(Transcript) – Americans owe $1.3 trillion in student loans, with $43 million people, young, old, and everyone in between burdened with student debt. This debt has shaken the fundamental values of the nation’s higher education system. Now the Republicans are proposing to cut $150 billion from student aid in the recently passed budget bill, including freezing the Pell program that helps needy students acquire higher education.
College costs have increased 1000 percent since the ’70s. Students are graduating with an average of $25,000 to over $100,000 in debt, and often with an education that will not secure them a good-paying job.
Now joining us from Boston is Josh Hoxie. Josh directs the Project on Opportunity and Taxation at the Institute for Policy Studies. Also joining us from Bellingham, Washington is Mayra Guizar. Mayra is a senior at Western Washington University, and serves on the U.S. Student association board of directors, chairing the Pacific Northwest region.
Thank you both for joining us today.
JOSH HOXIE, DIRECTOR, PROJECT ON OPPORTUNITY AND TAXATION, IPS: Thank you.
MAYRA GUIZAR, BOARD OF DIRECTORS, UNITED STATES STUDENT ASSOCIATION: Yeah, thank you.
PERIES: So Josh, let me go to you first. Josh, this, the student loan crisis in this country is massive, and the issues faced by a graduating student who had borrowed from the system is tremendous. Can you outline for us what are some of the issues that a graduating student, an average student will be faced with in the coming years?
HOXIE: Absolutely. So student debt today now tops over $1 trillion dollars higher than credit card debt. And the class of 2015 is now the most indebted college class in history, just passing classes before it, and probably likely to be, 2016 will be the next highest after it. Students today graduate with tens of thousands of dollars in debt. I think the average today is about $27,000. they’re faced with mortgaging their future in order to get an education in this country. And what that means for them is they are not buying houses at the same rate as they otherwise would. They’re not starting businesses at the same rate they otherwise would. They’re also not going into jobs that they would want to take, because they have to find employment that will be able to pay their student loan payments.
PERIES: And Mayra, let’s begin with you. Now, you are a student in your senior year. What is the debt burden you are carrying in your last year at school?
GUIZAR: Okay. So yeah, I’ll be graduating in the fall. And I’m currently looking at $30,000 in student debt. And so to finish this last quarter, you know that will definitely go up. It’s something I’ve been struggling–I’m a first-generation student, the first of my family out of three to go to college. I have another younger brother who’s about to go into college who’s about, you know, to face the similar struggles of having to carry student debt on him as well.
PERIES: Josh, the higher education system in this country has shifted its burden from the public pocket to the private pocket, and families and students in the system. And now that we are almost slipping into an election year, suddenly a number of politicians are actually talking about reforming the system. What kind of proposals are there out there that actually, in your opinion, begins to address the problems that students are facing?
HOXIE: Yes. So the problem with higher education is structural. It’s really a problem that we need to invest significantly more money into providing four years of public higher education, and we should reduce the burden on students preferably all the way to zero so that they can succeed and achieve their potential.
And one thing that I wanted to add on that is that a lot of folks think that this is just about young people, of the $1.3 trillion in student debt. Over $40 billion of that is held by people over 60. So this is a, really across the entire economy. That number shot up 850 percent over the past decade. So really it’s affecting everyone in our economy, not just young people.