I still remember the day.
I was sitting at my kitchen table, pen in hand, and I signed the dotted line to borrow a significant amount of money to pay for my first year of college.
The funny thing was — despite what you might hear in the media these days — no one was standing over my shoulder forcing me to. No government official told me I had to borrow the money. It was my decision then, and it’s my debt today. I weighed the price of borrowing against the value of a secondary degree, and I chose education.
My decision, my responsibility.
That’s not what you are hearing today from most of America’s youth. There are rallies in the streets of Portland, as well as in cities across America, with Occupy-inspired students and graduates whining about their debt and how they need a way out. Students who have borrowed too much — of their own free will, for degrees that haven’t led to a job — are now demanding a handout.
My generation is looking for a bailout. It doesn’t matter that many of them are in tough positions, loaded with debt, because they made poor choices. It doesn’t matter that borrowing money is a personal decision and requires personal responsibility. They want the easy way out.
The Portland Press Herald ran a story a couple days ago highlighting several students who carried student loan debt. One of the students was a social worker who owes $97,000 in student loan debt. A cursory search of the Internet will tell you that social workers don’t earn enough to warrant that kind of debt. The same goes for a Maine student who will owe more than $27,000 for his degree in philosophy.
I know that Walt Disney told my generation we can “be whatever we want to be” if only we “believe in ourselves.”
But borrowing $27,000 for a career in philosophy? In Maine? That’s a questionable decision at best, and it’s not the government’s fault.
The government already stepped in quietly and took over the student loan industry as part of Obamacare, and they have already used taxpayer money to lower interest rates on current government student loans to 3.4 percent. Now those taxpayer-subsidized interest rates are set to expire and more than double, and the “gimme-gimme” nation doesn’t like it.
Naturally, those who want government to take care of them are calling for the interest rates to be held at 3.4 percent, with the taxpayers chipping in for the difference. But make no mistake, even if those rates are held, this won’t be the end of the discussion. Now that the government holds all student loans, they have the opportunity to “bail out students” by forgiving loans.
Occupy camps in a park near you are already chanting to the beat of the “forgive all student loans” drum, and you can expect that cry to get louder this summer — it’s warm now, so they can start occupying again.
Don’t get me wrong: I agree that college costs are too high. And that is partly the government’s fault. Consider the University of Maine, piling on raises for its teachers while simultaneously jacking up rates for students. In just a few years, university salaries were up 29 percent overall while at the same time tuition costs jumped 30 percent. That’s unacceptable, and it’s a problem that needs to be addressed.
It’s also the government’s fault that anybody considers a bailout a legitimate solution to our problems. The bank bailouts and Obama’s boondoggle “American Recovery and Reinvestment Act” set the precedent and taught my generation that poor decisions and failure can be fixed with a government check. Shame on them for that, and shame on us for looking to government to bail out students now.
Ultimately, students and their parents make the decision to borrow money for school. And it’s their responsibility to pay it back. I’m tired of the whining, I’m tired of the blame game and I’m tired of people relying on government to bail them out.
It’s your debt. Pay it yourself.
Sam Adolphsen runs the Center for Open Government at the Maine Heritage Policy Center.
Hell must have frozen over; I actually agree with something written by someone from the Maine Heritage Policy Center. Not all of it, mind you, but definitely that people need to be responsible for their debts.
I’m trying to be responsible by finding a good paying job and paying my debts. How am I suppose to do that when I can’t find a better paying job? The fact that I make $3,000 a month and have to pay $1,200 in student loan payments is absurd.
You can apply for a deferment or forbearance if your economic situation is that dire. How did you get $1200/month in student loans? Yikes. You definitely need a job that pays better than $3000/month. I wish you the best of luck.
Just how much money did you borrow? And who ever told you that borrowing that much was a good idea?
Or was it a case of “I just have to go to this expensive private school.”
