Climbing the student debt mountain
Business Daily
BBC
4.4 • 816 Ratings
🗓️ 15 May 2019
⏱️ 19 minutes
🧾️ Download transcript
Summary
Could a new scheme alleviate the crippling cost of university fees for young Americans, who have already accumulated a trillion and a half dollars in student debts?
Dr Courtney McBeth tells Ed Butler how under the "income sharing agreement" scheme that she is piloting at the University of Utah, the amount that students repay depends on how much money they manage to earn in their future careers. This new approach frees graduates up to start a family or risk starting their own company, according to Charles Trafton, who runs a student loan marketplace called Edly.
But the financing is provided by investors looking to make a profit, in contrast to similar government-run schemes in the UK and Australia. And according to David Robinson of British think tank the Education Policy Institute, this means that the US scheme may not do much to improve social mobility or meet the needs of the jobs market.
(Picture: Coins stacks stepping up towards a money jar topped by a university mortar board; Credit: marchmeena29/Getty Images)
Transcript
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| 0:00.0 | Hi, this is Kevin Fong, and to celebrate the 50th anniversary of humans landing on the moon, |
| 0:06.9 | I've made a podcast with some of the people involved. |
| 0:10.3 | 13 minutes to the moon from the BBC World Service is available now, |
| 0:14.6 | and I'll be back at the end of this podcast to tell you more about it. |
| 0:18.9 | But now, here it is. |
| 0:25.5 | Music podcast to tell you more about it. But now, here it is. Hello there, I'm Ed Butler. Welcome to Business Daily from the BBC. Coming up, the one and a half |
| 0:31.6 | trillion dollar student debt pile. It is a growing burden on a young generation of Americans. It's hard to think about |
| 0:39.8 | any sort of future. I can't even think about buying a house or going on vacation. I don't even go |
| 0:48.7 | out. But now here's a new scheme, one which supporters say could liberate millions from debt. |
| 0:54.5 | The trillion and a half dollars of student loan debt is holding back millennials from starting |
| 0:59.1 | families, buying homes. I say is free up the human potential of American students in a way |
| 1:05.1 | that debt cannot do. How to fix the debt crisis in America and elsewhere, business daily from |
| 1:10.8 | the BBC. |
| 1:14.4 | It is a deep crisis, some campaigners say. More than 44 million borrowers in the US alone and the 1.5 trillion dollars that they owe places a huge burden on them. It can feel immense. Here's a couple who we've heard |
| 1:29.7 | from here at the BBC, Melissa Haggerty. She's 24 from Chicago, Illinois. And first up, Rosemary |
| 1:36.2 | Ash Anderson, who at 62, has lived with student debt all her life. When I first took out the |
| 1:43.4 | loans, my undergraduate degree and my |
| 1:45.6 | graduate degree combined was around $64,000 for both. And now that amount is over $160,000. |
| 1:53.8 | I am paying close to $1,000 a month towards that debt. It's like a millstone around my neck. I will |
| 1:59.7 | never pay it off. Today I owe about 170,000, |
| 2:03.5 | and it's growing. I knew it was a lot, and my family told me it was a lot, but I know it sounds |
| 2:10.3 | stupid, but I was young, and I just didn't really know. I thought I would be able to pay it back. |
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