Higher education has reached a tipping point in America. Students are facing a confluence of challenges: high levels of student debt combined with a poor servicing and abusive debt collection practices; persistent state disinvestment since the Great Recession dovetailing with longer-standing trends in reduced spending per student; and a…
Higher education has reached a tipping point in America. Students are facing a confluence of challenges: high levels of student debt combined with a poor servicing and abusive debt collection practices; persistent state disinvestment since the Great Recession dovetailing with longer-standing trends in reduced spending per student; and a system that fails to ensure that schools provide a quality education to students – one with a pathway to finish school, get a job, and not drown in debt.
We hear from students everyday about the many ways the system is failing them. One student we’ve worked with, Danyelle in Louisiana, is now $15,000 in debt because of lack of transparency about the type of program her school offered. Another student, Sherita from Chicago, works 40 hours a week while carrying a full course load because her Pell grants do not cover the full cost of tuition. At the same time, she cannot access Pell over the summer, which would allow her the flexibility she needs to finish school quickly and efficiently. Thankfully, tackling these critical issues is becoming more of a national priority, garnering increased attention on the campaign trail and in the halls of Congress.
But before electoral rancor clouds in-depth discussion further, it is critical that lawmakers grasp the full scope of the challenges facing young people today. By 2020, 65 percent of jobs will require some sort of post secondary education or training beyond a high school diploma. Yet, tuition and fees at both 4-year and 2-year institutions rose 28 percent since the last recession, and state investment in higher education is down 21 percent since the start of the 2008 financial crisis. Further, students today face a range of unique challenges. One in four postsecondary students are also parents, and 38 percent of all students are 25 or older and often carry additional financial burdens. This reinforces the need to make sure that the financial aid and educational options available for folks juggling caregiving, work, and school are accessible, affordable and of a high quality. Still, too many students leave school with debt and no degree, and almost 12 percent of borrowers are left in such dire straits that they default on their loans.
The kicker? We can’t even really tell students which programs will land them that job and the ability to repay their debt, because there is a ban – a federal ban – on providing that data.
These new economic realities for this generation have translated into political awareness and engagement. Young Invincibles recently released a poll which showed that 61 percent of Millennials say that a candidate’s position on student debt will be a “major influencer” in terms of who they will support in the upcoming elections -- and the number jumps to 75 percent for African-American and Hispanic Millennials. In that same poll, most Millennial voters supported solutions such as requiring schools to share liability if a graduate defaults on their loan, and capping liability for loan repayments at 10 percent of income.
In other words, it’s time for policymakers to get serious about solutions. At a minimum, Congress has to do three main things: improve affordability and access; hold institutions accountable for better outcomes; and provide a better system of debt repayment or relief for those already struggling with student debt.
First, when it comes to affordability and access, Congress must pass reforms that decrease cost for low-income students and expand student supports, such as increasing Pell grants, establishing better state-federal partnerships to finance higher education, helping young parents as they try to balance child-care and school, and making the financial aid process simpler.
Second, we must ensure accountability in the system. There is no reason that the worst actors should be getting taxpayer dollars to provide students with a degree that gets them nowhere and a debt load that holds them back. We need to cut off the worst actors, and overturn the Student Unit Record ban to ensure that students and families get the information they need – in a format that works for them - to make decisions.
Finally, we need a plan to protect students and families as they try and repay their loans. We need to simplify repayment, cutting existing monthly payments through the expansion of income-based repayment, and tackle many of the terrible practices we see in the loan servicing and debt collection side.
With the reauthorization of the Higher Education Act perpetually right around the corner, it’s time to get going.
Mishory is the executive director of Young Invincibles, a policy and advocacy organization for millennials.
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