S6E5: What Can We Do About the Student Loan Crisis?
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As we continue exploring the topic of economic equality and the different factors that influence a fair and equitable economic experience, today we are tackling the topic of student loan debt.
Americans owe $1.77 trillion in federal and private student loan debt as of the second quarter of 2023, and questions about whether and how borrowers should be required to repay that debt have become part of an ongoing national conversation.
Here to help us unpack all of this is Adam Looney. Adam is a professor and executive director of the Mariner S. Eccles Institute for Quantitative Analysis of Markets and Organizations here at the Eccles School. He is a nationally recognized expert on student debt, having testified before Congress multiple times on the topic of student debt forgiveness.
With host Frances Johnson, Adam shares his thoughts on how we got to this place of burdensome student debt. He’ll dive into the quest for equity in higher education accessibility, repayment options, and his thoughts on student loan forgiveness.
Eccles Business Buzz is a production of the David Eccles School of Business and is produced by University FM.
Episode Quotes:
Can we make higher education equitable and efficient?
[23:48] The reality is that college is a very good investment for a very large share of Americans. And I think the problem is identifying programs and institutions that are effective at serving disadvantaged, low-income students who historically had not enrolled in very high numbers. If we could have increased enrollment at good-quality programs and provided better guidance to steer students into programs that they can complete and that lead to good-quality jobs, then I don’t think we would have a repayment crisis.
Why do we have student loan programs?
[08:36] We have a student loan program for two reasons. One is to help people pursue. a college degree and graduate programs. And second, to make access to college more equitable in the U.S. and around the world, whether you go to college, whether you complete college, whether you go to graduate school, is closely related to family income, your family background, and whether your parents went to college.
The uneven burden of student debt
[11:18] On average, college students do well because student loan borrowers, to a large degree, reflect who goes to college; the outcomes of student loan borrowers look a lot like the outcomes of typical college students. And so, it’s important to remember that student loan borrowers are more likely to have a job. They earn more, they’re more likely to be able to own a house, and they’re more likely to become married. So, it’s not a universal impediment to being able to launch a career and a life.
Why does Adam think that college is a high-quality investment?
[10:10] I think college is a very high-quality investment. It is a key way where Americans move up the economic ladder. It’s a vehicle of social mobility. It’s obvious that there are huge inequities in terms of who gets to go to college, who’s able to persist and complete a degree, and who gets to go to graduate school. But it seems like access to financial aid alone is not able to overcome those barriers and, in fact, seems to have made many millions of these often disadvantaged students worse off.
