The Wisconsin Public Interest Research Group hosted a roundtable discussion to address issues relating to student loan debt in a meeting Thursday.
The discussion, sponsored by Associated Students of Madison and United Council, hosted Rohit Chopra, representative from the Consumer Finance Protection Bureau to talk about student debt.
Chopra said the Consumer Finance Protection Bureau is a new agency that has become the centerpiece of financial reform.
An economic crisis that infected almost every state in the country, Chopra said, led to devastating cuts to higher education, not just in Wisconsin. Complications from these cuts caused higher tuition, less savings and a lot of student loan debt, he added.
According to Chopra, there is now more than $1 trillion in American student loan debt. This, he added, is more than credit cards and auto loans.
“There is a real tension because on one hand, it is absolutely important to go to college because in the world we live in today, people with degrees and training are going to be much better off,” Chopra said. “But, what does leaving school with thousands and tens of thousands of dollars in debt really do”?
Having so much debt is not just a question of fairness, Chopra said, but it is also a question of how students are going succeed in the economy.
Chopra said the problem of student debt and the consequences it has for college students will fundamentally change so much of people’s lives today.
“Is this [student loan debt] going to fundamentally change all of us for the worst”? Chopra said. “Rather than a college degree being the vehicle for our whole societies success.”
ASM intern on the University Affairs financial literacy campaign and University of Wisconsin freshman, Mary Prunty, said financial awareness about loans is an issue for students on campus.
On the issue of financial awareness, Prunty said the biggest problem is that students know everybody gets loans, but they do not know what these loans are going to turn in to. Students do not understand what will happen in the future with loan debt taken on, she added.
“A lot of students think they’re confident with their finances,” Prunty said. “They assume that they know what they need to know and if you tell them they don’t they get very offensive.”
Rich Williams, the Higher Education Advocate for U.S. Public Interest Research Group, said while they can train students to be become advocates and look out for the dangers of student loan debt, by the time they are in college, it is too late.
Williams said a lot of his work deals with the cleanup. He said he is working to make sure interest rates on student loans do not double and expressed the importance of Congress taking action.
“Now is not the time to let interest rates on student loans for seven and a half million students double,” Williams said.