I feel I often read something about how this or that situation is unsustainable, or untenable, or that “something’s gotta give.” There’s some phenomenon identified as wrong, and someone looks for it to result in some terrible outcome. As a general rule, I find this kind of thinking unbearably disappointing.
I’m thinking about this just now because I noticed an article on the Jacobin website about the unsustainability of the rise in student debt. And the basic point does seem sound – the sheer quantity of debt cannot go on growing in the way it has over the past 30 years. But what can we take from that? If the growth of student debt is unsustainable, then what? Well, maybe higher education needs to be more adequately subsidized. But I kind of doubt that’s what will happen. Probably there will simply be fewer students, fewer colleges and universites, and so on. And also, a bunch of people will go on carrying very large debts into the indeterminate future. Student debt has become a way for the financial system to capture returns to human capital. Income generated by high quality labor inputs (i.e. people with graduate degrees capable of working very hard at very difficult things) goes to financial institutions in exchange for the development of the very same labor inputs.
Is it unfair? Sure. But people who take on student loans do so of their own accord. Ultimately what will probably happen will be fewer people will be capable of carrying those loans, and fewer people will develop those sorts of high level skills. But here’s the odd bit: it seems to me that that peculiar outcome is maybe nearer to what society, in a broader sense, wants. Its hard to discern, of course. But that’s my intuition.
samuel barbour 