Thursday, October 20, 2011

What OWS Protestors Need to Know About The Origins of Their Student Debts







Queries and samplings concerning the issues engaging Occupy Wall Street (OWS) protestors span the gamut from lack of decent paying jobs, to predatory banks and suspect investment practices, to student debt. Indeed, many of these idealistic youngsters are stuck in the maw of creditors who want consistent payments for their outstanding students loans and won't relent on collection - whether the students find jobs or not.

How did this student debt crisis originate? During the time I attended Loyola University in the mid 60s, then the University of South Florida afterward (to finish with my degree in astronomy) I amassed roughly $4,500 of debt in all - but most of that was repaid within the space of the 4 years I'd served in the Peace Corps, and maybe 1 year after. (This was done via regular small monthly automatic deductions). Now, the average outstanding debt is something like $24,000. Statistics show that essentially, college tuition costs have increased 50% since 1980, along with the other associated costs such as housing, textbooks.

Why did so many univerisities aggressively increase their tuitions after 1980? The short and painful answer is because they could! They did this even as most students over the intervening three plus decades lost contact with the best professors and were assigned TAs or adjuncts instead. (Adjuncts being the academic equivalent of 'temps' in the corporate world, and I will not diss them because on returning to the U.S. from Barbados in 1992, that was the first full time job I had - being a physics adjunct at a community college in Maryland).

But the point here is we're not talking about economically-thrifty community colleges, but rather many high profile universities - private and now public- that charge students $20,000 or more a year and still let their primary educators be TAs or adjuncts. Are the students getting their money's worth ? I don't know but I've asked this before, e.g.

http://brane-space.blogspot.com/2011/10/are-college-students-getting-gypped.html

This question is critical to address, given the current costs of a college education (including the fact that 45% of all those who commence that journey, don't finish it - and so in their minds may have gotten into massive debt for nothing). And we won't even go into the millions of 50-plus year olds now returning to the ivy halls in the hope of improving their employment chances. But bear in mind, many already tried this tack in the early 2000s, rushing into computer science degrees. What happened? Ninety percent of those jobs were farmed out to Bangalore, Mumbai and other places. Point being, the reason for job scarcity has nothing to do - in many cases - with education, but rather with companies eliminating costs (mainly from workers and their benefits) any way they can to maximize profits! Welcome to capitalism, American style!

I also referenced - and let this be food for thought - the terrific article 'The Myth of Higher Education' by Dr. Steven Mason in an issue of Integra (No. 9, Oct. , the journal of Intertel), noting that a huge error of American education is orientating it explicitly for the utilitarian purpose of making money or getting a job.

As he writes:

"the bottom line regarding a well -rounded education is that it has nothing to do with any kind of bottom line. Its value (non-monetary) is to be found in the quality it adds to one's life. It allows one to better appreciate music, art, history and literature. It contributes to a better understanding of language and culture, nature and philosophy. It expands rather than limits horizons and replaces faith and belief with reason and logic"

Mason adds that a college education that's worthwhile, "teaches a person to live - not to earn a living" and that living encompasses an impetus for further learning just for its own sake. If a fantastic, well-paying job also comes with it, that's icing on the cake.

So the question then becomes for all concerned:

Is that $24,000, or $50,000 post-graduation debt worth it to YOU, to teach you how to live and expand your base of acquaintance with a vast array and diversity of human knowledge?

Or are you laser-locked into utilitarian benefits in terms of a superior job?

Obviously, the way the academic trap works is that if you take the high money route you must demand the best job for remuneration to repay the loans. The problem is, there may be no such jobs available, at least for the forseeable future!

Now, we do know other nasty elements of the academic game as well, which is geared to make debtors (and hence slaves) of most students, and winners only of the few - mainly the already wealthy). Much of this has already been expounded on in the book, The Winner Take All Society, and more recently in Daniel Brook's The Trap (2007).

Brook, for example references the return (big time) to "Gatsby era wealth and education distribution" in academia (p. 33) and how this has been accompanied by a "let them eat cake" attitude for the non-wealthy students who need to survive on loans. Thus, the "elite" schools (which statistical analyses have shown to not really generate the elite outcomes most believe) hike tuitions at will to "scare off nonwealthy applicants".

