Federal Myopia: Chasing the Wrong Priorities

Better Essays
Since World War II, home ownership and higher education have been equated with success in America. In this 21st-century economy, higher education is more than ever an important pass to upper social mobility. However, like the American Dream of home ownership that was shattered by predatory lending, The American Dream of higher education is also being threatened to be crushed by ever-growing student loan debts. Following the Great Recession, it is only normal to worry about an impending student debt crisis given the parallels it has to the housing crisis. Not only do both issues stem from inequality and involve huge amounts of loans that are doomed to default, but most important, they lack proper government intervention. Similarly to governmental policies that fostered unsustainable increase in house prices by encouraging subprime mortgages in an effort to expand home ownership, a significant growth in subsidized lending in higher education is pushing college tuition costs upwards. Higher education is becoming more a financial burden than an opportunity for self-growth and the growth of a country.
Just like homeowners were left stuck with the bill in the wake of a financial crisis, the federal government is failing to protect college students form the incessant rise in the cost of college tuitions. According to Joseph Stiglitz, a professor of Columbia University and a Nobel Memorial Prize winner in economics, “average tuition, and room and board, at four year colleges is just short of $22,000 a year, up from under $9,000 (adjusted for inflation) in 1980-1981.” In an economy that is increasingly dependent on knowledge-related industries, more Americans are seeking a higher education in order to climb up the rungs of the economic and...

... middle of paper ...

...ry of the Primary Causes of the Housing Bubble and the Resulting Credit
Crisis: A Non-Technical Paper.” The Journal of Business Inquiry, 8.1 (2009):120-129. Web.
10 March 2014.
Lewis, Michael. The Big Short: Inside the Doomsday Machine. New York: W.W. Norton &
Company, 2010. Print. New York Fed Report Shows Households Adding Debt, 18 Feb. 2014. Web.
10 March 2014. Interest Rates and Fees on Federal Stafford Loans, 2014. Web. 10 March
Stiglitz, Joseph E. “Student Debt and the Crushing of the American Dream.” New York
Times, 12 May 2013. Web. 10 March 2014.
Taylor, John B. “How the Government Created the Financial Crisis.” The Wall Street Journal,
2009. Web. 10 March 2014.
Wallison, Peter J. “The True Story of the Financial Crisis.” The American Spectator, 2011.
Web. 10 March 2014.
Get Access