Apple News In Conversation How America’s student-debt problem got so big
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Jan 9, 2025 Ryann Liebenthal, author of 'Burdened: Student Debt and the Making of an American Crisis', discusses the staggering $1.7 trillion student debt crisis affecting millions of Americans. She reveals how the student loan system evolved from supportive initiatives to a heavy financial burden, especially for lower-income students. Liebenthal critiques current debt cancellation measures and advocates for a complete overhaul of the education financing system, emphasizing the need to view education as a public good rather than a personal investment.
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Ryann's Debt
- Ryann Liebenthal graduated from Reed College with $21,000 of debt and later from NYU with over $100,000.
- Her first job paid $31,000, leaving her feeling overwhelmed and hopeless about her debt.
Origins of Federal Student Loans
- The first federal student loan program, the National Defense Education Act, was a response to the Soviet Union's launch of Sputnik.
- It aimed to boost American science and engineering education amid Cold War fears of falling behind.
Guaranteed Loan Program Expansion
- The Higher Education Act of 1965 created the Guaranteed Loan program, where banks lent money with government backing.
- Intended for middle-income students, it quickly became heavily used by lower-income students, leading to unsustainable debt levels.