Perez 1 David A Perez John Kubler English 114A 12 November 2013 Student Loan Crisis: Something Must Be Done

The American nation has been dealing with a student debt crisis for a long time, where the economy has been greatly affected. Collectively, students have already accumulated one trillion dollars in debt (Robinson). Students are graduating from college and are paying almost more than fifty percent of their paychecks towards their debt making them unable to support themselves. With the nations economy being damaged and students struggling to live their lives in society, in my opinion, something should be done in order to fix this crisis. The solution to this crisis is out there, and various articles and documentaries illustrate great examples of whats really happening to these students and answers to aid the crisis as well as making a difference within the nation. According to a video by PBS News Hour called: Student Loans: More Debt, More Defaults, More Problems, the student loan crisis have challenged graduates to figure out what theyre going to do in order to pay off their debt. The video shows us that, in reality, the students dont know what theyre getting themselves into and find out the hardships after college. Furthermore, the video also shares that the student loan crisis has had a huge impact on the U.S economy stating that collectively, students have over $1 Trillion in debt and its added to the other U.S debts like car loans, housing and more. After graduating, students expect to have a career and life settled so that they can have a wonderful life doing what they love the most. For the most part that isnt true. Students who graduate college with loans have a hard time going through life trying to pay back their debt. A perfect example would be the one shown by the PBS news hour video, when they describe the life of a former college graduate Beth Hanson. This twenty-seven year old

Perez 2 is now working full time at a middle school as well as working two jobs and earning $46,000 while still being in debt for $60,000. This shows us how badly and complicated the life of a student is just for being in debt. Before getting into this mess, these students are unaware of the long term consequences of loans. I for one had no idea what I was getting into. When I entered college, I knew I had to get into debt to get an education, but little did I know that I was going to go through serious consequences just trying to pay off my debt. Just thinking about it, Im already $5,000 in debt and its just my first year. People everywhere have their own opinion towards the solution to the student debt crisis. One person in particular is the opinion of Jenna A Robinson, and her article, Bankruptcy, Not Forgiveness, for Student Loans. In her article she writes about the student debt crisis, how. Since 1999, [the] average student loan debt has increased by more that 500 percent (Robinson). With that in mind, she mentioned what other people have suggested, such as trying to cut university costs, and allowing students to relieve themselves of the debt by filing bankruptcy. Some may say this is a bad idea, but in my opinion its a wonderful approach. Such an approach would allow students to make something out of themselves when trying to get an education. This would relieve them of so much stress and finally recreate the dream of living a comfortable life. Yes, such an idea seems too good to be true, but I do agree that there should be restrictions. Robinson writes that this bankruptcy should be restricted to private loans and should be allowed only after a set amount of time, such as 5 or 7 years. An idea like the one described sounds like a proper idea, but you will be surprised that such an idea has become pointless and ridiculed. A great example of someone who strongly disagrees with the whole idea of the student debt crisis is: Richard Vedder with his article Forgive Student Loans. Vedder writes about the opinion of Economist Justin Wolfers stating, This is the worst idea ever what he means by that is that students shouldnt be taking on any loans in the first place. Vedder also adds on that with

Perez 3 the idea of forgiving students from their debt is an even bigger problem saying that its also worsening the national debt. Yes, I do agree with what both sides are saying, but the reality is that they arent giving students a chance. They bring up the statistics that forty percent of students would probably drop out and not receive a bachelors with debt, and students like that are adding on more to the student and national debt crisis. If you notice, only forty percent of students are doing what they describe, but they do not see that sixty percent are actually receiving their BA. They do not see that these people are actually trying to make a difference in life when trying to get an education. Its not their fault that college is expensive, but at least they are trying hard to pay back their debt. People like Beth Hanson, described in the PBS News Hour are a perfect example of how these people can be outrageous when it comes to student debt saying nothing should be done about the situation, especially when it comes to forgiving. These people need help. To me, the way the student debt crisis is being approached is unfair. An article that supports an example of my idea is one written by Tim Donovan called, Student Loan Should be treated like Detroits. In this article, Donovan writes that its unfair that places like Detroit are forgiven of their debt by declaring bankruptcy, while students are attempting to file their own bankruptcy yet cant escape theyre student debt. To me, that absolutely sounds preposterous. Wheres the equality in that? Detroit was able to get rid of billions of dollars in debt while students with small debts of $20,000 cant even escape their loans. Major corporations can file bankruptcy with billions of dollars still in their bank accounts but still; students cant do anything about their debt. Huge cities like Detroit or corporations arent going to struggle in life. They have hundreds of dollars with them, what is the worst that can happen? Why is it that they can get away with such a huge amount of debt? As of now, nothing has been done in order to solve this issue. Before, students were able to get their student debt forgiven through bankruptcy, but since laws

Perez 4 passed during the Reagan Revolution (Donovan), it has made it nearly impossible for students to get rid of their loans. Today, in my opinion, I believe that there is an actual solution to the student debt crisis, and the nations national debt put together, and that is with, The Student Loan Forgiveness Act of 2012.There are many people out there that completely disagree with the Act or even the idea of fixing the crisis itself. People like Richard Vedder and his article that pretty much said, forgiving student loans is a bad idea and it is ruining the economy more. Other people are saying that forgiving students from their debt would make them irresponsible with the extra money theyll be making The fact of the matter is that if the Act were to pass, it would: eliminate many of the awful consequences of educational indebtness. In doing so, it would give Americans greater purchasing power, helping to jumpstart [the] economy and create jobs (Clark). Of course, it does have some restrictions, but it will help the student loan debt crisis and the national debt crisis. The solution is that students will continue to pay their debt flexibly/comfortably by paying ten percent of their income, and after twenty years of paying, the debts can be forgiven. Another great benefit to this act is that even those students who end up getting a government job after college would end up paying their loans off within ten years and would eventually be forgiven if they exceeded the time. This act does not hurt the nation, in fact, its actually fixing it. As of today, this act hasnt passed, but if it does, the solution to the student debt crisis would be solved; students would be relieved of financial stress and they would be given an opportunity to gain a better education and make the nation a better place. The student debt crisis is something the nation is suffering from as of today, something can be done about it and we now know that there is a solution out there. People must move on and help make a difference to aid this country with its massive debt. The passing of the The Student Loan Forgiveness Act of 2012 would be the perfect solution. Its about time a solution like this

Perez 5 came has finally come across. Its about time these studentss stopped suffering from trying to make a living and pay for their debt, and its about time this nation fixed itself from such a crisis.

Perez 6 Works Cited Biden, Joseph. Ensuring the Student Loans are Affordable. Whitehouse.gov. The United States Government. n.d. Web. 13 November 2013. Clark, Hansen. Trillion Dollar Crisis: The Case for Student Loan Forgiveness. Huff Post/College. HuffingtonPost.com. The Huffington Post, 25 Apr. 2012. Web. 18 November 2013. Donovan, Tim. Student Loan Debt Should be Treated Like Detroits. Salon.com. Salon Media Group Inc., 24 Jul. 2013. Web. 12 November 2013. Lehrer, MacNeil. Student Loans: More Debt, More Defaults, More Problems. YouTube.com. PBS Newshour, MacNeil/Lehrer Productions, 30 May 2012. Web. 13 November 2013. Robinson, Jenna Ashley. Bankruptcy, Not Forgiveness, For Student Loans. InsideHigherEd.com. Inside Higher Ed., 7 Dec. 2012. Web. 13 November 2013. Vedder, Richard. Forgive Student Loans? Its the Second-Worst Idea Ever. NationalReview.com. National Review Online, 11 Oct. 2011. Web. 12 November 2013.