Yesterday, we started a great conversation about an open spreadsheet that is currently documenting the level of debt that some grad students accumulate. More about it at Slate and the CHE.
Actually, the articles don’t do justice to spreadsheet. So far, there are 1200 entries. And half of them are horrific. $200K in non-dischargable debt to get a PhD in Art History. Even if that individual gets a tenure track job, he’ll never, ever repay it. That’s debt that can never go away. He’ll never own a home. Never travel. Never retire. He won’t have enough money to send his kids to college.
Isn’t this predatory lending?
We’ve all made mistakes in our 20’s, but massive student loans for a humanities PhD is a mistake where there’s no recovery.
Apt. 11d 
[Back story: I took 2 small loans during grad school, the summer my daughter was born and the next one (we had insurance through my husband’s job, but owed a ridiculous amount of money as our share of her birth), and the loan was a better option than him taking a second job. They’ll be paid off before she’s in HS.]
I was SHOCKED when I called Financial Aid at my uni to start the loan process. They asked me how much I needed and told me I was eligible for 50,000! I choked and blurted out, “I’m getting a PhD in English! What makes you think I could ever pay that back?” Even knowing my program, the counselor reiterated that I was eligible for 50K EVERY YEAR of a 5-6 year program.
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I took out about $60K in loans in a science/social science PhD program that took me 6 years. About $10K a year (in reality, much less in the first few years, then more in later years), explicitly to help me have more of a life than my $10-12K stipend gave me (I was living in a very inexpensive city, and was single, but I earned only one paycheck too many for food stamps). (I remember my whole food/entertainment budget was $120 a month.) I totally banked on being able to pay them off comfortably once I had a job, and I was lucky that it was true. I still have 10 years left of repayment, but my payments are less than $200 a month because my consolidation interest rate was only 2.25 percent. At that rate it has never been worth it to pay them off early, even when I had an extremely high paying TT job (for the field), since even my low interest rate mortgage and car loans have higher rates than that.
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The best option for the $200K PhD is to shack up with a debt free partner in a state without commonlaw marriage. Stay home, raise the kids, be on the partner’s health plan. Be the valued volunteer in the PTA, and help out at the local library. The phone will ring a lot, but, well, so it goes.
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I don’t think that’s necessary. As I understand it, Mr. Smith is responsible for Mr. Smith’s debt, while Mrs. Smith is responsible for Mrs. Smith’s debt, and they are only jointly responsible for joint debt. This gets tricky with regard to home ownership (creditors will have an eye on the debtor spouse’s half of the house), but marriage itself is not a problem. If Mrs. Smith has $200k in student loans that she isn’t paying on because she’s a SAHM, there is nothing that creditors can do to Mr. Smith.
(Please do not act on this without consulting a lawyer.)
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I still don’t understand how people are allowed to take out loans in those amounts. I have a limit on my credit card. Nobody would lend me money to buy a million dollar home. Why don’t student loans have caps?
I had only 20K in loans that included a small amount for undergrad, the one semester at Univ of Chicago where I didn’t get funding, and a small amount here and there in the other grad school. My tuition was paid for at the grad school. Other expenses were significant; I lived in a high cost city. I had a policy job for the entire time that I was in grad school. It meant that I worked at least 20 hours per week (including summers) for the entire time that I was in grad school, but it kept my loans down. Steve, the history PhD, didn’t have the work options that I had, so he took out loans, lived in Harlem in rather deplorable conditions, and had credit card debt. When we got married, we dealt with the credit card issues right away. He had 50K in student loans. We’re nearly paid off, but not there yet.
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I have a limit on my credit card.
A few years ago, I had a credit card with a $50,000 limit. I’d never asked to have the limits increased or anything. I just kept the same card for years and they kept increasing it. After the recession hit, they cut the limit, which was fine. But they did it by means of a letter making it sound like somehow I was no longer worthy of the great trust they had previously shown me. That pissed me off because I was solvent at the time and they weren’t.
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“Why don’t student loans have caps? ”
Because they are non-dischargeable in bankruptcy and, horror stories notwithstanding, most are probably still being repaid, even the ones with high balances.
Caps are to protect the lender, not the borrower. Your credit card debt, which is dischargeable in bankruptcy, is capped so that the card issuer can limit its exposure.
