We Knew Student Loans Were Going to be a Problem

There’s no question that one of the most important stories of 2011 was the emergence of Occupy Wall Street, the multi-city protest that began in New York soon spread around the country. The movement captivated the country and inspired, for the first time in recent memory, a serious discussion about wealth and income inequality in the United States. As Rebecca Solnit wrote in Salon:

The blather about the deficit was replaced by acknowledgments of grotesque economic inequality. Greed was called greed, and once it had its true name, it became intolerable, as had racism when the Civil Rights Movement named it and made it evident to those who weren’t suffering from it directly. The vast scale of suffering around student debt and tuition hikes, foreclosures, unemployment, wage stagnation, medical costs and the other afflictions of the normal American suddenly moved to the top of the news, and once exposed to the light, these, too, became intolerable.

At the center of the concerns that have fueled OWS is the issue of student debt, which reached $1 trillion for the first time this year.

Ezra Klein explained recently that “college debt represents a special sort of betrayal. We told you that the way to get ahead in America was to get educated. You did it. And now you find yourself in the same place, but buried under debt.”

As longtime readers of the Washington Monthly know, the spiraling costs of higher education has been something of an obsession for us–a running sub-theme of our annual college guide and of the blog I write. But of all the stories we’ve published, the one that really broke the dam on this issue was Stephen Burd’s, “The Subprime Student Loan Racket,” a devastating expose on how for-profit colleges foist unpayable debt burdens on poor students while failing to teach them marketable skills. That article soon found its way to Senator Tom Harkin, who had just taken over the senate’s powerful Health, Education, Labor and Pensions committee after the death of Ted Kennedy. Outraged by the story, Harkin held hard-hitting public hearings on the problem. Those hearings in turn helped fuel the Obama administration’s gainful employment regulation, which cuts proprietary schools off from federal financial aid if they present students with debt above 12 percent of their income and if their students have loan repayment rates below 35 percent.

Burd’s piece exemplifies the kind of work the Washington Monthly does well; carefully-researched, clearly-argued stories that help illuminate real policy problems with an impact on people’s lives.

If you value that kind of work, not to mention the daily dose of fresh thinking you get from this blog, now’s your chance to support it. We’re in the midst of our annual year-end fundraising drive, so click here and toss in a few bucks–$10, $20, $30, $50, whatever you can afford. Donations to the Monthly are tax-deductible — we’re a non-profit outfit, and really appreciate and rely on the help we get from readers to continue to do what we do.

Daniel Luzer

Daniel Luzer is the news editor at Governing Magazine and former web editor of the Washington Monthly. Find him on Twitter: @Daniel_Luzer