I could never understand how it is legal for a bank to sign a contract with a 16 year old for a major loan. Sixteen year olds don’t seem like they are old enough to make decisions like that, but there you are, we saddle ’em up early in America, load ’em down with massive debt before they’re old enough to vote, and then berate them when the economy goes bad, and they can’t find jobs in their field… anything to make the banks happy, I guess. That should be our national motto.
I don’t believe 16 year old’s can sign. I think you need to be 18.
A sixteen year old cannot enter into a contract. Not to mention that most sixteen year old students are in high school, not paying college tuition. The banks have enough legitimate sins; you needn’t fabricate more.
Contracts for student loans signed by minors are enforceable under a special exception carved out under the Higher Education Act.
A minor student enrolled in college may be subject to that exception but there are few sixteen year old college students.
Aren’t you misinformed – wow! Sixteen year olds signing contracts and in college? Actually, change that to clueless. Minors can not enter legally binding contracts and the average high school graduate is 18.
That’s it in a nutshell. Now that the government
has the loans I feel extremely confident that us
taxpayers will not have to foot the bill for deadbeats who
want everything for free. Yeah….right.
Doubling of the interest is the issue, not people being “deadbeats”.
Show a little maturity for a change, Gomer.
You mean reverting to the original rate?
With all this talk lately about college loan rates, I think I might short Sallie Mae’s.
Hey Mistook, talk to the dems for passing a bill
that brings the rate back to what it was originally.
I suppose you want your loan for nada too. Get a job!
No, They want you to pay it off for them.
Republicans also voted for that bill.
You can’t compare student loans to other consumer debts like credit cards, mortgages or gambling debts. Student loan debt is classified with criminal fines, actually treated harsher in many ways. If we could get the return of the basic free market, capitalistic mechanisms of consumer protection for student loans, this wouldn’t be happening.
The penalties are generally harsher because most student loans are guaranteed by the Government and they hate being stolen from.
Many mortgages are guaranteed by the govt (Mac and Mae) as are a number of small business loans. Yet those loans have consumer protections and are discharged during bankruptcy. There is no legal reason why student loans should not be treated the same way (and they were prior to 2005 and 1998 respectively*).
*When student loans had consumer protections, only 1% went into bankruptcy, which is far lower than other govt backed loans. The only reason to remove such protections is to pad the pockets of the lenders and handlers, who sponsored the law.
http://www.studentloanjustice.org
My understanding is that all loans made after July 1 2010 are completely controlled by the government including origination.
I don’t know the history of the transformation to a different legal status, but I think it’s because student loans are issued without the same rigorous checks of credit worthiness. So because the government decided to give them out to all comers, they needed added protection from those who would just walk away.
Readers — and the author — might find it interesting to know that virtually no one who earns a B.A. in philosophy ever intends to make a “career in philosophy.”
No, people with B.A.s in philosophy nearly always go into other fields which, due their extremely strong analytical, logical, writing, and verbal skills, they do quite well. Philosophy majors are far over-represented in corporate suites compared to degrees earned. Moreover, they consistently get the highest scores in the LSAT, which is used for law school admissions, and many highly-compensated lawyers have degrees in philosophy.
In fact, people with philosophy degrees make more, on average, than people with business degrees. Big companies see the business undergrads as technicians. They want the people who can think — and they can pay for philosophy B.A.s to get M.B.A.s should the company decide that would be helpful.
It’s sort of sad that philosophy degrees are some sort of easy shorthand, a punching bag, particularly since this might steer the sort of people who are capable of earning such degrees into less lucrative fields.
Of course, but then we are safe to assume they have ways to pay their debt, right?
Please provide reliable data that indicates B.A. Philosophy makes more than a person with a business degree. Please average in the Philosophy majors that lost their jobs when Borders closed down.
I’m willing to bet that most plumbers and electricians make more than most people with a B.A. Philosophy.
Especially if you can get them to show up at your house!
