Student loan debt is a runaway train. The only way to stop it is to blow it off the tracks completely with massive student loan forgiveness AND halt annual college tuition spikes for good.
Since massive student loan forgiveness is not entirely realistic, even though it may be necessary, I will focus on the annual tuition spikes that have made college unaffordable and plunged many of us into insurmountable debt AND what to expect if colleges were no longer able to raise tuition.
Throughout the last several decades, colleges have hiked up tuition by 7% annually (that is COMPOUNDED annually) BECAUSE the student loan companies are dishing out obscene amounts of money to 18–22 year old kids so that they can afford the price of college. So long as the lenders keep lending large amounts of money in droves, colleges can continue to raise tuition by 7% every year.
For many of us millennials, college was not an option unless we borrowed a LARGE amount of money. Couple this with the lie we were all sold that we would not be able to find a “good job” and live a “good life” without a college education…NOT going to college was NOT even in the cards.
A college degree was simply something you needed to have. That was that. This is an example of a consistent theme throughout the baby boomer generation… “it is that way now because that’s just how it is, that’s how it has been, and that’s just how it will continue to be” mindset, never really questioning authority or challenging the status quo…and a SEVERE lack of critical thinking.
I suppose the baby boomers aren’t really to blame for this black and white thinking, so much as their parents before them. BUT, I have a bit of a hard time pointing the finger at that generation because many of them were also brainwashed by the government, society, and their parents at a very young age.
They were told what to believe. They believed without question. They were told what to do. They obeyed and did as they were told.
Many of this generation were religious and regular church-goers. I think this contributed heavily to their mindset and system of beliefs. Most religions (at least in America) teach you to do as your told, follow a list of rules, respect authority, be an obedient man/woman, and do NOT question that which you have been told.
SO, after completely derailing my own article, I’ll get back on track. Sorry fellow humans, I have a tendency to go DEEP AF on an occasional tangent.
Here’s what can be done immediately to prevent the student loan debt problem from worsening moving forward:
Place an annual lending cap on the dollar amount student loan banks are legally permitted to loan out to college students each year AND place an annual borrowing cap for each student per year.
For example, no bank or company is permitted to loan any one student more than $10,000 per year. Additionally, no student is legally permitted to borrow more than $10,000 total from their combined lenders each year. Meaning, Sara borrows $5000 from Bank ABC and $5000 from Bank 123 for a total of $10,000. Sara can borrow no more money in the form of a student loan until next year rolls around. Over the course of four years, the maximum amount Sara could borrow to pay for college is $40,000.
The lending banks would be up in my arms. They would take a MASSIVE hit financially. Good. The worst is yet to come for those economy-decimating twats.
If there was a lending cap imposed on the student loan banks and a borrowing cap instilled for college students, a few downright incredible things would permeate:
FIRST, less people will go to college because they simply can’t afford it.
Instead of going to college, young people will go to work. They will start their professional life at younger age completely debt-free. They will gain valuable work experience while other people their age are still learning in the classroom. They will be more inclined to start their own businesses and take other healthy risks. They will have more flexibility and time to think for themselves and explore their passions.
SECOND, colleges would issue more scholarship money to make attendance more affordable in order to minimize the impact on their student enrollment numbers.
For those of you who don’t know, the highest expense for most colleges are empty beds. They spend the bulk of their budget on maintaining and growing their overall undergraduate population. A decrease in enrollment is their BIGGEST nightmare. I learned this from working closely alongside many college administrations for several years.
THIRD, colleges would be forced to lower the cost of tuition.
Issuing more scholarship money is a bit of a sneaky way to lower the cost of college, however that would serve as little more than a band-aid. Eventually, colleges will be forced to lower tuition. The meteoric year over year increase in tuition (approximately 7% compounded annually) we have witnessed for several decades will come to a screeching halt. Colleges can’t afford to have low enrollment numbers as mentioned above. As such, they will be forced to reverse the upward trend of the cost of tuition. Over time, the cost of tuition would decrease up until it reaches a point of equilibrium where people can actually afford to attend college.
FOURTH, people will graduate with substantially less than debt.
This is a BIG one. A major problem faced by many millennials today is that we are so burdened by student loan debt, we are unable to buy homes, buy property, get married, have kids, take risks, invest into the economy, invest into ourselves, start businesses, and gain any real traction in our lives. *Click here to read about my personal experience in dealing with massive student loan debt.*
Remove the crippling burden of massive debt from future college graduates, and the face of America begins to positively evolve. The entire global economy would feel the impact. New businesses would be started. Young professionals (21–30) would be in a position to buy homes, property, and invest into the economy. The economy would become more competitive. Our collective intellect would evolve. The soul-crushing grip that large corporations have on the bulk of America would loosen gradually over time as each new class of graduates is handed their diploma. Antiquated systems and thinking would be exposed and properly disposed of. More people would pursue their passions. Reliance on the government would decrease. The mental, physical, and emotional health of America would transform. Depression and anxiety would slowly dissipate over time.
These are four probable outcomes whose impact would ripple across globe. It would have an overwhelmingly positive impact on America especially. It could help to save the economy from a potentially detrimental collapse, one that America may never recover from. This is not some massive overhaul of systems that are deeply entrenched into America.
Cap the lenders. Cap the borrowers. Problem fucking solved.
Frankly, it is an utterly simple change that should have happened decades ago.
If you enjoyed this article please clap, clap clap, clap ya hands.
If you like reading about the nightmares of insurmountable student loan debt, check out my recent article “Student Loan Debt is Crippling America”.
Love to all my readers and fellow klimbers ❤
