The true cause behind rising college debt

by Maxwell Matheny

Staff Writer

The following story was written by a student on the staff of The Jaguar Times as part of Hilliard Bradley High School’s Journalism Production course.

Debt crushes individuals and leaves them with little left. Photo Credit by Unsplash

With Bradley seniors about to head off to college and juniors already visiting colleges, there is one thing on everyone’s mind: College Debt. As all students will know, the price of college is very high. Over the last 40 years, the average cost of college has more than doubled, and is on track to continue that trend. There are several reasons for this, primarily centering around the current system of government loans.

Before World War II, very few people went to college, however this quickly changed after the war. After the war was over, congress passed the GI bill, allowing veterans to easily secure loans and more importantly, to go to college. Many of these colleges were on the smaller side and had very few courses offered. In order to accommodate more students and interests, these colleges expanded their programs. This in turn would shape the trend for years to come. This would also happen to increase the overall cost of college.

As professors with higher levels of knowledge are needed more than ever, this has indeed driven up the average salary. This in turn would ultimately the price of college. While this is one part of the problem it is not the major problem as professor’s salaries only make up 30% of all profits from the college.

For years, the way to go to college primarily centered around obtaining a loan from the bank. In order to make their money back, these banks would intentionally keep these loans low.It was in part because of this that the price of college was also low. In addition, banks also only gave loans to individuals who they thought would be successful in college and beyond. This system of smaller and targeted loans would keep the enrollment rate low and avoid widespread public debt.

Beginning in 1965, the U.S. federal government began to guarantee these loans provided by banks and other external lenders. This, in theory, would allow more people to go to college. The federal government is an institution that has massive amounts of cash to draw from and has the ability to make any student loan. Meaning that a college could name any price and the government would still give you the loan at the cost of your financial well being.

A side effect of the student loan guarantees is that it makes it impossible for students to default on their loans. When these loans were from banks, you always had the route of defaulting if you just couldn’t pay. With the government, this is just not a possibility. This creates a massive amount of student debt, totalling $1.7 trillion dollars and a significant amount of stress and financial insecurities in many graduates.

According to CNBC, the cost of college from 1980 to present day has increased 169% compared to the relatively stagnant young worker wages growing only 19% over the past 40 years. This over-inflationary trend by colleges exacerbates the college debt issue. Graduating senior Matt Penaherrera thinks that “honestly the best way I feel to fix it is to lower the costs of colleges.” He also suggested that we could “even make some specific colleges free so that those who are trying to avoid debt have some options to work with.”

There are many ways we could go about lowering the cost of college. But ultimately, the easiest way is to simply address the problem at its roots. Our government on all levels has done a great job of ignoring this issue and has left us with a mountain of debt. This is an issue that needs to be resolved as more will face the daunting decision of choosing to go to college or not.