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The Old College Lie

Written By Brian Hicks

Posted November 7, 2011

The way things are going, you’ll have to be in the top 1% to pay for college.

Students are graduating college these days with a very heavy burden of student loan debt. The average student holds more than $25,000 of debt – 5% more than the average student in 2009.

Total student loan debt is expected to top more than a trillion dollars this year – a year after student loan debt topped total outstanding credit card debt. And no, this can’t be discharged in bankruptcy court.

It’s not like getting out from under a mortgage.

As we’ve said:

We believed the “experts” who encouraged us to borrow for college because it would pay off with great salaries in a robust workforce — much like we believed owning a home in 2007 was a great investment.

We ate up the notion that a college education was the key to getting a great job and living the “American dream”. But as millions of students are realizing, the rosy picture that was painted for diploma-holding members of society isn’t as rosy as it was made out to be…

Graduates are struggling to pay off hefty student loans as they stock shelves and wait tables.

Here we are absorbed by a trillion-dollar higher education debt bubble that’s bankrupting college graduates and burying the rest of us in bills we simply can’t pay.

The amount of student loans taken out last year crossed $100 billion. And outstanding loans will surpass $1 trillion, as Americans now own more on student loans than they do on credit cards. Sounds a lot like the subprime bubble, doesn’t it?

Only difference is you can’t foreclose on a degree. You can’t get rid of your loan in bankruptcy court.

All the while, your degree is worth only a fraction of its cost.

But while the students get screwed, the lenders should be just fine. They get paid either way.

How to Solve the Crisis…

The government could always forgive part of student loans…

Schools could always get rid of the bogus prerequisite courses already taken in high school, knocking a year or two off college. Why should students be forced to take English 101, Algebra 101, General Chemistry, Introduction to American Studies, or even History 101 — the same courses we took in high school?

What are your thoughts?