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Kennedy: Student loan crisis erodes middle class

Matthew Kennedy
Guest Column

The hotel manager with a Ph.D in geology.

The airline customer service agent with a master’s in public administration.

The ski resort recruiter with a bachelor’s in environmental studies.



And countless other individuals with a college education and high student loans but are unable to find work connected to their degrees, so they take jobs in customer service.

The commonality? An American economy devoid of a recognizable middle class. The country needs to re-establish, buttress and solidify a new middle class. It’s vital for various economic and political reasons. A key benefit is solving the student loan debt crisis.




This is achievable in part by efficiently raising taxes and subsequently distributing the collected revenue in certain, vital key economic sectors, and morphing a long-discussed collaboration between the academic community and the private/public sectors into action.

A degree of momentum is developing toward addressing the country’s student loan problem. It’s a problem encompassing 45 million individuals with a combined debt of $1.6 trillion. 

Forgiving student loans misses the point. The Aug. 24 decision by the Biden administration to forgive up to $20,000-plus and extend the Covid forbearance until December is commendable. But it doesn’t address the roots or provide a viable start for solving the real problem behind the student loan crisis. 

Many students borrowed five- or six-figure student loans to find work in their degree fields. They did not take the loans out for the educational experience. The students did not pursue the education to enter a service-based economy. The loans were accepted with the expectation of joining the middle and upper classes. 

A common argument, particularly from members of the Silent Generation, is that many students fail to find work in their degree fields. The argument is plausible to an extent, especially in the social sciences, business, and art fields. There are frequently more applicants than positions (not necessarily in the engineering and medical arenas, where the situation is reversed).  And yet it has become increasingly difficult for most students to find work outside of the customer service arena within the past decade.

The solution to the crisis isn’t forgiving student loans — it’s creating solid, middle class positions; positions furnishing a high enough salary for students to pay off their loans, own a house, and start a family. Currently? Those positions are far and few in between.

A solid middle class entails non-minimum wage/non-service, middle/upper five figure paying positions allowing students to pay off their loans. It doesn’t exist currently. 

It’s a task I’m not convinced Washington is willing to pursue since it may be politically costly in the short term, but with medium and long term benefits.  It’s an approach involving raising taxes and ensuring the generated revenue is efficiently allocated toward projects incentivizing non-service sector corporations to create viable middle-class positions.

A second approach involves a collaboration between academia and the private sector. The idea entails colleges and universities working with non-government employers to ensure students receive skills/experiences attractive to employers. It also involves concurrently furnishing students with the traditional academic aptitudes.

Critics of the pursuit argue that trade schools provide the aforementioned training. A trade school education is unattractive to students interested in biology, business, or sociology (for instance). Trade schools provide skills necessary for plumbing, auto mechanic, electrical, cyber, or other linked fields — not the various non-engineering and medical fields many students are interested in.

The university-private sector discussion began taking place since shortly after the Great Recession started. The idea yet it hasn’t been developed, except by a tiny group of colleges/universities. It’s a discussion needing to morph into action on a large, national scale. The results would benefit the academic and private/public sectors.

The student loan debt crisis isn’t about racial inequality, as some Washington policy makers contend. It isn’t about a free handout, as many without a college education argue.

It’s about reinvigorating a sector of Americana that existed up until the Great Recession. The middle class drove America’s financial and industrial base for decades. It was a vital component of the American Dream.

The crisis is about re-creating, re-establishing, and solidifying an aspect of Americana enticing students to take out thousands of dollars in student loans. A new, stronger, more durable middle class can resurface again, but not without some short term political pain, yet with medium/long term benefits — benefits thousands of student loan holders dream and yearn for (including the author who owes student loans himself, and has only found work in the customer service arena).

Matthew Kennedy has a master’s degree in diplomatic studies from the University of Westminster in London.