RUSA holds student loan teach-in event
The Rutgers University Student Assembly held a student debt teach-in last night at the Red Lion Café on the College Avenue campus with the aim to educate students about the amount of debt associated with higher education costs.
Spencer Klein, RUSA chair of Legislative Affairs, said the gathering comes at a critical moment, with student debt becoming an increasingly prevalent problem among those who attend colleges across the nation.
“We’ve got student debt reaching $1 trillion next month,” said Klein, a School of Arts and Sciences junior. “We need to keep students from taking out subsidized private loans and encourage the subsidization of public loans and grants.”
John Connelly, vice president of RUSA, said the University’s sources of revenue are linked with the growing tuition prices and debts students accumulate.
“Rutgers’ total endowment is $603 million, ranked 105th in the nation,” he said. “Tuition is the biggest piece of the pie, and Rutgers administration has realized that. If they need the money, they can always milk it from us.”
Connelly, a School of Arts and Sciences junior, said New Jersey is especially mismanaged in terms of financing education. He said that the state hasn’t attempted to solve the problem.
This lack of funding from the state, Connelly said, has resulted in a strategy of cutting programs students rely on in order to compensate for the mismanaged funds.
He said the average student loan debt is $20,000 per student.
“When financial aid is insufficient for a student, what do we do? We bet against our own future. We turn to the private sector for loans,” Connelly said.
Pavel Sokolov, RUSA chair of Internal Affairs, said turning to loans could seem like an appealing choice for students, but it is potentially dangerous.
“Private loans are much more risky and more expensive to finance than federal loans,” said Sokolov, a Rutgers Business School sophomore. “The banks have a lot of money … they can make rates that are much more stringent, and they can hardball you into doing what they want you to do.”
He said students often fall into a trap when they miss a monthly payment and end up in default, which could lead to the banks tripling their interest rates.
“Private loans should be your last option,” Sokolov said. “The only way out is that you have to die. Legislation just changed so your debt doesn’t pass on to your descendants — so that’s actually an improvement.”
Ben Weitz, a School of Arts and Sciences first-year student, said students should think before choosing a loan, as the decision can be hard to overturn once it is made.
“If you declare bankruptcy, you still have to pay off your student debt,” he said. “This makes it a really big commitment to take out a loan.”
Weitz said 20 percent of government student loans default, a trend that the banks are happy about. This massive amount of student debt, he said, is liable to cause a tuition bubble similar to the 2008 housing bubble that led to the economic recession.
Bilal Ahmed, a School of Arts and Sciences senior, said his personal relationship with loans is similar to that of many students also in the position of having a seemingly insurmountable debt.
“I’m in tens of thousands of dollars of debt I never even wanted because they kept slashing all of my options,” he said. “I don’t know what to do, and I don’t think there will be any time soon when I do know what to do.”
Joe Cashin, RUSA corresponding secretary, said students should take responsibility in their own hands and bring the issue to legislative officials in an effort to make changes in the system.
“It’s up to us to go to Trenton, to go to [Washington] D.C., to do the little things like write or call our representatives ... tell them that education is a right and that that is not what is going on in this country right now,” Cashin said.