Kennedy: The student loan crisis is eroding the middle class

The hotel manager with a doctorate in geology.

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

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



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

The common point ? An American economy without a recognizable middle class. The country must restore, strengthen and solidify a new middle class. This is vital for various economic and political reasons. One of the main benefits is solving the student debt crisis.



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

There is some momentum building towards solving the country’s student loan problem. It’s a problem that affects 45 million people with a combined debt of $1.6 trillion.

Forgiving student loans misses the point. The Biden administration’s Aug. 24 decision to pardon up to $20,000+ and extend Covid forbearance through December is laudable. But that doesn’t get to the roots or provide a viable starting point for solving the real problem behind the student loan crisis.

Many students have borrowed five- or six-figure student loans to find work in their field of study. They did not take loans for the educational experience. Students did not pursue their studies to enter a service-based economy. The loans were accepted in the hope of reaching the middle and upper classes.

A common argument, especially from members of the silent generation, is that many students fail to find work in their fields of study. The argument is plausible to some degree, especially in the fields of social science, business, and art. There are often more applicants than positions (not necessarily in engineering and medicine, where the situation is reversed). And yet, it has become increasingly difficult for most college students to find work outside of customer service over the past decade.

The solution to the crisis isn’t to forgive student loans—it’s to create solid jobs for the middle class; positions that pay enough for students to pay off loans, own homes and raise families. Currently? These positions are far and rare between the two.

A strong middle class involves no-minimum/no-duty, middle/upper five-figure paying positions that allow students to repay their loans. It currently does not exist.

This is a task that I am not convinced Washington is ready to pursue because it may be politically costly in the short term, but with medium and long term benefits. It is an approach involving raising taxes and ensuring that the revenues generated are effectively allocated to projects that incentivize non-tertiary sector businesses to create viable jobs for the middle class.

A second approach involves collaboration between academia and the private sector. The idea involves colleges and universities working with non-government employers to ensure students gain skills/experiences that are appealing to employers. It is also about simultaneously equipping students with traditional academic skills.

Critics of the lawsuit argue that trade schools provide the aforementioned training. A trade school education is not attractive to students interested in biology, business, or sociology (for example). Trade schools provide the skills needed for plumbing, auto mechanics, electrical, cyber or other related fields – not the various non-technical and medical fields that many students are interested in.

The discussion between the university and the private sector began shortly after the start of the Great Recession. The idea, however, has not been developed, except by a small group of colleges/universities. This is a discussion that must turn into action on a national scale. The results would benefit the academic and private/public sectors.

The student debt crisis is not about racial inequality, as some Washington policymakers claim. It is not a free handout, as many people without a college education claim.

It’s about reinvigorating a sector of Americana that existed until the Great Recession. The middle class has driven America’s financial and industrial base for decades. It was an essential component of the American dream.

The crisis is about recreating, re-establishing and consolidating an aspect of Americana that encourages students to take out thousands of dollars in student loans. A new, stronger and more sustainable middle class can re-emerge, but not without some short-term political difficulties, but with medium/long-term benefits – benefits that thousands of student loan holders (including author who owes student loans himself, and has only found work in the customer service field).

Matthew Kennedy holds an MA in Diplomatic Studies from the University of Westminster in London.

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