The looming tragedy of college debt
High-class, high-cost education looks more and more like a bubble that’s “already losing air,” said Andrew Hacker and Claudia Dreifus at TheAtlantic.com.
Andrew Hacker and Claudia Dreifus
The rising price of college is “turning a generation of young people into debtors,” said Andrew Hacker and Claudia Dreifus. Two thirds of undergraduates are in debt, and total college loans are “nearing the $1 trillion mark, more than what all households owe on their credit cards.”
Universities are to blame. They “actively encourage” students to borrow to pay not just for soaring tuition but for the increasingly extravagant campus amenities that come with the modern college experience. Institutions are pushing “extraneous activities—from obscure sports to overseas centers—and tacking most or all of their tabs onto students’ bills.”
Teenage student-borrowers are “not exactly the most experienced clientele” for loans, and many don’t understand the small-print penalties and interest rates. Not to mention that the average student debt of $27,650 can easily turn into a six-figure sinkhole in hard times.
That’s why student-loan defaults could be the “next subprime crisis,” with the major difference being that students can’t escape the payments, even through declaring bankruptcy. High-class, high-cost education looks more and more like a bubble that’s “already losing air.”