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Student Loan Debt and Its Effect On the Health of the U.S. Economy
I have been writing on hubpages for a little more than two months, and in that time I have concentrated on matters of the health of the human body. This subject will remain as my major focus in the future, but right now I thought it would be a good idea to dedicate a hub to an examination of the burgeoning student loan debt in the U.S. and its effect on the health of the economy. Indirectly, I am still writing about human health because the state of the economy can affect a person's mental and physical well-being.
The Cost of a College Education
On January 31, 2012, cbsnews.com reported that President Obama issued a statement challenging America's colleges and universities to start making college affordable. His words carry weight because in 2011 the Federal Government allocated $167 billion to private and public colleges and universities in the form of grants, loans and tax credits, and the President is now proposing to withhold some of this money from colleges that don't act to keep tuition costs reasonable. For the past several years, college tuition costs have been rising faster than the rate of inflation. Students from the middle class have been forced to take on more and more debt to finance their education. Tuition and income figures from the last 20 years tell the story. According to the College Board, from 1988 to 2008 tuition and fees at 4-year public universities have increased by 130%. For the same period, the Internal Revenue Service says that median family income has not increase at all, holding steady at about $33,000.
High Student-Loan Debt and the Housing Market
It is very difficult to start out on your own in life when you graduate from college with the kind of debt that many students now have. According to FinAid.org, 67% of the 2011 graduates of four-year colleges had an average debt of $34,000. With that kind of student debt, these young people can't even dream of buying a home.
Many economists believe that without a vigorous housing market, the U.S. economy can't fully emerge from the Great Recession. One of the things still holding the housing market back is lack of participation by recent college graduates. Many of them are delaying marriage, having a family and buying a house because their student loan debt is such a heavy burden. In addition, some of them are moving back in with their parents in order to reduce expenses and to try to save some money. This means that the parents must delay buying a smaller house or a condominium, further limiting the demand for new or existing houses.
Commentary on How the Increasing Cost of College Might Be Addressed
According to the National Center for Education Statistics, undergraduate enrollment increased 39% from 1999 to 2009. As the number of students attending college rose, so did their expectations regarding the kind of campus life they wanted. College and university administrators were all too willing to meet those raised expectations in the hope that their school would attract the best students. Posh new apartment-style residence centers were built to supplement the older buildings. Improvements were made to existing athletic facilities, and in many cases these improvements included new swimming pools and exercise and fitness centers outfitted with the best equipment. All of this costs money. Increases in tuition and room and board are one of the ways being used to pay for capital improvements.
It seems to me that both students and college administrators have lost sight of their respective missions. For students, the mission is to learn and acquire a skill that can make them productive members of society. This is what they need to focus on--not on whether or not the school has luxurious living accommodations and state-of-the-art fitness centers. Administrators have the job of making sure that the level of instruction at their school is top notch. This means hiring and retaining the best teachers they can find, and making sure that classrooms, laboratories and the college library are up to the task of supporting the learning process. Further, administrators need to work with Federal and state government and with industry to establish ways to insure that anyone in the United States who wants a college education can have access to one. Programs that emphasize paid internships, work-study, need-based scholarships and outright grants should be formulated so that students from middle- and lower- income families need to rely less on loans.
Student Debt Precludes Pursuit of the American Dream
This hub has been written for the sole purpose of providing information to the reader. It is not intended to be a source of any kind of medical advice or instruction, and it should not be used in the diagnosis of any illness, disease or condition. You should consult your doctor if you have questions about a specific medical problem.