WHAT IS THE PROBLEM WITH STUDENT DEBT?

Student debt is a symptom of a serious problem: blocked opportunity for education beyond high school. While not a cure-all, education is a strong intervention that improves the lives of nearly all who receive it. A highly educated populace is necessary for a strong democracy, economy, and society. While private returns to individuals also accompany education, the substantial public returns are the primary justification for government investment. When people seek, but cannot afford, further education they are often pushed into sub-optimal financial decisions, including taking out student loans. Given evident racial disparities in borrowing, some refer to this process as predatory inclusion— loans are offered on terms that limit or eliminate their long-term benefits (Seamster & Charron-Chenier, 2017). Against their better judgment, many students are taking out loans for college not because they are certain of the economic payoff, but because they are sure that their life chances, and those of their families, will suffer if they do not (Goldrick-Rab, 2016). The government imposes substantial penalties on them, including administrative burdens, for this constrained choice (Herd & Moynihan, 2018). When they leave college with debt, many without a degree, people start from behind—enjoying less financial stability and experiencing more stress than prior generations. This, in turn, makes them question the value of education, both for themselves and for others. The intergenerational consequences of that shift in valuation of a critical public good—education—is perhaps the most serious consequence of college unaffordability and resulting debt. But it is often overlooked in analyses framing students as economic subjects rather than citizens (Nissen, 2019). Any solution should recognize that education at all levels is a public good and align the price of education with that value. When delivering support, administrative burden should be shifted from the individual to the state, where it belongs. We argue that this means making public higher education tuition-free and restoring broad cross-class public interest in also making it high-quality. We further contend that debt forgiveness, whether partial or full, is necessary in order to rectify past mistakes and restore well-being and faith in education among those who borrowed.