Making good choices, innovation and the middle class were in my thoughts when I read about the government's debate on student loan interest rates.
The interest rate is set to double, to 6.8 percent, on July 1 unless the federal government can hash out a different plan.
For the sake of transparency, readers should know that our son recently graduated from a state university and is now attending medical school in Washington, D.C. Also, I am a dentist who is very involved in professional education at the local, state and national levels. Lastly, please be aware that at the graduate education level, a reduced rate for school loans no longer exists; additionally, interest accrues from the moment monies are dispersed.
When I see how much money college grads will owe, I remember what we all tell our children as they grow up, "Make good choices." Well, it seems to me that trying to make "good choices" while paying huge chunks of early-in-your-career earnings has become much more challenging. However, reality is that the more people need to make to pay their bills, the less opportunity they have to make good choices and be creative.
Having owned a small business for more than 30 years, I see the economic burden on our students as a detriment to pioneering new concepts and products. As we have seen over the past five years of economic struggles, innovation has paid a very high price. When many dollars are owed and times are tough, folks will concentrate on their core business and covering costs before they ever think of getting outside the box - much less investing in what they hope will be a profitable new concept.
Ultimately, the higher interest rate for education monopolizes potential salary and discretionary dollars that would contribute to our economy.
At one time in the not-too-distant past, a college education was the road to the middle class for aspiring folks in our country. With the large amounts owed and looming higher interest rates, the road to the middle class just got more bumps.
We must deal with the costs of college and graduate school in this country. I have written how dentistry, K-12 education and medicine have all been mandated to do more with less. As professionals, we have all had to find ways to not only control costs, but to lower them while providing the same standard of care.
The cost of college and graduate education has become prohibitive. While we as a society address the issue of increasing interest rates on student loans, we must use the interaction as a jumping off point to start a discussion of whether the actual cost of college and post-grad education should follow what has been asked of K-12 education, medicine and dentistry.
It is vital to remember that this generation of students will be the workers who will fund Social Security for the now-retiring baby boomer generation. As I tell nearly every young adult I meet, "I hope you get a good education, have a great job or profession and make lots of money. That way you will pay more into the government and help fund my retirement!"
Enjoy the journey,
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