I completely agree. My MPA program is about half the cost of Harvard's and is a great program, but even I am concerned about paying that money back.
KSG is an excellent program, but please remember at the end of the day, you are getting a public policy degree. If you're planning on working in an NGO, Government Agency, Non-profit, whatever, you more than likely will not have a salary that will allow you to repay these loans. And when I say repay, I mean being able to afford your student loan payments PLUS all your other expenses without major sacrifice.
If you were going to Harvard's Business or Law School, I might think differently. But don't let the fuzzy feelings you have about possibly having Harvard on your resume outshine the fact that we are in a deep recession and probably still will be when you graduate. There is life AFTER graduate school and if you have $130k in loans to pay back, that can be a SERIOUS issue to deal with when seeking employment, buying a home, buying a car, getting married, having kids, traveling, etc. in this sucky economy. Even President Obama and his wife were still paying their student loans up until he wrote a bestseller; ONLY THEN were they able to pay their loans off entirely.
I also don't get the impression that "prestige" matters with public policy degrees the way it matters with MBA's, JD's and MD's. I'm not sure where you want to eventually work, but the federal government is staffed with people from EVERY school you can think of (imagine the backlash if our tax dollars went to employing only or mostly graduates from "prestigious" institutions in government positions). In my experience as a federal employee, I don't believe that a Harvard graduate is any more likely to get a job than someone from a less "prestigious" school. Like other people said, after a certain number of years, your work experience will trump everything else. People want to know what you can DO, not where you went to school.
If all the programs were offering you significant financial aid, I'd say go to Harvard, no questions asked. But in my personal opinion, a public policy degree isn't worth $100k if you have to borrow all of it.
(WHY is Harvard being so stingy with financial aid, by the way?)
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EDITED: I see the OP decided not to attend Harvard because of that debt load. I think that's a smart move! Congratulations on being accepted anyhow! Now when you schmooze with people, you can say "Yeah Harvard admitted me, but I told them no".