Student Debt and the Passion of a Lost Generation
Student debt can be a crushing burden. Decisions one makes as a youth can potentially weigh down an entire life. Often, students are told by parents, teachers, and university professors to pursue what they love, that passion is more important than money. And in the walls of a university, this is an appealing argument. Outside school, too, this should be the driving force of one’s life.
If you were a college student in the past 10 years or so, and are middle-class or lower, you probably took out student loans to pay for that degree. And if one loves books, or art history, or 13th century religious iconography, following that advice with passion will cause problems when you have to pay off those student loans. When you graduate, excited about the world and its opportunities, do something big and interesting. Because after that, you might find that the world doesn’t want to pay you, or at least not very much, to pursue your passion.
This is our own fault. Believe it or not TRC does believe strongly in personal responsibility. If you took out a 100K in student loans, you are responsible to the institution which borrowed you that money. It must be paid back, even if, at 25 years old, you realize that you made a terrible decision at 17, and will pay for it for the remainder of your adult life. Alas. These are the rules, which, even when soul-crushing, are still the rules.
The US is in an a difficult place regarding student debt, and it could have serious consequences. The nation now carries more student loan debt than it does credit card debt. The costs of tuition have been rising at staggering rates, and show no signs of tapering off, and in the meantime wages for graduates are decreasing. Student debt, it is being said, could drag this economic recession on and on, and leave a generation of college students unemployable. By year’s end, a projected $1 trillion in student loans will be outstanding in the United States. A trillion dollars. How is repayment going?
Barely more than a third of loan holders are actively paying down their debts, indicating that the burden may be too much for many. What effect will the ballooning student debt load have on the economy in the long term? According to Alan Nasser, professor emeritus of political economy at Evergreen State University, the American dream is about to become the American nightmare.
That doesn’t sound good. Too many people are having too hard a time surviving and one cause of the difficulty is simply that middle-class kids did what they were told middle-class kids do: go to college. College is a benefit, and it should be encouraged. The college years are the best years of one’s life (they really were), and the intellectual pursuit is among the greatest endeavors of human existence (truly). It is not culture or society’s fault that millions of young, highly educated people are unable to get a job. But culture is not guilt free, either. There is plenty of responsibility for this $1 trillion dollars. The question should be, what are we going to do about it so it does not erase a generation?
Who knows. Are there any viable solutions? At Occupy Wall Street there is a growing cry for student debt relief. There is an argument to be made for debt forgiveness: if we forgive the crushing debt burden, individuals will have money to spend on goods and services rather than sending their money (or not sending money, as the case may be) to pay off interest on student debt. Mrs. TRC and I have discussed this. We are doing well in comparison, working and able to meet our payments. But if we didn’t have to make the monthly student loan payment we would immediately: buy a car, buy a computer, re-do our kitchen floor. Would it help if we opened up what little capital is available to Americans and allowed them to direct that money towards economic recovery? It seems reasonable, but I’m not economist.
Either way, that’s not likely. And no one should be surprised that our government does not forgive a trillion dollars in debt to its own citizens. It’s not our style, and it may not be the best solution anyway. A strong argument against simple debt-relief is that it is unfair to people to worked tooth-and-nail to pay their education off and did not accrue debt. This person, the argument goes, did not need a private school education, and found a way to pay for it without loans. That is true, and that individual deserves the praise of our society; that person is a role-model. I think there are too few of those individuals; I wish I had been one.
Another plan is out today from President Obama to help ease the burden of student loans. The President’s plan “allows borrowers to cap their loan payments at 10 percent of their income, a significant reduction from the 15 percent cap in current law. And the plan would allow for loan forgiveness on a remaining balance after 20 years of payments.” Pay 10% of your income for 20 years, and the rest is forgiven. That seems generous. Whether it will work or be welcomed remains to be seen.
There is also a third option that TRC has thought of lately, and it’s terrifying, but no less realistic. It is said that if you do not find a job within five years of graduation, the odds of ever working into the competitive position you could have decrease significantly (I heard this on MPR, and am looking for the source). That is going to be a lot of students in the wake of this recession. And it will not be just liberal arts majors who want to be curators or book-store owners, but law students and scientists, and individuals from every field with graduate degrees, and thus more loans, because why look for a job when there are none? Better to keep learning and acquiring degrees to be more competitive when jobs come back. One may disagree with this line of thinking, but it is not uncommon and results in a lot of MAs, MSs, PhDs, JDs, etc.
Millions, probably. And the vision of these over-burdened and underemployed college graduates making coffee around the nation will eventually, finally, demonstrate what people around the country have known for a long time: the university system needs to change. The system cannot be: take out loans to go to school to get a job to pay off the loans you needed to go to school. That is a heartless cycle, and will destroy too many people in its wake.
Or we’ll just stop attending higher-education. The US will continue to run colleges and universities that compete with the best institutions in the world and continue to increase tuition to meet costs, but Americans will not attend those schools, at least not the majority of Americans. And this would be a loss of monumental proportions. Learning what you are passionate about, like your teachers said, is what college is for, and learning how to follow that passion for the rest of your life should take priority over monthly interest payments.