Thomas Piketty, one of the most important economists of our time, guru of economic inequality, offers some brief and pithy observations on student debt in American higher education. Let’s break it down.
First, the general observation:
[T]he amount of household debt and even more recently of student debt in the U.S. is something that is really troublesome and it reflects the very large rise in tuition in the U.S. a very large inequality in access to education…
Piketty links student debt to mortgages, which is an underappreciated combination. (Yes, I am still paying both at 48 years of age)
Second, student debt has reached crisis proportions. Not just for the students, but also for the economy and nation as a whole:
[I]t’s not possible to have such a large group of the population entering the labor force with such a big debt behind them…
this is a situation that is very troublesome and should rank very highly in the policy agenda in the future in the U.S.
“It’s not possible.” Are we approaching an economic and/or political limit? Continue reading