Student-loan debt is set to top a TRILLION dollars this year. Student loan debt is officially higher than credit-card debt. With an apparent political concensus that access to higher education is not necessary for democracy, debt for diplomas is similar to loans for paychecks: a recession-proof growth industry.
The average student-loan debt for a 4-year degree now stands at $24,000 and half of those who take out student loans NEVER graduate. Furthermore, averages are a terrible measure of student loan debt since at wealthier institutions like the one where I teach there is very little debt whereas at less-wealthy universities, average debt loads are much much higher than $24,000.
Obviously student loan debt will continue to grow as Congress slashes Pell grants and other forms of aid for higher education and state legislatures try to squeeze more blood from the turnip that is the state university system.
And the response from most of the media is missing the point. Over at The New York Times, Tamar Lewin writes that
many economists say student debt should be seen in a more favorable light.
Sure, and many economists think bailing out Wall Street and continuing the redistribution of wealth to the wealthiest is a great idea. But many economists are shills for the financial elites.
Obviously the generation of student debtors will face a highly diminished future. As Lauren Asher, president of the Institute for Student Access and Success.
If you have a lot of people finishing or leaving school with a lot of debt, their choices may be very different than the generation before them. Things like buying a home, starting a family, starting a business, saving for their own kids’ education may not be options for people who are paying off a lot of student debt.
Lewin then ties these diminished futures to the contemporary panic over declining marriage rates in the United States.
In some circles, student debt is known as the anti-dowry. As the transition from adolescence to adulthood is being delayed, with young people taking longer to marry, buy a home and have children, large student loans can slow the process further.
It is perhaps necessary, in these times, to point out the rather obvious fact that marriage rates are NOT the problem. The problem is the corporatization of higher education in response to the state stepping back from its responsibility to provide some form of access to higher education for its citizens.
At Corporate U, set “free” in the market, the goal is now fund raising, not education. The results are predictable: Salaries at the very top have grown exponentially while the workers have seen the use of a mobile labor force (adjuncts) diminish wages and job security.
Even at the supposedly progressive (maybe not since their buyout by AOL) Huffington Post, student-loan debt is framed as a potentially good investment. Fortunately the readers of the Huff Post are not missing the point. One comment asks:
What I want to know is WHY I have a 7.625% interest rate on a loan I needed to fund an education while the banks are given a 1% interest rate on Federal Reserve lending which they are gambling to generate huge profits and pay their CEOs extravagant bonuses?
And yet another question is why so many university presidents and other administrators are making ten times or more what professors are being paid, raising the tuition each and every year regardless of inflation rates, and there is apparently no more accountability in academe than on Wall Street?
Rather than cutting Pell grants, the government ought to be regulating academe’s crack addiction to student-loan debt. If schools charged what their students could actually afford, the corporate university would disappear. People would take on leadership of high ed not to live the lifestyles of the rich and famous, but for the same reason people teach: because they care about students and the future. University leaders could spend their time organizing and agitating for federal and state funds, not wining and dining the uberwealthy for yet another check. Ultimately, it is up to the state to regulate the market. Whether we’re talking about toxic assets or toxic student debt. Until that happens, expect more rich university presidents, more banks making huge amounts of money from student loans, and much more debt for diplomas.
