by David Grasso
Even as college tuition increases slow down, we still see student debt growing, reaching new highs consistently every year. As we cross the $1.4 trillion mark, we stop to ponder how long this debt bonanza can last.
As college graduates enter the real world more indebted than ever before, there are suspicions that this overindulgence in student debt cannot continue forever.
The sobering reality is that eventually, someone, somewhere is going to have to pay back this eye-popping amount of debt. Whether it’s consumers or the government who ponies up the cash to address these obligations, the debt is very real and poses a danger to our entire system of higher education and our economic way of life.
That escalated quickly
Just how fast student debt has risen is shocking. Total student debt is almost three times as large as it was in 2006. Student loan debt eclipsed credit card debt in 2010 and auto debt in 2011. It is now the largest form of consumer debt besides mortgages.
We blew past the trillion-dollar mark in outstanding student loans in 2012 and have already added nearly $400 billion, to that number since.
These numbers are so large that it’s often hard to grasp their enormity. Consider that $400 billion is approximately the yearly GDP of Thailand, and that we’ve accrued that much student debt in only five years.
A little less than half of the total student debt has been used to finance graduate and professional degrees. Although many of…