Did a little work…
http://www.payscale.com/best-colleges/degrees.asp
These numbers did not provide information on what percentage of degree holders were actually employed. But it did say “Lucrative careers exist for the history, English and foreign language majors out there, too, but they’re harder to find.” I expect philosophy and gender studies majors might be even harder to employ.
http://www.bls.gov/oes/2010/may/construction.htm
We very rarely agree, but in this instance you are on the mark. As you point out, any student with good strong analytical and communication skills can and should do well in the work-place.
In my opinion there are too many students that are lured into the fallacy that “practical or relevant” course material is the ticket to financial success when a solid background in the core liberal arts course material (languages, history, philosopy, etc.) will be much more valuable in opening up opportunities with a much more diverse universe of employers.
Finally, and quite sadly, many graduating students haven’t a clue about how to go out and find a job – they may be excellent at social networking but they don’t know how to leverage those networking skills in order to find a job.
I’d like to agree, but in my experience the BA in philosophy/gender studies will not get you hired. You will need to prove with some other qualification that you have those analytical and communication skills.
I would probably enjoy working with or having coffee with a philosophy major more than a business major.
I totally agree about the importance of networking–but that is something you learn in business classes–not so much in philosophy/gender studies.
Only in your ivory tower environment does a bachelor in philosophy do you any good. You point out yourself that many utilize the “skills” developed to get a higher degree. I graduated with a Bachelor of Liberal Arts. I majored in history and minored in business administration. After serving in the military I applied to a Fortune 500 company for a job. I was invited in to test for the position. Possibly based in the fact I had a degree. In addition by then I was a veteran when it was “cool” to hire a vet. I was told in an interview that I tested well and had a degree but would not have my application forwarded to a hiring department because I didn’t have the background they were looking for at that time. After owning and operating my own business for 16 years, I was informed by UMO that to get into their MBA program I would need a year of prerequisites. By the way I did borrow money for my degree and paid back every nickle. Student loan programs, however, got to the point where students were picking up their sheep skins with their right hand and filling bankruptcy petitions with their left. Student loans in recent years have had their interest rates reset once a year based on prime rates plus I think one percent. The summary here is it is your RESPONSIBILITY to know what you are getting yourself into when you sign on the dotted line.
your argument is logical however, you will find most liberal arts programs at state schools like UMO, UNH, UMASS are filled with kids who have no idea what they want to do with their lives and their parents, teachers, guidance counselors, etc. said “go to college, you will figure it out” and like they have been conditioned to do for the last 12 years of their lives they obey, they go, they sign the promissory notes.
I want to see some statistics on your claims. I think you have a valid hypothesis however research will quickly debunk it.
Philosophy is only a stepping stone to grad school. Critical thinking and writing skills are great but those can be learned in highschool and through entry level positions in the working world and dont require a $80,000 college degree!
Not Responsible for My Student Loan Debt!
http://www.esqpainting.blogspot.com
kljjklljk
A doubling of the interest rate is the government’s problem though.
There is alternatives to going into debt and millions of our finest citizens have taken the oath and had there education completely paid for in some cases and had huge assistance in others.
Many service members never go back to school, they chose service to there country as a career over going into debt.
Are you stupid? You must be stupid. The cost of tuition at any school that is not community college vastly inflated compared to employment rates after graduation, AND GOOD LUCK GETTING A GOOD JOB WITH A CC DEGREE. It is completely unfair to blame students for this balloon-Economy that is happening in our education system. Student are told with good cause to “go to college, get an education and you will get a job”, what they don’t get told is that they are becoming pawns in the biggest Nation-wide Ponzy-scheme this country has seen in years! Banks and colleges alike prey on teenagers and swindle them into taking on thousands upon thousands of dollars in high interest student debt with no way out and promise them high paying jobs, future security then throw them to the sharks without a life belt! It should be a crime, but its not its capitalism at it’s finest and its a long road down towards a cycle of debt, joblessness, and a suffering economy. You wanna know why America keeps falling into Economic downturns? Because institutions like Banks, colleges, and government are greedy and would rather force you to give them all your Money RIGHT NOW!!! than secure a stabilized economy where people can afford to consume good and services and stimulate growth, and universal prosperity FOR THE FUTURE!
