Reality Check

The Curse of Student Loan Debt

If changes are made, we may see tuition decrease and return to the promise of education as a key to long-term economic advantage

I graduated college in 1998, and law school in 2001. Both degrees are from the University of Montana. It was the result of assistance from Pell Grants; the money my parents could scrape together for a year of support; Montana’s commitment to keeping tuition affordable; and federally subsidized Perkins and Stafford student loans. I also worked two to three jobs every semester and in the summer to make up for the shortfalls. When I graduated from law school, my total debt was $48,000 and my husband was undergoing cancer treatment. I was fortunate as the federal loans I’d obtained allowed me to defer making payments until my income recovered. After my husband died and I chose to move to Kalispell, I sold my home and paid off all of my accrued student loan debt. I was one of the “lucky” ones; my loans were paid off in four years.

Times have changed. New college grads are sinking in a sea of student loan debt, with few opportunities for relief. The problem is real and isn’t due to lack of fiscal responsibility. In the early 2000s, for-profit colleges became normalized by accreditation and access to federally backed student loans. When the recession occurred, those who couldn’t find a job went back to college for the protection and presumed opportunity it could afford. So folks hid out in college, deferred payments on pre-existing student loans, and earned graduate degrees (and more debt) under the notion that “more education” equals “more opportunity” for a job and income. The problem is once everyone has a graduate degree, the undergraduate degree becomes less marketable, and when a flood of students occurs, colleges can (and did) raise tuition. Tuition has doubled at UM since I was a student; yet starting wages for college grads have only modestly risen (my profession’s starting salary has only increased 15 percent since 2001).

Free college isn’t the answer either; as a friend of mine related, “there has to be skin in the game.” Congress attempted to address the issue through a student loan forgiveness program in exchange for public service. However, the program has been undermined by a private servicer with no incentive to help graduates navigate through the morass of regulations tied to the program. The forgiveness program should be modified to ensure its promises are delivered. The private sector is now learning that student loan relief is a valuable employee benefit. The amount of debt available to a student should be capped; we cannot expect 18-year-olds to make $100,000 debt decisions. If these changes are made, we may see tuition decrease and return to the promise of education as a key to long-term economic advantage.

Tammi Fisher is an attorney and former mayor of Kalispell.