Degreed, indebted and unwanted

The Occupy Movement’s Common Thread Is Anger, writes the New York Times.  Many thought a college degree — in any subject — would lead to a good job.

In Boston, a hub of colleges and universities, a higher education theme emerged among protesters. “What did I spend the last four years doing?” asked Becky De Freitas, a recent graduate of Gordon College in Wenham, Mass. “Fluent in Mandarin and French and no one wants to go for that? And it’s like, now what?”

Gordon, a private college, estimates that tuition, fees, room and board will cost $39,040 a year. While most students receive scholarships and grants, De Freitas is likely to owe quite a bit for her Mandarin and French fluency.

College debt will exceed $1 trillion this year, reports USA today. In 2010 alone, students borrowed $100 billion.

Students are borrowing twice what they did a decade ago after adjusting for inflation, the College Board reports. Total outstanding debt has doubled in the past five years — a sharp contrast to consumers reducing what’s owed on home loans and credit cards.

Defaults are up, despite federal forbearance options.

The credit risk falls on young people who will start adult life deeper in debt, a burden that could place a drag on the economy in the future.

“Students who borrow too much end up delaying life-cycle events such as buying a car, buying a home, getting married (and) having children,” says Mark Kantrowitz, publisher of FinAid.org.

“It’s going to create a generation of wage slavery,” predicts Nick Pardini, a Villanova University graduate student in finance.

Student loans can’t be discharged in bankruptcy.

 

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Comments

  1. L. C. Burgundy says:

    By “wage slavery,” I think Mr. Pardini is saying “I can’t believe I actually have to have a job and work for a living.” Bonus points for likening actually having to pay for your four years of optional “free” college to being brutalized as chattel for your entire life.

  2. Just what “job” did Ms. Freitas expect to get with degrees in French and Mandarin? I’m guess there are jobs where those skills would be valued, but wouldn’t they more likely be in France or China?

    I have no patience with idiots who get foolish, self-indulgent educations in underwater basket weaving or whatever the cool thing is these days and then are astonished that they can’t find a job.

    • greeneyeshade says:

      All the business we’re doing with China and a degree in Mandarin doesn’t help? Am I missing something here or is Ms. Freitas?

  3. In a healthy economy, French and/or Mandarin would get your foot in the door at many compainies that do business internationally. These young people would be willing to wait until the economy improved, if they weren’t facing such crushing debt. True, no-one held a gun to their heads when they took out their loans, but reputable institutions from colleges to banks to high school counselors all told them it would be a good idea.

  4. Sean Mays says:

    …Total outstanding debt has doubled in the past five years — a sharp contrast to consumers reducing what’s owed on home loans and credit cards …

    This isn’t an entirely fair comparison. There have been several studies and articles in popular press indicating that the reduction in consumer debt is majorly driven (80%) by lenders writing down and discharging the debts. Much of the “new frugality” is pretty much hot air.

    EB: No, nobody held a gun to their heads to borrow that much for college. But caveat emptor still holds no? I mean, it’s not like their parents and people ahead of them went hog wild buying houses with little to money down with variable teaser rates tied to LIBOR; right?

    Students borrowed $100 million in 2010? That sounds like it’s missing a couple zeros…

    • You’re right about the missing zeroes: $100 million is chicken feed. I’ve changed the “m” to a “b.”h

  5. superdestroyer says:

    The question is not getting a job but getting a job that pays enough to be able to not live near poor people (read minorities).

    How much does it cost to live in Boston in a neighborhood with upper class people. What percentage of the jobs in Boston pay that amount? What people are qualified to work in those jobs?

    When you look at statistics, the real gap is between the pay for many college graduates in large cities and the cost of living there.

    • Right…if you’re willing to move or commute long distances, the jobs are out there. My father used to rent a cheap bedroom near his work and then travel two hours each friday to see my mother, who still lived with my grandparents for two years after they were married. This was in the late sixties and he had a bachelor’s degree.

      I’d say that a lot of the problems are due to unrealistic expectations of what college grads should be able to afford starting off…and a lot of college debt is due to too-high expectations of quality of life in college. I wonder how many rounds of beer and video games taxpayer money has paid for.

  6. Richard Aubrey says:

    LIke to see the cost breakdown for a college which charges over a grand a year per credit hour.

  7. Elizabeth says:

    I certainly don’t think Liberal Arts are worthless, but back in my day, we called them the 55 wpm degrees. You knew you’d have to have secretarial training on top of it to land a job.

    Additionally, many of the loans/credit card balances are due to not working while in College – these kids should work more hours – lots of janitorial and food service jobs allow for day time school attendance.

  8. I ran across this quote in Explaining Postmodernism: Skepticism and Socialism from Rousseau to Foucault:

    [The modernist view of education that seeks to train a child’s cognitive capacity for reason] is replaced with the view that education is to take an essentially indeterminate being and give it a social identity.

    This explains a lot.

  9. Richard Aubrey says:

    I suppose we could cut The Kids a bit of slack. They were eighteen or nineteen when they chose a major. Who bothered to tell them anything? Some of their K-12 teachers were the touchy-feely types–given the numbers they couldn’t have escaped entirely–and their parents were probably born around 1960, grew up in the society infected with what was loosely called “The Movement”, or “the loose movement”.
    The idea that one should prepare, in a directed, hard-nosed fashion for future employment was not in fashion and a late teenager was unlikely to see through the fog.
    Those of you of a certain age will recall that the “hardhats” were considered both Archie Bunkers–those of you of a certain age will recall Arch–and the muscle of the conservative reactionaries. Actual, hands-on construction of anything more than a computer program was selling out.
    I exaggerate, but not much, about the society in which the current ed debtors grew up and from which they took direction, explicitly or implicitly.
    Liberal arts were originally for the folks who already had a competency, who didn’t need to work to support themselves.

  10. Michael E. Lopez says:

    Actually, the liberal arts were originally for the free (liber) folks who had slaves to do all their manual labor.

    It’s something to keep in mind.

  11. Deirdre Mundy says:

    I’ve noticed a lot of young people have crazy lifestyle expectations0– they remember that their parents had liberal arts degrees and big houses and could eat out and buy expensive food, but they fail to realize that that was after 20-30 years in the workforce.

    EVERYONE starts out poorer than they finish. EVERYONE starts with a crummy apartment and having to budget carefully and “fun night” being pizza and cards with friends, not nights at the opera. Well, OK, the kids from really wealthy backgrounds may get huge subsidies, but for most people, small apartment and crummy job is how you get your foot in the door!

  12. Richard Aubrey says:

    Deirdre?? You ever have trouble remembering how to spell that?
    Well, anyway, you make a very good case for my generation. I was born in Mar of 45. My family and a bazillion others was a veteran and a mom and several kids just getting started. An apartment in a split up big house in Norwich, CT, an apartment in Detroit. A tract house in Redford. A “got it made” house in Redford. The adults in question, remembering their prospects ca 1936, thought it was all very jolly.
    The younger kids remember growing up in the got-it-made house and figure that’s the standard. As a first-born, I remember the succession.
    Maybe some of this is delaying kids until you get your financial feet under you and the kids think being in a got-it-made lifestyle is the normal order of things, and their right, absent which somebody is screwing them.
    Or maybe they’re just ignorant as hell on account of being so well educated.