You’re Not A-Loan: The Implications of Rising Student Debt

Sarah Reinbrecht, Scarlet Staff

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The Student Borrower Protection Center reports that “44 million Americans [are] saddled with student loan debt; $1.6 trillion [have] outstanding debt across the country; [and] 1-in-4 borrowers [are] behind on their student loans,” emphasizing that student loan debt is a growing burden among young Americans.

Nationally, about 65 percent of college seniors have student loan debt. On average, they owed $29,200, an increase from 2017, according to The Institute for College Access and Success. The Institute also noted that the amount of student debt was still increasing, but at a slower rate. 

More than half of all students from either public colleges, private (nonprofit) colleges, and for-profit colleges have debt, with students from for-profit colleges generally having the most debt. Student debt also varies by race and class, with low-income students and students of color being disproportionately affected by student loans.

In Massachusetts, the Institute for College Access and Success lists the average student loan debt for the class of 2017 at $32,065, making Massachusetts the state with the seventh highest student loan debt. Following Massachusetts, the states with the highest debt in the Northeast are Connecticut, Pennsylvania, and Rhode Island. The average amount for the top three states is over $35,000. For Clark University, US News lists the typical total debt after graduation at $27,000.

A report on student debt from MassBudget notes that “deep cuts in state support for public higher education have contributed to some of the highest tuition fee increases in the nation from 2001 to 2016.” 

Postsecondary education costs are now primarily borne by students and families who manage these costs by borrowing more. The report also notes that previously, “Massachusetts public university students used to graduate with some of the lowest student loan debt in the country” and that the “average debt of graduates from public universities in Massachusetts has grown faster than in all but one other state.” Additionally, attending a public school as opposed to a private school offers minimal financial benefits, while the debt of a public school graduate and a private school graduate are almost equal.

On the Mass.gov website, the Attorney General’s Office attempts to offer guidance and resources for managing student debt. It also encourages people seeking help to fill out a Student Loan Help Request as well as collecting information about federal loans by creating a FSAID with the US Department of Education. The site also warns against student loan “debt relief” companies that often charge unnecessary fees for assistance while providing resources to explore additional options and seek more information.

Student loan debt has received national attention from various presidential candidates. Presidential candidate Bernie Sanders has received extensive attention and support for his radical proposal to cancel all student debt. He also plans to reduce interest rates and make public school tuition free. Sanders argues that canceling the debt will benefit students and the US economy. 

Candidate Joe Biden will “lower the monthly payment amount for those with income-driven repayment plans” and focus on community colleges and vocational trainings. Elizabeth Warren has an income-based approach to canceling student debt for people with household incomes under $100,000 to $50,000. She would also make two-year and four-year public college tuition free and expand the eligibility of pell grants.

In the Massachusetts Legislature, Senator Eric Lesser presents a Senate Bill, S.160, aiming to establish a Student Loan Bill of Rights. The Institution for College Access and Success lists adopting a student loan bill of rights as a main way to reduce debt burdens. There is also the House Bill, H.998, by Representative Clay Higgins, which focuses on student loans and the oversight powers of the Division of Banks and Financial Services.