Oh boo hoo. Maybe the problem with the current generation is their seemingly infinite capacity to whine.
Ok, you go make $3,000/month and pay $1,200/month in student loans and see what you can afford.
Your choice to borrow so much…
You start right out with an insult. Let me guess, you are an extremist. I read a little further…ah yes, lots of capitals and exclamation points. And you’re point? – Banks are out to get us. Poor students were taken advantage of. You need to quit college, Jaslynn, and enroll into the school of hard knocks right away. Your education is sorely missing some real world experience.
The point is that the cost of tuition is vastly inflated compared to employment rates after graduation.
Then don’t go! Or choose a major with prospects. Nurses find jobs easily and can make big bucks right out of college. The Army has the GI bill. Plumbers make excellent livings without a college degree. Many options and paths in life.
Youse can read some of my student loan debtor’s novel here:
http://esqpainting.blogspot.com/2012/03/allstate-interview-story.html
Our system of higher education is much like our health care system in that it is under performing and over compensated. The spin that has been given to us is that a degree is the only way to prosperity and that going into debt is well worth the expense. In many cases it is not. We need to question these people more when they tell us things that are not true and bring them to task to expose the truth. Many of our problems today are caused by our gulibility for believing people that are only interested in their own narrow agenders and self promotion.They don’t deserve to be believed.
This reminds me of the people who jump on the cheap land deals by the interstate to build houses, then demand the rest of the tax payers foot the bill for a sound wall.
Which came first the homes or the highway? In Bangor anyway it was the homes.
Samuel Adolphsen’s argument isn’t ONLYmisguided and/or heartless and elitist– he does get *close* to the truth– because it IS true that student debt isn’t (only) the government’s fault– it’s the fault of a massively commodified, alienated, and bogusly meritocratic (i.e. class based) society. Until a whole slew of “free market” policies change, working class students will keep getting set up for a massive debt load by capitalism before they even start out in life…
Funny, the poster above blamed the student loan issue on the over-regulation and lack of normal “capitalistic mechanisms” to keep it under control. I can’t figure out which is the problem: too much government regulation/subsidy or too little!
Maybe some of the blame belongs to those who sign on the dotted line…
If Mr. Adolphsen and the Maine Heritage Policy Center (a Koch brothers front organization) would stop trying to eliminate public higher education by attempting to starve its public revenue sources, students wouldn’t have to take on so much debt to go to college.
We should not have created the economic environment that leads to high student dept. Shifting wealth to the 1% means that less support is available for many important programs such as education.
The nation, including the top 1%, needs an educated populace to lead to future economic growth. Quite frankly maybe a few more philosophers might not be a bad idea. Maybe some clear rational thought would help us get back on a more evenhanded tract. OCCUPY for change.
So here is what frustrates me about this opinion. It is not honest. ”
they have already used taxpayer money to lower interest rates on current government student loans to 3.4 percent.” How are we using taxpayer money to lower the interest rates? It is a closed system. Meaning the 3.4% covers the entire over head cost of providing those loans to the students. Thus any interest rate above that amounts to a TAX on anyone that is borrowing money to go college.
This is an excellent article. Very well written!
I hope you’re being sarcastic.
I just have to say Hire me, or help me, I have no problem
paying obligations, and I have been doing so, but I am the part of the
statistic of 50% underemployed/unemployed, I am underemployed, so Hire me
someone, or help me, as I am doing my best to do so by myself, but the economic
situation is not making my investment paying off, and I have MBA degree, and I
am a Vet also, so I have experince.
