Is Student Debt Prolonging the Recession?

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Tuition is 3x as much in current dollars at UofW Seattle since 1968-71. Aren't universities afraid of future declining enrollment?

Dan McKissack of NY 5:29PM March 07, 2012

I have a good paying job and am able to pay back my student loans, so much so that I'm actually ahead of schedule.
BUT
I do not own a house, I do not own a car, I have NOTHING of my own besides owing $150,000 to the government and $100,000 to Sallie Mae (I pay about $400/month in interest alone). If I had the extra $1500/month I would be able to buy a house, a car AND have more money to spend on other things like clothes.
I have life insurance. Sadly I am worth more dead than alive.

PoorDoctor of PA 12:59PM March 07, 2012

My personal spending has been declining since entering law school in 2002, but it really hit rock bottom after graduating in 2005. My $180K student loan debt and earned income, which ironically has not reached anywhere close to the income earned BEFORE becoming a licensed attorney, means I have no disposable income. I spend money only on basic necessities: rent, food, utilities, transportation about $50 a month on recreation (basically covers on-demand movies to watch at home). Everything else goes to student loan repayment, it's been like this for 7 years (at times I've had to use forbearance because I earned no money) so I actually owe more than I borrowed and at current trend can expect to be in a mortgage sized student loan repayment mode until I'm 68, so I am out of the real estate market and many other products and services on which other people rely for their livelihood. Yes, I do believe the rising student loan debt is holding back the economy. As baby boomers age, there is a need to downsize family home into something smaller, less expensive, less maintenance demanding. But, who will they sell that property to if the next generation already has a mortgage on a diploma? But a few will be able to afford to start family & carry two mortgages (maybe 3 if both spouses are educated) over 30 years?

Kathryn Tokarska of CA 11:29AM March 07, 2012

Also what Robert Applebaum, others have proposed is nothing short of groundbreaking and genius, this might be the wake up call we need to fix a broken financial system, and rework an education system that hasn't matured since the later 19th Century. People need this hands up. Things need to change and for the better!!!

Chas. of OH 11:11AM March 07, 2012

This has been a problem for sometime and it affects not only current students and recent grads, but older borrowers, and co-signers as well. I think that if Forgiveness is an option the IRS, might need to relax their idea of 'taxable income' as if most students and parents can' t pay the loan, chances are they can't pay the taxes on the amount forgiven. The United States needs to retain the Global Prominence it once enjoyed, and the easiest path to that is a highly educated, highly trained, and highly skilled populace and this ranges from Surgeons to Ditch Diggers, we need all occupations. Many of us are repaying and are current, however, with the loss of interest deduction coming next year, not to mention the inability to refinance loans for better rates and some relief, we can't. This bubble has burst, and the politicians and comments that tell us to 'buck up, and the pull up the boot straps crud' really don't get it. People walk away from credit debt, GAMBLING DEBT, medical debt, etc. every day. We are responsible, we are paying, however we don't have options. Many of us went to affordable schools, and took lucrative careers. However, the economy tanked and many of us became casualties of an out of control economy. Eventually sometime in your life you might need help, and many of these borrowers need help, and need it now. I don't expect many people to 'get' how dire this situation really is. This will affect the next 60-80 years of economic growth as many students, and parents are dealing with repayment well into their 70's and yes 80's. This will affect retirement savings, personal savings further taxing a system that can barely support itself now. Don't call these borrowers lazy, entitled, spoiled or irresponsible. We could be your accountant, doctor, lawyers, pilot, etc....We are paying, many of us are, however need relief and options that are available to EVERY OTHER type of consumer loan. You have those options on your homes, cars, even credit. We don't. And as for working multiple jobs, to pay these off, most of the occupations require long hours, and additional training to remain competitive and productive. As for working your way through school, many of us did, as believe it or not, the loans didn't always cover everything. So whether you chose to believe this or not, support us or deride us, something needs to happen. If it doesn't you ain't seen nothing yet, and this could make the housing and banking crisis look like a cake walk with much more detrimental and long reaching effects. Forgive, and fix the nation, put people back to work!!!

Chas. of OH 11:08AM March 07, 2012