Etaryan 1 Gregor Etaryan John Kubler English 114A 18 November 2013 The Calamity of Student Loans The staggering

number of student loans have sky rocketed over the years and keeps rising due to the fact that education is getting more expensive. The student loan crisis has been around for many years and every year it increases more and more. College tuition keeps on rising, therefor higher loans are being taken out by students. The big question that the government has been asking themselves is how to approach this situation in order to solve it once and for all. There is a lot of controversy over this topic, because there are pros and cons about how to handle the situation and there cant be a win win situation. The government already dealing with so many national debt issues that student loan debt adding on to the list is a major crisis, but they need to look at the good and the bad to better handle the situation in order to try to improve our economy as best as they can so everyone can live in a better society. Loans are rising and will keep on rising until the government decides to figure out how to handle the situation as best as possible. The government is so engulfed with all the problems going on around the world that it is difficult for them to reach a consensus on how to handle the situation of the student loan crisis, because there is too much to consider. Many have argued the idea that the government should forgive all students loans and the burden should be on the government. That might sound like a great idea, but with the government already in debt that the student debt adding on to it would make it even worse. If the federal government shoulders the entire burden, we are adding a trillion or so more dollars in liabilities to a government already grievously overextended

Etaryan 2 (upwards of $100 trillion in liabilities counting Medicare, Social Security, and the national debt), almost certainly leading to more debt downgrades, which could trigger investor panic (Vedder 2). Although if debt-burdened young persons were free of this albatross, they would start spending more on goods and services, stimulating employment, that would still be more of a crisis to the national government which will affect the economy even more (Vedder 2). With that being said if the government took on the student debt crisis it will make the economy possibly go into another depression, because it will then start affecting the people and then the entire society will be in a rut. One option that has been thought out by many and sought to achieve was to file for bankruptcy. When it comes to student loans, filing for bankruptcy is a different process and most of the time not achievable. In order to discharge a student loan debt, a debtor needs to file a separate action and argue in front of the bankrupty court, a process that usually requires an attorney and money (Merling 1). This process requires that person to use their own money to go to court and prove their case and why they should get approved for bankruptcy, but since most of these people are already in hardship they cannot afford to go to court, because of financial issues. Filing for bankruptcy can give people a new start, but the actual process to be approved for bankruptcy may cost so much that they become bankrupt. Even though bankruptcy may be an option for some it is still not a real solution as to solving the student debt crisis overall. Dealing with the student loan crisis also relates to the bigger picture of debt that the government has to deal with. It relates, because solving the bigger issue can help the government focus and strategies on the student debt loan crisis. In the documentary film The One Percent, Jaime Johnson who is the heir to the Johnson & Johnson Company, documented the rich and their lives and how greedy they were. The owner of Kinkos stated that even though he had

Etaryan 3 millions of dollars he still wanted more. With all the money he has and the all the other rich people they have the chance to help the society, but instead they want it all to themselves. Many have had the assumption that my taxing the rich it could potential help start up the economy even more. Reasonable proposals for taxing the highest-income households can raise significant amounts of revenue (Sherter 1). By taxing the richer families a little more than it can add up a lot to help the economy even if it is just by a little. The rich are more than capable of giving away more money, because they are all surrounded by their wants and not their needs. Its good economics to raise the taxes on the rich, because it will help the economy even if it is just a little bit (Sherter 1). With the richer people get taxed more and helping the economy the government can then put more energy and focus into solving the minor debt issues compared the national debt such as the student loans. From personal experience I have seen a family friend who was in student loan debts most of his life and he has barely paid them off now at age 50. He shared stories with me about how he struggled to find a job after he graduated and how he worked two minimum wage jobs just to stay afloat. Later on in life things started looking up more, but he was still stressed and struggled to pay off the loans. Every year students get apply for student loans and they do not understand what they are getting themselves into until it is too late. Some argue that it is the students responsibility to pay these loans back and that they should not be forgiven. In a sense that is correct, because they did sign the legal documents, but most do not understand what they are getting themselves into. The reason in which students get these loans is to get an education to better their life, but in reality they actually make it worse in a sense by putting this burden of debt on their shoulders.

Etaryan 4 When it comes down to solving the crisis of the student loans, there is no 100% way of doing it correctly, because there are pros and cons and not one side can win everything. The government has to try to figure out how to handle the situation as best as possible. There are options such as bankruptcy and forgiving the loans, but these methods are not 100% effective. Student loans keep rising and will keep on rising and people who take out loans must try to educate themselves as much as possible before considering it. For the government to figure this crisis out they must try to figure out the small tings surrounding it such as the overall debt and must start from the sources to try their best to solve the student loan debt crisis.

Etaryan 5 Works Cited Johnson, Jaime. The One Percent. YouTube.com. 1 Nov. 2011. Web. 5 Nov. 2013. Merling, Davon. "How Bankruptcy Could Help Solve the Student Loan Crisis." DeseretNews.com. Desert News, 23 Aug. 2013. Web. 9 Nov. 2013. Sherter, Alain. Why Raising Taxes on the Rich is Good Economics. CBSNews.com. CBS Interactive Inc., 9 Aug. 2011. Web. 9 Nov. 2013. Vedder, Richard. Forgive Student Loans? Its the Second-Worst Idea Ever. NationalReview.com. National Review Online, 11 Oct. 2011. Web. 9 Nov. 2013.