While the government is writing big checks with your tax dollars to bail out the same people who preyed on N. American first time homeowners across the nation, there has been little done about another burgeoning crisis: college tuition and tuition related debt.
Congress has met to discuss the problem, including enforcing more regulation and a break between lenders and colleges that previously meant they were making money off of forcing requiring students to use lenders they owned stock in or got other kick backs from and at least one of the Presidential hopefuls, Obama, has a plan of reduced debt for service. Colleges themselves have also started offering new full-funding strategies for targeted groups. But this has done very little to address the predatory lending strategies over the last 20 years, the failure of college loans to meet basic loan agreement standards for this country (which among other things requires that both parties have full-knowledge and are able to consent – if you can’t go to college without funds, you are not really consenting, and if you are not told that you can choose a lender or that your college owns stock in the lender they are requiring, you don’t have knowledge), and an entire generation that has been forced into group living or back into their parents homes by burgeoning loan debt. No, this reality is swept under reports of “too much shopping” and called a generational problem rather than exactly what it is, predatory cannibalizing of poor and middle income students earning potential based on projections that recession insured are nearly impossible to meet.
Enter, the latest funding crisis that no one seems to know about: se van Pell Grants. At a time when more students than ever need funding to go to college, one of the only sources that will not enslave their futures is facing a deficit. Pell Grants provide between $400 and $4,000+ in aid to qualified students that does not need to be paid back. They are based on income, with 90% of recipients coming from households that make less than $40,000/yr. Over 800,000 new students qualified for them this year alone.
Unfortunately, Pell Grants are projected to fall $6 billion short of the need and eligibility of students in 2009. While Congress has been asked to find money to fix the shortfall, they have yet to do so.
Whether the program eligibility is reworked or the allotted amount per school is cut, students will likely shoulder the burden through loans. Replacing a grant with a loan has obvious repercussions, like long term debt. For those who do not qualify for subsidize loans, the loss Pell Grants is even more dire as they will have to figure out how to pay interest or worse pay back exorbitant fees and interest to a non-government college lender while also in school. Putting them in the same boat as “generation debt,” who unlike popular opinion are not on a perpetual shopping spree but instead largely in debt because of skyrocketing college tuition, predatory lending, and a failing economy.
I have long advocated for debt absolution for college loans. It makes no sense for our best and brightest to be so hampered by debt that they cannot be productive members of our society. As Obama pointed out recently, many people do not go into primary and secondary school teaching, family practice, and non-profit work because they simply cannot afford it. So our philanthropists and social justice works become corporate lawyers, plastic surgeons, etc. while working class people wait 6 months to be seen and sign away their rights because there are not enough general practioners nor advocates to help them.
And Obama’s service plan? While those who still have the luxury of envisioning generation debt as spoiled youth trying to live the like the stars of a WB teenexploitation show are moved by the “hard work” argument, his plan is not new. In fact, Perkins Loans can already be cut through service. There is an extensive list of qualifying criteria for employers/employment that will cut your loans by 25% per year of service. Obama’s plan simple extends the service-deduction agreement to Stafford Loans, which are larger and have historically not been able to be cut back for any reason. And while this extension is extremely important, it does not address the various loopholes that lenders have used to get out of giving federally granted deductions. Speaking from personal experience, it took 5 years to get my lender to give me 50% of my loan deduction because the language of the deduction allowed them to claim my work with low income students did not count because it did not occur in a school. In the meantime, I had to keep paying. So while the ultimate decision led to the rest of my Perkins Loan debt being absolved, I should not have had to pay any of it by federal standards and it was only the threat of having to continue fighting with them to get the other 50% deducted and then fighting to get the 50% or more, presuming I would have to keep paying while we fought, returned to me that made me accept the compromise. (Again, a basic failure to meet minimum loan standards in this nation that require loans do not occur under duress.)
The situation is bad enough that one female student is auctioning off her virginity this year to pay for college. Rather than the exception, she joins a lesbian student who auctioned off her “heterosexual virginity” a few years ago for the same reason. As well as the number of exotic dancers, several of my students who work at Hooters, and at least two of my students’ friends who have online webcams and take requests, who all site college tuition as one of their main reasons for participating in sex work. (The boy, who is considerably younger than I am, just piped in that one of his friends paid for college by table dancing.) And no, most of us do not go this far to pay for school, many of my students literally work 4 jobs, sometimes one full time job and 2 part time jobs or some other similar combination, and some stay with abusive husbands because they pay the mortgage or the grocery bill while my students’ 2 job incomes go straight to the university and child care. (yes, these are real stories from real students, who work hard for very little and not just screed.) Any of these ways of meeting the new demand for tuition is engendered, some are high risk either emotionally or physically or both, and many make it extremely hard for students to succeed while getting the full benefit of their college education. And it does not seem like the work for aid pla
n has taken any of these subsistence level and increasing lower middle class student realities into account.
Let us not forget the loan commercials that said:
How will you pay back your loan? A. sell a kidney B. commit suicide C. Move out of the Country D. Search for change under the couch E. Call [lender number]
that they took off the air precisely because they were too real for people to handle. When the options presented for how you will pay back your college loans are similar to how so-called “third world” citizens deal with “third world” poverty (sell kidneys, set themselves on fire, immigrate, and/or scrounge/beg) we cannot deny that lenders are very clear about the situation they have put students, and ultimately our nation’s future, in. In fact, the image above, came from one of many “consolidate your loan” sites that clearly seem to be linking sexual imagery with paying your loan. (To be fair, this was a non-affiliated site. Lender sites used less suggestive images of women that still appeared sexually available rather than the “getting into college” or “paying for college” sites that tended to show women with books and backpacks looking studious.)
So while the national government is patting itself on the back for working hard to save us from financial ruin, I cannot help but be cynical. First because it is not the homeowners who were so cavalierly cannibalized by the banking industry that our government is bailing out, it is the cannibals. Second, because like those home owners, college students are being sacrificed to those same cannibals. While we can certainly question the decision of anyone who signed away their futures without reading the fine print, or who made lending choices they could not possibly sustain, we must also remember that the price of home ownership and college have far exceeded most people’s economic abilities. And in the case of college students, the ability to get and retain a good job is dependent on a college education, so college has not been a choice you can walk away from for some time in this nation. Lenders and the government know this and they made trillions of dollars off of what is becoming two generations of youth who will struggle their whole lives to pay it all back.
In Latin America, people are actively rejecting debt passed on to them unfairly by their governments. Around the world the people are demanding that predatory global lenders reduce or abolish debt unfairly taken out in their names. So why are we sacrificing first time homeowners, small farmers, and our young just because what is happening to us is happening on a national scale?
read more about the Pell Grant issue here.
Jim Hummel 1998
Kristiana Lokken unattributed
state police and homeless workers clash over tent city in 1935. unattributed.
Hoverville Sacramento CA. 1935. Bancroft Library UC Berkeley