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These comments are responses to the statements listed below,
which were generated in regard to the 
Laura Gilbert  Interview of

Student Debt: What are the Possible Long Term Economic Consequences? 


The student-loan crisis is predicted to be the next big financial crisis, says Laura Gilbert, a writer and speaker on financing higher education and a consultant for families facing college-financing decisions. Nationally, the number of people with student loans increased by 70 percent from 2004 to 2013, so that the country as a whole now has $1.1 trillion in student-loan debt. People aged 50 or older hold $155 billion of that debt. In 2012, 70 percent of Minnesota undergraduates had student loans, with an average debt of $31,500, the fourth highest in the nation.

But the major problem, Gilbert says, is that student loans amount to only 18 percent of the cost of college. While 30 percent of college costs are paid by grants and scholarships, over half the costs are paid by parent loans, student income and savings, parent income and savings, and friends and relatives. Gilbert notes that because of that, college debt is a much bigger problem than the $30,000 debt facing a college graduate at age 22 and a much bigger problem than unprecedented tuition increases.

She recommends ideas for dealing with the existing student-loan debt and a new framework for approaching college funding that could help reduce future debt. Among the ideas are looking at tax and business-friendly opportunities to pay down college debt, considering lemon laws for students who were misled about the quality of a program and are now deeply in debt, and encouraging families and prospective students to borrow no more in student loans than a low-end, entry-level salary can comfortably support and to avoid debt that could affect major adult life choices.

For the complete interview summary see: Gilbert interview

Response Summary: Average response ratings shown below are simply the mean of all readers’ zero-to-ten responses to the ideas proposed and should not be considered an accurate reflection of a scientifically structured poll.

To assist the Civic Caucus in planning upcoming interviews, readers rated these statements about the topic on a scale of 0 (strongly disagree) to 5 (neutral) to 10 (strongly agree): 

1. Topic is of value. (8.8 average response) The interview summarized today provides valuable information or insight.

2. Further study warranted. (8.2 average response) It would be helpful to schedule additional interviews on this topic.

Readers rated the following points discussed during the meeting on a scale of 0 (strongly disagree) to 5 (neutral) to 10 (strongly agree): 

3. College debt crisis affects competitiveness. (8.2 average response) The enormous college debt burden on students and their families is likely to constrain our ability to develop the human capital we need to maintain competitiveness.

4. Do college-level work in high school. (8.8 average response) Students could reduce college debt by taking more college-level courses, free, in high school, finishing college in fewer years.

5. Do without all the amenities. (9.0 average response) Students could reduce college debt by purchasing fewer nonessential college expenses, such as athletic club dues, apartments instead of dorms, and amenities such as large, flat-screen TVs in rooms.

6. Plan in advance to assure timely graduation. (8.4 average response) Students could reduce college debt with better advanced planning, so that a two-year degree doesn't take three or four years or a four-year degree, five or six.

7. Help families be better consumers. (9.4 average response) ping families become more knowledgeable consumers and encouraging them to take the impact of student and family debt into account when deciding on the best college for their children would reduce college debt levels.

Response Distribution:

Strongly disagree

Moderately disagree


Moderately agree

Strongly agree

Total Responses

1. Topic is of value.







2. Further study warranted.







3. College debt crisis affects competitiveness.







4. Do college-level work in high school.







5. Do without all the amenities.







6. Plan in advance to assure timely graduation.







7. Help families be better consumers.







Individual Responses:

Dave Broden (7.5) (10) (10) (2.5) (5) (0) (7.5)

1. Topic is of value. Good but not the depth of thinking we expected.

2. Further study warranted. This is a national crisis and no one is listening or working the issue. [There is o]nly more and more growth of loans and no resolution.

3. College debt crisis affects competitiveness. This will be a burden on families and the overall economy for decades.

4. Do college-level work in high school. This is a great idea, but in reality I do not see this as having an impact.

5. Do without all the amenities. This is simply budget management just as we all do. Some can afford and some cannot. Do not make decisions for others.

