Federal Reserve

U.S. student loan debt has reached $1.2 trillion and it continues to climb, according to the latest figures from the Federal Reserve. Meanwhile, lawmakers have begun rewriting higher education legislation to try to control college costs.

Congress is taking testimony on the reauthorization of the Higher Education Act, which was designed to bolster financial aid for college students. Longtime consumer watchdog Sen. Elizabeth Warren, D-Mass., has seen student loan providers called before Congress repeatedly, and yet, she said Saturday, there's no accountability.

“That's what worries me," Warren said. "We have a whole system set up to say we’re monitoring higher education, but not one single group takes responsibility for holding the costs down.”

Sen. Elizabeth Warren speaks to reporters at Northeastern University. (Mikhail Zinshteyn/Education Writers Association)

In the past five years, the Fed says total student debt has spiked more than 60 percent. Senator Warren said the government shouldn't profit from federal student loan programs.

Speaking to education reporters at Northeastern University in Boston,Warren said lawmakers to restore the traditional role of public colleges and universities, where the vast majority of students in the U.S. are enrolled. 

"There was a time when state schools provided a reasonably priced, high quality education for all our citizens.  Today, the quality of the education offered at most public schools is strong, but the price is staggering."

Warren said Congress should eliminate government profits from federal student loan programs, reduce the burden of student debt on existing borrowers by refinancing that debt and restore basic consumer protections like bankruptcy relief.

"I know that some will look at these proposals and say that we cannot afford to make these changes. And it's true that some of these steps - like eliminating profits from our student loan programs - will require us to make hard choices about our values. But for the most part, these ideas are not about spending more federal dollars - instead, they are about getting a better return on our investment."

As Inside Higher Ed reports, the reauthorization of the Higher Education Act takes place against the backdrop of an Obama administration proposal to develop a new rating system for colleges based on their student outcomes such as graduation rates.