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That ignores recent history. Just before the recession, the standards for what was dischargeable in bankruptcy were significantly tightened and it doesn’t seem to have done anything to protect the lenders. It seems to have done nothing but given them enough rope to hang themselves. The default rate on student loans has been edging up and, for federal loans, is now near 15%.
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“Isn’t this predatory lending”
I don’t know. Are lenders permitted to refuse to lend to students due to 1) their current debt level, 2) their field of study, or 3) their GPA?
I haven’t been able to find any mention of due diligence in connection with student loans. I am under the impression the loans were made non-dischargeable due to the high default rate on student loans.
So, is it predatory lending if you aren’t allowed to make distinctions between the guy studying Bioinformatics at Johns Hopkins, and the guy studying Folklore at an institution on the brink of losing its accreditation?
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My understanding is that this is why PResident Obama is so keen to get some kind of a rating system in place where things like the employment rates of graduates might actually come into play when considering who can get a loan and which school they can use that loan at. There is a nursing program in our area on the verge of losing its accreditation because less than forty percent of the students typically pass the licensing exam — it doesn’t make a lot of sense to use tax dollars so people can borrow money to go to a nursing school where they have less than a fifty percent chance of actually becoming a nurse.
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On the other hand $200,000 is only 20 sets of pictures for Jezebel.
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What a disgusting story. I should blog about that next.
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It doesn’t look like half of Kelsky’s data shows $200K or more even with the selection effects going on here. That statement certainly doesn’t jibe with the data reported here http://www.cgsnet.org/data-sources-graduate-student-loans-and-debt-0.
Can we, just once, talk about a serious issue without the hyperbole? It is still serious even if the percentage with more than $90K in debt is a little over 6% rather than 50%.
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The site you link to reports the data per student.
Some of the people filling in Kelsky’s data are reporting _family_ student debt load. Two grad students with $40,000 in debt represent a family with $80,000 in debt.
How many academics marry other academics? The combined debt load does not show up in figures tracking per-student debt load, but both spouses are liable for the debt, aren’t they?
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If 6.3% have loans greater than $90K, then marriage still isn’t going to make the percentage with household debt around $200k greater than 50%. Doesn’t a statement like ‘half are horror stories” peg your bs meter? It just isn’t reasonable once you think through the implications.
As I said above, student debt is a serious problem. Why does it have to be exaggerated? That just makes you (generic you) lose credibility. if I know you’re lying about what the data says (or using data that is collected in a way that appears to be deliberately biased upwards), why should I believe you about anything else?
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The page you linked listed the debt of PhD recipients in one year. So, that would be people who completed the degree, and the sums taken out, right? But it would not include debt accrued through paying only the minimum on the loan (over years), nor the debt of people who did not complete a degree.
A relatively small debt can balloon, if missed interest payments are added to capital. Someone who graduates with a PhD, but ends up driving a cab or working as an adjunct, may well watch his debt increase after graduation.
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Sadly, Kelksy’s data looks pretty useless for examining the dollar values because of sample issues. It is too bad because the narratives of why the individuals took loans are interesting (and can be useful alone).
Happily, there are credible sources of student loan data. I wonder why she doesn’t use those – oh right – not as dramatic, much less buzz.
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“I am under the impression the loans were made non-dischargeable due to the high default rate on student loans.”
I do not know what the default rate was, but I had the impression that such loans were made non-dischargeable because of a perception that doctors and lawyers were filing for bankruptcy right after they got out of school.
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I wrote, ‘And half of them are horrific. $200K in non-dischargable debt to get a PhD in Art History.” I put a period between horrific and the example of the art history phd. I think 70K is horrific. And the personal stories in the grid were extremely sad.
No, Kelsey’s graph isn’t scientific. It has sampling problems. But each one of those stories is important and deserves to be heard. It opens up all sorts of interesting discussions about the student loan process and the factors that bring on the bigger debts.
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When I was on the job market 7 years ago, my three lowest offers were from directional state type places – one in the deep south, one in the upper midwest and one in the lower midwest. All were low cost of living places and all three offers were more than $70K. Less than 1 year’s salary does not seem horrific to me.
And yes, I noted that the story portion of her data is useful.
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Perusing through the spreadsheet, I saw the comments fell into 4 broad categories:
1. I didn’t get any support for my studies at all, or I only had partial support. What are you going to do?
2. I couldn’t “live like an adult” on my stipend (actual quote). Do you expect me to actually live in a group house on ramen noodles?
