The American nation has been dealing with student loans for a long time, where the economy has been greatly affected. Collectively, students have already accumulated one trillion dollars in debt (Lewis and Zaidane 586). Most graduates from college are paying almost more than fifty percent of their paychecks towards their debt making them unable to support themselves. As the article “The Myth of the Student Loan Crisis” states, “College is an undeniably risky investment, seemingly more so than ever” (Allan and Thompson 580). With the nation’s economy being damaged and student’s struggling to live their lives in society, in my opinion, something should be done in order to fix this dilemma. There are solutions to this out there, and various articles and documentaries illustrate great examples of what’s really happening to these students, and answers to aid the crisis as well as making a difference within the nation.
Although many students will have scholarships and financial aid, a lot more will struggle to pay for schooling and will have to take out multiple student loans. The cost of going to college continues to rise every single year and with that comes great struggles and stress. The inception of the student loan market started like any other loan market, there were a large amount of borrowers who needed money now to invest in college to make more later that were matched with lenders who had excess funds and wanted return on the funds.
The National Defense Education Act of 1958 which provided loans to students in higher education institutions started the student loan market. This was supposed to help train students to get jobs that will help them succeed and in turn help our nation succeed. Student Loans taken out have been increasing, student loan debt outstanding has been increasing and average student loan debt per borrower has been increasing. Some believe that these may cause problems and increase outstanding debt and defaults which taxpayers have to pay. While government professionals may believe that taking a hit now to help consumers get higher paying jobs may be worth it in the long run so they can start consuming.
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In the article, “Here’s Your Crisis: Student Loan Debt Isn’t a Myth” states, “…53 percent of recent college graduates are either unemployed or not putting their degree to use” (Lewis and Zaidane 587). Student loan debts are skyrocketing through the roof with lots of individuals graduating from college, and having a tough time seeking jobs in their studied fields, so they tend to have problems paying off their student loans. According to Kristina Dell points out in her article “I Owe U” student-loans are not the best idea a college applicant could have. Repaying student-loans is very difficult especially because some college graduates are paying back their loans with their low income salaries due to the wages of a recent graduate normally has as well, which leads to rough situations.
Many people are not fully knowledgeable of the different terms and their choices if they cannot repay any of their student loans. The federal government is able to reduce the finance of this issue. There are several ways the government can partake in this situation. One process is to have the amount of each loan the same and lower the number of loans allowed. A second process the government can do is minimize the quantity of individual loans and provide the alike number as in the past. Regardless, students that reside in low-income families will be highly affected. Like the article “Here’s Your Crisis: Student Loan Debt Isn’t a Myth”, “… the cost of college prevents many low-income Americans from even seeking a higher education” (Lewis and Zaidane 588). Decreases in the maintaining of student loans have many effects. An effect most likely to happen is toward the less fortunate people who will miss the possibility of taking part in college. Even so, it isn’t due to the students academic potential, but simply because they cannot afford to attend college without one of these student loans.
The manner in which the student debt calamity is being addressed is unreasonable. An article by Tim Donovan named “Student Loan Should be treated like Detroit’s”, explained how unjust areas such as Detroit are pardoned for their debt by bankruptcy, while students are trying as well for their own self, but they still can’t seem to get away from their debt. Where’s the equality? Detroit was able to get rid of billions of dollars with this, yet students with small debts of $20,000 can’t even escape those loans. Major corporations file for bankruptcy with billions of dollars still in their bank accounts but still; students can’t do anything about their debt. Huge cities like Detroit or corporations aren’t going to struggle in life. They have hundreds of dollars with them, what is the worst that can happen? Why is it that they can get away with such a huge amount of debt? As of now, nothing has been done in order to solve this issue. Before, students were able to get their student debt forgiven through bankruptcy, but since laws passed during the “Reagan Revolution” (Donovan), it has made it nearly impossible for students to get rid of their loans.
A solution to this ongoing problem, and the nations national debt put together is with “The Student Loan Forgiveness Act of 2012”. There are many people out there that completely disagree with the Act or even the idea of fixing the crisis itself. People such as Richard Vedder along with his point of view within the article, pretty much said that forgiving student loans is a bad idea and it is ruining the economy more. Other people are saying that forgiving students from their debt would make them irresponsible with the extra money they’ll be making The fact of the matter is that if the Act were to pass, it would: “eliminate many of the awful consequences of educational indebtedness. In doing so, it would give Americans greater purchasing power, helping to jumpstart [the] economy and create jobs (Clark).
Of course, it does have some restrictions, but it will help the student and national loan debt. The solution is that students will continue to pay their debt flexibly/comfortably by paying ten percent of their income, and after twenty years of paying, the debts can be forgiven. Another great benefit to this act is that even those students who end up getting a government job after college would end up paying their loans off within ten years and would eventually be forgiven if they exceeded the time. This act does not hurt the nation, in fact, it’s actually fixing it. As of today, this act hasn’t passed, but if it does, this problem would be solved; students would be relieved of financial stress and they would be given an opportunity to gain a better education and make the nation a better place.
Student debt is something the nation is suffering from as of today, something can be done about it and we now know that there is a solution out there. People must move on and help make a difference to aid this country with its massive debt. The passing of the “The Student Loan Forgiveness Act of 2012” would be the perfect solution. It’s about time a solution like this has finally come across. It’s about time these student’s stopped suffering from trying to make a living and pay for their debt, and it’s about time this nation fixed itself from such a financial crisis.
