Student Debt and College Affordability

           How would you feel if I told you could have an extra thousand dollars to spend this upcoming semester?  What would you spend it on? Add some flare to the apartment?  Extra beer money?  Or how about wisely investing that extra cash into a Kindle, an Ipad, or some other device that could help with your daily life and education.  As tantalizing as that sounds, the bad news is you don’t have that extra thousand to spend or save.  Now the question becomes, why? 

This past summer, the Board of Visitors raised the cost of tuition and President Steger stated that the underlying reason for this increase was a decline in state support for higher education.  He wasn’t lying.  In fact, it’s more of an understatement.  I would call it “Commonwealth negligence” or “higher education severance”.  Through 2000-2001, the cost share relationship between Virginia and undergraduates was 59% to 41%; 2011-2012 is projected to be a mere 29% to 71%.  Talk about picking up the tab.  Moreover, in academic year 2009-2010, Virginia in-state students borrowed over $657,000,000 to pay for school – a 260% increase from just a decade ago.  Consequently, Virginia now ranks 40^th in state and local appropriations per student.  (The U.S. average is roughly $1,000 more.)  Essentially, we just took a seat next to West Virginia -- at the back of the bus.

So the Commonwealth decided that the burden of higher education funding should be put on the parents and the student.  Unfortunately, not everyone comes from affluence or has financially responsible parents, so in order to pay for college we do what every needy person does, we borrow.  The National Center for Education Statistics affirms this premise: one in every two undergraduates in the Commonwealth is borrowing money for public school.  Keep in mind that borrowing money is not necessarily a bad thing, it is actually quite important for the survival of an economy, but when the default rate is on the rise, it is time to pay attention.  According to the Wall St. Journal, student loan debt is the only type of credit to grow after the Great Recession and the delinquency rates on these loans is on the rise.  Moreover, it is almost impossible to have your student loans forgiven and wiped.  More than likely, your failure to repay will result in one of the following: garnished paychecks, tax refunds offset, federal benefits stripped, or the government sues you.

“I will be fine, my degree will provide me with a high-paying job and I can pay off my debts incrementally.”  Wrong.  Our age bracket is facing a nauseating unemployment rate of 14.6% and that number is probably understated.  Imagine an intro class with 500 students, now picture at least 75 of them back at home with mom and dad picking up their unemployment check.  That is the stark reality we face.  Now couple that with insurmountable student debt and we have a conundrum on our hands.

Now the question to be asked is: What is being done about this?  The answer: surprisingly, quite a lot; especially in the Commonwealth.  Governor McDonnell has two sons that go to UVA and a daughter that goes to VT, so fortunately for us, he understands the cost burden college is putting on families because he himself is going through it.  That is why in the new proposed biennial budget he has “reallocated” monies to “higher-value programs” and is seeking an additional $100 million a year for “very specific policy goals”.  These policy goals coincide with the Higher Education Opportunity Act passed during the last General Assembly session: making college affordable, increasing the number of Virginians with degrees, and placing an emphasis on high-demand fields such as the sciences and health.  Interestingly enough, a group called “Virginia21”, which is a non-partisan, non-profit organization, is one of the reasons why the Governor felt he was able to propose a “reallocation of values”.  Virginia21 launched a lobbying effort back in September called “What’s Your Number” that encompassed a viral effort, e.g. YouTube videos that interviewed college students who were struggling to keep up with tuition hikes or had exorbitant student debt and could not find a job, a grassroots effort that put the boots on the ground and focused on petition signatures, and an overall emblematic question that asked college students, “What is your student debt number?”  The lobbying effort was not met with contempt or indignation as with years past, but rather, a gracious welcoming party from the Governor’s Office.  He mentioned Virginia21 approximately ten times during his budget proposal and Virginia21 advocates, wearing their school shirts, stood behind the Governor as he voiced the proposal.

The Governor, just like the President, cannot act unilaterally on budgetary issues - he can only make recommendations and the General Assembly can surgically remove any language or allocation they feel is unnecessary.  So I encourage my fellow Hokies to take action, whether it is going to lobby on Hokie Day or signing Virginia21’s petition at www.virginia21.org/whatsyournumber, it is imperative that we do something.  As the law of inertia states: a body at rest will remain at rest unless acted upon by an external force.