You probably didn’t know it, but tuition increases, growing student loan debt and tax dollars for public higher education are funding Wall Street profits.
In 2012, Wall Street raked in $44 billion in profits from college students, colleges and taxpayers. That’s nearly 10 percent of the total amount spent on higher education in America.
In the last 15 years, student debt has increased more than 1,000 percent. In 2012, students and families paid Wall Street and the Department of Education $33 billion in student loan interest, while colleges paid another $7 billion in financing costs on institutional loans, and for-profit colleges raked in about $4 billion in profits.
A college education is a pathway to opportunity, but it’s getting harder to achieve because costs keep rising. Money from college tuition and taxpayer dollars shouldn’t go to Wall Street profits—it should go to making college affordable and accessible for all students.
Today, the University of California at Berkeley’s Institute for Research on Labor and Employment released a report that explains “The Hidden Costs of Financing U.S. Higher Education.” Public colleges are facing a decline in state funding, so they have to increase their debt and issue capital bonds to investors, and they push students to borrow more money from student loan profiteers. In addition, for-profit colleges continue to divert tuition from high-quality education to stockholders.
Over the coming months, we’ll be using this report to fight to reclaim the promise of a high-quality, affordable college education. But first, we need people to know that the opportunity to get a college education is being threatened by Wall Street profits. I hope you’ll watch and share the video.