“You know, in today’s economy, higher education can’t be a luxury. It’s an economic necessity. Everybody should be able to afford it.” – President Obama in a speech to UNLC in June.
Well, the president got his wish.
Congress passed legislation to keep interest rates low on student loans back in June of this year. By doing so, college degrees are essentially regressing into earning a second high school degree””you need one just to keep up with the rest of the country and for just a hope of finding a job. Artificially holding interest rates at low levels on student loans dramatically increases the demand to attend college. Basic economics shows when demand increases, so do prices.
During the Obama Administration alone, College Board has reported a 25 percent overall increase in college tuition. Students are encouraged to live fiscally irresponsibly by taking out massive loans to attend schools who keep raising prices. The Department of Education released for the first time an official three-year student loan default rate report. With this larger time span, it’s obvious that students have had a much harder time paying off their student loans. Two years after graduation the student loan default rate is 9.1 percent””up from 8.8 percent in the previous report. The more shocking figure is at the three-year mark, when the default rate increases to 13.4 percent.
The ratio of students that attended for-profit institutions that are defaulting on their student loans after three years is 1:5. Private schools are only slightly better off with rates at 7.5 percent after two years and 11 percent after three years. Nearly 250 schools had loan default rates of over 30 percent, and handful of which were over 40 percent.
Read the rest of the article on TheBlaze.com.