While the conversation on higher education on Capitol Hill generally focuses on student loan rates, the larger problem isn’t the loans. It’s the cost of the education itself.
Over the past 50 years, the average annual cost of tuition, fees and room and board at the public and private level have risen by 101% and 137%, respectively. From 1950 to 1970, sending a member of your family to a public university cost you 4% of your family’s income; in 2010, that number nearly tripled to 11%.
Tuition’s not the only problem either. The trend of economic inequality in this country has manifested itself in the education market, and prominently.
According to a Georgetown University study, only 14% of students at the most competitive colleges come from the lower half of the income bracket.
Even if you are a high-achieving student, if you were not born in the highest income brackets, your odds of ending up at a top college are slim. Analysis done by professors at Harvard and Stanford shows that only 34% of high-achieving high school seniors in the bottom fourth end up attending one of the 238 most selective colleges – compared with 78% of high-achieving students in the highest income quartile.
Given the upward trajectory of college tuition and a weak economy, the $1.1 trillion in outstanding student loan debt isn’t likely to go anywhere anytime soon. According to the Federal Reserve, 35% of 25-year-olds with student debt were at least 90 days late on their payment, up from 26% in 2008.
Student loan interest rates are a band-aid, Klein said. ”At some point we actually need to stop costs from rising so quickly or we’re never going to be able to afford this.”