Beware The 'Student Debt Bomb', says New Report
March 12, 2012 The amount of student borrowing crossed the $100 billion threshold for the first time in 2010 and total outstanding loans exceeded $1 trillion for the first time in 2011, according to a new report.
The report titled, The Student Loan "Debt Bomb": America's Next Mortgage-Style Economic Crisis? (pdf), was published the National Association of Consumer Bankruptcy Attorneys (NACBA), and paints a frightening economic picture of the world created by skyrocketing tuitions and high interest rates in a job market that continues to offer few jobs to graduates.
"How big is the danger to the US economy?" the report asks. Most worrisome to those on the ground during the 'mortgage crisis' that sent the world economy into a tailspin in 2008, is that the atmosphere and metrics around the student debt crisis feels much the same.
"As with the mortgage foreclosure crisis, the staggering amounts owed on student loans also will have repercussions for the broader economy," reads the report. "Just as the housing bubble created a mortgage debt “overhang” that absorbs the income of consumers and renders them unable to afford to engage in the consumer spending that sustains a growing economy, so too are student loans beginning to have the same effect, which will be a drag on the economy for the foreseeable future." And continues:
Read More:
http://www.commondreams.org/headline/2012/03/09?print
Watch Trailer to documentary: Default: The Student Loan Documentary http://vimeo.com/2618035
