One of the major pitfalls in education policy is viewing education as intrinsically valuable in and of itself. This is like saying that a dollar is valuable for being a dollar, rather than what can be bought with said cash. A recent article by Mary Beth Marklein, with USA Today, notes that one third of millennials have earned a four-year degree. This is “up from 28% in 2001 and 2006 and 17% in 1971,” according to U.S. Census data, she reports. “They may live with their parents and they may owe thousands of dollars in student loans, but a larger share of young adults can boast a bachelor’s degree than ever before, says a report out Monday,” writes Marklein.
“While President Obama has made college completion a hallmark of his higher education agenda, the report’s authors attribute much of the increase to the struggling economy and decline in job opportunities in recent years,” she writes. “They also note that other countries have made similar or greater gains in college-completion rates.”
In other words, persons who cannot find work–worldwide–may have chosen to swell the college ranks until the recession has passed.
“More than half (55%) of respondents to a 2009 survey by the non-profit Public Agenda Foundation said college is necessary to be successful in today’s work world, up from 31% in 1999,” writes Marklein. “Even so, opinions are mixed, particularly amid concerns about rising student debt. Just 57% of 3,000 Americans surveyed this summer by Country Financial, a group of insurance companies, said college is a good investment, down from 81% in 2008” (emphasis added).
This may be at least partly due to rising tuition costs. “College seniors who graduated with education loans in 2011 owed $26,600 on average, up 5.3 percent from a year earlier, as students shoulder more of the cost of their undergraduate degrees,” reported Janet Lorin for Businessweek last month. “With college costs climbing faster than the rate of inflation over the past four decades, students have taken out more loans, swelling outstanding education debt to $1 trillion, more than what Americans owe on their credit cards.”
At least for recent students, President Obama has changed federal regulations so that students can pay for less of their debt over time, with the federal government covering the remainder after 20 years. (Under the old program, the federal government would cover the outstanding debt after 25 years, after certain income-based repayments.)
“The U.S. Department of Education last week issued the final regulations for the new, more-generous student-loan repayment program announced by the president last October,” blogs Rachel Louise Ensign for the Wall Street Journal yesterday. “The plan, known as ‘Pay as You Earn,’ will allow some graduates to peg their federal loan payments to 10% of their discretionary income and then have any remaining balance forgiven after 20 years.”
“The program has taken on a role in the presidential race, with Obama’s supporters saying it provides crucial relief at a time when student debt loads are rising,” blogs Ensign. “For one, former President Bill Clinton lauded the package of student-loan reforms that includes this initiative in his speech at the Democratic National Convention.”