America’s Student Debt Crisis

Picture: j.o.h.n. walker (CC)

Student debt activists and education advocates Kyle McCarthy and Natalia Abrams are tired of the ‘silence and complacency’ that our elected (and duly bribed) officials exhibit in the face of overwhelming evidence of usury and millions of voices of the disaffected. At least two out of three of students take out loans for college and at least 1 out of 5 of those will default.

Via Huffington Post:

Since 1978, college tuition has skyrocketed by over 900%, while simultaneously, grants and scholarships continue to be slashed. The result? Students are forced to mortgage their futures with student debt, from which there is no escape. In 2010, student debt actually eclipsed credit card debt as the second largest consumer debt in the country (second only to mortgage debt, surpassing $1 trillionin total). The Atlantic recently reported that, since 1999, student debt has increased by 511%.

And who benefits from so many Americans bogged down with student debt? The lenders, of course. The nation’s largest student lender, Sallie Mae, a company that continues to lobby againstconsumer protections and which has poured millions into destroying Pell Grants, recently announced that they would be issuing dividends to shareholders, enriching themselves off of the backs of those who did nothing other than to seek out a better life through higher education. At a time when funding for education is being slashed at all levels, the lenders are flush with cash as our leaders stand idly by, refusing to do anything about this ever-growing problem.

These student lenders shower our leaders with millions of dollars, give them free rides oncorporate jets and, perhaps most egregious, the single largest recipient of campaign cash from the student lending industry, Speaker John Boehner, was rewarded by Sallie Mae for doing its dirty work by giving his daughter a job at General Revenue Corporation, Sallie Mae’s collections subsidiary. Yes, you read that right. Sallie Mae actually has its own collections agency. When a borrower defaults, he or she can be charged up to 25% of the principal amount owed, including capitalized interest. One could logically conclude that it’s in the lender’s best interests, and can make far more money, when borrowers default on their loans. Why else would the lenders be so unwilling to work with borrowers to come to reasonable repayment options?

Read the rest and make up your own mind. While you’re at it, check out the petition urging the Chairman of the House Committee on Education and the Workforce to hold hearings on H.R. 4170: The Student Loan Forgiveness Act of 2012.

, ,

  • frafri

    just check out whats going on in Chile with the students.
    they are taking over shit. and thats how theyve made changes.
    its all in the culture.
    Here we care but we dont do anything about it. we are being consumed by the media…

  • http://buzzcoastin.posterous.com BuzzCoastin

    > Students are forced to mortgage their futures with student debt, from which there is no escape.

    This is the main purpose of higher edumacation & student loans today.
    Enslavement by debt; very old school.

    There was a MBA school professor at Stanford who taught his students how to use Excel
    to calculate how they would never recover the investment they made into a Stanford MBA.

    • DeepCough

      Funny thing about the word “mortgage:” it means “to pledge to pay even unto death.”

  • Haystack

    One of the major functions of higher education is just to get people in debt as soon as they turn 18. Once you’re facing a court order to garnish your wages, it becomes a lot harder to forgo earthly riches and pursue an altruistic vocation. 

    I would encourage anyone having problems to Google the William D. Ford consolidation loan. I was able to reduce about 63k in both public and private loans to roughly $25/month. 

  • anon

    imagine if each of those hats (i forget the name right now) had solar panels on :P

  • MoralDrift

    It would be sweet, don’t know if it will happen though

  • http://twitter.com/Sonoma7 joni frisina-bowles

    As a Retired Prof./Social Worker, I am so sickened by this student lending debacle and this horrific system that I have shared as much of this information with our soon-to-be, new Senator from Maine, and a former creative Governor from Maine, Angus King. I have been sending his policy specialist information, and keeping them updated on the FACTS being presented to the public, recently, and finally, after years of students being exploited, lack of transparency and a relatively Bought Congress, who even Dylan Ratigan speaks about in his book, “Dirty Bastards”. The Corporatization of America is also being revealed as it exists in the Educational System, that we have so entrusted the minds and futures of our persevering youth and adult students, who thought they were bettering themselves, and believed in a brighter future — not one laden with debt and despair. There is plenty of blame to go around, but now the blaming must put on the back burner in response to a SOLUTION. H.R. 4170 is a win-win, and could put education in America back on a positive course. There must be resolution, or this will become an economic catastrophy that makes the housing crisis pale in comparison.

    • http://hormeticminds.blogspot.com/ Chaorder Gradient

      most of these exploited youths are so disenfranchised, hopeless, cynical, uninformed, and apathetic that they don’t even see anything like this ever going through.

  • Big_Bear

    There is an escape.  Get a new identity.  New SSN (not necessarily a new name).  To these debt collectors, you are just a number anyway.  Stick it to them for their phony education bubble.  Use their system against them.

21