6. Plan in advance to assure timely graduation. Planning is another crutch. Things change as time rolls along; [we] need to adjust accordingly.

7. Help families be better consumers. More common sense. Lets get to the real problem and that is how do we develop and manage the college costs; control costs at the college and not just let schools increase cost since students will find a way to pay.

Kevin Edberg (10) (10) (10) (10) (10) (10) (10)

1. Topic is of value. Exceptionally good interview and discussion of policy options. This topic is directly related to the larger overall theme of investment in human capital.

2. Further study warranted. Especially exploring actionable options.

5. Do without all the amenities. Gilbert's "live like a student today..." is so right on. Our precious pampered children would benefit from some tough love here.

Don Anderson (5) (5) (7.5) (7.5) (7.5) (5) (10)

5. Do without all the amenities. But society today requires a different style of living than we of the generation that lived in the World War II years grew up on.

Phil Kinnunen (10) (10) (10) (10) (10) (10) (10)

7. Help families be better consumers. Students and their families should first figure out "how are we going to pay for this" before jumping into student loans. This attitude of "it's the right thing to do" has poisoned young people (and some not so young) into leaping before they look. A sense of entitlement has become a true problem in our society.

Vici Oshiro (10) (5) (5) (10) (10) (10) (10)

R. Brown (10) (10) (10) (10) (10) (10) (10)

A major factor in creating this debt problem is that in the 1960s the federal government’s grant and loan programs replaced the family as the primary source of support for college. Because the loans were relatively [low-] interest and they were very easy to get, people frequently took loans without considering the consequences. I remember arguing with my daughter when she said she was going to take out a student loan because everyone else was doing it. I vetoed that matter and, between her work, institutional aid, and my help she graduated with no debt. I now have had two graduate assistants who have managed to get their M.A. degrees with no debt because they worked hard and learned to manage their resources. Parents, schools, and colleges must improve their personal finance understanding and teach the students money management. School counselors should particularly work with the families of low-income students and those who are the first in their family to go to college. And counselors should not try to steer students to high priced colleges because they are more prestigious. While there are always exceptions, most low-income kids could be served more than adequately by starting in a community college where they can get a two-year degree with little or no debt.

Chuck Lutz (9) (8) (8) (10) (8) (9) (9)

Peter Hennessey (na) (na) (na) (na) (na) (na) (na)

Once again we are talking about a pathological situation brought about by pathological application of a pathological philosophy, and the application of pathological "solutions" trying to fix it. Everything but common sense free market solutions

The more money you throw at something, the higher its price goes. If students, parents and grandparents refused to go into debt, or if there were real price competition between colleges, the price of college would drop, just like any other commodity, to the level that customers are willing to pay. That's just basic economics. The more the government made college loans easier to get and to repay, the higher the colleges hiked their tuitions. That, too, is basic economics; you don't leave money on the table that the customer is willing to give you. As it is now, there is no incentive for students to be concerned about cost, because Democrats are promising loan forgiveness and free college for all. That, too, is basic economics: why should you be concerned about a faceless third party payer, even if eventually it will turn out to be you, stuck with ever higher taxes? You can always justify the larceny by appealing to the theory of social justice and its tax policy of "soak the rich."

Education is a cost of living. Education is not an investment; not in any sense applicable to investing in a business or product. There is no "ROI" in any similar sense, and there is no "product" unless you claim to stretch the definition to include "knowledge for the sake of knowledge." A BA in English is if no value if the only job you find is flipping burgers. Even the theory of the social value or societal benefit of education falls apart when the political and economic leadership is hell-bent on flooding the country with millions of uneducated cheap labor.

In any case, education is not a federal government function and there is no reason why it should be a state government or local government function. Cut all subsidies. Let the free market work. Let the customers decide where and how to spend their money.