3. How am I supposed to support a family on $14000 a year? Really now.
4. Something horrific came up and I needed money quick for some crisis. (Medical or unexpected unemployment or somesuch.)
Of the four, I really only really feel sympathetic to the last. I feel a bit for (3), because I think it is sad that for a long time academia was largely a playground for the financially independent and it risks becoming so again. Still, your twenties and thirties are where you have to make decisions that limit your ceiling. Having and supporting a family is something that, unfortunately, constrains your life in other ways and not necessarily being able to follow your career bliss is one of them. There were people in my program, of both genders, who had a partner and kids. They either had amazing financial management skills (In the midwest it *is* possible in many cases to support a kid on two graduate stipends if you are exceptionally frugal and lucky.) or had a partner who wasn’t an academic and was willing to make that sacrifice for their partner to follow their dream. Sometimes, something has to give for one person in the relationship.
The first two, no sympathy. None. At. All. When I was looking to go to grad school I was given the same two pieces of advice several times over. Namely, “Don’t ever join a program that doesn’t commit to full support for the duration of the degree. Never, ever, ever, EVER. If they aren’t committed to supporting you they aren’t committed to graduating you.” And, “Expect to live in student poverty as a graduate student. Embrace it. It’s part of the lifestyle. And whatever you do, don’t take time off to work a real job first, because earning a what seems like a pile of money in your early twenties when you have no real responsibilities is like indulging in a crack habit. You won’t easily be able to give that up.” If that advice was so accessible for me, I have to conclude that it is for everyone. And, if it wasn’t, they should have figured it out anyway. I mean, we’re talking about people who are in the top 5-10% of educational achievement. If you are an aspiring intellectual who wants to have a livelihood as a professional smart person you should be able to figure it out on your own.
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Here’s an example of #2.
http://thehairpin.com/2013/11/how-my-obsession-with-furnishing-a-future-put-me-nearly-40000-in-debt
She really messed up good, but she has a nice smooth writing style.
Some quotes:
“In April of 2009, I was 22, debt-free, and a month away from graduating from an expensive, private liberal arts school whose primary focus, beyond education, was the careful comfort of its 2,000 students…My parents—a pharmaceutical chemist and French teacher who’d fallen in love on that same campus—had paid my tuition in-full, an average of $48,000 a year, insisting there was no need to apply for student loans or even federal aid. It was a gift, they told me simply—something they could easily afford, and would.”
“I’d been offered admission into the prestigious University of Iowa’s Nonfiction Writing Program, and offered a full-ride to do so. I would teach my own undergraduate class, the director told me, and design my own assignments. The fellowship not only made my move across the country and my subsequent enrollment possible, but also provided a monthly stipend that could, if I lived frugally, offset the cost of bills and rent, a tank of gas and a few trunk loads of groceries. I believed my future bright and it seemed nothing—most especially finances—could keep me from my dream.
“Flash-forward four years: I am now nearly $40,000 in debt.”
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I knew someone like this in grad school. She moved in with her boyfriend who was also a grad student and she got all obsessive about the Ikea catalog. She bought art for the walls and used the words dinette set. She never finished. I have to admit that it baffled me at the time. It never occurred to me that she was unhappy or that she felt trapped or desired something else. I remember being weirdly jealous of her, building her little nest while I ate ramen and read Russian novels.
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“She bought art for the walls and used the words dinette set. She never finished.”
It could also be a form of procrastination or writer’s block.
I have a relative who came this close to not finishing a dissertation (and keeping her job depended on it) because she bought a house and did stuff like finishing the basement. It was such a relief when she finally finished her thesis. She also had a tendency to head off for long road trips. Thank goodness she’s done now.
That said, two graduate stipends do provide for more creature comforts than one does, so your classmate probably did have just a little bit more discretionary cash than you did.
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I have classmates with immaculately decorated condos. Usually they were bought and decorated by the parents. Sometimes it is hard (and this can be at any level of education) to remember that people who are your peers in some ways are not in others. Friends who take expensive vacations every break. Friends who fly first class. Friends with their own condos. Friends who eat at nice restaurants on a regular basis. I’ve definitely been swept into spending more on a night out because I’ve gone with someone who thinks nothing of ordering 2 cocktails and an appetizer.
