http://www.projectcensored.org/top-stories/articles/17-students-crushed-by-one-trillion-dollars-in-student-loans/
My chosen topic of discussion for this blog project is the astronomical amount of student loan debt that has been accumulated in the United States, currently numbering over 1 trillion U.S. dollars. I chose this topic because it is a highly overlooked problem in the U.S. economic system at present as well as something that affects a huge amount of the work force, as well as many young adults coming into the work force. While many people point out the looming threat of the American credit card debt, student loan debt actually passed that of credit in 2012.
While virtually everyone recognizes that seeming insurmountable amounts of debt aren't good for anyone, there is a lot of opposition to proposed solutions for this current problem. There has been growing support for a Student Debt "Jubilee" which would, in the most basic terms, wipe out student loan debt through the use of funds from the Federal Reserve. The Federal Reserve put $1.3 trillion into relieving the Wall Street Banks' financial issues so, in theory, a $1 trillion student loan investment would be a viable economic move.
While this proposed solution is far from perfect it is most definitely something that should be looked into and explored on a much larger scale than it is now.Another problem is the economic strain of $1 trillion in spending, particularly after the significant loss after the Wall Street bail-outs which did not make their returns back. Their is evidence in previous legislation, the GI bill, that a government-funded student loan reprieve would be successful on a grand economic scale, over time the GI bill is supposed to have made an approximated 800% return on its investment and is widely regarded as one of Congress' best actions.
One of the most significant issues with this proposition is that some say it is rewarding private institutions that are already charging obscene tuition from their student body. It is not uncommon for private colleges and universities in America to charge upwards of $40,000 a year for an education, amounting in student loan debt that follows students for decades after they graduate and (hopefully) get jobs in their respective fields. While both public and private tuition costs have steadily rose, private costs have risen at a significantly higher rate.
One of the largest proponents of the proposed "Student Loan Jubilee" is the aptly named Jubilee USA Network (http://www.jubileeusa.org/home.html), which is a group of individuals "building an economy that serves, protects and promotes participation of the most vulnerable", or so they hope. The group they identify as the most vulnerable are those already in debt, and those looking to a future with inevitable debt. Jubilee USA is a highly active group, with ample ways to involve oneself provided on their "Get Active" section of their website (http://www.jubileeusa.org/get-active), with clear initiatives and goals set out. So far, Jubilee USA has succeeded in greatly raising awareness for debt issues and hopes to grow and be more influential in future elections and political decisions.
Click image to enlarge
As pictured in this infographic, private college loans have gone up from $13,686 on average in 1981 all the way to $31,395 in 2011 and show no signs of stopping; this is a net increase of 229% over just 30 years! While it is still proven to be far worth it to get an education, that is hardly rationale for institutions to be charging these ludicrous sums of money.
Americans at large have come to accept student loans as an entirely commonplace economic burden on individuals seeking a college education, and while student loan groups do enable those who wouldn't be able to afford college otherwise, they in turn gouge them for money right as they get out of college.
For a first hand perspective on the struggles of the indebted, I interviewed my cousin Matthew Holland, who graduated from our local Pace University with approximately $47,000 and change in student loans and a masters in education. He described his experience dealing with his student loans as a "looming expense [he] could only put off for so long", as he chipped away at them slowly but surely, paying more interest than principal for his first 4 years after graduating and getting a job as a public school teacher. Starting college in 2004 he signed up for student loans with Sallie Mae, one of the biggest loan companies in America; at the rate he is paying them off (averaging $300 a month) he will likely still be paying for them for upwards of the next 10 years, and has already been paying through them for 4 years. He said he has already postponed moving into a new house with his wife, and continues to rent largely because of the student loans both of them have accrued pursuing their degrees. On the brighter side of things, he said that student loans, for him, were a "necessary evil" and he would not have been able to pursue teaching had it not been for the loans he had to take out.
In my brief interview it was clear that student loans may be a common expense for many adults, but it is not an expense to be taken lightly, despite how easy it is to get the loans in the first place.
