Thomas Donlan of Barron’s devotes his latest editorial commentary to issues surrounding the skyrocketing price tag of American higher education.

Unfortunately for most of the not-wealthy but not-poor students and their parents, the discounts offered to students of limited means come with a catch: student loans that will be a burden after graduation—and a bigger burden if they never graduate.

The size and burden of student loans has become a powerful political issue, and the federal government has responded by increasing grants. Loans, which accounted for 55% of student aid in 2007-08, declined to 43% of student aid in 2013-14. But the volume of loans is still rising, and the indebtedness of students and former students last year was more than $1.2 trillion. …

… There might be a better way to ease the financial burden of college tuition on students and families, not just those of the poverty class but also on middle-class and even upper-class people.

It would build on the existing income-based repayment plans for federal student loans, with a venture-investment twist and an equity kicker.

Instead of making students and their families solely responsible for college tuition, we might make it possible for others to share the burden. Instead of being responsible to the government to pay back loans, students might sell a percentage of their lifetime future earnings to investors for cash up front that they would use to pay tuition.

High-school students would monetize their SAT scores, academic grades, community service, extracurricular activities and special abilities, submitting them to the value judgments of their potential investors.

Investors would probably insist on some special protections from youthful irresponsibility, such as standards for grades and focus on remunerative careers, but that would be a helpful feature strengthening student efforts. We can see little economic or cultural harm if the system produces a few more chemical engineers and not as many unemployed art-history majors.

If the idea took off, it would be an easy second step for investment bankers to create portfolios of fund-seeking students, diversified by region, expected college major, professional goal, and other characteristics. Shares in the portfolios would be sold like shares in a mutual fund. With long-tailed returns, the students’ economic futures could be attractive investments for pension funds benefitting the older generation.