High tuition prices and heavy student loans could sap economic growth.

[Selatius]

The near doubling in the cost of a college degree the past decade has produced an explosion in high-priced student loans that could haunt the U.S. economy for years.

While scholarship, grant money and government-backed student loans -- whose interest rates are capped -- have taken up some of the slack, many families and individual students have turned to private loans, which carry fees and interest rates that are often variable and up to 20 percent.

Many in the next generation of workers will be so debt-burdened they will have to delay home purchases, limit vacations, even eat out less to pay loans off on time.

Kristin Cole, 30, who graduated from Michigan State University's law school and lives in Grand Rapids, Mich., owes $150,000 in private and government-backed student loans. Her monthly payment of $660, which consumes a quarter of her take-home pay, is scheduled to jump to $800 in a year or so, confronting her with stark financial choices.

http://biz.yahoo.com/ap/070930/student_loans_the_spiral.html?.v=3

Little money to spend on goods and services = little economic growth.

I think it's time for reform of higher education. Standards for entry should be higher, and more money should be allotted for vocational training for those who don't qualify for university, but once a student gets into college, I think it would be better for long-term economic prospects that his or her tuition/room and board should be subsidized with grants. This should be seen as a form of economic investment in our future. Student loans, on the other hand, sap potential future growth.

[knitter4democracy]

1. My dad's been saying that for ages.

He did everything he could to make sure that none of us kids had any debt (thanks, Dad!! :hi:) because he was worried that too much debt would really hurt us starting out in life. Hubby's med school debt is more than enough for us as it is. I hate to think of what it would be like if I had student loans and he had loans from undergrad, too.

[midlife_mo_Jo]

5. It's what we're doing for your kids

We refuse to sign any loans or do anything to encourage large amounts of debt.

So far, three have gone to local in-state schools. They live at home the first year or two, work, save money, and get their own apartment with friends when they're ready. We encourage higher education, and believe it's better to spend the money on grad school.

Of course, they're free to do as they please with no hard feelings from us, but they don't have a right to get parental subsidies. haha And they are so HAPPY and RELIEVED when they graduate and they have much more freedom to do what they want.

[knitter4democracy]

11. That's an amazing gift--freedom from loans.

It really is. :)

[midlife_mo_Jo]

13. With scholarships and good old fashioned WORK

The largest loan any one of them have had to take out for undergraduate school was about $10,000.

[knitter4democracy]

14. That's great!

Hubby got through by working as a nurses' aid in nursing homes and lots of scholarships. I was from out-of-region (church college), so I only got one scholarship. Luckily, my mom's dad's estate money was still around then and paid for most of it.

[bluestateguy]

2. I've got 9 more years to go with mine

I'm not complaining, as may payments are very reasonable for what I make, but at the same time, I'd probably be living in a house now, and not an apartment, if it weren't for those loan payments.

[lovuian]

3. its ridiculous and it makes one want to go to India for their

Bachelors..it would be cheaper

[cornermouse]

4. I'm going to have to disagree here Selatius.

Overall I agree with you, but I don't think standards of entry should be raised. You have a lot of older people who are finding themselves returning to school later in life because their jobs went bye-bye overseas. Some of them may not be entirely up to the necessary speed upon re-entry to the system. Going back to school after 20 years away from the classroom is something of a shock all by itself. If there were enough honest-to-God jobs for those with vocational training available I'd go for that but the fact is that unless you're looking at plumbing or electrician, again, the jobs are either not there or don't pay enough to pay off even the smaller vocational education loans. I don't know what people are going to do in the future to try to get their children college educations. But it is clear this is a problem that could put a complete stop to our ability to compete for jobs. Just about anything that pays real money requires a four year education.

[mvccd1000]

6. How do they manage to accumulate these huge debts?

All four of my parents' children went to college, and my parents did not pay for any of us.

Me: GI Bill + ~5K in student loans = Bachelor's Degree.
Brother: Academic Scholarship + 2 summers of highway construction + ~5k in student loans = Master's Degree.
Sister: 2 jobs + small scholarship + ~5k in student loans = Bachelor's Degree.
Sister: Money in savings from working five years after HS before college = Associate's Degree.

Four kids, four degrees, less than 20k in student loans.

All of this with no financial help from our parents - how on earth do some of these kids rack up so much debt?

All four of us got our degrees within the last 10 years, so I'm not throwing out old numbers here.

[cornermouse]

7. It depends on the degree they're going after.

Plus not everyone has the benefit of a GI bill. High school savings and scholarships are a little hard to find and come by for older students. Congratulations on how you did it.

My brother got a degree that is probably more equivalent to the amount of time and money that a physician racks up. Like you he didn't get any parental help other than living at home for an extended period of time. He worked full time, went to school full time, got about 3 hours of sleep per night. I don't know too many people with the stamina to do that, do you? I do think we were lucky he didn't end up as a traffic statistic. He got scholarships and he took a couple of years off to try to pay down his student loans by working two full time jobs, one of them heavy labor in a meat packing plant. And in the end, he did get all of his education but it took longer to get the degree. The end result is that overall he will earn less over his lifetime than he could have if he'd not taken those years off to pay down the loans. He has said since that he regrets the time he spent paying down the loan.

[knitter4democracy]

12. Depends on the school and degree.

Hubby and I got out of our undergrad without loans, but his med school was costly. We needed loans to help with living costs, too, since I was making less than $20K a year at that point as a teacher and he couldn't work with his hours. With deferment through residency, he ended up owing about $175K when he had to start paying them back. He consolidated the ones he could, but the private loans from the med school couldn't be consolidated, so they're our highest monthly payment but will be paid off sooner. It's almost $1200/month in med school loan repayments.

[treestar]

8. Go to India for college?

Well, it would make sense. Their education must be good enough, since they're coming here and "taking our jobs." :sarcasm:

Some people learn English as a second language and come here to go to school, taking university courses in a second language even.

Americans could do that, too, if they were as motivated as the people they are competing with. In fact, they probably wouldn't have to learn the second language, since English is used to such great extent abroad.

[knitter4democracy]

15. We have friends who did that for med school.

They went to college here and India for medical school. Since they lived with family, they somehow qualified for the free schooling the government offers. Good doctors, too. They were in residency with Hubby.

[Toots]

9. Clinton did something about it

He had government issue very low interest loans to students with a forgiveness clause if they worked in certain fields after graduation for a number of years. He took it out of Private hands (banks) so took the Profit motive away and college enrollment skyrocketed. Bush* immediately did away with all things Clinton and screwed over America and our children..

[PDenton]

10. overvalued college education

Go to school and get a technical degree that is in demand. Fuck college.

I live near a college. Sometimes I go to the local game/movie store. I got a chuckle last week when there was a kid there talking about "text and lore" classes. Yeah... how is that going to make you a living? Fuzzy degrees grow on trees and unfortunately corporate America doesn't value them. At least he's going to a state school, but he's still going to leave with alot of debt and a degree that will prepare him for a job serving up French Fries and making smartass post-modern critiques to his boss.

The truth is, you can get a decent liberal arts education at home now days, assuming you just enjoy learning; I don't see the point of going to college unless you want to pursue academics or a specific field. With the internet alot of information is available at your fingertips. You can learn about everything from history to psychology and walk away with more information in your head than the typical 4-year liberal arts college will give you.

I only have a two years degree but at least I'm not in debt anymore (finding a job is very hard, OTOH). But I know some people with 20,000 in debt in the same position.

[BlooInBloo]

16. You're the perfect American.