I agree almost entirely with Megan McArdle’s critique of Lee Siegel, in his article on why he chooses to default on his student loans (NY Times Link). And I don’t particularly wish to defend Mr. Seigel, who, as McArdle says, presents what is perhaps the least sympathetic account of why he has defaulted. Mr. Siegel comes across to McArdle–and to me–as an entitled, even snobbish, person who doesn’t wish to live up to his freely-incurred obligations mostly because it’s inconvenient for him to do so. I’d also add, though McArdle doesn’t say this, that if, as Mr. Siegel urges, all who hold student loans boycotted paying them, then one possible consequence would be a huge curtailment of the loan program, such that others would not have the same opportunities that loans have afforded him.
But there’s a little bit of something in the article that does give me some sympathy, if not for Mr. Siegel’s situation, then at least for what some people face when dealing with student loans. It’s an image his opening anecdote evokes for me:
Here’s the image that snippet evokes for me. It’s the image of an 17- or 18-year old and his parents, who seem to not have had much or any experience with college or with how to play the loan game. Perhaps they all assumed that college was a guarantee of success in life, or perhaps they had met people with college degrees who had money and authority and whom they perhaps had to answer to at their jobs
ONE late summer afternoon when I was 17, I went with my mother to the local bank, a long-defunct institution whose name I cannot remember, to apply for my first student loan. My mother co-signed. When we finished, the banker, a balding man in his late 50s, congratulated us, as if I had just won some kind of award rather than signed away my young life. [link omitted by GC]
By the end of my sophomore year at a small private liberal arts college, my mother and I had taken out a second loan, my father had declared bankruptcy and my parents had divorced. My mother could no longer afford the tuition that the student loans weren’t covering. I transferred to a state college in New Jersey, closer to home.
They, I imagine, had talked to a recruiter for the small liberal arts college at which he found himself. Or perhaps they read the glossy pamphlets that such institutions send out, perhaps with bucolic scenes of campus life, photographs of attractive young students and older but good-looking professors with charismatic faces, and quotations from famous alumni about the value of a small liberal arts college education. Perhaps the recruiter or pamphlet offered some impressive statistics that showed a large number of students obtaining a BA (instead of dropping out) and going on to high-paying jobs or to professional or graduate degrees.
There’s something not quite right with that image ( and I admit I’m reading much into this that Mr. Siegel doesn’t offer). There seems to be something exploitative about it, and I might at a later date write how I believe it is exploitative. But it’s not clear to me what the solution is.
To make matters more difficult, we don’t need to assume bad faith on the part of anybody when the loan was taken out and when Mr. Siegel first matriculated. He and his mother probably really intended to pay back the tuition. The loan officer and the bank he worked for probably really believed that going to college was a good thing and that the loan would help Mr. Siegel. The program of government guarantees for loans was designed to help people like Mr. Siegel to expand their opportunities. The impressive statistics the small liberal arts college offered probably were accurate. And for all I know, maybe that particular college was responsible–expensive, but mindful of costs and really making an effort to give its students real value for their tuition dollars.
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