College remains a smart investment, but too many students are taking on too much debt that is almost impossible to pay off and hangs over their adult lives like a dark cloud. The problem is particularly acute in Florida, where stingy state lawmakers expect students to pay an ever-larger share of their education. Without meaningful reform — particularly in need-based financial aid — the problem is only going to worsen, especially for lower-income students who can least afford it.
A study by the financial data website WalletHub shows Florida is among the worst states for people coping with student debt, ranking a dismal 40th. The study found that Floridians with student loans took out more of them and have higher default rates. They also live in a state with below-average wages. The combination makes it harder for those students to join the middle class and contribute to the growing economy that Florida needs.
PAUL ALEXANDER | Times
PAUL ALEXANDER | Times
As this chart shows, student loan debt far exceeds credit card debt. In fact, for many people, only their mortgages will surpass what they borrowed to attend college. Nationally, people owe nearly $1.2 trillion in student loans.
A college education still opens the door to opportunity. A recent Pew Research study showed graduates ages 25 to 32 working full time earn about $17,500 more annually than peers who only finished high school.
But college costs shouldn't saddle hardworking students with impossible debt that anchors them down, limiting choices and making it more difficult to pursue modest-paying but rewarding careers, buy a house or choose a partner without regard for income. It's one thing for a fledging doctor to take on debt. It's another for a 20-year-old, still trying to find himself, to be allowed to borrow tens of thousands with no clear sense of how that debt will be paid.
College costs have been far outpacing inflation, and the Florida Legislature too often expects students to pick up the difference, rather than recognizing that investing in education is investing in the future. And when state lawmakers brag about keeping tuition low, they miss the point. It is the total cost of college, not the tuition, that is out of hand. For example, the flagship University of Florida estimates that an incoming student's expenses will be $20,590 this year. But only $6,310 of that — not even a third — would be tuition, and that's not even taking into account a Bright Futures scholarship. Books, computers, housing, food and fees make up the bulk of college costs today. Policies that don't acknowledge that reality are not going to help.
The cost and the value of college is an issue in the presidential campaign. Democratic front-runner Hillary Clinton, for example, has floated a plan to cut student debt, including the intriguing proposal that would give colleges some skin in the game by requiring them to pay off some student loans if the students default. Sen. Bernie Sanders of Vermont proposes free undergraduate tuition at public universities. Far-sighted lawmakers could create more programs that forgive student debt in return for service to society, such as AmeriCorps does now. More Republican presidential candidates should offer their own proposals for making higher education more affordable rather than simply criticizing Clinton's proposal.
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Need-based financial aid should be designed to allow students to graduate with manageable, not massive, amounts of debt. And for students who do take on loans, regulations should require that they be informed consumers. They need to know the tough hurdles that substantial student debt would place in their path to a comfortable middle class life — what the monthly payments would be, for how long and just how much interest they would be accruing over the life of the loan. No one wins when students accumulate insurmountable debt — especially if they don't graduate at all.