization helps to ease the guilt of the admissions officers who are paid to reassure recruits that high-interest loans are still a solid investment in their futures. Those with less conscience have been caught colluding directly with lenders. Parents, for the most part, don’t ask too many questions. They are cowed by the prestige of colleges or are anxious not to puncture their children’s aspirations. As for the borrowers themselves, most are not old enough to drink when they are approached, like subprime-mortgage dupes, with offers they cannot refuse.

Equally problematic are the terms of the loans themselves. Unlike almost every other kind of debt, student loans are nondischargeable through bankruptcy, and collection agencies are granted extraordinary powers to extract payments, including the right to garnish wages, tax returns, and Social Security. The market in securitized loans known as SLABS (Student Loans Asset-Backed Securities) accounts for more than a quarter of the aggregate $1 trillion student debt. As with the subprime racket, SLABS are often bundled with other kinds of loans and traded on secondary markets. With all the power on the side of creditors and investors, it is no surprise that student lending is among the most lucrative sectors of the financial industry. As for federal loans, they are offered at unjustifiably high interest rates—far above those at which the government borrows money.