Student debt loads just may be America's next big crisis

  • Article by: LORI STURDEVANT , Star Tribune
  • Updated: November 26, 2011 - 4:56 PM

The problem is particularly acute in Minnesota. To navigate past this mess, we'll need a capable guide.

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ciamanNov. 26, 11 5:24 PM

Dear Ms. Lori Sturdevant: Yes, you have hit one big problem with regard to the cost of going to college and then finding a way to pay off that loan debt. Many clamoring ideas on just what to do, but hardly anyone agrees as to which might work, or which might just fail. One of the problems is that as we graduate more and more students into the real world, there are few jobs out there for the graduates. And if they cannot find any decent job to pay off their debt, then what? Just stop trying to pay off their loans and hope that the President will find a way to just forget about it? Just scotch it off so everyone is debt free except for us, the taxpayers, who would have to pony up for that to happen? I paid off all of my student loans and it really irks me to think that those students are holding out their hand for someone to pay it all off for them. That cannot and can't be that type of thing. Trying to scare up some decent jobs would help much, but the future is not bright. Everyone seems to be in debt, from our government to all the rest of the world. I am out of ideas as to what to do. And so do almost all of our "leaders". What do you think, Lori? Thanks, and deep thinking.

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jo1glexNov. 26, 11 5:25 PM

College education financing is indeed the next bubble. It's a perfect situation for the finance industry. Our economy has been in decline for several decades. Our tax burden has been shifting off of wealth and ownership and onto earned income. Wealth has concentrated upward to the already wealthy. Fewer and fewer jobs available without a college degree can support a family. Rising unemployment allows employers to set the terms and price of employment.

All this makes a college degree mandatory if one is not born wealthy and wishes to have a chance to escape the lower class.

In the meantime, the finance industry has been able to purchase control over the regulatory structure. They bought Joe Biden to make student loans non-dischargeable through bankruptcy, and completely guaranteed by the Federal government. The lenders cannot lose money; only the taxpayers and borrowers can.

State and federal support for education has been declining for decades. This puts upward pressure on tuition. The growing process of "running America like a business" has introduced business-style inefficiency and executive privilege and waste to colleges.

Add it all together, and it's a brutal debt trap. It will collapse. And then we'll have to figure out what to do about it. No doubt the loan originators, who pocketed the fees up front, will never be held to account for any of the fraud schemes and for-profit kickback schemes of the diploma mills.

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one4thepeepsNov. 26, 11 5:29 PM

Why have tuition costs and student debt increased exponentially? In part because year after year, Republicans have voted to cut state money to higher education institutions, thereby forcing colleges to raise tuition to balance the books. When we as a society we prioritize tax cuts to the wealthiest Americans at the expense of our students, we have damaged the next generation. The future of our state and our nation depends on an educated workforce to lead us into the 21st century. As long as we have groups of "know-nothings" in office, people who deny basic scientific facts about global warming and evolution, progress will be slow. It's time to get rid of these Republicans who would rather cut taxes to the richest one percent than invest in the young men and women who need our help.

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mugsdilNov. 26, 11 5:58 PM

This story has already, and will attract more of, the people who say, "I paid off my students loans so everybody else should be able to" and "I worked full time in college and didn't take out loans so too bad." Learn to have empathy, people. A lot of people are looking for jobs but just can't find them right now. There's nothing wrong with taking out student loans to fund an education and people should not be punished for doing so. You didn't have to take out student loans? Cool. We're happy for you.

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nemotodesNov. 26, 11 6:13 PM

"He took expensive University of Phoenix online classes at the Army's encouragement, only to discover that the credits he earned would not apply to the law enforcement degree he wants".

So it is the army's fault that he didn't check to see if his credits were transferable? Every commercial I see for on-line and private schools have a disclaimer warning you of that. I hope the guy never makes into law enforcement!

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nemotodesNov. 26, 11 6:18 PM

"Why have tuition costs and student debt increased exponentially?" Because the government keeps giving students easier access to student loans and grants. How easy it is for you to ignore that and blame Republicans. Furthermore, if tuition costs remain stable and taxpayers subsidize them through taxes it is the same. Really not that hard to figure out.

Were you also aware that to apply for financial aid you must submit your financial information with the government which then gives it to the schools so the know just how much to lend to you? Would you give a car salesman your financial information before shopping on the lot? Of course not. But, go ahead and blame the Republicans. It is the liberal way - deny all responsibility.

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guest1Nov. 26, 11 6:19 PM

Enough of the 'class warfare' nonsense. Student loan debt has risen because of decades of bloated university budgets and ever-rising spending by those schools. That's why tuition increases always jump far higher than inflation each year. There is no reason for that. Seems to me this 'story' is going to be part of yet another liberal push for yet another taxpayer bailout. Here's a thought: If you want to go to college, pick a field that is in demand, with a high likelihood of getting work in that field. Too many students pick majors today that have little to no chance of finding employment. And don't even think of running up student loan debt that you don't intend to pay back.

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nordeastguyNov. 26, 11 6:19 PM

If you want avoid the big loans, take PSEO classes (junior and senior high school years), go to a community college after high school, or work and go to school at the same time (even though this will not allow you to graduate in 4 years). Good luck.

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fastnfasterNov. 26, 11 6:21 PM

How about if college students stop racking up the debt and just work for a living? I know thats hard to comprehend but...it worked for me and I am not complaining about the student loans I paid off. If I hear one more miserable college student complaining about how hard life is...

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nordeastguyNov. 26, 11 6:23 PM

Mr Knapp took classes for a degree he admits is not hiring at a school that his credits will not transfer to. I'm sorry Mr Knapp, you didn't to your homework ahead of time on this one but I don't feel sorry you have the loans.

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