‘Till Debt Do Us Part

With the country’s national debt flying higher than a bald
eagle, the Deficit Reduction Act of 2005 should have come as
welcome news. Students and educators, however, worry that some of
the bill’s provisions will only exacerbate an already massive
problem: individual student loan debt. The bill, reports
Block from the San Antonio Current
, raises interest
rates on both parent and student loans from 7.9 percent to 8.5
percent, which will ultimately add almost $5,000 to the average
recipient’s debt load.

That’s not an enticing prospect, since undergraduates are
leaving school with an average of nearly $20,000 in debt, reports
Gaus for In These Times
. More than any other
generation, the ‘millennial generation’ — those born after 1978,
roughly — is facing college debt that, when adjusted for
inflation, is three times what graduates faced only a decade ago.
And that debt will most likely extend far into their working lives:
Gaus reports that the US Supreme Court recently ruled that Social
Security income can be garnished to pay for outstanding college

As students get loaded beneath mountains of debt, they are
encountering a ‘new way of working that is much more short-term and
mobile,’ says Sara Horowitz, president of Working Today, a New
York-based advocacy group. Instead of climbing the metaphorical
career ladder — and chasing the stability and benefits that are
supposed to go with said ladder — college graduates are
leapfrogging from low-paying job to low-paying job, bereft of
benefits like health care and retirement plans as they struggle to
meet their monthly debt payments.

In some respects, the situation is just as twenty-somethings
would have it — an itinerant lifestyle seemingly lends more
freedom, and this is an enticing prospect for a generation that
romanticizes the postponement of adulthood. The situation is,
nonetheless, dangerous in many regards. For while businesses and
young employees alike may celebrate the latitude that transitory
employment breeds, Anya
Kamenetz, author of Generation Debt: Why Now Is a Terrible Time
to be Young
, thinks the jubilation is misguided.
Businesses, she says, have ‘gotten people to accept intangible
benefits instead of old, actual benefits.’

Not everyone, is seduced by this romantic vision, reports
Moyers in the Southeast Missourian
. As students
graduate with spectacular amounts of debt, some are taking a
pragmatic tack: ‘[I]nstead of a student choosing something they’re
most interested in, they may choose something that will make them
more money.’ The debt load a college education incurs can influence
a student’s decisions from matriculation onward, guiding their
choice of major and job. The education that was supposed to open
doors for them can, paradoxically, chain them to a job or
profession that offers a modicum of financial stability instead of
emotional fulfillment.

Laden with debt, college graduates appear to be facing two
options: either chase a romantic vision — credit score be damned
— or pursue tangible benefits in a dwindling, contingency-based
labor system. And the fallout from this choice means the
freewheeling, itinerant grad may be becoming a thing of the past.
The legal and financial picture surrounding higher education is
such that education without debt is increasingly rare, and with
last year’s stringent adjustments to bankruptcy laws, Gaus notes,
it is now ‘nearly impossible to discharge educational loans.’ The
new cost of higher education, it seems, is not a corrupted mind but
rather what Gaus calls a ‘chasm of liabilities.’

Go there >>
Millennials, Debt Becomes You

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