The Anti-Dowry
CARLSON, ALLAN
The Anti-Dowry A complaint about our student loan system. BY ALLAN CARLSON IF A GOVERNMENT set OUt slowly to strangle the family life of its people, what would be the best tactic? One diabolical...
...But it's a game that should not continue...
...But alas, federal education loans now account indirectly for up to a quarter of college and university revenues...
...What then should be done...
...The figures today are presumably higher...
...During the last decade, the costs of college or university education rose about 6 percent a year...
...It is highly unlikely that all indebted graduates would have the four children needed to eliminate their entire debt...
...The state has a compelling public interest in the marriage of young adults...
...Another option would be to convert future loans into "super Pell grants": college vouchers for most, if not quite all, citizens...
...But the cost of the Pell program is already soaring: $9.1 billion in 2001, up two-thirds since 1995...
...In short, repeal or reform is politically unlikely...
...At the same time, this plan would be far more cost effective than the "super Pell grants" noted above...
...Moreover, children growing up in married-couple households are significantly healthier, safer, and happier, more likely to succeed in school and life, and much less likely to be abused or imprisoned or to use alcohol and drugs than children growing up in any other circumstance...
...One option would be to abolish federal student loans altogether, and let the market sort things out...
...The birth of four children over the space of 6 to 8 years could eliminate debt of over $40,000...
...One diabolical approach woUld be to saddle young adults in their early 20s with massive debt...
...Surely, this would delay marriages, as potential spouses shied away from this perverse form of anti-dowry...
...While obviously not the sole or even perhaps the main cause of these changes, the burden of debt has surely played a part...
...Yet the real value of the grants (eventually called Pell Grants) fell over time...
...among state universities, the increase was 85 percent...
...Yet there is a third choice, one that's cheaper, simpler, and more appropriate...
...Specifically, for every new child born to indebted married parents, the federal government should pay off one-fourth of their outstanding student loan debt, up to $5,000 each for mother and father (a figure that would be indexed to overall inflation...
...Won't the Supreme Court declare this measure unconstitutional...
...Intended this time to encourage investment in education (and so improve "human capital"), the student loan program more actively works to postpone marriage and to prevent the birth of children...
...Among 25 to 29-year-olds, the proportion of the never-married has tripled during the era of student loans...
...These bloated institutions, found in every congressional district, can be counted on to fight abolition— or even significant cutbacks—to the death...
...Even more surely, this tactic would push back childbearing for a decade or more, as potential mothers and fathers put off having children until their debt collectors were satisfied...
...Even if we deduct half of that, $850,000—an extremely high estimate—to cover the cost of each person's public education and possible public care, the net gain is clear...
...In this case, though, a strong argument for the state's compelling interest in targeted debt relief can—and should— be made...
...This is precisely the policy being pursued by the U.S...
...According to the Public Interest Research Group's Higher Education Project, 39 percent of new graduates with loans carry an "unmanageable debt," defined as requiring payments of 8 percent or more of the borrower's monthly income...
...As an effective form of contraception, the loans actually keep new "human capital" from forming...
...Moreover, colleges and universities have found student loans to be a wonderful way to expand budgets...
...Research shows that both married men and women are, on average, more productive, wealthier, healthier, happier, and much more engaged as citizens than the unmarried...
...At private four-year colleges, tuition climbed from an average of $10,348 in 1990 to $19,312 in 2000, an increase of 87 percent...
...Even in 1997, when the burden was significantly less, one survey conducted by Nellie Mae (the largest non-profit provider of student loans) reported that 15 percent of graduates had delayed getting married because of their student debt load...
...Finally, using the overall inflation rate as an index, rather than inflation in education costs alone, would dramatically constrain projected costs...
...The report also underscored the increasing reliance by all institutions on student loans...
...Moreover, the cap on the maximum amount would mean that over half of graduates would still repay a significant share of their obligation, even if they brought four children into the world...
...Cohabitation, meanwhile, has displaced marriage for many of the young...
