Column: College affordability and student loan debt

Who is to blame for America's crippling student loan debt? It depends on who you ask.

There's a general consensus that we're heading for a 2008-style disaster if young borrowers keep defaulting on their shares of this country's $1.2 trillion in outstanding student loans. But when it comes to causes, fingers point in every direction.

Borrowers point to the skyrocketing cost of higher education. Colleges and universities point to steadily increasing overhead. Private schools point a second finger at dwindling endowments while their public counterparts take aim at shrinking state appropriations. States and money managers point to sluggish economic activity. Job creators point back to borrowers who graduate under a mountain of debt but with skills and aspirations mismatched to employers' needs.

Feeling dizzy? Well, here's the kicker: Every one of them is right.

The federal Consumer Financial Protection Bureau figures there are about 7 million borrowers currently defaulting on a federal or private student loan. They estimate one out of three Federal Direct Loan Program borrowers is making reduced monthly payments under alternative repayment plans. Borrowers with private loans rarely have such an option. Experts fear this increasingly unmanageable debt is preventing young adults from doing everything from starting a family to buying a house to starting a business to saving for retirement, sending ripples throughout the economy.

There is no single bad guy here, just a giant, tangled mess.

And while the plan President Barack Obama outlined this week plucks a couple of important threads - by looking to make it easier for students to figure out which schools offer the most bang for their buck and offering incentives for schools to keep costs low - it won't be enough to completely untangle it. Because the answer isn't simply that if we can make higher education cheaper, everything will work out just fine. The truth is, despite broad generalizations that show the average worker's lifetime earnings jump with each accumulated diploma, advanced degrees are not inherently good investments.

The amount a worker earns depends a whole lot on his or her choice of occupation - something that makes sense to anyone who has ever held a job. That means an English major is not worth the same, in dollars, as an engineering degree. Or, as the Georgetown University Center on Education and the Workforce summarized it in a 2011 paper titled “The College Payoff:” “In a surprising number of cases, people with less educational attainment earn more than those with more.”

In fact, many of the fastest-growing sectors of our economy are in health care services and trades that require only a few semesters' worth of school. There is no reason for every American to go to graduate school, or even to get a four-year degree. No matter how affordable we try to make it.

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