New Obama regulation on college marketing puts taxpayers on the hook for $43 billion or more

‘Likely to be the single most expensive proposed regulation of the year’

Did your college give you overly rosy projections on your job prospects after graduation, as a way to convince you to enroll?

You’ll now be able to sue your alma mater for that, but it’s taxpayers who will be footing the damages.

A proposed student-loan relief regulation from the Department of Education would lower the bar for litigation against colleges when they market themselves deceptively to prospective students, The Washington Free Beacon reports.

Currently “intentional deception,” the new standard of “substantial misrepresentation” would open taxpayers – who finance $1.2 trillion in student debt via the feds – to a flood of litigation that the government estimates would cost between $2 billion and $43 billion:

“Bureaucrats are proposing a rule that imposes costs—they think—of at least $2 billion and quite possibly $40 billion or more on taxpayers,” said Phil Kerpen, president of American Commitment, an economic policy institute. “What kind of insane range is that? They clearly have no clue how much this will cost.”

Kerpen said the regulation “could easily cost more than $43 billion.” …

Kerpen wrote that the student loan proposal is “likely to be the single most expensive proposed regulation of the year,” and recommended it not be instituted without input from Congress.

MORE: D.C. has nation’s most crippling student debt

Franklin Center Policy Director Kevin Glass says any university whose job placement statistics look iffy – a list that includes Georgetown, Vanderbilt and the universities of Texas, Michigan and Virginia – is a new litigation target:

“Many of them advertise very, very high ‘job placement’ rates and either count those who have pursued further education as ‘placements’ or omit them from their placement statistics entirely—or don’t specify if the degree earned actually helped them get the jobs they claim credit for,” Glass wrote.

One theoretical example of “deceptive” marketing: Promising students a “solid foundation in Western literature” in English 101, without mentioning Shakespeare.

Colleges warn of unintended consequences of @usedgov borrower-defense plan https://t.co/Ztis0dinmb w/ @JMitchellWSJ pic.twitter.com/8YOQdHg96I

— Melissa Korn (@melissakorn) August 11, 2016