Americans now hold a staggering $1.3 trillion in student loan debt. And last week, Prairie Public News asked an important question: How did we get here? To get to the bottom of the question, PPN interviewed journalist Lance Williams of The Center for Investigative Reporting. Williams recently co-reported an in-depth piece for the center’s radio show Reveal. Here are some highlights of his responses:
On the student loan behemoth Sallie Mae, which was privatized in 1997:
“After privatization, it became a full-service, for-profit corporation . . . The concern now is we replaced a program whose real purpose was to help people go to college with something where that's kind of a secondary goal. The primary goal, of course, for for-profit institutions is the bottom line.”
On the appearance of private loans with higher interest rates and fees:
“You get really aggressive companies that come in there and work really hard to get the money back. That's totally understandable in the corporate context. But we started this trying to help people get educated and get on with their lives. And now you've got thousands upon thousands of students who fall behind on their debt harassed from dawn to dusk, hassled, pushed hard.”
On the responsibility of universities and the government for the crisis:
There's been tremendous disinvestment in public higher education in our country. . . . If state legislatures had continued to support higher ed at the rate they were in 1980, they would have pumped an additional $500 billion . . . into state university systems. . . . As the states disinvest, the burden is picked up by the students, and the way they pay for it is they borrow the money.”
On future relief options:
“The Obama administration has made some strides, Congress has made some reforms . . . [But] for people who've already got the loans, . . . relief is not really on the horizon.”