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“That said, two graduate stipends do provide for more creature comforts than one does, so your classmate probably did have just a little bit more discretionary cash than you did.”
Yes, 2 people on $40,000 can live a different life than one person on $20,000, especially if they share a bedroom.
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“Sometimes it is hard (and this can be at any level of education) to remember that people who are your peers in some ways are not in others.”
Though when one is the crown prince of Spain, it’s a bit easier to remember.
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It gets awkward when somebody is from enough money or royalty. You don’t know whether to sympathize or congratulate when their parents are ill.
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B.I. said:
“I have classmates with immaculately decorated condos. Usually they were bought and decorated by the parents. Sometimes it is hard (and this can be at any level of education) to remember that people who are your peers in some ways are not in others. Friends who take expensive vacations every break. Friends who fly first class. Friends with their own condos. Friends who eat at nice restaurants on a regular basis. I’ve definitely been swept into spending more on a night out because I’ve gone with someone who thinks nothing of ordering 2 cocktails and an appetizer.”
I was at a birthday party this afternoon and I was having a similar sort of lightbulb moment. The wife is a professor, the husband runs a mediumish business (more a fun one than a super lucrative business, I’m pretty sure) and they’ve got four kids in private school (so, $2k+ a month every month just in tuition) and I’d always thought of them as being roughly our financial peers. They put huge amounts of sweat equity into improving a home in an iffy location that was a total disaster when they bought it and they look and sound more or less like us. However, now that I’ve had chance to think about it and I’m thinking that the combination of well-remodeled home, four private school tuitions, a dozen or two Bulova brass figurines in a case, massive antiques, and the dad mentioning a year or so ago that his family has a fairly large ranch (wealthy Texans LOVE their ranches), I’m finally starting to realize that there’s probably a lot of family money there. Either that, or they are in awful financial peril. But I’m betting on family money.
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On the one hand, what Jay and others say, that you shouldn’t go to grad school unless you have full support (tuition plus a stipend) is true, and everyone should know it. Even my friends from wealthy families back when I was in my 20s would never have come out of pocket for grad school, because they knew that if you don’t have the credentials to get your tuition paid, you won’t be getting a TT position when you graduate. At most, some of them used allowances from home to live in slightly nicer apartments or take an occasional vacation. So yes, “everyone” knows this.
On the other hand, don’t the schools have some responsibility? Loading 20-somethings who trust you with unrepayable debt is a fairly contemptible activity. “Everyone” is supposed to know not to buy penny stocks from boiler room operators who cold call you, but neither society nor the law condones the sellers who commit such frauds.
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y81 said:
“Loading 20-somethings who trust you with unrepayable debt is a fairly contemptible activity.”
I think there are probably quite a few MA programs that are ethically pretty dubious in this respect.
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Especially true when they are borrowing that money to pay you — then you’re kind of like that used car salesman pushing the loan to buy the car. And, yes, that car might be important for someone’s life, like a degree can.
and, a particular burden to disclose completely because of the non-dischargeabiity of the debt.
I still believe though, that some of the folks who make the worst decisions are doing so because it is a an acceptable short term solution to a current problem (no job, no money, but the ability to take a loan for living expenses.).
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“I still believe though, that some of the folks who make the worst decisions are doing so because it is a an acceptable short term solution to a current problem (no job, no money, but the ability to take a loan for living expenses.).”
Exactly.
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Y81, you don’t understand. These are people with clean hands, and liberal, and they read the New York Times. They can’t possibly be ‘contemptible’. By definition, they are virtuous. And, if bad things happen to some 20-year-olds, it must be the machinations of the Koch brothers which cause the bad things.
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I suppose if all you’ve got is an axe, you may as well keep it sharp all the time.
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You never know when it will come in handy.
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Be prepared!
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I am surprised at the lack of sympathy and empathy in this thread for the people who have immense loans. ‘Everybody” knows. No, not really. Not “everybody’ knows that some colleges and grad schools are bottom-dwelling thieves. And nobody deserves to be used by these thieves. Certainly not some naive 20-year olds.
Programs that don’t fund their students should be shut down. But they keep on trucking. Why? Well, I think we all know the answer to that.
How do some PhD students get into so much debt? Well, that’s why self-reporting data like this is very useful. It tells a story that you don’t get from quantitative research.
