The current student loan issue is a complex crisis with multiple culprits as well as victims. For one, academic institutions in and of itself cannot deny their responsibility for instigating the crisis. For example, when was the last time, at least in recent years, that anyone heard of a university actually lowering their tuition fees? In reality, year after year the trend has been for universities to increase rates. In fact, according to Larry Abramson of NPR, “tuition and other costs have been going up faster than inflation, and family incomes can’t keep up" (2012). Despite the outrage over this problem, there is also little indication that these costs will drop anytime in the near future. Universities justify raising tuition rates for the purpose of advancing their academic standards, expanding library collections, or making more computer labs. However, students struggle to justify their university spending money frivolously on non-academic projects such as extravagant recreation centers or beautifying student unions while subsequently raising fees on students to pay for the costs incurred.
Furthermore, academic institutions are not being socially responsible as they set up freshman undergraduates for financial failure by enabling credit card companies to peruse borrowers on campus grounds. Credit card companies entice students to enroll in their credit program with the use of free pizza or t-shirts for the exchange of putting their personal credit on the line. Although it is up to the student to read the fine print of the terms and conditions, many students do not understand the repercussions of credit card debt. On a related note, banks are part of the problem as well. As a result of stagnant incomes and high unemployment rates stemming from the recession, families have turned to federal student loans, and even much more expensive private loans to support their child’s education (Abramson, 2012). Nevertheless, “private loans are much riskier than federal student loans, because they don’t come with the important repayment plans, forgiveness programs, and other borrower protections that federal loans provide” (Abramson, 2012). Along with the academic institutions, state and federal government are responsible for the crisis as well. For instance, states are contributing less to education than they used to as state budgets shrink, the students’ share of paying for education goes up (Abramson, 2012). Further, others argue that the grant aid has not risen fast enough as a “federal Pell Grant covers only about one-third of what it costs for a public four-year college in state” (Abramson, 2012).
Finally, many students are accountable for the crisis as they knowingly signed up for something they could not pay for and chose to live off student loans instead of contributing to their own education (Tkacik, 2012). This paper will breakdown all of the legal, ethical, and social issues relating to the crisis, and while...