2012 has proven time and time again the year of the crack of student loans in the U.S.. The prediction overall, needless to say, is what Cassandra James Howard Kunstler so prophesised:
The story that unfolds is so obvious that only an economist could manage to not notice. Here’s what happens: a few months with the worsening of the financial crisis the lure of jobs with good gains fading to dissolve, a dangerous cross catchphrase on the Internet: the two thousand young people get rid of student loans!
As many know the universities in the United States are generally very expensive. Students make do with scholarships, jobs, and of course bank loans. Loans which are repayable after graduation through a monthly mortgage on the rich pay future professionals.
The problem is that, however, in many cases today there is no longer a safe salary for graduates even in the United States. Many young people with the piece of paper are unemployed or are reduced to paying jobs that do not even allow to live, let alone repay the loan. The bubble was inflated throughout 2012 to represent a serious social problem. Thus the government has launched a “bailout” that this time instead of helping the usual banks it will aid young graduates who now can no longer repay their debt with a fixed monthly amount but in proportion to their earnings. It follows that the debts usually for decades can stretch for up to twenty years.
But they are always payable. So who knows what will happen to the American university system with the effects of such financial disaster.