I have, once again, seen the future, and it's a disaster
I am writing from America. Indeed, I lived in your future for many years. This week, the figures are in: once again, we have seen the future, and it doesn't work.
The front page headline in the New York Times is grim: Debt Collectors Cashing in on Student Loan Roundup (NYT, A1, Sunday Sept. 9, 2012). Students were protesting, wearing T-shirts advertising their levels of debt: $20,000, $75,000 and $90,000. Debt collectors were gloating. "I couldn't believe the accumulated wealth they represented - for our industry," wrote one, in a trade publication. "It was lip-smacking."
The defaulted debt is now $76 billion - more than the yearly tuition bill at all US universities. You can declare bankruptcy on a credit card debt - if you bought too many pairs of shoes - but never on a student loan. That means you've got to pay, no matter what it does to you. So the debt collectors are chasing 5.9 million former students, a number that has climbed radically during the recession. One young woman reported seven harassing calls from a collector in one day.
Without wishing to announce, piously, I told you so: 14 years ago I railed against the Blair government's introduction of student loans in 1998. I said then that student loans would do more harm to the fabric of our society than the reintroduction of capital punishment. Sadly, it's still true.
After the Second World War, there was a movement towards making access to university free. Indeed, with the Education Act of 1962, maintenance grants further facilitated the education of my generation. Then came the Blair government: we were assured, in 1998, that the £1,000 annual charge would have a minimal impact. Then came the £3000 charge in 2004, followed by £9000 this year.
Many of my generation benefitted from a free university education. I suspect that large swathes of those who later voted to create the student loan programme paid nothing. On a primary level, then, this is a great swindle on the youth of Great Britain: it is not a matter of making them pay the cost of their own education; rather, they are paying off the debt accrued by my generation. It is a tax on the young and poor to pay the debts of those who are older and richer.
Proponents of this youth tax announce, ignoring the evidence, that the availability of loans mean that nobody will be dissuaded from getting the education they want. Even if this were true, it glosses over the most important point: it places a noose around the student's neck. In the gleeful words of one collector, there may be a statute of limitations on armed robbery or rape, but there's none on student loans: "You are going to pay it, or you are going to die with it."
This means that the student must take a higher paying job to pay the debt, and is forced out of my world of charitable endeavour, where the salaries may be too low even if the other rewards are great. In short, the government has mortgaged the next generation's ability to do good, in order to subsidise the lifestyle of the wealthy today.
If he loses the US election, we may want to install Mitt Romney as Prime Minister. He'll simply move us to the future a bit faster than the current man in Number Ten.
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