generation ago, Congress privatized a student loan program intended to give more Americans access to higher education.
In its place, lawmakers created another profit center for Wall Street and a system of college finance that has fed the nation’s cycle of inequality. Step by step, Congress has enacted one law after another to make student debt the worst kind of debt for Americans – and the best kind for banks and debt collectors.
Today, just about everyone involved in the student loan industry makes money off students – the banks, private investors, even the federal government.
Jessie Suren is an energetic 28-year-old who wanted a career in law enforcement. Albert Lord is a 70-year-old former accountant who became a multimillionaire executive. The two have never met, but their stories tell the history of America’s student debt crisis.
Suren attended a free boarding school for underprivileged youth in Hershey, Pennsylvania, and enrolled in La Salle University in Philadelphia. Scholarships didn’t cover the cost of the private college, so she borrowed about $71,000, much of it from Sallie Mae, the financial giant of the student loan industry.
Suren did well in school. But a job with the U.S. Marshals Service fell through, and by graduation in 2010, she had a soaring loan balance and no career prospects.