The Inky Says "Yes" To College Student Debt

(And are you really surprised; by the way, posting is questionable for tomorrow.)

This column appeared over the weekend in The Philadelphia Inquirer, and it was written by Kiley Austin-Young, a sophomore at Penn majoring in English and economics according to the bio.

This individual tells us that his (her?) tuition…

…will eclipse $200,000. This estimate includes full tuition, summer classes, textbooks, housing, food, kegs of Natural Light, and spring break vacations to Aruba.

I assume this person is serious.

Due to my selection of an expensive school, and my overindulgence in certain extracurricular activities, I will enter the labor market saddled in debt. None of my tuition will have been reduced or subsidized by the federal government, nor does it need to be, because the shocking price tag of my privately financed bachelor's degree will some day be worth every penny and more.

…

The numbers are clear. An average bachelor's degree worker will earn almost $1 million more over the course of a lifetime than a worker with only a high school diploma. An average professional degree holder will realize an additional $2.3 million in income. Even those graduates who earn far less will overcome their educational costs with the added income. Because of these dramatic added gains, students can finance a college education by borrowing against future income.

Now I will be careful in my responses to this individual because this column represents free speech, after all, and this person is not a typical blathering pundit. However (true to what passes for editorial standards at the Inky), there are no citations sourcing the statistics in the column, and no dissenting point of view is acknowledged of course. Also, we really don’t learn anything about this person’s circumstances, mainly how much of the education will be funded by his or her parents or through part-time employment.

So in place of the generalities noted, I’d like to provide this information…

For those who do graduate, the average loan debt was $17,600 in 2004 - $22,581 in the case of private colleges, according to the Center for Economic and Policy Research. (Anya) Kamenetz (an author who has written on this subject) says those averages are too close to the $23,000 maximum that undergraduates may borrow from the federal Stafford loan program over four years.

"If students need to go over that maximum, it means they need to take out private loans with higher interest rates," she says. "That means they'll likely be paying more over a longer period of time, which slows down life even more."

Of the three major variables affecting student debt - tuition costs, the job market, and interest rates - the latter has the gloomiest forecast, says Jacqueline King, director of the American Council on Education's Center for Policy Analysis.

Please note that the Christian Science Monitor article was written in 2006; this is an update with much of the same information, though the job market has declined further over the past two years and credit has worsened because of the subprime mortgage meltdown.

And by the way, here’s something else for the Inquirer author to consider…

Income for teachers is simply too low for many graduates, according to a report released last month by the State Public Interest Research Group. The study found that more than a third of borrowers who graduate from private, four-year colleges would face "unmanageable" debt on a starting teacher's salary, meaning they would need to set aside more than 8 percent of their pay to cover student loans.

More than half of black and Latino graduates would fall into this level of "unmanageable" debt, set by the lending industry.

Accumulating loan debt even pushes back many of life's milestones, according to a survey that (college board analyst Sandy) Baum conducted in 2002 for Nellie Mae, a major student lender, which is now a subsidiary of Sallie Mae. The report found that 38 percent of graduates held off buying their first house because of student loans, 14 percent put off marriage, and 21 percent delayed having children.

"We are the first society in history to take our brightest and start them out in debt," says Allan Carlson, president of the socially conservative Howard Center in Rockford, Ill. "That's just stupid public policy. We should encourage them to grow, not hold them back."

So that means that graduates will be saddled with debt and looking for employment in science or business professions to the exclusion of all else (nothing wrong with that, but we need teachers too, as well as people in communications and other “liberal arts” professions) in an economy which, for the most part, doesn’t generate good jobs any more (is it necessary to link to Paul Craig Roberts again?), particularly now that we are in a recession.

Well, at least this tells you how you can protect student loan funds from garnishment in the event that you have to file for bankruptcy (important if you ever hope to complete your education under these circumstances, of course).

But in spite of all of this, Austin-Young tells us…

If the many benefits of a college education continue to outpace the costs, subsidies are not needed. Precious public funds are better spent increasing opportunities for the disadvantaged, those who - from a flaw in the educational system or a broken family life - will not even finish high school.

Actually, after reading this elitist drivel (blaming the Inquirer more for allowing it to see the light of day than the author for expressing his or her point of view), I can see where Austin-Young should feel secure in his (her?) job prospects. This person has the makings of a first-class Inky columnist (and if that isn’t a tongue-in-cheek remark, I don’t know what is).