Dental surgeons must have never had it so good. Given the number of teeth gnashed over college student debt levels in today’s news media, one only hopes today’s top newspaper journalists have decent dental plans. “The college debt crisis is even worse than you think” read the Boston Globe last week. Student loan debt has been type-cast as “bonkers”, a “time-bomb”, a “nightmare”. At the same time it’s blamed for both crippling and gouging college students. It’s even akin to indentured servitude. It ain’t easy being student debt these days. These articles hone in on what is not an insignificant issue. College debt is climbing and there are a healthy number of students who truly are in over their heads. But not everyone. Not even a majority.
About five years ago the country collectively gasped in horror over numerous media reports citing a Justice Department report that apparently uncovered the federal government spending a whopping $16 a piece on breakfast muffins. The body politic seethed with rage. Senator Chuck Grassley called for heads to “roll.” Bill O’Reilly was predictably terror stricken with the news. But after all the muffin crumbles settled, including a formal 151 page investigative report from the Inspector General, it turned out that the $16 wasn’t for just muffins but rather included “other food and beverage items, such as coffee, tea, and fruit, were included in the charged amount.” (Stephen Colbert smartly noted that those 151 pages detailing the exhaustive governmental efforts to review all of this “proved that the federal government wasted no money on those muffins.”)
Student debt has become the muffin-gate of higher education and this sensationalism needs to be tempered with a strong shot of reality. What’s that reality? We can start with a wonderfully named piece from the Hamilton Place Strategies group entitled, “The Plural Of Anecdote Is Data (Except For Student Debt)” Here, this firm writes, “A closer look at some of the particulars around college financing reveals more nuance than overall media coverage has indicated. While tuition has consistently gone up, the net price actually paid has been much flatter as universities offer more tuition assistance and discounts to entice attendance. And while the average amount of debt incurred has been increasing over time, the increase in monthly payments is typically manageable.”
Some are even suggesting that the levels of student debt are actually dragging down the nation’s economy as students with debt are unable to afford to buy homes and automobiles. Susan Dynarski, a faculty member at the University of Michigan and widely recognized as one of the leading experts in higher education financing, college costs, and access issues writes for the Brookings Institution that this simply is not the case. Multiple other studies have supported this finding. It’s worth noting a few of the major newspaper willing to dig into the nuances of the issue. The Wall Street Journal recently cited a federal reserve bank of Cleveland report which found that the typical student borrower between the ages 20 and 30 pays $203 a month toward student debt. And seventy five percent of borrowers pay no more than $400 a month.
At Michigan Technological University, where I work, last year’s average debt of those graduating with a bachelor’s degree was $36,041. The national average was about $35,000 (note the snarky headline for this article where I found this average). And while Michigan Tech is a bit over the national average, the ability of its graduates to pay down that debt far exceeds the national average.
Collegemeasures.org found that a typical Michigan Tech graduates expends 3.5% of their earnings on college debt repayment. That’s ranked in the top three percent in the country for lowest ratio of debt payment to earnings. What more, that is one percentage point less than the state of Michigan income tax rate of 4.75%. Michigan Tech graduates working in Michigan are paying a larger proportion of their income to the state (who doesn’t exactly have the best track record in providing its support to help students earn their degrees) than they do to pay back their student debt.
Those stories go mostly untold. The media needs to make money. And what bleeds leads. Perhaps the most damning evidence of sensationalism is this finding, again from the Hamilton Place Strategies. After reviewing 100 articles on college debt for 2012 graduates over a three month period, HPS found that the average level of student debt reported in news coverage was $85,400. What was the actual national average for student level debt in 2012? $29,400.
And then there is the $1.2 trillion dollars in student debt. The biggest muffin in all the land. It’s the collective sum of all student debt in the country. But scratch just a millimeter beneath the surface of this ubiquitously reported stat and one begins to see a different picture. Forty percent of that 1.2 trillion dollar sum goes towards graduate degrees for people pursuing, for instance, a medical or law degrees. And props to the NYT’s and again, Susan Dynarski, who found that, “The huge run-up in loans and the subsequent spike in defaults have not been driven by $100,000 debts incurred by students at expensive private colleges like N.Y.U. They are driven by $8,000 loans at for-profit colleges and, to a lesser extent, community colleges.”
If we are going to collectively address issues of access, student success, and college financing, we need to start from a place of truth and accuracy. Demonizing higher education using points of fact that are, in fact, without fact muddy the waters and will hold students, who might otherwise benefit from a college education, back from pursuing that education. In today’s knowledge-based economy, we simply can’t afford to have students who would like to pursue an education, decide not to based on incomplete and incorrect assumptions about higher education financing.
Jason Delisle sums it up best when he remarked, “When somebody says student debt is killing the economy, replace ‘student debt’ with ‘higher education’ and see if the sentence still makes sense.” If there will be weeping and gnashing of teeth, let it be over research questions and lab reports in route to a college degree and high paying job, not over undue $16 muffin scented panic regarding student debt.