We’ve just completed graduation weekend for Oregon’s state universities, producing lots of parties, a boom in robe rentals and one powerful meaning for the state’s economy:
Thousands more Oregonians are now beginning to have their student loans come due.
We’re giving a whole new meaning to the phrase “college credit.”
Student debt in America now tops $1.2 trillion, more than credit card debt or car loans, an amount that hangs around graduates’ necks like the hoods showing what they studied. The trillion-plus is an anchor weighing down the entire country, at a time when we’re counting on recent graduates to buy cars and houses and otherwise inject life into the economy. For that reason, it’s dangerous for the debt level to continue to swell, but it’s growing a lot faster than the investment in Pell Grants, the federal scholarship grant program.
Last week, President Obama increased the (limited) percentage of Americans owing student loans who qualify for a program that caps their payments at 10 percent of discretionary income, and forgives whatever’s left after 20 years – or just about when the student debtors may have to start worrying about sending their kids to college. Wisconsin Republican Rep. Thomas Petri has a proposal for student loan debtors to pay 3 percent of their income, something like Oregon’s “Pay it Forward” proposal, except this being Congress nobody is expecting anything to go anywhere – except for Petri himself, who’s leaving at the end of this year.
Oregon has a particular interest in something happening. According to the Project on Student Debt, among Oregonians graduating in 2012 – the most recent numbers available – 60 percent carried a graduation present of student debt, an average of $26,639, or 22ndin the country.
At least we’re above average in one higher education statistic.
Coming out of last year’s legislative session, state Sen. Mark Hass, D-Beaverton, brought a mandate to try to make a dent in Oregon’s debt pile by slowing how fast it piles up – by covering the tuition cost of two years of community college.
“It’s what originally drove me,” said Hass about the debt problem. If students can postpone accumulating big college debt for two years, the total landing on the shoulders of graduation robes could be a lot lighter.
Besides,“You can’t do much with just a high school degree.”
Already, some players are trying to help navigate the narrow straits between diploma and debt. High schools emphasize dual credits that also count for college, and a handful of them, reports Hass, allow students to stay for five years – picking up college credits while the district still draws the state’s K-12 student payments for them.
If you think the role of high schools is to help students succeed in life, it makes some sense.
But Hass has another strategy. The core of it is to draw more Pell Grant money for Oregon students, which he’s certain can be done: “We’re leaving federal money on the table.”
But, according to University of Wisconsin professor of educational policy and sociology Sara Goldrick-Rab, who’s been consulting with several states on the idea, the plan would also involve moving some federal scholarship money around. The state would seek a waiver to redirect money to community college students who otherwise might not be going to college at all.
“You’re going to do triage, like you’re in an emergency room,” argues Goldrick-Rab.
The proposal would likely stir resistance from private colleges and universities, as well as Oregon’s public universities, these days overwhelmingly funded by tuition revenue. Like every other idea for strengthening both the quality and the number of graduates produced by Oregon colleges, it would likely require some significant state reinvestment in the Oregon higher education system.
But what Hass and Goldrick-Rab – and pretty much everyone else who’s looked at the situation – agree on is that Oregonians who don’t acquire any post-secondary education are likely to cost the state money in the long run. The state pays for high school on the grounds that its students require it to function; that reality may now have extended from 12 to at least 14 years of education.
And the benefits could extend to graduates of the universities as well. With two years of subsidized community college, points out Goldrick-Rab, “The transfers won’t be racking up the same amount of debt they are now.”
As last weekend demonstrated yet again, something has to make that happen.
Graduation weekends would be a lot more celebratory if it didn’t feel like graduates were moving from university to debtor’s prison.
NOTE: This column appeared in The Oregonian, Wed., June 18, 2014.