I know a lot of people with serious grad school debt. And, honestly, nobody told them that they were being idiots going to these schools. Not the ancient undergrad advisors who have no clue about the new realities of the job market. Not their families, who aren’t in the UMC club. Once they are in the schools, they get in the academic bubble and lose real world perspective. Certainly, faculty in these schools never tell the students, “why are you in my class? you know that not a single student in this room should be here? not only do have almost no chance of getting a job, but you are also destroying your future by taking out too many loans.”
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But a lot of people *do* get the message. And how do we distinguish between my story (maybe solid middle class? money was tight but my parents did manage to pay for Catholic school for 4 kids by giving up vacations, new cars, and retirement savings) with professors from a small Catholic college (phenomenal education but not a prestigious SLAC) who *did* tell me not to pay for grad school (in 1995) and that of any one of the people on Kelsky’s spreadsheet who chose to go to an unfunded program?
And by the time internet searching became as ubiquitous as it is (so early 2000s), really, how can anyone say they didn’t know?
As for why programs that don’t fund their students are still in business — it’s because people are paying to attend them.
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I was pretty much totally unprepared for the practical aspects of graduate school when I went in the late 90s, but it never even crossed my mind that somebody like me would borrow for a humanities graduate program (unless it was in order to get a pay bump as a teacher or something like that). The key reason I went was that I got a $10k a year guarantee of funding and I knew I could live on that. (I also wanted to know more about the subject and hoped to become a professor, but I wouldn’t have gone without the funding.)
To expand on something that bj and I have said a number of times, one can’t underestimate the extent to which a lot of people are going to school because they will be able to survive on student loans and/or because going to school will give them temporary refuge from previous student loans. While student loans can be as incurable as herpes, the interest is relatively low (compared to credit cards) and you get a temporary amnesty from paying as long as you’re in school. It’s not a long term solution, but as the story goes, either the donkey may die, or the king may die, or I may die before there’s a reckoning.
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I got the message and I was working class. My parents’ reaction to me going to grad school was fear that I would end up driving a taxi. So who are these people who didn’t know?
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Not having a family in the UMC club is a big disadvantage. The conversations around the dinner table while the kids are growing up that aren’t about careers that require post-secondary education, the network of friends and relatives who didn’t go to university – these are the invisible bits of privilege that have some kids ready to make reasoned choices and other kids ripe for the picking for unscrupulous schools.
I am surprised too at the lack of empathy. Everyone makes their own choices but some are at a disadvantage when making decisions that have huge ramifications.
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I think it’s partly just sheer fatigue at reading the 100th horror story.
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This. I think a lot of people a few years removed from school forget that by the time you graduate from college, lots of students have heard the same refrain ‘more education good’ basically their entire lives from everyone they’ve met their entire lives. Suddenly that’s not true and lots of PhD (or law school, or for profit school) programs are outright bad ideas. They act like no one told them, and in a good number of cases it is probably actually true! Buyer beware was just not on the radar until it was too late.
And as to the lots of people do get the message – hey, lots of people get the message about lots of thing. So? If we are going to ignore problems that most people avoid, we can happily ignore most of the problems in the world.
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I’m not saying we should happily ignore most of the problems in the world. But we do need to figure out which stories are worth our angst when we’re debating public policy. Go read Kelsky’s doc (admittedly difficult at the moment due to some formatting issues): look at WHY people are racking up 6 figures of debt. It’s frequently because of obligations to other family members (in which case we should be talking about things like universal health care, daycare, and care-giving assistance) or it’s answers like this:
“To pay for living expenses. And, honestly, maintain some degree of having a life. I’m lucky in that I do receive an assistantship in the amount of $20,000 per year. Unfortunately, I live in one of the most expensive cities in America. It would be impossible to live off of $20,000.”
No, I’m not hugely sympathetic to the person who takes out 80K to “maintain some degree of having a life.”
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I’m generally on board with the idea that programs that don’t fund their students should close, except, that’s not true for every field. We expect people to pay, and always have, for law, medical, pharmacy, mba degrees. Medicine and pharmacy do try to regulate numbers (not completely sure why they are successful at it, but I’m guessing the comfort we have with medical procedures being regulated plays a role, but maybe it’s just the strength and cohesiveness of the guild). How about masters degrees in engineering? and education?