...What about young adults who cannot biologically bear children...
...This choice would begin removing some of the disincentives toward marriage and childbearing that young graduates now face, creating modest incentives in their place...
...A new report released last month by the College Board shows public university tuition up 9.6 percent in 2002...
...Perhaps...
...Allan Carlson is president of the Howard Center and Distinguished Fellow in Family Policy Studies at the Family Research Council...
...Why create an incentive for more births...
...government, in alliance with the nation's colleges, universities, and other post-secondary schools...
...The same debt forgiveness could be accorded to those married couples that adopt a child...
...Going cold turkey would close many schools and disrupt them all...
...It would take a program that discourages marriage and children and reverse the incentives...
...Colleges and universities have padded their budgets and avoided financial discipline by loading their hapless students with ever more federally inspired debt...
...A modest federal investment of $10,000 in parental debt relief at the start of a new life would—for a change—be a good public investment...
...In addition, federal loans became available to families with higher incomes, drawing nearly 60 percent of families with college students into the debt trap...
...by 2000, only 39 percent...
...And the problem of college costs seems to be getting worse...
...An average couple that contemplated marriage on graduation would calculate a joint debt of $44,000, a heavy burden under which to start a new home...
...The alternative is the accelerated shriveling of family life among America's young adults...
...How did this happen...
...These public goods translate into higher government revenues, lower government expenses, more citizen engagement, and a more stable public order...
...Such delays would mean more infertility, smaller families, and empty or never-formed homes...
...And yet the overall Consumer Price Index increased during these years by only 30 percent...
...This modest countermeasure to yet another anti-family policy would encourage the birth of new human life only within relatively responsible married-couple homes...
...Allow me to address some of the immediate (and probably frantic) objections: • Why favor marriage...
...There were 4.6 million of these unmarried couples in 2000, an increase of 800 percent since 1970...
...When the federal program began, the loans were largely modest supplements to grants, which provided direct support (without the obligation of repayment) to low- and low-middle-income students...
...The marital fertility rate in 2000, meanwhile, was a third below the 1965 figure...
...Loans took up the slack...
...Moreover, the average American life, circa 2002, generates $1.7 million in economic gain over the course of its existence (for the children of college graduates, double that...
...Other federal policy measures, such as the income tax and the Social Security system, also create incentives hostile to marriage and child-rearing...
...It's called "Guaranteed Student Loans...
...Given the lack of principle guiding the Court in recent decades, anything might be declared unconstitutional...
...Indeed, Census 2000 statistics point to a massive retreat by young adults from marriage and children...
...for young men, the never-married figure in 2000 was 84 percent...
...Rather, just as with the infamous Aid to Families with Dependent Children (AFDC) program, we see another federal entitlement undermining the material basis of family formation...
...at four-year private universities, it's up 5.8 percent (while the overall inflation rate is under 2 percent...
...In 2002, the average new graduate carried an estimated debt of $22,000, up from $8,200 in 1991...
...To replace all federal education loans with grants, another $40 billion would do the trick for 2003...
...22 percent had delayed childbearing, up from 12 percent in 1991...
...In that year, 73 percent of women ages 20-24 were in the never-married category, up from 36 percent in the pre-loan days of 1970...
...It creates perverse material incentives for young adults to succumb to cultural trends like cohabitation and the avoidance of parenthood...
...Twenty years ago, the average award covered 84 percent of state school tuition, fees, room and board...
...If we assume even modest inflation in program costs (6 percent annually, as opposed to the 11 percent experienced in recent years), this entitlement would rise to the staggering figure of $157 billion in the year 2020...
...The problem is not so much the default rate (although that remains stubbornly high at 11 to 12 percent), nor the spiraling amount of new education debt being generated each year ($42 billion in 2001, up 35 percent since 1995), nor the approach to a probable limit on personal debt that even giddy undergraduates might recognize...
...Viewed this way, the student loan program corrupts the nation's social order and distorts its future...
Vol. 8 • December 2002 • No. 14
