While Latinos acquire slightly less student-loan debt than their white counterparts, on average $49,700 as opposed to $54,000, this does not mean that they are in any better position when – or if – they finish school. Many Latinos opt to work through college instead of taking on a large debt burden, Maldonado said, and that leads to a longer amount of time spent in school and a lower chance of actually graduating.
According to statistics from the public policy organization Demos, 31 percent of Latino students drop out of college.
Thanks to certain progressive senators and Democratic presidential hopefuls, interest in debt-free college is at an all-time high. But what happens next is very much uncertain — people don’t even agree on what debt-free college means, much less how (or whether) to make it a reality. Demos, which put the idea on Washington’s radar via a white paper last May, is now trying to tackle both issues — by wrangling a common definition of the idea, and starting to codify it via Higher Education Act reauthorization.
Policy makers are also exploring ways to maintain a safety net for seniors with defaulted student loans, while still ensuring the Education Department gets the money it’s owed. Sens. Elizabeth Warren and McCaskill, Democrats from Massachusetts and Missouri, respectively, sent a letter to the GAO earlier this year asking for more information about the financial and loan status of seniors losing their benefits.
European countries also differ substantively from the US in terms of the percentage of college attendees that their debt free models serve.
“Germany has a lower percentage of students go on to college than we have here in the US,” Mark Huelsman, a senior policy analyst at think tank Demos, told ATTN.
"Debt-free" might not sound as sexy as simply "free," but O'Malley's approach could in fact create a more effective mandate for radically reducing the cost of college in the United States.
Education-loan borrowing among students pursuing an associate’s degree has increased significantly in the past decade, particularly among low-income students. For the 2011-2012 academic year, 55% of students who received Pell Grants and earned associate’s degrees also graduated with debt, according to a 2015 report from Demos, a progressive policy group in Washington, D.C.
“The decline in state funding for state colleges and universities is the main driver of what’s increasing costs,” says Mark Huelsman, senior policy analyst at Demos, a liberal think tank. He’s the author of a 2014 proposal for increasing public higher education funding that he says has drawn interest from several presidential primary candidates.
“This view that college pays off and that most people pay off their loans, is narrow and tragically flawed,” Heulsman said in his opening remarks. “This is a crisis of equity, it’s a crisis of opportunity and we’ll argue it’s a crisis for the economy.”
Declining state appropriations for higher ed is responsible for more than three-quarters of tuition hikes between 2001 and 2011, the analysis found. Increased spending on administration and building projects accounts for only about 12 percent of the tuition increases over that time. During the recession, when many states scrambled to cope with shrinking coffers, lawmakers slashed spending on public universities. But appropriations haven't returned to prerecession figures despite an improving economy.
“If we begin to think of education as a part of the economic mobility system, then we can begin to think of education’s implications for children long after school,” Elliott, who also serves as the founding director of the Center on Assets, Education, and Inclusion (AEDI), explained at a recent New America event.
Today's very high threshold for default rates allows tons of colleges to mask poor student outcomes and doesn't take into account the difficulty students are having with repayment itself. But moving beyond the extreme scenario of student default — which means a borrower has been unable to pay their loan back for at least 9 months in the case of federal loans — is important to developing a more nuanced understanding of post-graduation hardship.
Millennials have an average credit score of 625 (based on the Experian VantageScore 3.0 credit score), compared to 650 for Generation X and 709 for those over 50 years old. They also use an average of 43 percent of their credit limits—compared to 34 percent nationally—and their average debt (excluding mortgages) totals 77 percent of their income, compared to 49 percent nationally.
While every single Democratic member of the Legislature has signed on as a sponsor of this bill, not a single Republican has been willing to break from party orthodoxy and let common sense trump caustic partisanship.
Imagine the benefits to our state economy and Wisconsin families if millions of dollars in interest on student loans paid by borrowers every year to the federal government and Wall Street banks would instead stay right here.
The St. Louis Fed findings add to the growing body of evidence that higher education benefits some groups more than others, which may help to exacerbate the yawning racial wealth gap instead of shrink it. Black and Hispanic students are more likely to approach college with lower levels of wealth on average and are, therefore, more likely to have to borrow to attend school, according to a report earlier this year from Demos, a left-leaning think tank.
In the 2016 presidential election, we are approaching a singular and momentous crossroads in our nation’s history. Will we, or will we not, make a serious effort to achieve a low-carbon future for our children and our planet? The fossil fuel magnates and the GOP say no, because we can’t or shouldn’t, but more than 75 percent of Americans want our leaders to take significant steps to fight climate change, according to a poll released in January 2015 by the New York Times, Stanford University, and Resources for the Future.
Consumer advocacy groups have long complained that there is no link between bad credit and job performance. They argue that such checks lead to discriminatory hiring.
The system is profitable but imperfect, and for decades critics have attacked it for all sorts of offenses. In 1969, Columbia University legal scholar Alan Westin testified to Congress that the companies violated Americans’ right to privacy and that their inaccuracies damaged lives.