Those who might get accepted, and don't receive scholarships or Pell Grants, then have to navigate the shark-infested high bracket interest loan universe. No surprise then that "elite schools have long drawn the bulk of their students from the upper echelons of society"

In other words, the top 1%. You know, the same ones who take off to luxury resorts for their foie de Gras gorgings, golf by the sea, chocolate sugar scrubs and rose wine wraps? Well, their kids are also the ones who get easy passes to most of the Ivies, thanks to what are called "legacies" or legacy scholarships. Oh yes, the non-wealthy will sometimes get in, but they reap their degree often with enormous debt.

The bottom line is simple: the criteria for maximizing success are preserved for the wealthiest 1%, who obviously will retain their positions amongst the top 1%. Meanwhile, the competing students of the 99%, without debt support, will have to sacrifice quality of life and even descend into the lower rungs of the 99% in order to try to make good on their great debt. (Recall also that student loans are never voided by bankruptcy!)

In this way, the inquality of income distribution is preserved, the wealthy and their scions get wealthier (especially if their Bush tax cuts are extended) while the hoi polloi - or ordinary middle class earning $70k a year or less - descend further into the proletariat. (See also the excellent book, False Dawn - which I intend to devote a future blog to- on how the Neoliberal - free market fundamentalism afoot deigns to turn 99% of the world's population into a vast pool of the proletariat to feed the sundry needs of the planet's top 1%.

After all, with ever increasing population, the strain to even get to that magic 1% become harder. More people in the 99% means more competition for the better jobs which themselves are stacked like a pyramid with only a tiny "cone" at the top paying the best - but which billions now compete for.

Another aspect here in the student debt crisis, is the pay degradation for all but the most elite jobs.

For example Brook observes (p. 34) that:

"In 1980, it was inconceivable that a University of Chicago student's first job - even as a social worker or editorial assistant - would pay less than their tuition bill.."

He goes on to cite the example of an "idealistic" UC student who goes on to graduate then teach in a South Side school for about $13,770 a year. A salary more than 2 and a half times the then tuition of $5,100 a year.

The point? Back then idealism had an active role in society because the educational cost-benefit transaction allowed it! Today, it almost prohibits it! For example, Brook cites that today (meaning in 2007, so it may even be worse in 2011) "such a student would earn $38, 851 or barely 23% more than her senior year tuition of $31, 500."

Thus, the narrowing differential between possible remuneration and tuition costs makes idealism more prohibiitve, and rewards monetary-driven students more despite the fact that decent monetarily rewarding jobs are much more difficuilt to find - unless one is networked ab initio into the elite 1% and their clans.

The overall process on society is also one of communal erosion and degradation as money becomes the real "coin of the realm" trumping all other issues, aspects and motivations. Thus, a graduate realizes that inevitably - though his ideals might lead him toward teaching or social work - if s/he takes that route it means one's offpsring will likely themselves be saddled with debt in their own education. Hence, the temptation is to ditch ideals and "shoot for the Moon" in terms of income or payback.

And hence, a sad and disquieting treadmill effect is enhanced and reinforced. This also means fewer genuinely idealistic young people volunteering for Peace Corps or even Teach for America. Indeed, those who do join up for the latter often only choose it as a "link" spot until they can find something that pays better! As Brook observes (p. 155):

"They already have a jaundiced view of America...raised in an American that makes no pretense of trying to eliminate poverty"

and (p. 156):

"Only 28% of Teach for America volunteers keep teaching after their two-year committment is up."


At the heart of nearly all this inequity is an impoverished public domain which grows moreso each year, because it is being depleted and eviscerated by austerity policies and Neo-liberal free market fundamentalism based on maximizing profits everywhere, because mobile capital is permitted to do that.

As I said, this will be the topic of a future blog, including the steps we will need to take or demand to return the world to democratic principles as opposed to allowing ourselves to be ensalved by the corporations and their debt mongering tools.

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