Survival Under the Shadow of Debt

Well, we’re all fucked . . .

It’s no secret that America is in the midst of a student debt crisis. But, most people do not understand that we are facing two distinct crises with two distinct groups.  The first group is those people who incur debt, but do not finish their education or alternatively earn a worthless degree. Whose bright idea was it to let you get a communications degree from a community college?  Go work in retail. You’ll learn at least as much and actually get paid for it. Also, if you got shit grades in high school, why on earth would you not go right into the workforce, or at most seek vocational training?  Instead, you continued to get shit grades, flunked out of college, and now are saddled with thousands of dollars of loans that you can’t afford. Good job genius.

These are the people who represent most of the individuals defaulting on student debt. Because they are never able to obtain the higher paying jobs required to pay off their debt, the lost individuals in this group, unable to discharge the debt in bankruptcy, have been squashed by a rock they could never bear.  And, the bankruptcy piece is key. If Lord Protector Trump is right about one thing, it is that our bankruptcy code exists to correct economic fuck ups, so that people can get on with their lives. Because the government is by far the largest owner of student debt (see my diatribe {hyperlink} on that issue), bankruptcy is not an option, and you basically have to die to get out of your student loan.

The bottom line being that we are forcing the lower-middle class into destitution and widening the wealth gap into a chasm.  We are stripping away what few comforts they would have been able to enjoy in their lives, if they had not taken on the student debt.  We are stripping away their hope for a better life. These people will continue to perform the same jobs that they have always performed, rent in the same neighborhood they would have rented in, and, apart from a small hit to consumer goods that can be corrected by selling more product abroad, the American economy will continue to go on.  The more alarming issue is what faces our second group.

Our second group of Americans in crisis are those who take on student debt, do make those soul-crushing monthly payments, but are never able to amass the same financial cushion as their predecessors.  They will rent longer, have kids later, and underfund their retirement. These are our traditional homebuyers. This is both our middle and upper-middle class. Why is this important? These are the individuals to whom the Baby Boomers planned to sell their homes, the asset in which they hold most of their wealth.  Right now, America’s real estate market is enjoying a surge of pent-up demand from the Great Recession. But, when this game of musical chairs is up, what do you think is going to happen to the value of all of those McMansion cookie-cutter suburban homes? Crash, crash, crash.

In short, our current economic clusterfuck is screwing us all.  For those of you who see the writing on the wall, come live with us in our sustainable inner-city neighborhoods.  Yes, the ones that were abandoned a generation ago, and we can ride out this next crash together. We may even share our avocado toast.

Yours in solidarity,
The Angry Millennial

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