We’ve all seen the headlines: the cost of university education in the United States has become completely debilitating. And student debt keeps rising to record high levels.
It’s almost commonplace now for a 22-year old to graduate from university with $50,000+ in student debt.
According to data from the Federal Reserve, the total amount of student debt in the United States is now $1.5 trillion.
As SovereignMan.com's Simon Black notes, that’s more than the estimated $1.3 trillion in direct costs that the government spent fighting the War in Iraq.
What’s probably even more bizarre is that the US government actually owns about 70% of those student loans– a total of $1.06 trillion.
I discovered this over the weekend when I was reviewing the federal government’s recently published financial statements for fiscal year 2017.
Student loans actually constitute the #1 asset of the US federal government, comprising about 30% of its balance sheet.
In other words, young people of America owe more money to the federal government than the value of every tank, every bullet, every aircraft carrier, every acre of land in the national parks.
That’s a pretty sad statement to make.
And remember that student debt in America is a very special kind of debt: it chases you around forever.
Thanks to a piece of legislation signed into law by Bill Clinton in 1998, student debt is almost impossible to ‘discharge’.
So unlike just about every other type of debt like a home mortgage or medical debt, student debt is extremely difficult to wipe away through bankruptcy procedures.
It’s more a form of indentured servitude than it is debt.
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