America’s collective student loan debt now stands at more than $1.5 trillion. For some perspective, that’s more than the entire GDP of Spain or Sweden or any of the 54 countries in Africa.
Apart from mortgages, student loans are the biggest source of personal debt in this country, more than car loans and credit card bills. That’s a staggering amount of debt. It’s enough to distort and cripple the U.S. economy. It’s enough to stunt the life prospects of an entire generation of young people.
If you’re wondering why the majority of Americans under 30 say they prefer socialism, debt is a major reason. Student loans are killing them, and they never go away. Thanks to extensive lobbying efforts here in Washington, student loans, unlike other forms of debt, cannot be erased by bankruptcy.
Economist Herb Stein famously said that something that can’t go on forever, won’t. For decades now, America has been investing ever-growing fortunes into its K-12 education system in exchange for steadily worse results. Public schools haven’t changed much from the late 19th century industrial model and as a result young Americans are left increasingly unprepared for a competitive global economy. At the same time, Americans are spending more than they can afford on higher education, driven by the kind of cheap credit that fueled the housing bubble. With college graduates unable to secure employment or pay off student loans, the real-world value of a traditional college education is in question.
In The New School, Glenn Harlan Reynolds explains how parents, students and educators can, and must, reclaim and remake American education. Already, Reynolds explains, many Americans are abandoning traditional education for new models. Many are going to charter schools or private schools, but others are going another step beyond and making the leap to online education—over 1.8 million K-12 students already.
The New School does not prescribe a one-size-fits-all solution for education. Americans require a diverse system of innovative approaches—each suited to a family’s needs and spending potential. But with the profusion of online education, school choice, and even a return to alternatives like apprenticeships and on the job training, Americans hold the power to lower costs and improve outcomes from the ground up.