Student Debt: A Growing Crisis

Caleb Hamman
chamman@butler.edu

Lately, with health care reform taking Washington’s center stage and Supreme Court cases and special elections filling the remainder, efforts to combat what is too often perceived as a “smaller issue” have gone widely overlooked. I am referring to the issue of student debt—one that, if left unchecked, will prove to be a potent driver of US decline.

The most recent action to address the issue is H.R. 3221, or the Student Aid and Fiscal Responsibility Act. The legislation would attempt to mitigate student’s exploding debt levels by reducing the role of private companies in servicing government loans. This would allow the government to cut back on subsidies to private firms and to give the resulting funds back to students, primarily in the form of Pell Grants to those from low income households.

The House passed H.R. 3221 last September, and the Senate is expected to take up companion legislation soon. Considering the current state of student borrowing, they should avoid delay.

According to the Project on Student Debt, nearly two-thirds of American students graduating from four-year colleges are indebted. For those who owe, the average amount exceeds $23,000. To put things in perspective, only 58 percent of American students were indebted upon graduation in 1996, and, on average, they owed only $13,200. (Note that all figures in this post are in current dollars.)

The historical trend is less than comforting. In 2008, The National Center for Public Policy and Higher Education (NCPPHE) found that the price of college tuition had increased by 439 percent since the 1980s, tripling the rise of family income over the same period and even surpassing the much maligned growth of health care expenses.

This explosion of student debt bodes ill for the United States, obviously because it jeopardizes American accessibility to higher education.

Students can only borrow so much—there will inevitably be a breaking point. Indeed, the NCPPHE’s study finds that “the continuation of trends of the last quarter century would place higher education beyond the reach of most Americans and would greatly exacerbate the debt burdens of those who do enroll.”

If large numbers of Americans become excluded from higher education, a multitude of problems are sure to follow.

From the callous perspective of economics, exclusion promises a poorly trained workforce, a risk for American competitiveness abroad.

From the perspective of politics, uneducated citizens threaten to summon the plagues of the Bush administration: susceptibleness to propaganda, disregard for global warming—all of the problems outlined by Dr. Mason in chapter four of The End of the American Century.

And, not least in importance, from the human perspective, an inaccessible system of higher education constitutes a certain path to lives of lessened potential for finding fulfillment and beauty.

Tragically, these are merely problems faced by those who are excluded from higher education.

Those actually able to attend colleges and universities face another set of obstacles. Not the least of these is the increasing likelihood of graduating with a mountain of debt, thus aggravating the already considerably problem of a heavily indebted citizenry, a topic discussed by Dr. Mason in his analysis of economic decline.

Stepping back, the growing necessity for student borrowing in the United States can be viewed as part of larger inequality trends. As shown in The End of the American Century, the United States has become exceptional among wealthy states in its high levels of economic inequality and in its relative failure to implement policies that would rectify the situation. If college continues to become increasingly unaffordable, education threatens to become a privilege afforded only to the wealthy. Not only will this provide a tragic demarcation of class along lines of knowledge (similar to an equally tragic demarcation of class along lines of health); rather, an exclusive system of education will also assist in keeping poor people poor and in keeping wealthy people wealthy. In other words, higher education will not simply distinguish class structures—it will help solidify them.

These are just a few of many reasons demanding student debt be brought under control.

Current proposals for reform should be passed and signed as soon as possible. And if we are serious about fixing this mess, we cannot stop there.

Has the Supreme Court Legitimized Armed Insurrection?

The scary idea of insurrectionism may have been given a boost by the Supreme Court, according to a new and disturbing book by Joshua Horwitz and Casey Anderson, entitled Guns, Democracy and the Insurrectionist Idea, published by the University of Michigan Press. They argue that in the landmark Heller v. D.C. case of 2008, the majority ruling went far beyond the individual gun rights argument and opened the door to the (previously radical fringe) “insurrectionist” argument that citizens have a right to arm themselves to counter government tyranny. The authors make a strong case that this has potential to undermine Constitutional government, the rule of law, and democracy itself.

I raised similar concerns in chapter 3 of The End of the American Century, on the “Torn Social Fabric,” one important component of which was the huge number of violent crimes in the U.S., and the concomitant prevalence of some 200 million privately owned firearms. There, I raised particular concern about the minority of gun owners who believe that gun ownership provides an extra check on the government itself. As I wrote there ( p. 58):

“They see the Second Amendment to the Constitution as an implicit right of armed Americans to forcibly overthrow the federal government if they view it as tyrannical. It is hard to imagine any constitutional document, especially one with so many democratic checks and balances built into it, providing for its own violent overthrow. But many Americans seem to believe this—yet another reason why the United States is increasingly seen around the world as swimming against the tide of modern civilization.”

