Student Loans

College debt is a $1.1 trillion problem. (Photo courtesy Wikipedia / September 24, 2013)

A guy from Darien named Paul Streitz thinks the only way to solve the $1.1 trillion (that's right, trillion) crisis over college student debt is to get radical.

He's launched an online petition drive to force Congress to get off its collective ass and do stuff like taking away the tax-exempt status of colleges and universities that don't lower tuition or fail to agree to student loan "give-backs."

"I think all colleges and universities should be responsible for paying back student debt," says Streitz, who's created his own College Parent Association to help in his fight. Streitz argues that huge amounts of tuition money have been squandered on lavish salaries and prestige-enhancing projects that don't help educate anyone.

Other critics blame the federal government and the financial industry. The one thing that just about everybody agrees on is that what's happening now simply can't go on much longer.

"It's a huge crisis," says Beth Bye, a state senator from West Hartford who is co-chair of the General Assembly's committee on higher education. And the whole mess is personal for Bye: "We're very much living this."

Bye has three kids in college: a daughter at the University of Chicago ("The tuition is like $63,000 a year"); a son at St. John's University ("That's like $56,000 or $57,000 a year"); and another daughter at Emmanuel College ("In the high $40,000's").

The non-profit Institute for College Access & Success looked at the latest statistics available from 2011 and estimated the average graduate from both public and private four-year colleges and universities in the U.S. owed something like $26,600.

In Connecticut, the average student debt was even higher, at $28,783, according to that study.

We also had the dubious honor of hosting one of U.S. News & World Report's Top 10 schools for highest student debt. Sacred Heart University was listed as the fourth ranked in the nation, with a average student debt load of $45,402.

The average student debt for this state's biggest public school, the University of Connecticut, came in at $23,822. Yale University, either because lots of its graduates had lots of financial aid or wealthy families, ranked low with average graduate debt of $9,254.

Streitz points out that, if private college tuition had simply risen with the rate of inflation since 1960, the cost of higher education at the average private school would be about $9,000 a year — not the current $44,000 per year hit.

You know things are bad when even U.S. Sen. Chris Murphy, D-Conn., and his wife are still paying off their college loans 20 years after graduating. Murphy has been advocating bigger reforms for college loans, though hasn't yet come out in favor of anything as radical as forcing loan give-backs.

Abe Scarr, director of the Connecticut Public Interest Research Group (ConnPIRG), points out that this huge debt crunch isn't just trouble for those college grads.

"It's a problem for Connecticut as a whole," he says. Because of loan payments, new graduates don't have money to buy cars, rent apartments or even save to buy homes. Lots end up living with their parents and scrimping on all sorts of normal routine consumer purchases to make ends meet — all of which hurts the state's economy.

Streitz's petition drive to push for congressional action has gotten off to a slow start, collecting a few more than 200 signatures in its first two weeks. But Streitz has a system whereby every signature generates petition e-mails to the staffs of the 42 members of the U.S. House and Senate education committees.

"It's kind of clogging up their e-mails," he laughs.

Scarr doubts that radical reform efforts like the one Streitz is making will have much immediate effect.

Congress this summer reached a compromise on student loan interest rates. Now those costs to students won't jump as high as they would have without that deal.

President Obama has also proposed a series of reforms that include linking federal financial aid to colleges and universities to how well schools do in helping lower-income folks to gain access to higher education and how much they help students having trouble repaying loans.

Those more modest reforms are likely to satisfy lawmakers for now, Scarr says. "I doubt any state or federal legislators will be able to pass anything of that [radical] nature," he says of Streitz's call for major loan give-backs.

But Scarr believes that just the fact that people are angry enough to push for drastic solutions will increase the pressure for major reforms in the next few years.

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