Post by notknowmuch on Jul 5, 2013 5:03:34 GMT -7
Lower income college students deserve better
By Peg Tyre
By Peg Tyre
This holiday weekend, our federal legislators headed home to their leafy country clubs and, unable to come up with a coherent long-term plan on how to support low-income college students, let the interest rates for government-backed students loans double—from 3.4 percent to 6.8 percent.
When our elected officials get back to Washington, they are widely expected to agree on some kind of retroactive year-long extension of the low rates. If all goes as expected, the issue will come up again in 2014.
But their failure to agree yet on how much students should pay to borrow money to go to college hints at our deep confusion about a darker reality: A generation of smart, ambitious, motivated young people are trying to better themselves through education. They are getting trapped in a maze of debt from which many will never emerge. And while there is plenty of suffering to go around, the people who will suffer the most are from poor and lower middle-income families.
Are we okay with this?
Let’s look at how this works. Americans now owe over a trillion dollars in student debt – more than they owe on auto loans and credit cards. On average, people with student loans owe about $24,000. About 13 percent of people with student debt owe more than $50,000.
Those numbers are dismissed by a lot of folks who say, “Feh! Stop moaning! If you end up owing 50 grand to get a sheepskin from Middlebury or Vanderbilt, it’s a good investment.” Here’s how that thinking goes: With your newly minted degree, you can get a decent job, live with you parents for a couple of years and pay down your debt to a manageable level. Presto!
To which I have this to say: “Sweetie. Honey. With all due respect, do you know anyone who isn’t rich?”
Because once you step out of bubble of affluence, college and college debt looks pretty different. Here’s how it works when you aren’t sitting on a big cushion of cash: Because your family is not wealthy, you live in an under-served neighborhood and the local public school didn’t prepare you for college in the way that students from affluent suburbs are prepared.
Republican legislators say low-cost student loans encourage colleges to inflate their prices. Democrats say we have to continue to offer low interest loans to prepare the work force of tomorrow. But neither side, in my view, is being innovative enough. The options for our hard working young people of limited means are way too narrow. They are being set up for failure and once they stumble, the penalties are too severe. Playing politics with student loans does a disservice to people who need and deserve more helpful and forward-looking government policies.
When our elected officials get back to Washington, they are widely expected to agree on some kind of retroactive year-long extension of the low rates. If all goes as expected, the issue will come up again in 2014.
But their failure to agree yet on how much students should pay to borrow money to go to college hints at our deep confusion about a darker reality: A generation of smart, ambitious, motivated young people are trying to better themselves through education. They are getting trapped in a maze of debt from which many will never emerge. And while there is plenty of suffering to go around, the people who will suffer the most are from poor and lower middle-income families.
Are we okay with this?
Let’s look at how this works. Americans now owe over a trillion dollars in student debt – more than they owe on auto loans and credit cards. On average, people with student loans owe about $24,000. About 13 percent of people with student debt owe more than $50,000.
Those numbers are dismissed by a lot of folks who say, “Feh! Stop moaning! If you end up owing 50 grand to get a sheepskin from Middlebury or Vanderbilt, it’s a good investment.” Here’s how that thinking goes: With your newly minted degree, you can get a decent job, live with you parents for a couple of years and pay down your debt to a manageable level. Presto!
To which I have this to say: “Sweetie. Honey. With all due respect, do you know anyone who isn’t rich?”
Because once you step out of bubble of affluence, college and college debt looks pretty different. Here’s how it works when you aren’t sitting on a big cushion of cash: Because your family is not wealthy, you live in an under-served neighborhood and the local public school didn’t prepare you for college in the way that students from affluent suburbs are prepared.
Republican legislators say low-cost student loans encourage colleges to inflate their prices. Democrats say we have to continue to offer low interest loans to prepare the work force of tomorrow. But neither side, in my view, is being innovative enough. The options for our hard working young people of limited means are way too narrow. They are being set up for failure and once they stumble, the penalties are too severe. Playing politics with student loans does a disservice to people who need and deserve more helpful and forward-looking government policies.