[cipher_system]

The point would be that the government assumes the risk of all students as a collective. With government rates much fewer people would default.

[lordnacho]

Fewer of the people who are currently borrowing would default. That's not the same as fewer people would default.

Lower rates will cause more people to take a loan, and you have to think they are the more marginal students.

Then you're left with whether it's ok for society to pay for more people trying college and not finishing. A political question of course.