Horwitz and Anderson note that when they began writing their book several years ago, this insurrectionist idea was considered marginal, radical, and probably even treasonous. (Article III of the Constitution, in fact, considers levying war against the United States to be treason.) But the Supreme Court’s ruling in the D.C. case has given the insurrectionist idea more stature and respectability, and brought it into the mainstream. Horwitz and Anderson believe that this is a very dangerous precedent, potentially giving cover to those who would forcefully overthrow the U.S. government.

I share their concerns, and believe these concerns have become even more germane in the polarized and radicalized atmosphere of the last few years. Fox News stirs up hatred of the government, and calls into question its very legitimacy. The election of Barack Obama, ironically, has emboldened racists and bigots of all stripes, and led to a huge spike in the number of threats of violence against the President and the government itself.

In their conclusion, Horwitz and Anderson urge that “the Insurrectionist idea should be vigorously challenged by citizens in the court of public opinion and now, after Heller, in courts of law as well.” Among their recommendations for action is “occupying the common ground” with the majority of gun owners who are not Insurrectionists. In my mind, this solution is part of a broader need in the United States—for Americans to find the middle ground, and to isolate and marginalize those who preach hate, violence and intolerance.

Jon Stewart Gives John Yoo a Free Pass

Jon Stewart hosted John Yoo on "The Daily Show" this week, and essentially gave the guy a free pass.

As Deputy Assistant Attorney General in 2003, John Yoo was the author of the infamous "torture memo" which argued that torture was allowable if the physical pain was anything less than "death, organ failure, or the permanent impairment of a significant bodily function." This memo, signed by Yoo, is available at the website of the ACLU at this link. In a debate in 2006 with Notre Dame professor Doug Cassell, Yoo apparently justified even the torture of children, in this exchange:

Cassel: If the President deems that he’s got to torture somebody, including by crushing the testicles of the person’s child, there is no law that can stop him?
Yoo: No treaty.
Cassel: Also no law by Congress. That is what you wrote in the August 2002 memo.
Yoo: I think it depends on why the President thinks he needs to do that.

Torture is explicitly prohibited by the Geneva Conventions; the 1984 Convention Against Torture; the 1948 Universal Declaration of Human Rights; the International Covenant on Civil and Human Rights; and the American Convention on Human Rights. Most scholars also believe torture violates the U.S. Constitution’s prohibition on “cruel and unusual punishment.”

Jon didn't raise any of these issues with Yoo.

Last spring week, a Spanish court opened a criminal investigation against Bush administration officials, including John Yoo,for violating international law in providing the legal framework for the U.S. government’s use of torture. (See my previous post on this).

By almost any measure, the decisions of Yoo and his superiors were legally incompetent. At the very least, their recommendations, and the decisions taken by President Bush, were violations of international law. They come close to crimes against humanity. They should be brought to account in this country, under American law. But Yoo, far from facing indictments in the U.S. continues to teach at one of the most prestigious law schools in the U.S., and continues to find a hearing for his views in the pages of the New York Times and the Wall Street Journal.

Shameful.

And we expect more from Jon Stewart!

Cutting Education Budgets Further Weakens the U.S.

Indiana, like most states, is facing a budget crisis, and Governor Mitch Daniels (President Bush’s former Budget Director) recently proposed cutting $300 million from K-12 education budgets—3.5% of the total. This came on the heels of some searing stories in the Indianapolis Star about the dismal state of public schools in the city.

The Governor argued that he “had no choice.” But I am always wary when someone makes that assertion. We always have choices. The issue is priorities, not a lack of choice. Indiana had no difficulty, for example, raising $720 million to build a new professional football stadium.

Money alone will not solve the problems of public education in Indiana, or in the U.S. But inadequate funding is one of the problems, and budget cuts will simply exacerbate those problems. One reason that the U.S. is falling behind globally in education, and why Indiana is lagging nationally, is because of low levels of funding for education. According to U.N. figures, the U.S. ranks 45th among the countries of the world in public spending on education, as a proportion of the economy. Among the 50 states Indiana ranks #33 in per capita expenses for K-12 education (U.S. Census Bureau data).

It should be no wonder, then, that our schools perform so poorly compared to others, both globally and nationally. The high school graduation rate in Indiana is 73%, placing us in the bottom half of the 50 states. Even worse, Indianapolis ranks dead last among the nation’s 50 largest cities in high school graduation rates

Our spending on education is low, in large part because our state revenues are low. While there has been a big hullabaloo about property taxes in the state, they are overall low compared to other states. As a proportion of household income, they rank 34th among the 50 states. Indiana’s income tax rate is also low, especially given the “flat” rate of 3.4%. Most states have “bracketed” tax rates (as for federal income taxes), which require wealthy people to pay a higher rate than poor people. Almost all such states have top brackets above 5% of income.

So we are getting what we pay for. We have low taxes, low funding for public education, and poor schools. One choice—a necessary one in my view—is to raise taxes, especially on those who can most afford it, and begin providing funding that the schools deserve. We have choices.