In today’s economy, a college education is essential for getting a good job and entering the middle class. Yet, despite this reality, college costs are rising beyond the reach of many
Wisconsinites, and student loan debt has become a clear and present danger to both the Wisconsin and American economies.
Nationwide, student loan debt has exploded from $200 billion in 2000 to $1.3 trillion today.1 Outstanding student loan debt is the largest component of consumer debt in the country, exceeding both auto loans and credit card debt, and is the second-largest source of household debt, trailing only mortgage debt. Student loan debt also impacts every generation in America. According to the Federal Reserve, borrowers aged 40 and older owed 34 percent of outstanding student loan debt as of 2012.2
In Wisconsin, state policy decisions have played a significant role in this rise by shifting costs onto students and families though declining state support. Wisconsin’s investment in higher education has decreased considerably over the past two decades, and its financial aid programs, though still some of the country’s most expansive, fail to reach many students with financial need. As a result, students and their families now pay—or borrow— much more than they can afford to get a higher education, a trend which will have grave consequences for Wisconsin’s future economy.