When the higher education/student loan bubble pops, the folks at the Grand Forks Herald should be indicted (figuratively, not literally) as co-conspirators. Because despite a report illustrating the bubble perfectly, despite a report in their own paper showing that student loan debt has exploded even as the degrees students are purchasing have fallen in power, the Herald’s editorial page continues to poo-poo the problem.
“So, why do students keep enrolling?” asks Tom Dennis at the beginning of today’s editorial. His point, if the cost is so high and the degrees are falling in power, why haven’t more students opted not to go to college?
I’d answer with another question: Why did people keep taking out subprime loans, and why did banks keep issuing them, right up to the point when mortgage market collapsed? The answer, of course, is because the federal government kept buying up the loans. Fannie Mae and Freddie Mac were back or buying subprime loans until they couldn’t any longer, and the banks kept issuing the loans as long as the feds were buying.
And, because the low-cost loans were available, Americans kept taking out first, second and third mortgages to finance vacations and all the other foolish things people got up to in the midst of the bubble.
The same is true of student loans. The government is still backing the loans. Heck, in 2007 the government raised the ceiling on the amount of money which can be lent to students. And there is still a very strong push in society for kids to go to college whatever the cost. In fact, newspapers like the Herald are very much a part of that problem.
So, yeah, kids are still buying in because the bubble is still inflating. And college, obviously, isn’t a bad deal for every student (just as every mortgage issued at the height of the subprime bubble was a bad one). But that doesn’t change the fact that there is a bubble, and publications like the Herald are doing their readership a real disservice by prioritizing reflexive defense of all things higher ed over the truth.