As if the country doesn’t have enough problems on its plate, the nation crossed yet another critical economic threshold on Tuesday, May 8 when the total student loan debt crossed the $1 trilion mark.
You would think that the astronomical costs invested in college education in this country would result in every adult having a degree hanging on their living room wall. But the U.S., which used to lead the world in the number of 25-to-34-yearolds with college degrees, now ranks 12th among 36 of the world’s developed nations.
The graduation rates for U.S. colleges is about 20 percent. Canada, meanwhile has a rate of 55.8 percent; China’s rate is 97 percent.
Just like everything else in the current economy, we are paying more for less, and the standard of living—and education— continues slip sliding away, as the Paul Simon song goes.
When students look at the sticker price for a college education, it’s enough to make them faint. The cost of going to a public college has increased by an average of 24 percent in the past five years; private school tuition is up an average of 17 percent.
The average cost of tuition, room and board at private schools in 2010 was $36,993. Add the incidentals like books, supplies and all the other things needed to gain knowedge and the cost is staggering.
Very few families have the money at hand to pay for their children to undergo higher education, and with cutbacks in federal aid programs such as Pell grants, more students must acquire student loans, then pay them back based on what they earn following graduation.
However, the bleak job market hasn’t been any kinder to college graduates than it has been to middle-aged Americans who have lost their jobs in recent years. The Associated Press reported this week that one in two new college graduates is jobless or unemployed. Broken down by occupation, young college graduates were heavily represented in jobs that require a high school diploma or less, namely food service industry jobs offering meager wages.
But this wicked economic reality doesn’t change the responsibility of every student to pay their debts. And yet, the worst may not be over, as a hike in the student loan interest rate is approaching—and the federal government, as usual, is proving itself incapable of agreeing on a solution to avoid even greater economic pain on those who can’t afford any more.
With $67 billion of student loans in default, the Education Department has hired 23 private debt-collection companies to chase borrowers. The agency, however, said it was reviewing the possibility of letting student loan borrowers make payments based on what they can afford, rather than the size of their debt.
Students go to college, in theory, to gain a higher education that will afford them the opportunity to get a high-paying job. But there are few of these jobs left in this country. Too many college students must resort to low-paying, low-skill jobs to put food on their table—and they’re mired in debts that will take them decades to pay off.
Is the college debt worth the trouble students now face?
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