5 million Americans have more than $50,000 in student loan debt, and most pay none of it back in the first four years

What makes this even worse is that, in 2010, Obama shoved the banks aside and forbid anyone but the Department of Education from making government-guaranteed student loans. Worse in the sense that, while banks aren't as much on the hook from the inevitable defaults, the taxpayers are. Total student loan debt now totals $1.4 trillion, and the borrowers carry that debt for a very long time - incurring mounting interest charges in the process. They take years before they start paying off any principal, so their balance gets even higher. That's especially true if you continue incurring debt through grad school, which might keep you in school for another three to seven years after you get your bachelor's degree. You're still spending, still borrowing, not doing much earning. And once you finally do start earning, you're either turning around and turning it over to your lender or, in the case of far too many, you're paying off nothing at all:

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A study released Friday by the Brookings Institution finds that most borrowers who left school owing at least $50,000 in student loans in 2010 had failed to pay down any of their debt four years later. Instead, their balances had on average risen by 5% as interest accrued on their debt. As of 2014 there were about 5 million borrowers with such large loan balances, out of 40 million Americans total with student debt. Large-balance borrowers represented 17% of student borrowers leaving college or grad school in 2014, up from 2% of all borrowers in 1990 after adjusting for inflation. Large-balance borrowers now owe 58% of the nation’s $1.4 trillion in outstanding student debt. “This is comparable to mortgage lending, where a subset of high-income borrowers hold the majority of outstanding balances,” write Adam Looney of Brookings and Constantine Yannelis of New York University. “A relatively small share of borrowers accounts for the majority of outstanding student-loan dollars, so the outcomes of this small group of individuals has outsized implications for the loan system and for taxpayers,” the authors say.

This is the inevitable result of several unwise societal trends we should stop following.

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One is the constant pushing of very expensive college degrees, regardless of whether the student being pushed really needs or benefits from the degree. If you want to be a doctor, an engineer or a lawyer, then yeah, you need a degree. If you just graduated from high school and have no idea what you want to do, then may not need it, and you certainly don't need to be incurring tens of thousands in debt while you try to figure out your direction in life. A young person who goes to college delays the start of his or her earning life by four years - spending and borrowing a considerable amount in the meantime - and it's far from a sure thing that the resulting degree (assuming he or she even finishes one) facilitates such superior earning that this becomes a good deal over the long haul. Another trend that's driving this is the constant rise of college costs. It's not just the classes and instruction. It's all the administration, all the external programs, all the facilities, all the sports . . . all this helps to drive tuition costs, and why not when guaranteed government loans are going to pay for it all? And finally we have the ever-present imperative to simply borrow to pay for what you think you need. The government does it. Your parents do it. You're encouraged to do it. Hey, the banks will approve you! Why not? You qualify, dude. Someone else pays for your education. I want to say that's not how it works, but with so many people defaulting on these loans, that increasingly is how it works. You borrow tens of thousands to pursue a degree you might not even need, then spend four years pursuing that degree instead of producing anything or earning anything, then at the end you don't pay back the loan and your earning potential is no greater than if you'd just started working after high school. And as a nation we push as many young people as we can to college so they too will join the spend/borrow/study/default parade. That's $1.4 trillion. That's $1,400,000,000,000. And who's on the hook for that? Well that's the only somewhat poetic detail. It's the same people who went and pursued those degrees so they could become taxpayers. That's right. One way or another, you're going to pay.

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