High college debt has stifling effect on whole economy

June 23, 2014 

The huge debt weighing down so many young Americans from the moment they step off campus with diplomas in hand is worse than just a financial burden on them, and on the rest of the economy.

It's also threatening to become a serious disincentive, and in some cases a prohibitive barrier, for people to get higher education at all.

There's no good news for anybody in any of that.

A weekend story from the Miami Herald, republished in the Ledger-Enquirer's print and online editions, laid out some of the troubling particulars. About 40 million Americans trying to launch careers are having to spend a crippling amount of what they make to pay down college loans. Almost 60 percent of students who attend college have to borrow money. Student debt increased by $31 billion just in the first quarter of this year, and it's already 12 percent higher than at the same time last year.

The proverbial vicious cycle is becoming harder to escape: Higher education increases earnings, but the earnings are swallowed up by paying for the higher education.

The economic burden is hardly limited to the debtors themselves. People who have to spend big chunks of their money paying down debt aren't spending it on other things that fuel the economy and the society.

Solutions to the worsening problem are elusive, because most of the things that need to happen to make it better aren't likely to. The Herald story suggested a few: States spending more, not less, on public colleges and universities, and more, not less, on scholarship and grant programs. Significant cost control by the colleges and universities themselves. Closing tax loopholes for the politically and economically powerful in order to lower student interest rates.

Want to lay odds on any of the above?

So higher education continues to price itself out of the affordability range of more and more Americans. Whatever short-term benefits the status quo is providing a few, for the rest of us the long-term cost is likely to be high indeed.

Gwynn's legacy

There's no definitive evidence that baseball great Tony Gwynn's fatal salivary gland cancer was caused by his long addiction to spit tobacco. One person absolutely convinced it was: Tony Gwynn.

The Hall of Fame outfielder will be remembered for his sweet, compact swing, his eight batting titles, his 19 straight seasons as a .300-plus hitter, and the highest career batting average (.338) since Ted Williams. He will be remembered for his love of the game, and for his infectiously joyful personality.

Sadly, he will also be remembered for the circumstances of his death at just 54. And if it stops just one young person from using spit tobacco, Tony Gwynn would probably want to be remembered for that, too.

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