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The interest rate on new federally subsidized student loans doubled on Monday from 3.4 percent to 6.8 percent. Congress may work out a deal in the next two weeks to soften the blow. But left as is, the interest rate hike could cost the average student $2,600. Yet critics say the larger problem is the level of the debt itself, which can be crippling. Is there a better way?

Bruce Chapman, economist at the Australian National University in Canberra, is the architect of a system that's attracting some attention in Washington, DC. He joins Marketplace Morning Report host David Brancaccio to discuss Australia's “study now/pay later” formula.

Follow David Brancaccio at @DavidBrancaccio