Ominous Student Loan Debt Report Released By Federal Reserve Bank of New York
March 7, 2012
Don Lee of the Los Angeles Times recently highlighted an alarming March 5, 2012 report released by the Federal Reserve Bank of New York. In his article titled, “College Debt A Looming Time Bomb” Lee notes that the report claims as many as 1 in 4 borrowers carried a past-due student loan balance in the third quarter. Educators worry that student debt levels are increasing college dropout rates. Declining college graduation rates and educational achievements will negatively impact our nation’s competitiveness in the global economy. Higher student debts also pressure graduates into jobs with higher immediate rates of pay as opposed to lower paying public interest or public sector opportunities that may benefit communities more in both the short and long term. According to the New York Fed, the latest outstanding student loan balance ($870 billion) is $175 billion more than total credit card debt and $140 billion more than total car loan debt.