The rational solution (there is only one) is to make student loans dischargeable by bankruptcy.
The universities have been promising a value they knew that they weren’t delivering for many decades.
Exactly. Tuition costs have steadily risen and risen since the 70s because government created a bubble in the market with guaranteed loans.....which uniquely cannot be discharged in bankruptcy. Then to top it off we just went through the worst economy we’ve had since the 1930s. It’s hardly a surprise there are a lot of defaults.
The thing is if that many can’t repay their student loans, they won’t be able to buy real estate. That knocks out a significant chunk of the market. At that point it’s everybody’s problem.