An Analysis of the Regulation of Federal Student Financial Aid

This analysis begins with a review of how the regulatory process has evolved since the first student financial aid program, National Defense Student Loans, was established in 1958. Next, the regulatory process is examined, with particular emphasis on the ability of higher education and others to influence the results. It will then explore the reasons, stated or otherwise evident, for what in many quarters is considered to be over-regulation. The analysis will examine how the federal regulatory process operates in other areas to ascertain the extent to which student aid may be subject to special treatment. Finally, some alternative regulatory approaches, which would seem less burdensome to the critics of the present situation, will be examined. Some of the significant questions that will be addressed in the analysis include the hypothesis that regulations too often seem to be made in response to worst case situations. lf that is determined to be the case, should all institutions be held to the same requirements? Is it appropriate to use student financial aid to achieve certain social and political objectives?