We crush them with debt to go to college — and today, rates are actually set to double. Are we out of our minds?
By Joan Walsh
Next time you’re watching a college graduation, as you look out over the sea of caps and gowns, make sure you notice the ball and chain most graduates are wearing as they march onstage to receive their diplomas. That’s student loan debt, which at over $1 trillion tops credit card debt in the U.S. today. The average burden is $28,000, but add in their credit cards and they’re graduating with an average of $35,000 in debt. It’s no wonder that people who’ve paid off their student loan debt are 36 percent more likely to own homes than those who haven’t, according to new research by the One Wisconsin Now Institute and Progress Now.
What kind of society sends its young people from higher education into adulthood this way? I’m aware I’m only talking about those lucky enough to go to college, when roughly one-third of high school graduates don’t – but if this is the way we treat our relatively lucky kids, the rest of them don’t have a prayer. For many, the school to prison pipeline functions much more efficiently than the school to college one; California is one of at least 10 states that now spends more on prison than higher education. According to the Federal Reserve Bank, two-thirds of college graduates leave with some debt, and 37 million Americans are repaying a student loan right now.
Unbelievably, interest rates on federally subsidized loans are doubling today, from 3.4 to 6.8 percent. As Congress bickers over alternatives, even Democrats are backing “market-based” plans that aren’t as bad as GOP ideas, but aren’t good either. I hope they can find a way to lower interest rates, but the real scandal isn’t the rate hike. The real scandal is that we take for granted that young people must go into debt – at whatever interest rate – to pay for college.
Of course, the truly lucky kids – those blessed wealthy members of the Lucky Sperm Club – sail through higher education without debt. But today, even upper-middle-class kids are having to take out loans, as the average annual cost of a four-year public university soars above $22,000, while private schools are over $50,000. Who the hell thinks this is a good idea?
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