Graduation is less than a month away and many seniors, faced with the harsh possibility of an impending recession, are beginning to fully realize the weight of their student debt load.
For graduates across the United States – and at FSU – the due date of the first loan payment looms just a few months in the future.
With the upcoming presidential election, many potential candidates have made promises to address the crisis and help graduates who have found themselves under the thumb of their loan servicer. We should hear them out.
According to Student Loan Hero, U.S. graduates in 2018 averaged $29,800 in both private and federal loans. There is over $1.56 trillion in student loan debt among 44.7 million Americans.
This is largely seen as a problem that only impacts those who chose to take out loans. But the reality is that when people cannot pay back their loans or struggle to do so, it impacts the nationwide economy.
Last year, Federal Reserve Chairman Jerome Powell said he feared student loan debt would stunt economic growth because it injures students’ credit scores. This, paired with general lack of funds, can prevent young people from making large purchases, likes cars and homes.
Student loan debt is widely misunderstood as the byproduct of generations that just aren’t “working hard enough.” However, the prices of college have increased astronomically throughout the years and today, being able to afford college while working one part-time job is impossible.
The website marketwatch.com compares the cost increases between 1987 and 2016 at any university, adjusted for inflation.
The cumulative four-year cost of a degree from FSU, including tuition, fees, and housing, increased 161% between 1987 and 2016, from $31,523 to $82,360.
In 1987, a student working a part-time job at minimum wage (if they only used the money for school) could cover 112% of the cost of FSU. In 2016, a student with an equivalent job could only cover 51% of the cost.
The student in 2016 would need to find a way to afford the $40,136 they couldn’t cover with part-time work, either by working longer hours, asking for parental support, taking out loans, or – most likely – some combination of the three.
Kids as young as 17 are signing on to mountains of debt that can takes decades to pay off. These young people often don’t fully understand the implications of their loans – particularly first-generation students navigating the complicated FAFSA system on their own.
For some – there are options. State and federal jobs offer the possibility of loan forgiveness, but it isn’t a guarantee.
According to Forbes, more than 99% of students who applied for public service loan forgiveness were rejected – only 206 have ever qualified for forgiveness. The program, which has been anemic at best, does not meet the support graduates so desperately need.
Some states have taken it upon themselves to make higher education more accessible. Twenty states offer completely free higher education at community and state colleges.
While few presidential candidates have announced concrete ways to address student loan debt, we should be listening to the candidates who have comprehensive plans to lessen the burden.
Sen. Elizabeth Warren, a presidential hopeful, has proposed a near-complete elimination of student debt for 75% of Americans who have it. And she has a real tax plan that could fund this.
Some have criticized the $1.25 trillion price tag and the lack of focus on the skyrocketing prices of higher education.
However, this plan would benefit nearly 33.5 million people who are facing years of loan payments. It may not be the perfect solution, but it is a step toward the kind of practical policy discussions we need to be having.
As the crisis continues to mount, it is clear that this is no longer a problem we can write off as one that is simply impacting the individual.
The fight has to be more than simply alleviating student debt. Our country is only in this position due to the prohibitive nature of college costs. While eliminating the debt is important, public colleges should be accessible for every American.
This isn’t just about equity in our educational system, but about preventing loan servicers from continuing to devastate our economy.
This isn’t about giving a “free pass” to people who have completed their degrees, but rather, offering an opportunity for future generations to rise up from underneath their debt – and bring the rest of the country with them.