Frustration over mounting student debt reaches a new high
Jaren Wilkey, BYU Photo,
Thirty-seven percent of households "headed by an adult younger than 40" now have student debt, according to a study by the Pew Research Center.
According to the study, that's the highest percentage on record, and the indebtedness of such a large percentage of the adult population is having serious economic ramifications.
"There is a tendency among elite opinion makers to believe that debt accrued while gaining a college degree is 'good debt,’ ” Quartz's Mark Huelsman and Sean McElwee wrote Tuesday. "Like many pundit platitudes, this assertion is grounded in fantasy, not fact."
McElwee and Huelsman take the dissenting view that those who accept the trade-off of student loans for the hope of higher income are short-sighted.
"For students just out of school, upward of 15 percent of their federal student loans are in default within three years of students leaving school," they said. "Delinquency rates for student loans have continued to rise during and after the recession, even as delinquencies in every other form of loan—including mortgages, home equity loans, credit cards, and auto loans — have declined."
Pew's data also seems to give support to the claim that student debt can be more counterproductive than common platitudes assume. Those with no student debt, according to Pew, see seven times the wealth accumulation of those who took out loans to pay for college.
Even more frustration with increasing student loan debt has surfaced with the recent revelation that student debt is rising the fastest at universities with the highest-paid presidents.
"The sharpest rise in student debt occurred when executive compensation soared the highest," according to the Institute for Policy Studies, which analyzed data from the American Federation of Teachers Higher Ed Data Center to contrast rising student debt to rising presidential salaries.
"Administrative expenditures at the highest-paying universities outpaced spending on scholarships by more than two to one," The New York Times' Tamar Lewin wrote after reviewing the study, adding, "Since the 2008 financial crisis the leaders of the highest-paying universities fared well, largely at the expense of students and faculty."