Some truly staggering data here about the total amount of student loan debt outstanding in the U.S.; more specifically, the growth thereof in the last 14 years. Brookings provides the data.
Look carefully at those figures. The "leading" school in debt outstanding grew from $2.2 million to $35.5 million in just over a decade. I wonder if starting salaries have grown by a factor of seventeen since 2000? Total student debt in that time period has quadrupled. Mean wages have too, right?
The numbers are alarming enough, but if you really need to lose sleep look at where all the money is going. The top 12 schools are, with the exception of crushingly expensive Ivy League bastion NYU, for-profit or non-profit in name only (Nova SE is an open enrollment joke school that is barely accredited, and we all know Liberty University is, uh, rather a thinly veiled moneymaking scheme for the homeschooled crowd). And that raises the question: Who in the name of god is taking out this much money for such demonstrably worthless degrees? The average online degree holding graduate (the 2% of enrollees who actually graduate) is earning $21,000. $21,000! You could make that at Burger King without a high school diploma. We know that for-profits unfairly target susceptible, vulnerable populations like the poor, unemployed adults, and discharged veterans. But we're talking about loans here – money that inevitably has to be paid back. People are taking on debt to get something that is worth less than nothing.
Can that many people really be that gullible? I realize large numbers of Americans are extremely gullible, but we're also notoriously tight-fisted when it comes to education. Unless you're a government employee who is guaranteed a move up the pay scale by acquiring a Master's Degree – any MA, from any school – I do not understand how anyone can talk themselves into going deep into debt for a degree that advertises during Maury Povich. I'm guessing that there are very few "traditional" college students in this boom. There is not, contrary to what brick-and-mortar colleges fear, a ton of kids fresh out of high school enrolling in these diploma mills. It has to be composed primarily of adults with stagnant wages rolling the dice, even in the face of overwhelming statistical evidence to the contrary, on coming out on the other end with greater earning potential.
At some point the dynamic in this market shifts from predatory lending – and there has been plenty of that – to something a sentient consumer recognizes as a scam. Expecting something from a for-profit degree is close to being on par with expecting a fair game of three card monte in a back alley at this point.