Page 53 - UD Research Magazine Vol5-No1

The Great Recession reshaped many students’ prospects, including laid-off workers who hoped a new degree might help them find new work. But students who made it to graduation didn’t neces- sarily find eager employers waiting. And those who didn’t graduate still had loans to repay but no degree with which to find better-paying jobs.
The expansion of guaranteed federal loans also sparked growth in an unex- pected sector—for-profit schools. These schools used readily available federal loan money to recruit students with little concern for their ability to succeed, the authors say, let alone their financial wel- fare. Many had to drop out, taking only their debts with them.
At the same time, tuition and other costs also rose at public and more tradi- tional private schools as they competed for students by building bigger and more luxurious facilities and programs.
The next mess is emerging now,
Eric Best says, as marginal schools close, leaving the taxpayers on the hook for forgiven loans.
The loans meant to expand access to higher education for middle-class and low-income families have instead become a burden too great for students and society.
So is a college education still worth it?
“College absolutely pays off,” Joel Best says—and not only for the graduate, who typically makes a higher salary and enjoys other advantages, but also for society, which benefits from a more productive worker.
$ 100
BILLION
INCREASING DEBT
Student loan debt is rising by more than $100 billion every year.
Education is not a one-size- fits-all proposition, though, they say. They would not point every student to a four-year school, for example. Less-expensive options— community colleges and technical schools—may deliver a much bet- ter return on investment for some.
The authors promise no easy fixes, but they do offer several recommendations (with more detail than could be included in this space), including:
◆ Control the growth of ad- ministrative costs in higher education.
◆ Reduce non-instruction costs, perhaps by cutting athletic programs.
◆ Reduce instruction costs, perhaps by requiring less time on campus for students.
◆ Find ways to encourage more family savings.
◆ Increase state support for higher education.
◆ Adopt realistic accounting methods that don’t mask the truth.
◆ Restrict support for schools that perform poorly.
◆ Improve grants for more vulnerable students.
◆ Make payment terms more workable.
◆ Restrictlendingtohigh-risk
borrowers.
Joel Best is a professor of sociology and
criminal justice at the University of Delaware. His writing focuses on understanding how and why we become concerned with particular issues at par- ticular moments in time—why we find ourselves worried about road rage one year, and identity theft a year or so later. His co-author, oldest son Eric, is an assistant professor of emergency management at Jacksonville State University. Eric received his bachelor’s, master’s and doctoral degrees from the University of Delaware.
STUDENT LOAN DEBT
Now exceeding $1 trillion and predicted to reach $2 trillion by 2020.
LOAN REPAYMENT
Among recent college students who are supposed to be repaying their loans, more than a third are delinquent.
BANKRUPTCY
Because student loans cannot be discharged through bankruptcy, the federal government assumes virtually all loans will be repaid
in full.
LOAN POLICIES
Higher default rates and college costs, and pro- posals for more generous terms for student borrowers make it likely student loan policies will cost taxpayers hundreds of billions of dollars.
+ Forthelatestupdates,visitstudentloanmess.com
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