Do we really mean PhD programs that don’t fund their students should be closed? Only some STEM fields guarantee funding for 4+ years — many say they fund, but when it comes down to it, they can only fund if there are enough grants to go around. A few programs I know of actually rescinded admissions offers, when they realized that they didn’t have enough funded faculty to be confident that they’d offer 4+ years of funding for all the entering students. But many will be hopeful, that in the next round their faculty will get grants, or that the ta’ships will come through.
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Do we really mean PhD programs that don’t fund their students should be closed? Only some STEM fields guarantee funding for 4+ years — many say they fund, but when it comes down to it, they can only fund if there are enough grants to go around. A few programs I know of actually rescinded admissions offers, when they realized that they didn’t have enough funded faculty to be confident that they’d offer 4+ years of funding for all the entering students.
I *do* think that, actually. If you can’t pay your students then you can’t place your students. And in the STEM fields that are grant driven, no grant/support=no advisor (essentially), so if you are ever in that situation you are a dead duck anyway.
Actually adding this requirement (you need to fully fund your students to have an accredited program) to the doctoral accreditation process would be one single thing that could go a long way towards fixing this problem and a lot of others. (Time to finish, for example.)
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‘Everybody” knows. No, not really. Not “everybody’ knows that some colleges and grad schools are bottom-dwelling thieves.
Maybe not everybody knows. But there is no excuse for not knowing. There are so many ways of figuring this out that the only way not to know is to be willfully ignorant.
I was told the facts of life, myself, in the early 90s when I was finishing college, by *all four* of the faculty that wrote my grad school recommendations. Two of these went to grad school in the 80s and two were “ancient undergrad advisors,” as you put it, who got their degrees in the 50s but were still (apparently?) remarkably cognizant of the state of their profession. And, the students who had gone on to grad school ahead of me who I was still in contact with. And then again by all the other grad students in my program when I matriculated.
Even if I had access to resources that are unavailable to some isolated graduate school aspirants, there is this amazing tool called Google which *was* unavailable to me. Just a single “Should I go to grad school?” query at least provides the starting point to make the correct inquiries.
The only way not to know these things is to not want to know these things. There are none so blind as those who refuse to see. And, like I said, this is a serious problem for someone who supposedly wants to be a professional smart person for a living.
Before we fix this problem (if it is a problem), I want to fix the problem where people come out of *undergrad* with $200K in debt.
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I have some sympathy, because being bitten in the ass by our own bad decisions is the human condition and the stuff of great literature. But I find the “nobody told me” line of reasoning very unpersuasive. It seems more like people are in denial. They think nobody told them, but really they didn’t listen, and didn’t do their part to make good life decisions. I definitely think mid-twenties is old enough to understand the concept of student loans, compound interest, and a budget. It’s more than old enough to join the Army, for Pete’s sake, and that can wreck you a lot worse than student loans. More than old enough for a subprime mortgage, credit cards, any number of financial commitments. Do we really want to live in a world where people aren’t expected to make good decisions until they’re 30?
Smart enough to get a PhD means smart enough to do basic research for major life decisions, even if nobody tells you to. And you want to do research *for a living* but you can’t possibly research student loans on your own initiative? And even if I could understand starting grad school exceptionally young and naive, what excuse is there for not waking up to the problem midway through? It just seems like this line of reasoning cuts an otherwise-competent group of people an awful lot of slack for their own bad decision-making. Major social problem it is not.
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z said:
“Smart enough to get a PhD means smart enough to do basic research for major life decisions, even if nobody tells you to.”
Yep. And it has literally never been easier to do that research.
“And you want to do research *for a living* but you can’t possibly research student loans on your own initiative? And even if I could understand starting grad school exceptionally young and naive, what excuse is there for not waking up to the problem midway through?”
Sunk cost fallacy?
Gambler’s fallacy?
This is going to sound mean, but one of the things I’ve noticed from reading dozens of student loan sob stories is that the big-time debtors never sound super bright. It’s almost like this is a sort of real-life intelligence test. Also, I can’t help but notice that I’ve never seen anybody get in over their head for a physics BS. I’m not saying that it never happens, or that science majors never make financial mistakes, but they pretty much never show up in these news stories (maybe the quantitative science students would be too embarrassed?).
