The New Politics Of Student Debt

These days, Robert Applebaum is feeling vindicated.

In January 2009, Applebaum, then a 35-year-old lawyer with more than $80,000 in student debt, created a petition calling for student loan forgiveness to stimulate the economy. It was greeted with a few weeks of buzz and plenty of scorn. Then, for more than two years, silence.

Then student loan balances passed $1 trillion, interest rates spent a week as the focus of the nascent 2012 presidential campaign, and suddenly everyone wanted to talk about student debt. Applebaum's solution may be as unrealistic as ever. But even President Obama has now signed onto the underlying thesis: that student debt isn't just a burden for debtors but a drag on the economy. In the de facto first week of the general election campaign, Obama and presumptive Republican nominee Mitt Romney sparred not over health care reform or foreign affairs, but the interest rate on federally subsidized student loans.

Half a century after the first federal student loan program was established, student debt has come into its own as a political issue.

Over the past three years, the Obama administration has gone further than any of its predecessors in putting higher education at the center of its policy agenda. Now the Obama campaign appears poised to elevate college issues — beginning with student debt — to a status rarely, if ever, seen in American politics.

To political observers, the convulsion of national concern about student debt, and by extension the cost of college, has a precedent: health care.

“It’s a sector of the economy that seems to be growing inexorably in cost and much faster than the rest of the economy, and much faster than family income,” says William Galston, a former policy adviser to President Bill Clinton and a senior fellow at the Brookings Institution. “In the same way that we’ve had a huge public policy debate about health care, it doesn’t take a prophet to see that some of the same forces are generating a pretty significant political debate about college.”

Colleges might cheer an increased federal focus on access and affordability — the last political campaign to incorporate college issues, in 2006, led to an expansion of Pell Grants and lower interest rates on student loans. But for higher education, there is a potential downside. The more politicians worry about student debt, the more likely it is that their attention will turn from federal financial aid programs to what many see as the root of the problem: the rising tuition charged by colleges themselves.

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