Student Loan Crisis

The government did, however, do one wonderful thing. It became a threat, and they did lose, but they absolutely tried. They gave student loans. Some were just loans, other required you to go into certain fields or to work for them, and others were only for elite students. Some even were after the fact, meaning they forgave your loans if you worker in a capacity that freed up some of their money, like teaching in an inner-city school.

Sounds good, but universities were receiving $X dollars for students and then were receiving less than $X and the rest of the tuition from the government. Since the government is a larger source of cash per student than the actual student or his or her parents, they raised tuition. It’s pathetic.

Now I promote education for everyone. I tell everyone that they should learn as much as they can, and that’s why I’m teaching all this stuff to you–I just feel like I have to–so let’s not blame the universities. Why not? Well, even if you want to blame them, there’s a bigger fish to fry. They’re at least educating us. They’re overcharging, but a lot of that money is going toward education. Sometimes, you get a TA and the education is going directly from the professor to the community or a company or the government via his or her research, but we’re learning as a country. The country and the world is becoming more intelligent and being taught some many ways to be more innovative and efficient. Since most professors are an expert in only a couple things, you’d think the students are learning something along the same lines as those other stakeholders, which means those stakeholders can hire those students. The students and, let’s say, the community or a company are taught by the same professor or at least that professor’s TA and in the same subject matter. So, they can obviously work together, with the company paying the student. It’s a perfect system.

Yeah, right.

The companies aren’t paying the students. They are finding every way to not pay someone after they graduate. I know it sounds silly, but their excuse is basically¬†‘I don’t wanna!’

These loans are bankrupting people. The most important effect is the psychological stress that just ruins any chance of being able to handle any of life’s challenges, but let’s say you’re fearless: what’s the economic cost of all this?

Well, we have an average of $30,000 in student loan debt, and we end up paying probably $55,000+ when you add in all the interest over many years. That’s a down payment on a gigantic house you’ll never need because you can’t afford children. Your salary is going to be around $100,000 as an oft-promoted veteran of a good company. Many do better than that, but so many wash out. Even more never get on that track. We talked about that: outsourcing, automation, underemployment, and so on. So, you get that awesome salary, you feel good, Wall Street slowly recedes into the shadows before you realize the ruse, and you get a bill in the mail christened with a free migraine to go with it.


  1. Great article shedding light on these economic issues. Outstanding student loan debt is like a house of cards that will eventually collapse. A key phrase in your article is “fiduciary duty to constantly raise earnings per share”, which will always create great wealth and great poverty, as one cannot exist without the other in a credit-based economy that strives for infinite growth.

  2. I have a slightly different take on this.

    (1) Executives at companies with more than 1,000 employees have little control over what their companies do, other than buying and selling components. Ask them what R&D in any of their divisions is doing on a particular day — no clue. One of my assignments in trying to turn around a troubled company was to find out what projects were underway and which ones might have so real value in the future (value as in the ability to create revenue). Management didn’t know.

    (2) Technology has changed the relationship between workers and product. We simply don’t need all of the workers to produce the same amount of stuff. Instead, we need creativity to help find new stuff to make.

    (3) Unfortunately, there’s a lag in communications between markets, companies, schools and students. Part of our problem is having too many people lacking skills or with obsolete skills (e.g., COBOL programmers). Finishing high school should not be optional for anyone. Nor should at least a two-year college degree. However, we need to strengthen adult learning and teach people that stopping learning is economic suicide.

    (4) Hand-in-hand with item (3), basic college education should be free, as it is in much of the rest of the world (Europe, the Middle East, China, etc.). That reform takes care of the debt issue.

    Unfortunately, US politics is dominated by a small cadre of rich and greedy who place themselves above law and country, and make the rules in Congress. That’s why a thinking person has to consider seriously the idea of living someplace else. Upwards of 3% of US citizens now live in another country (that excludes military/government workers stationed offshore). Free healthcare (in many cases, better healthcare), free education, lower food and housing costs are powerful incentives.

  3. Reblogged this on sportyoldude and commented:
    I worked up to three jobs as a student just to feed myself and put a roof over my head, and that was in 70″s when tuition was a lot cheaper. part of the reason for the inflated tuitions is the NCAA a pernicious parasite that sucks the money out of schools and universities and gives little in return. they are listed as a non profit an insult to anyones intelligence.

  4. I would like to thank you for following my blog. Although our beliefs may not overlap at times, it is people like you, with an open mind and accepting heart, that give me hope in the other sides of the political spectrum.

    1. Thank you for your comment. I’m glad you’re here. I certainly want to learn about everybody, and when there’s something that doesn’t seem to add up, I don’t run away from it. I ask about it.

      Please share your thoughts about any of my posts and any additional information you may have. You’re welcome here.

  5. I’m still waiting on a national politician willing to push hard on exactly the points you make here. Someone to make it their central issue. Elizabeth Warren is the closest it seems.

    I mean, these are huge problems that can damage a society long term. But most politicians either openly dismiss or at a minimum pay lip service. It’s frustrating.

    1. Thank you, Jon. I support Senator Warren’s opinion on a number of issues. Another is wage theft, which I wrote about a few weeks ago.

      It may be a complex issue, the more likely scenario is the one that you’ve presented. I don’t know that no one cares, but I think they still have this bygone ethos that “everything will work out in the end.” The younger generations can’t justify that outlook.

      Despite what baby boomers say about us, we’re actually MORE responsible than them, and we want some assurances. We’re tired of analogies to “bootstraps” and “grindstones,” and I don’t want to ever hear the word “sticktuitiveness” again. We want data. We want action. We want something real. Who’s going to give that to us is anyone’s guess, but Elizabeth Warren is on my short list of nominees for the ticket in 2020.

  6. Working on keeping my daughter debt free for undergrad, but she’s been told grad school will be on her dime.

    1. Thank you for your comment. That’s a good plan. It’s expensive.

      Debt is inevitable for so many and you may never work in the field you study. Might as well study what makes you happy. That may be the only silver lining.

      I recommend studying in an expensive city to maximize salary potential at nearby employers.

    2. Actually the cost of living in AZ is reasonable and we’ve just approved a $12/hour minimum wage. ASU is also improving its education model.

    3. If she’s staying there, she’s set. ASU merged with Thunderbird, a gradschool I looked at out there. Several of my high school classmates went to ASU or UofA. One even went to NAU.

      I’m happy about the AZ minimum wage increase. I talk about that in last week’s post about Wage Theft. That’s the best solution. We know what we need: give us a living wage, and we’ll take care of the rest.

      I’d be interested to know how much local coverage Arpaio is getting. There’s a national spotlight there, and I’ve certainly written about immigration in general at least four times on TrumpDiaries alone, but sometimes people in distant states are more concerned about certain issues than are the locals.

    4. Thanks for letting me know. From what I’ve read, issuing a pardon is determining that someone is guilty so it doesn’t matter whether the defendant pleads guilty or not. However, given that pardons don’t require any reason and that they are irreversible, no one’s really cares about the details.

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