If you borrowed $30k or under and have a barista job, I have a lot more sympathy for you, because $30k and under is a reasonable risk for a BA. But what is the game plan of a person borrowing $100k for a degree that is not an MD? $100k is a pretty nice house in much of the country. If you had borrowed $100k for a house in a decent neighborhood, you’d be so much better off.
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I just remembered that Honey Smith (the creative writing PHD at Get Rich Slowly) and her husband (a lawyer) are jointly members of the $200k club. She had nearly $100k in grad school debt (an MA and topping up her doctoral stipend) while her husband has around $100k in law school debt (but quit a good-paying job to strike out on his own for half the salary). I think their situation is not quite as dire as it was (Honey’s down to $93k in student loans–yay, Honey!), but the Get Rich Slowly gang used to treat her like a pinata for all the delusion and self-justification.
http://www.getrichslowly.org/blog/2014/01/06/honeys-financial-goals-for-2014/
At some point, I think both HS and her husband owed 2X their yearly income in student loans, which is a very bad situation.
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I didn’t mean my comment to be lacking in sympathy, and I don’t think some of the others who more or less agreed with me meant to say that they had no sympathy. One can point out mistakes (like investing with a money manager who doesn’t have an independent custodian) and still feel sorry for Bernie Madoff’s victims.
Admittedly, there’s a slightly different feeling one has about people who suffer even though they made no mistake that would have been visible a priori: for examle, people who took a job in 2005 at Lehman instead of a similar job at JP Morgan. I remember our church used to have weekly prayer call-ins for people in financial services; it was heartbreaking in the fall of 2008 to hear some of the 20-somethings who had just lost their jobs and had no idea what to do. I guess I have more sympathy for them than I do for people who took out $200K in debt while earning a degree in art history.
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Do we really mean PhD programs that don’t fund their students should be closed? Only some STEM fields guarantee funding for 4+ years — many say they fund, but when it comes down to it, they can only fund if there are enough grants to go around. A few programs I know of actually rescinded admissions offers, when they realized that they didn’t have enough funded faculty to be confident that they’d offer 4+ years of funding for all the entering students.
Well, I *did* explicitly say that I had no sympathy for the plight of the unfunded and the poverty refuseniks, so I suppose that is what I meant. 🙂
And I, for the most part, stand by it…
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Oops! pasted the wrong quote:
I didn’t mean my comment to be lacking in sympathy, and I don’t think some of the others who more or less agreed with me meant to say that they had no sympathy.
Well, I *did* explicitly say that I had no sympathy for the plight of the unfunded and the poverty refuseniks, so I suppose that is what I meant. 🙂
And I, for the most part, stand by it…
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Yes I’ve read the document, and there are plenty of people I have great sympathy for quite apart from grad school problems. What I’m trying to get at is that it sure seems like there’s a major blind spot about a group of people who are quite obviously being exploited to pay some tuition and provide some cheap labor.
A PhD student at a non-top program who is borrowing to fund their degree is in a rough situation from day one. They live near the poverty line, likely in part dependent on the social safety net (such as it is) especially if they have a family. They work for years. They pay at least some tuition, they probably do some TA or adjunct work at the university, and at the end of it they get a degree that theoretically qualifies them for a tenure track job – but since they’re borrowing at a non-top program their real prospects are basically nil.
Contrast this with the average Walmart employee. They also are living in near poverty. It is widely documented that a decent proportion of Walmart employees depend on the social safety net (such as it is), especially if they have a family. After doing this for a few years they may have a reference from a manager that they show up on time, sober and work hard – which isn’t nothing, but isn’t that much on the job market.* They do not however pay tuition or borrow money for the privilege of living this life.
And there’s lots of sympathy for people in that situation, and opprobrium for Walmart for creating it, around the comments here. Honestly it’s hard for me to look at it objectively and say the 5 year veteran of Walmart isn’t better off.
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The difference is that while the Walmart employee may borrow and get in over their heads, the kind of consumer debt they get into is readily bankruptable.
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The big difference between the Wal-Mart employee and the grad student is that Wal-Mart executives aren’t one-tenth as sanctimonious as university professors. (Another difference is that the Wal-Mart employee has done something the benefits the broader society (the customers) for five years, while the grad student hasn’t.) So in terms of moral worth, regardless of whether the grad student or the employee is worse off, it’s clear that the university professor is about ten times as worthy as opprobrium.
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If academia didn’t exist, you’d have had to invent it to have something to project your opinions upon.
