Beth Akers of the Brookings Institution, co-author of controversial research on the status of student loans, downplays the significance of the more than $1.3 trillion in debts held by Americans. “Debt is increasing steadily across all levels” of higher education”, Akers said recently at a conference in Austin. She formerly who served as a staff economist to the White House’s Council of Economic Advisors (2007-2008).
Akers blames the economy. “Wage income has been stagnant,” Akers notes, “for a significant period of time,” she noted. Yet and still, she claimed that, “Large debt burdens are exceedingly rare.”
Akers admitted that tuition and related fees have risen substantially since the 1960s.
“Price is a concern insofar as it relates to future outcomes,” she stressed, while placing greater emphasis on hopeful yet unknown factors. College degree holders have not only expectations of but also potential for remarkable returns. Akers thus concluded that “[w]e do not have a crisis on our hands.” The rhetoric regarding escalating deficits is allegedly fallacious.
She does acknowledge that “There’s a repayment problem.” Maybe that’s why they call it debt. Drop-outs and graduates alike are struggling to pay back their obligations.
However, she argues that “wiping away the debts” is impractical. “Clearly we need more evidence to understand what is happening in this education space,” she said in Austin. She might start with what’s already available.