New York Rep. Alexandria Ocasio-Cortez is still paying off $15,001–$50,000 in student loan debt. A policy priority of hers happens to be canceling all student loan debt. Here’s a prescription that would actually benefit younger Americans and not sink the economy: Avoid owing institutions of higher learning loads of money in the first place.
U.S. student loan debt recently reached a record $1.465 trillion, double what it was when the recession ended in June 2009. Anthony Carnevale, Director of Georgetown’s Center on Education and the Workforce, pointed out that millennials with degrees make up about 40 percent of the unemployed.
It doesn’t bode well for higher education that four out of ten Americans looking for a job hold a college degree. Indeed, if there’s a forty percent chance you’re going to be unemployed after graduation, does it make sense to spend four or more years on campus? From a financial perspective, an increasing number of Americans are rightfully saying, “no.”
According to a first-of-its-kind study on attitudes towards higher education, nearly half of Americans do not believe college is worth the expense. One-third believe it was more important to get a college degree thirty years ago than it is today. Further, Americans believe starting their own business is a better measure of success than possessing a college degree.
There are 44 million American student borrowers and the average student in the class of 2016 left school with $37,172 in student loan debt, notes Forbes. It’s even worse when you break down the numbers.
As of August, SmartAsset.com informs us that the average salary for a millennial is currently $35,592 a year. That’s not enough to survive in a big city like New York, Los Angeles, or San Francisco.
Still, let’s say that a millennial graduate decides to live in a city with more affordable rents like Cleveland, where you can get a decent studio apartment for $684 a month. After state taxes, their annual take-home pay will be $28,728, $8,202 of which will go towards rent, leaving them with $1,723 a month of disposable income.
Factoring in food, phone bill, and electricity bills, that doesn’t leave enough money for even cable television and a few movie nights, let alone a student loan payment.
The average 2017 salary for a college graduate is $59,124, but in terms of earning, they’re four years behind someone who went to work straight out of high school. On average, their non-college counterparts have already raked in $142,368.
There’s no guarantee that if you go straight into the workforce from college, you’ll succeed. On the other hand, there’s also no guarantee you’ll succeed if you first go to college.
In pursuing happiness, it helps to have money in your pockets. To have money, you need to make yourself of value. But that can only happen when you are good at — or, ideally, the best at — what you do, regardless of vocation.
The skills taught by trade schools are specialized and are not available at most universities. “Critical thinking” — the focus of higher education — helps you earn money, but in no way is it comparable to specialized skills, which virtually guarantee solid income. And there is growing shortage of well-trained technicians and tradespeople.
In 2017-18, the average in-state tuition at a public university was $9,970 while the average out-of-state tuition was $25,620. The average private-school tuition was $34,740. On top of that, as of 2015, universities held nearly $550 billion in endowments. One would assume that money would go towards, well, teaching and educational resources. One would often be wrong.
A 2018 Washington Monthly article revealed that while the prominent University of Texas at Austin received $603 million of endowments from an oil company between 2011-2017, only $143 million of which was used on general administration and $38 million for financial aid.
Then, for instance, there’s Colgate, the prestigious liberal arts college nestled in Hamilton, New York. It receives, as reported in a 2017 Forbes article, so much money that its cost-per-student of the entire teaching faculty is $14,500. This is opposed to Colgate’s actual tuition: $62,540.
All of this, in addition to over-the-top political correctness and a lack of viewpoint diversity on campus, should be enough to make you reconsider the value of sinking tens of thousands of dollars into higher education.
Americans must confront the educational industrial complex’s big lie: Everyone needs a college degree. The economy is changing rapidly. But with new obstacles, there are new opportunities. It’s time to respect them as much as the increasingly underperforming four-year degree.
Nick Adams is the founder and executive director of the Foundation for Liberty and American Greatness (FLAG). This is the first adapted excerpt from Nick’s new book, CLASS DISMISSED: Why College Isn’t the Answer, which will be released on Tuesday.
The views and opinions expressed in this commentary are those of the author and do not reflect the official position of The Daily Caller.