Wayne Jennings (9) (9) (9) (10) (10) (10) (10)

It is a crisis of consumer ignorance, student/family unrealistic values, and college rapacity. Action is needed on all three fronts. For example, high school sophomores, juniors, and seniors can take college courses without cost to the family. Some universities offer an entire year of courses for under $6,000—community colleges, Western State University and others. Too few students have a solid idea of what fits their interests and abilities. High schools need to work on that.

Roger Wacek (na) (na) (5) (10) (10) (10) (10)

Marianne Curry (na) (na) (na) (na) (na) (na) (na)

Civic Caucus needs to ask about the relationship between the guaranteed federal student loan program and the inflationary cost of higher education.  Institutions were ipso facto guaranteed payment for tuition hikes.  This debt issue is a major factor suppressing the middle class’ ability to spend on housing and consumer products as well as suppressing the U.S. economic recovery.

Tom Spitznagle (8) (6) (9) (9) (8) (7) (6)

What has caused tuition rates to skyrocket?  In the mid-60’s tuition at the U of M - Minneapolis was around $8 per credit hour so, with an average 16-credit load each quarter, tuition was about $128.  Add books of roughly $30 per quarter and it totals $158.  The school year was basically 3 quarters so total tuition and books totaled under $500.  Contrast this with current tuition of over $13,000 per year and it looks like tuition alone has risen by around 2600% in the last 50 years.  Something has gone terribly wrong.  More emphasis needs to be placed on holding institutions accountable for excessively high tuition fees and not on finding new ways for students and parents to acquire enough cash to pay for bloated tuition costs. 

Terry Stone (8) (7) (6) (9) (9) (10) (10)

An alternate solution to the student debt issue is a robust economy with growth in all economic sectors. A number of self-destructive state and national policies are contributing to under-employment and Minnesota’s 70% workforce participation rate.

A full economy places graduates at full employment in the field of their degree. Minnesota needs to stop blocking pipelines, non-ferrous mining and frac-sand quarrying.

A full economy addresses the issue of employers needlessly requiring degrees for employment.  The labor equilibrium of a vital economy will create shortages of applicants and either higher wages or the dropping of superfluous requirements will result. Companies only impose needless requirements because they can.

Minnesota has an unsustainable MnSCU system with 54 campuses. While having a local institution of higher learning is an admirable goal, many of these campuses are conducting precious little academics. Much of the activity on many MnSCU campuses is remedial to mitigate the performance of our K-12 system. Having paid once for basic academics and a high school diploma through property taxes, the citizens are now asked to pay for remedial classes at the local MnSCU facility.

The number of soft degrees being offered by MnSCU is exacerbating our student debt problem. Students with a B.A. degree in women’s studies, a B.S. degree in social justice or a master’s degree in social responsibility are essentially unemployable in the private sector. Loans for such degrees will prove troublesome and painful to repay while working part time at the local Verizon store. Ms. Gilbert has nicely identified the need for more STEM degrees.

A vital economy mitigates a number of mistakes made by students, their parents, schools, strange societal notions and political policy boondoggles. While the student loan phenomenon works itself out, it is important to understand that student loan debt is a personal decision, a personal choice and a personal gamble that education yields large enough rewards to offset the commitment and the debt associated with academic degrees.

Bill Kuisle (10) (10) (9) (7) (10) (10) (10)


The Civic Caucus   is a non-partisan, tax-exempt educational organization.   The Interview Group  includes persons of varying political persuasions,
reflecting years of leadership in politics and business. Click here  to see a short personal background of each.

  John S. Adams, David Broden, Audrey Clay, Janis Clay, Pat Davies, Bill Frenzel, Paul Gilje (coordinator), Randy Johnson, Sallie Kemper, Ted Kolderie, Dan Loritz (chair),
Tim McDonald, Bruce Mooty, John Mooty, Jim Olson, Paul Ostrow, Wayne Popham, Dana Schroeder, Clarence Shallbetter, and Fred Zimmerman

The Civic Caucus, 01-01-2008
2104 Girard Avenue South, Minneapolis, MN 55405.
Dan Loritz, chair, 612-791-1919   ~   Paul A. Gilje, coordinator, 952-890-5220.

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