RunningHead:CONDEMNEDTODEBT

CondemnedtoDebt
AlexFarley
Writing104
UniversityofRhodeIsland
25May2016

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Abstract
ThecostofhighereducationintheUnitedStateshasbeenrisingrapidlyoverthepasttwenty
years.Incomeformostfamilieshasbeendecliningorstagnant,soeachyearhighereducation
becomesincreasinglyunaffordable.Ithasbecomeincreasinglycommontotakeoutstudentloans
oftentotalingtensofthousandsofdollarsinorderforincomingstudentstoaffordtheir
education.Studentswithstudentloandebtsuffersociallyaswellasfinanciallybothduringtheir
timeincollegeandaftertheirgraduation.Tosolvethisissue,thefinancialaidsystemshouldbe
revampedtoprimarilytargetstudentsonneedbasedcriteria.Taxesmustberaisedsothatpublic
universitiescandeprivatizeandlowertuitionastaxpayersupportincreases.Doingsowillallow
studentstocontinuetheireducationwithouttheburdenofunreasonablyhighstudentloandebt.

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CondemnedtoDebt
Itiscommonknowledgethatanyonewhoplansonattendingafouryearcollege
willmostlikelybeforcedtopaytensofthousandsofdollarsfortheireducation,evenafter
scholarshipsandgrantsaretakenintoaccount.Evenpublicuniversitiesdemandatuitionhigh
enoughthatmanyfromlowerandmiddleclassfamiliesareforcedtotakeoutthousandsof
dollarsinloanstogotoacollegethatisaffordableincomparisontomanyprivatecolleges.
Somemightarguethatthehighpriceforeducationiswarrantedhighereducationis
seenasaprivilegedespitethefactthatpublicuniversitiesexistsothatanyonecan,intheory,
earnadegreeinthedisciplineoftheirchoosing.However,risingtuitionpricesleavemost
studentsheavilyindebt.Asofthisyear,studentloandebtisawhopping$1.3trillion,andover
43millionAmericanscarrythatdebtburden,(Johannsen,2016p.1).Mostindebtedstudents
owelargesumsofmoney:
60percentofallborrowers[owe]atleast$10,000andanother30
percent[owe]$25,000ormore,(Quadlin&Rudel,2015p.589)andareexpectedtobegin
payingofftheseloanswithinterestalmostimmediatelyaftertheirgraduation.
Themainissuewiththissystemisnotthatstudentsaretakingoutloanstopayfortheir
education.Theproblemwithstudentloansintheircurrentformisthatstudentsareforcedtotake
outloanstheycannotreasonablyrepaywithoutsignificantpersonalandfinancialsacrifice.
Becausetheseindebtedstudentsandgraduateshavesuchlargedebtburdens,studieshaveshown
thattheydelaybuying
homes,cars,andothermajoritemsthathelpspurourconsumerdriven
economy,
(
Johannsen,2016p.1).Thisdelayisespeciallyharmfulconsideringthefactthatthe
increasingunaffordabilityofcollegeisaresultofourcurrenteconomicstate.Accordingto
DonaldJ.Farish,PresidentofRogerWilliamsUniversity,theaveragelistpricefortuitionand

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feeshasrisen114percent[atfouryearpublicinstitutions][and]theaveragelistpricefor
privatecollegetuitionandfeesroseby70percentoverthepast20years,(Farish,2016p.1).
Thisrapidgrowthisunmetbyeveryotheraspectofoureconomy:thepriceofpublichigher
educationhasbeengrowingattwicetherateoftheeconomy,twiceasfastashealthinsurance,
andthreetofourtimesmorequicklythanconsumerpricesingeneral,(Meister,2011p.128).
Thistuitionincreaseisdifficulttomanageformostbecauseduringthepastdecade,almostall
familiessawtheirinflationadjustedincomeseitherstagnateorshrink,(Farish,2016p.1).
Indebtedstudentswillstruggletorepaytheirhighdebtsduetothepoorstateoftheeconomy,
andtheirinabilitytospendmoneyonmajorpurchaseswillcontinuetoexacerbatethiseconomic
issue.
Studentloandebthasbeenproventohaveharsheffectsonstudentssocialhabitsand
mentalhealth.Debthassoiledthecollegeexperienceformany:amongyoungalumni,only38
percentviewedtheircollegeexperiencepositively,accordingtonationalsurveyresultsinthe
2015GallupPurdueIndex,(Blumenstyk,2015p.1).Accordingtoasociologycenteredstudy
donebyNatashaQuadlinandDanielRudel(2015),
Indebtedstudentsspendmoretimeworking
[andstudying]andlesstimeonathleticactivities,(p.590)orpersonalinterests.Thisdedication
toacademicsandtoworkinginordertopayoffdebtleaveslittletimeforsocializing,leaving
indebtedstudentssecludedincomparisontotheirdebtfreepeers(Quadlin&Rudel2015).While
thisemphasisonhardworkmaynotseemharmfulfromanoutsideperspective,thisapproachto
handlingdebtleadstopoormentalhealth(Quadlin&Rudel2015).QuadlinandRudel(2015)
foundthatindebtedindividualsmayexperienceanxietyordepression,(p.593)orothermental
healthconditions,andaremorelikelytosufferfromtheseconditionsthantheirdebtfreepeers.

