.

Hello College Debt, Goodbye Risk

A New York Times story on graduates weighed down with college debt makes the case for last week’s column.

Once again, The New York Times is playing catch-up with Patch.com.

On Sunday, The Times had a front-page story about the growing burdens of college loans, three days after ran on the same subject. The paper did a wee bit more legwork for their gazillion-word story – my research consisted mainly of talking to a friend at the deli counter at the Giant supermarket – so I’ll leave the term “copycat” out of this discussion.

The lead of The Times story was about a young Ohio college graduate who owes $120,000 in loans and is working two jobs to pay the $900-a-month bill. Her mother is taking out life insurance on her because if anything happens to her daughter, she couldn’t pay the loans for which she co-signed. 

A decade ago, 58 percent of families didn’t have to take out loans to send their child to public colleges and universities. By 2008-2009, only 7 percent could say the same.

The Times story shows there is plenty of blame to go around. Too many colleges emphasize the long-term investment aspect of having a college degree and play down the debt students will be left with. Some of the students admitted they failed to ask enough questions about how much debt they were incurring. The situation sounds eerily like the complaints about lenders and borrowers of risky mortgages before the housing bubble burst.

State and local spending per college student, when adjusted for inflation, is at its lowest in 25 years, according to The Times. State legislators, in turn, say universities are inefficient and bloated. The price of tuition has outpaced inflation, increasing even faster than medical spending.  

The result is so many young people getting out of college with the equivalent of a mortgage but no house to show for it. One 24-year-old told The Times she dropped out of Bowling Green State University with $70,000 in debt and wasn’t going back. “It makes me puke to think about borrowing more money,” she said.

Many of those commenting on last week’s column had little sympathy for such students – variations of you-made-your-bed-now-lie-in-it were all the rage. But I think there’s some selective amnesia going on.

How many of those commenting had formative experiences in the first years after graduating from college where they lived on a shoestring budget in order to take a low-paying job they loved, follow a dream, work for a cause or have a life-changing adventure? It might have been a short window of freedom before the responsibilities of kids and mortgages, but it can have a lasting influence on their lives. 

The graduates The Times wrote about can’t even afford to move out of their parents’ homes. 

I fear I’m seeing the Ghost of Christmas Future. When my kids were little, we started a Pennsylvania Tuition Account for each one. We contributed to it each year but not enough so they’ll be able to avoid taking out loans. Right now, both boys have enough money in their accounts to go to college for about 1½ years – just so long as they don’t eat or sleep.  

Bob Zahm May 26, 2012 at 04:37 AM
@Rosemary - many successful European countries have had that model - and they're now moving away from it through the introduction of college fees - UK and Germany. So, the problem of affordability of college education is not just a US issue.
Bob Zahm May 26, 2012 at 04:38 AM
@Kelly - 100% agree. No one "deserves" anything other than a fair chance. The US has been about equal opportunity, not about equal incomes, equal living standards, etc.
Bob Zahm May 26, 2012 at 04:40 AM
@J. Schubert - have you looked at college campuses lately? Many of them are like all-included health spas with amazing work out facilities, dinning facilities, and boarding facilities. One of the big drivers of college tuition has been the need to pay for the facilities spending used to compete with other schools.
John Schubert May 26, 2012 at 11:38 AM
Bob Zahm, in general I agree, although I'd like to see a breakdown of the costs. (My suspicion is that academics and administration are the big cost driver.) I have this same discussion with my fellow Swarthmore alumni all the time -- and you've hit the nail on the head with the word "compete." Colleges compete for good students. An awesome campus tour can close the sale. Years ago, a friend of mine was working on a $100 million building campaign for Swarthmore -- and I asked her, "When is the place luxurious enough?" The best colleges find it difficult to stop this race.
John Schubert May 26, 2012 at 11:38 AM
By law, Pennsylvania community colleges can only charge one third of their cost of business to tuition. That's one reason community college is such a great deal. But given the wrecking-ball mentality of our state budget slashers today, one has to ask: (a) what will the future look like for community colleges, and (b) what would happen if demand for their services increased hugely? I don't know the answer to either of those questions, but I'm not sure I'd like it.

Boards

More »
Got a question? Something on your mind? Talk to your community, directly.
Note Article
Just a short thought to get the word out quickly about anything in your neighborhood.
Share something with your neighbors.What's on your mind?What's on your mind?Make an announcement, speak your mind, or sell somethingPost something
See more »