I have to agree, we should not have an educated population. It is much easier for the wealthy elite to subjugate the illiterate and uneducated. Where do these students of predominately working class families get off, expecting to be college educated? Take a bath, get a hair cut and get a job, just like I did back in 1970. What, there are not any jobs? Well, then let them join the military there is plenty of opportunity on the 750+ military bases in 40 countries. They are lucky to be paying 3.4%, 6.8%, WAA WAA. How the heck are we going to pay down the national debt, we can’t get that from the poor or the unemployed, that’s for sure. You cannot expect the corporations that do not pay taxes or the financial institutions to bail them out. How dare they expect help from the government, the nanny state. After all, the government is the problem with all those entitlement programs. There is absolutely no benefit of an educated populace. Being dumb has not affected me.
Student loan debt is not solely the governments fault. I think we can blame it on a mixture of the government, predatory lending (their lobbying to remove consumer protections), colleges, and misinformed students and parents.
“Student loans can be terribly complex and difficult to understand for
even the most sophisticated borrower, much less for a student who may
have limited credit experience,” said Gerri Detweiler, financial expert
with Credit.com. “You shouldn’t need a degree in finance to understand
what a student loan will really cost, but these days it’s not a bad
idea.”
When I signed for my loans, I knew I would end up paying more than I borrowed because of interest rates that I thought were reasonable. What I knew nothing about until two years after graduating was capitalized interest. I have no problem paying what I borrowed and then some, but what is absolutely usury is when people end up paying more than twice what they originally borrowed. Sallie Mae expects me to pay over 435% of what I borrowed should I only be able to afford the minimum payments. I’ve always paid more, but I’ll still end up paying something like 300% of what I originally borrowed.
I hope you plan on saving for many years for a house if you should decide to buy one. Look at the interest on a 30-year mortgage.
The capitalized interest was explained to me when I took out my loans.
Capitalized interest wasn’t explained to me when I took out my loans, I’d never even heard the term until after graduating and didn’t understand what it really meant until two years after that. I don’t plan on ever owning a home. Living paycheck to paycheck, can’t save…not even for retirement.
When they told you you didn’t have to make interest payments while in school, didn’t you ask whether it would be added to the principal? I don’t think you need a degree in finance to figure out when the interest would begin to accrue.
Take a look at a credit card statement and what you will pay if you only make “minimum” payments.
http://www.youtube.com/watch?v=M16NjL6Ja2Q
I read a lot of posts and no one mentioned the colleges whose costs are skyrocketing way above what most people can realistically afford check this out http://www.nytimes.com/2007/10/23/education/23tuition.html?_r=1
now only the rich or the well connected will be able to afford college
The biggest expense of college ? Salaries yeah I know money attracts the brightest but come on! Most all products provide upgrades or better products in order to compete in the business world Someone tell me in the average college degree what has changed except costs of getting that degree in the past 50 years..not much! Lets take a business degree for example they are still teaching the same principles they taught years ago 2+2 still equals 4 but just costs more to find out…don’t get me going about degree mills (colleges you see advertising on tv) I got suckered by a slick sales pitch and now am paying dearly for it. Thanks for listening to me rant and I will get off my soap box now
now I am going to go out on a limb here (my its drafty out here!!!) and say that the government shares some fault with this because they should and can regulate where the money goes. Using the FAFSA they should tell you what colleges they will loan money to you for. IF your FAFSA says you can’t afford Harvard then sorry
This guy is so right. No one forced students to borrow money. Just because they WANT to go to an expensive college doesn’t mean they should if they cannot afford it. You borrow – you pay it back. Quite simply, that is the right way to do it.
What about companies that want the best collage people only an if they don’t get them here than they will go to other countries to get them an the americans will be left out because they did not get a collage education
A lot of students pick an expensive college just because it is the IN thing…… Instead of taking the first 2 yrs at a community college then move to a 4 yr college for the rest…. Their own fault for ending up with 100K of debt.