Ryan Streeter
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Last week I pointed out in an article at National Review that part of America’s crisis of aspiration was the result of young men disengaging from the workforce.
Today, via Tyler Cowen, this chart sheds some additional light on the problem.
Cowen writes:
Non-college grads also have seen declining wages, and so one can look at the “finish college vs. finish high school only” margin and conclude that the return to higher education is robust. Another approach is to look at the “finish college and get on a real career track” vs. “finish college and hang out” margin and conclude the sector is in trouble, which indeed is the case.
Once again, we as a country are waking up to a huge problem way late. Obama laid out a student debt forgiveness plan yesterday, and it immediately ignited a debate in the blogosphere.
The student debt problem is tricky because using the federal government to help students out of their debt places a burden on many taxpayers who didn’t go to college and don’t benefit from such an education. Even though the returns to a college education are falling, it’s still better to have that B.A. or B.S.
On the other hand, just as we promoted homeownership as a society as a sure-fire way to build wealth, we have been shoveling young people into colleges with abandon, expecting the returns to education (even for 22 year olds who can barely write a memo or manage rudimentary tasks that any employer would expect) that have justified the ridiculous inflation of college costs.
Obama’s response will likely prolong the problem, while these underlying problems won’t be dealt with. Peter Schiff makes that case here.
We need growth more than ever to provide the jobs that college graduates need. But we also need motivated college graduates, who are willing to do whatever is necessary to pay off debt. It seems to me that any feasible loan-repayment solution would reward students who work longer hours and more days per week to do whatever they can to repay the loan.
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