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I am extremely sympathetic to people with debt. It is a terrible position. I also think there is an easy answer to some of the problems, which is to publicize widely, on billboards if necessary, to not go to grad school if you don’t have most or full funding or enough personal funds to do what could be a vanity PhD.* Also, as I mentioned in a previous comment, we should require schools to publish hiring, post graduation salary, and average debt load stats and require the data to be sent with all applications and admissions letters.
For the fact that grad school can take up to 10 years and occupy a woman’s most fertile years, I agree with Abby that solutions to the problem lie mostly outside grad school funding, since they’re problems which apply to all precarious, low-income workers: National healthcare, affordable day care, stronger social safety net, and union representation to deal with exploitative adjuncting.** For university specific issues, more funding for public schools, and a restructuring of funding priorities (schools are becoming more corporate and pay scales are reflecting that, with a huge inflation in high-level admin salaries) would really help, but only some of those can be dealt with as a academia-specific issue. But, as much as I would love it, I’m not sure that grad schools should pay stipends that allow one to raise a family on a single income. I would LOVE to get 45-50K a year as a stipend, but I can understand why schools don’t pay that for something that only very indirectly benefits them, given that I have minimal teaching requirements. (Adjunct wages are a different issue, of course). There ARE funding packages that pay something like that, and they are insanely competitive. As a grad student, I am active in our grad student union pushing for the best wages, benefits, and funding packages possible, and it is a constant struggle with the administration. I believe that grad school should provide a livable salary and benefits for a frugal individual, but the problem is that due to our lack of first-world-level public services, being low-income in the US sucks far more than it has to or ought to.
*With cuts to public universities this can be hard. Most R1 private schools provide full funding to their incoming students if they want them. Some top public programs can’t or won’t do that. There is outside funding (NSF, Mellon, FLAS, etc), but it can be hard to get. If I had gotten into one of the top schools in my discipline which doesn’t provide adequate funding, I would have had a hard choice to make. Of course, when I met with professors there before I applied, they told me outright not to go if I didn’t already have funding: (actual conversation: Prof: “do you have money?” me: “uh…no” Prof: “don’t come here if you don’t have money.”) Even though it has been my dream since age 8 and it would have been devastating to be admitted but not go because of funding, I wouldn’t have gone to grad school if I had had to take out loans. I would have found something else to do, and some other way to pursue my interests.
**Not that schools can’t do any of this or should not be held accountable–indeed our union is working really hard to make our school more friendly to grad student parents–it’s just that this is trying to fix our social safety net through schools, rather than just fix our social safety net in general.
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A graduate degree from Directional State College which you paid for yourself can be financially worth it if you are already a tenured middle or high school teacher, gets you a serious bump in wages. There is some unrest about this on the part of educational researchers – apparently NO data suggests that teacher-with-MA-plus-24-credits does little Johnny more good as far as, well, learning something than a teacher with a BA. So this gravy train may pull out of the station. Some government offices have similar policies. Again, not too much besides superstition supports the idea that the People’s Work is better done by bureaucrats with higher degrees (obviously, if you are looking at the folks who consider whether to license pesticides, you want them to know biochemistry and ecology pretty well, I am thinking more about the guys at GSA who write contracts to buy the government paper clips).
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A lot of the teachers get their MA’s paid for by the school district, something which unions presumably negotiate. Part of the problem there seems to be that if the degree is required and you’re not paying for it yourself, there is little incentive to seek out the most demanding program which will actually make you a better teacher. Rather it is perceived as a hoop to be jumped through, ideally with as little disruption to the rest of your life as possible. (The universities know this, and know that if they make their ed master’s too demanding, people won’t pick that one. they’ll pick the easier one.)
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I just remembered one more reason why it would never have occurred to me to take out large loans for graduate school. My parents both did MAs in the early 70s (in math and art), and my early childhood at least was economically pretty marginal. It would never have occurred to me that getting a graduate degree was some sort of golden ticket, because it certainly hadn’t been for my parents. Going to graduate school was just something that you did if you could go, but not something that you had huge expectations of.
When I was a graduate student in the later 90s, there was one student slightly older than me who had his funding cut off for whatever reason and then (I remember hearing through the grapevine) was going to take out loans in the hope of finishing. He was smart, but an odd duck. Nobody else was taking out loans that I knew of.
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