Eye Opener on Student Loan Debt

Let me say up front I have a bias on student loans. Yes, I am massively in debt. That debt was one of the drivers of my depression. 

That said, more than 25 years ago I was talking about student loans creating a class of serfs. I should never have gone into a solo practice. I should never have the business decisions I made. It was then  I noticed the fall off of new attorneys coming into Anderson. The culture there was for solo practices. People could not pay their student loans on the income generated by private work. I suspect the same is true of other professions. So I will ask the question I asked then, what will have happen to communities without sufficient professionals? I know before my arrest the hospitals were beginning to buy up the practices of local doctors. I think there are obvious long-term problems with that idea. Saying this will be a shake up of a market will not compensate a community for the loss of services necessary for the functioning of that community.

I do not favor mass cancellation of student loan debt. Not even after having just finished reading PRIVATE PAIN, PUBLIC DISINVESTMENT: TALKING STUDENT DEBT WITH ELIZABETH TANDY SHERMER. This interview brings facts unknown to me that brings out cynical and the wrongheaded political calculations underlying the student loan program. The interviews are too long with important detail for easy quotes but let me give it a try:

MS: Another thing that I feel like the academy needs to own up to is the legions of social scientists promising us that taking out debt to finance postsecondary education is “good debt.” The idea is that you are investing in yourself in ways that will enable you to earn substantially more money over the course of your life. That is true on the condition that you finish a degree, and that the degree is one that has some sort of exchange value in labor markets. But those end up being two very large ifs. 

ETS: I do not shy away from showing the academy’s complicity in this crisis. But I also think we need to keep in mind that campuses have been asked to do more with less. It can’t be emphasized enough that K–12 schools and college campuses are on the front lines of public disinvestment.

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 ETS: There are some interesting things at the federal and state levels. If you look at the Build Back Better bill, it was originally going to make community college free. More than 20 states have some version of free community college. There is also more attention on New Mexico’s experiment with making public campuses, including the four-year ones, tuition free.

But there is such dysfunction in politics and policy making that it’s hard to free up the political imagination for something different right now. And that’s unfortunate.

But there’s a role for everyone to play for something better. I hope that I helped, as a historian, to trace the roots of this crisis back to a guarantee for bankers to be repaid, not that campuses would get much-needed revenue or that students would have genuinely equitable opportunities to enroll. But we need more experts, like economists, to show how much it would save to actually have direct investment in colleges and universities instead of this reliance on tuition. Activists have been and will continue to be important in showing that a higher education overhaul is something the American people want and will take to the streets for and will turn out on Election Day for. It really is going to be a concerted effort to do that, and that’s actually what made the GI Bill a success.

Why I do not favor mass cancellation: justice and politics. It is unjust, therefore bad politics, for cancellation. Those who can afford their payments, those who have benefitted from the bargain, cannot be lumped with those who did not benefit from the bargain.

There existed a means for an equitable cancellation of their student loan debt: the Bankruptcy Code. This was removed at the end of the Clinton Administration. Bring it back. Let those who were defrauded, those whose economic calculations proved wrong, have the same relief as the current resident of Mar-a-Largo.

Not that will solve the long term problem. Ending the student loan program is the correct solution. Direct funding of higher education will create citizens, not serfs.

sch 5/27/22