Student Loan Debt Crisis, What Can We Do
Here are several key factors that we have been learning throughout the years about student loans, some may shock you, some will come as no surprise.
1. The cost of higher education has risen drastically over the last 50 years. A four-year, full-time public university, including tuition, fees, room, and board, would’ve cost $6,966 in 1964. In 2013, the price was $17,474. It’s just not possible anymore to “work your way through college” as it was in the ’60s and ’70s without taking on a big chunk of debt.
2. Universities have little incentive to make education more affordable. Most American children grow up being told by their families they must receive higher education to have a shot at a decent-paying job and a good life, so the demand for a college education has increased, along with tuition prices. So basically any attempts to keep tuition low are unlikely to be successful because of the high demand.
3. While institutions are bringing in more money than ever, most of it is going toward capital improvements, large increases in administrative staff and administrative bonuses, and athletics. The staffing levels for academics have stayed pretty steady over the last 30 years, meaning all this new money by-and-large is not going directly toward providing students a better education.
So now there are nicer college buildings, amazing facilities, game rooms, really expensive gyms with fancy machines and equipment, dorms that look like 5 star hotels, but the quality of the academic programs is still mediocre.
4. Student loans themselves are rigged entirely for the benefit of the big banking industry, government, and universities that control and profit off them and very much against the borrowers, many of them 18-year-olds who have very little understanding of what they’re signing. The picture included on this post perfectly shows what interest can do when someone takes on a rigged loan.
Now, what can we do?
1. Support political candidates that want what is best for the students and taxpayers equally. It is not fair to lower the burden of student loan debt while increasing federal taxes on Americans without college debt, just because they make a good income.
2. Advocate guaranteed tuition rates for those who graduate on-time. Unfortunately and ironically, those who struggle the most with high student loan debt never finished earning their degree. So they ended up in a lose-lose. A lot of debt to pay for, and no education to make up for it.
Some institutions are undertaking a model where tuition would be locked in place for the first 4 years, so if you finish your degree in that time, you’ll be paying the same rate as a senior you were as a freshman.
Some colleges raise tuition every year, so if they implemented this model, and students finished their degrees in 4 years, they could save a lot of money.
3. Base state-share of instruction on successful graduation rates. As mentioned above, the key is to get students to graduate so they are trained for the higher-paying positions that can help them afford their debt. Reward institutions that are graduating their students by tying their state share of instruction monies to their success on that end.
4. Stop giving ridiculous bonuses to administrative staff, driving up tuition costs while students struggle more than ever. If you insist on bonuses, moderate ones will suffice. Prioritize spending toward faculty and direct educational benefits for students.
5. Given that only a handful of athletic programs around the country actually bring money into the university, while all the rest are subsidized, the football coach at these athletics-subsidized institutions should not be the highest paid employee on campus. Ohio State football makes money. University of Toledo football drains money. Act accordingly.
7. Invest in the middle-class. The upper-class doesn’t struggle with student loan debt—the lower and middle classes do. We need to combat the unemployment and underemployment that exacerbates the student loan crisis, and get these people good-paying, benefit-having jobs. When they have those jobs, they can pay down their student loans, and they can grow the economy by participating as consumers. When consumers have money, businesses thrive, hire and produce. We will not get there by funneling money toward the top to people who don’t do large-scale consumption. The middle- and lower-classes are America’s consumer base. Invest in them, and watch the economy grow as the country prospers.
Latest News On Student Loans:
Feds Garnish Wages To Cover Student Loan Debt
Federal Student Loan Rates Rise
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