I have four children–three teenagers and one near-teen. Trust me, the conversations about college in our house are almost never-ending. College is something we always thought they would do, but we also always knew that our financial contribution to the bill would be minimal, if any. At the risk of sounding like I am much older than I am, I will start my next thought with, “When I went to college, things were different.” In the 80s, Reagan was in the White House. The economy was growing, at least a bit, and without a college degree, one couldn’t hope for much more than a job in retail. My family was low-income, so I qualified for a boatload of financial aid. I was also awarded a couple modest scholarships and worked part-time. When my four years were over, I left my private liberal arts college with a degree, a job, and $10,000.00 in debt. Overall, my college experience turned out to be worth the work, time investment, and minimal debt.
Today, the future for someone with a college education is not so bright. The cost has skyrocketed, and the need for having a degree is questionable at best. An article in Investor’s Business Daily spells out the problem for us:
American colleges and universities are expected to enroll around 20.2 million students and graduate 2 million in the 2015-16 academic year, with the average student leaving with more than $35,000 in debt. Over a 10-year repayment period at current interest rates, the average borrower will pay back $48,333.
To put this into perspective, the average income of a high school graduate is $25,000 a year. So a student spending at least four years attaining a college degree loses $100,000 in potential wage earnings before taxes as well as going more than $48,000 in debt.
Such crippling debt in an economy that doesn’t have a sustainable supply of degree-worthy jobs creates lifelong economic hurdles and keeps millennials from achieving traditional life goals such as buying a house and starting a family.
Since the 1980s, the price of food has increased 151%, the price of energy 154% and the price of health care 401%. Meanwhile, the cost of education has increased 757%. Why? The universities and federal government make great profits off the business of higher education, so it has gone unchecked.
Millennials have been shelling out absurd amounts of money for pricey degrees with the promise that they’ll bring higher income, earning potential and steady employment.
But with the stagnant economy, the loss of manufacturing jobs and more companies moving out of the U.S. due to a high corporate tax rate, none of the past advantages of a college degree is true for current and recent college graduates, leaving them unable to attain a middle-class lifestyle.
The government and universities are working together to make college something that only the elite can afford outright and that can only be heavily financed by everyone else. If something doesn’t change soon, the possibility of becoming successful after spending the time and money to get a college degree will not be worth it. If a financial adviser told a client to invest in a stock that had the same return as a college education, that adviser would be put in jail for fraud. Why do we think it is ok to tell our young people that college is a good option when we know the numbers don’t add up?
Government and higher education are locked in a corrupt and apathetic cycle that’s drowning millennials in decades of debt, slowing the economy and hindering the attainment of important life goals. Real reform is needed so the next American generation can become as successful as the last.
If one of next year’s presidential candidates could solve the problem of over-indebted under-employed college graduate millennials, that would be someone worth voting for!