…Wow. Just wow.

In the news: student loan debt has grown by 511%.

No, that’s not an exaggeration.

Ladies and gentlemen, this is what happens when education is treated as a business, with the profits geared towards the colleges and the lenders.

Let’s face it: college education is not worth anywhere near as much as what it used to be, and a Bachelor’s is the new high school diploma. All that a Bachelor’s degree does nowadays is work as a demarcation of the poverty line: if you have a college degree, you can make the minimum to pay the minimum payments on your bills. It doesn’t give you the respect that it used to, and most of the time, the highest-paying jobs require a minimum of a Master’s. And, also let’s face it, people with any sort of a college degree right now are lucky to find a job.

This isn’t a lack of education, it’s a lack of employment opportunity. There is absolutely no guarantee that a degree will be the automatic pass to get a job. Most of the time, even an entry-level administrative/secretarial position requires a degree, and it is only a marker that the job is obligated to pay you a certain wage, which, frankly, is still somewhere around the “barely enough to pay my bills” level. And also, most of the college grads are that much more likely to take a job outside their field of study. They really have no choice, because someone’s gotta pay those bills.

That’s just the pickle: the price of a degree has been steadily rising, and so far I have yet to see proof that said degree matters when it comes to the real world. The US school system isn’t based on creativity and independent thought; it’s based on regurgitation. Study, study, study to pass the test, and what stays in your head after the test? Little. All that high school focuses on is “Get into college!” Colleges allow for a good bit more of brain-flexing, but the deep drawback to them is that the post-college focus is summed up best as, “Get a good job to pay it all off later.” I see career services offered by every school under the sun; classes and workshops on interviews and resumes, job placement services – but how many of those workshops ever mention that the salary that a student or a fresh graduate will receive is completely out of touch with cost of living and student loan payments?

My school boasts an excellent career services program, and I’ve been in multiple workshops while there. Nowhere was it ever mentioned that the pay rate of the jobs for entry-level would be completely disproportionate to even the most meager NY living. And I was completely out of luck: I didn’t have a perfect GPA, and I was a crim-J major in a primarily business-geared university. Everyone was getting these great jobs and internships, but me? Nada. Why? The career department at my school did not have anything to offer to someone in Crim-J, but everything to everyone in business and accounting.

And know what, I don’t think anyone mentions that. Nope, it’s all about getting people into college, no matter what the cost entails.

I had once written on this blog about schools falsifying FAFSA information in order for the student to receive bigger loans. This goes hand in hand with the topic right now, and I’ll point out the glaringly obvious: everyone benefits but the student/grad. The college gets the money, and how they use it is not regulated. In fact, colleges have been hiring more TAs so that they wouldn’t have to hire more adjuncts, and TAs are grossly underpaid as they continue their own higher-ed studies; TAs are often graduate and Ph.D. students themselves. Federal funding has been cut back as part of the new “budget”, and same goes to the state, so the colleges resort to getting revenue elsewhere…for instance, from loans.

And that’s where the trouble begins.

So, readers, here’s a question for you: does this or does this not remind you of the mortgage bubble?

Come on: the similarities are there. Out-of-control lending, no thought whatsoever as to repayment, no thought whatsoever as to where the repayment is coming from… And the result is, frankly put, that the majority of a generation is either broke, or fast approaching it. For someone with a $25K/year starter job, to pay out $100K in student loans is just plain not feasible. What happens? They stop paying. And cue a cascade of consequences: jacked-up interest rates on everything else, cue a credit score being shot to hell and back, and a much worse time getting that holy-grail “better job”, because more and more employers check credit ratings. Banks foreclose on a defaulted mortgage, so what happens when a student loan is defaulted on?

Ramen noodles and Spam are not supposed to be daily staples so the bills can get paid. But that’s where so, so many people are finding themselves. Why? Because they got a degree.

The bubble is inflating as more and more colleges are jacking up tuition costs and everything is putting forward that a college degree is the be-all and end-all of success.

What will happen when it pops? Frankly, not to be a Charlie Downer, but I would be very surprised indeed if the college grads will receive some sort of a bailout. Very surprised indeed. Because we have already seen what happens when one bubble popped. Example goes a long way.

Also? I’ll give another elephant in the room a spotlight. There are no jobs right now for people. You can only be an admin/secretary for so long, and even then, admin departments in companies are usually first to get cut. There are no manufacturing jobs, because they’re outsourced, and what little left is being cut left and right. There are no tech jobs because they got outsourced years ago. There are no trade jobs because trade schools are very! few in number and no one ever thinks about earning a living by manual labor.  There are multiple graduates with great degrees in finance, accounting, business administration, and there’s so many of them that there are not enough jobs to go around. Healthcare salaries have been plummeting, and the student loan ratio there is legendary, but that’s also where so many people have headed, so that market’s about to be flooded too. There is no work. There is very little to look forward to after college except for paying back ginormous student loans.

And it goes without saying: I would love to not have student loans, but I didn’t hit the lotto. Them’s the breaks. Sucks, but them’s the breaks.

K.G.