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ForthemillionsofAmericanswhichcarrythisdebt,studentloandebtisnotjustafinancial
threat,butalsoisadangertotheirmentalhealthandstability.
Therisingcostofcollegetuition,whichforcesstudentstotakeoutloansinorderto
affordhighereducation,isacomplex,multifacetedissue.Inordertoposeaviabletosolution,it
isessentialtounderstandthemanyfactorswhichcontributetorisingtuitionprices.Themost
obviouscauseinpublicinstitutionsisthattaxpayerfundinghasbeendeclining:stateeffort
[funding]hasfallen30%sincethelate1970s,(
Archibald&Feldman,2006p.618).This
decreaseinfundingisadirectresultofthetaxrevoltinthe1970swhichwasmeanttolimit
governmentgrowth(Archibald&Feldman2006).Bylimitinggovernmentgrowth,thetaxrevolt
limitedtheabilityofpublicuniversitiestoofferlowtuitioneducationandprovideaidtothose
whocannotaffordthefulltuitionprices.
Despitetaxpayerdollarsdecreasing,thenumberofstudentsenrollingincollegehasbeen
increasing.Inordertoprovidethenecessarymaterialsandresourcestostudents,public
universitieshavebeenforcedtoprivatizerelyheavilyonnonstatefunds(Meister2011).To
doso,tuitionhasbeenraisedforallstudents.However,privatizationhasgonefartherthanwhat
isneededtoprovideforstudents,andhasbecomeanopportunityforaggressiverevenue
growth,(Meister,2011p.128).Universityleadersseetuitionasafasterandsurerformof
enrollmentgeneratedrevenuegrowththantaxpayerfunding,(Meister,2011p.128).
Privatizationhasledmanypublicinstitutionstobecomegreedy,demandingmoretuitionmoney
thanisnecessaryinordertomaximizetheirrevenue,despitebeingpublicuniversitiesratherthan
forprofitcolleges.

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Excessrevenueinthesepublicinstitutionswouldnotbeasmuchofaproblemifnotfor
theinefficientfinancialaidsystemcurrentlyinplace.Studentaidisunevenlyandunfairly
distributedamongstudents.Atpublicinstitutions,lessthan10percentoftheirgrosstuitionand
feerevenues[aredevoted]toneedbasedaid,comparedtoalmostaquarteratprivates,(Baum,
2007p.18).Thisgapbetweenpublicandprivateneedbasedaidisnotbecausepublic
institutionscannotaffordtoaidmorestudents,butbecausemostoftheiraidisnotneedbased
(Baum2007).Infact,despitebeingpublicinstitutionswhichshouldintheorybeavailableto
anyone,over60percentofinstitutionalaidgoestostudentswhocouldaffordtoattendwithout
aninstitutionaldiscount,(Baum,2007p.18).Aidatpublicuniversitiesisineffectivelytargeted,
tryingtoattractstudentswhowillenhancetheirprestige,ratherthanfocusingonincreasing
access,(Baum,2007p.18)tostudentswhocannotaffordhighereducationontheirown.This
strategyforcesneedystudentstotakeoutloansinordertopayfortheireducation,because
millionsofdollarsofaidaregiventostudentswhodonotnecessarilyneedit.
Becausethisissueissocomplexandsteepedinthingsliketaxes,theeconomy,and
governmentfunding,thereisnoonesimpleandquicksolution.Inordertosolvethisproblem,
multiplestepsmustbetakeninordertoaddressthemanycausesofrisingtuitionpricesand
studentloandebt.
Thequickest,temporarysolutionistoreorganizethestudentaidsystem.Overtimethe
systemhasbecomecorrupt,rewardingthosewhocanalreadyaffordtheireducationand
punishingthosewhocannot(Baum2007).Inordertomakehighereducationaffordable,the
majorityofaidshouldbetargetedtowardsstudentswhocannotaffordtheireducationwithout
takingoutlargeloans.Ifdonesuccessfully,theneedtotakeoutmassiveloanswilldiminish.

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Whilethiswillnotgiveeveryneedystudentafreeridetotheschooloftheirchoosing,itwill
guaranteethatstudentswillonlyneedtotakeoutloanstheycanreasonablyrepay.Thisisnota
longtermandhighlyeffectivesolution,butitwilllightenthefinancialburdenonstudentswho
wishtocontinuetheireducationuntilfurtherreformtotheeducationalsystemcanbemade.
Inorderforhighereducationtobeaffordableinthefuture,therapidlyrisingtuition
pricesmustbeslowed.Privateschoolsgivelargeamountsofaidtothosewhocouldnot
otherwiseaffordtheirtuitionprices,sothefocusmustbeonloweringpublictuitionprices
(Baum2007).Themostobvioussolutiontothisistoincreasetaxpayerfunding,whichhasbeen
declining(
Archibald&Feldman2006).Forcedtoprivatize,publicuniversitieshavebecome
greedy,askingformoremoneythantheyneedtoeffectivelyprovidefortheirstudentbody
(Meister2011).Thesolutiontotheseproblemsistoincreasefundingforpublicinstitutions
somethingmostwouldresistifitmeansraisingtaxesevenminimally.Despitethepublics
generalhatredofraisingtaxesforanyreason,itistheonlylongtermsolutiontothiseducation
crisis.Raisingtaxesisnot,asmanymightbelieve,asunreasonableasmanyseemtothinkitis
comparedwithotherdevelopedcountries,theUnitedStateshasverylowtaxes,(Campbell99).
Currently,studentloandebtisnotonlyharmfultostudentsasindividuals,butalsotoour
economyasawhole.Iftaxesareraisedjustenoughtomaketuitionratesatpublicinstitutions
moreaffordablenotfree,butenoughthatpeopledonothavetotakeoutmassiveloansthis
strainonoureconomycanberemovedwithminimaleffort.
Withtuitionprices,andsubsequently,studentloandebt,increasing,itisurgentthatthis
issueisaddressedtopreventfurtherdamagetostudentsasindividualsandtheeconomy.
Reorganizingtheexistingfinancialaidsystemandincreasingtaxpayerfundingofpublic

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universitieswillgivestudentstheabilitytocontinuetheireducationwithoutfearofcrippling
studentloandebt.