We Don't Need Another Student Loan Repayment Program

For the past several weeks the massive and ubiquitous student loan debt of American college graduates has been a major news story, along with the attempts by President Obama, Mitt Romney, and the GOP-controlled House of Representatives to make political hay of the issue while ostensibly advancing plans for resolving it. Of the ideas floated, President Obama’s appears the least serious and most political, particularly because his approach would expand the scope of federally subsidized loans — in effect pouring good money after bad.

According to the most recently compiled data, the average college student graduating in 2010 owed an average of $25,250.  According to the marketing research division of American Student Assistance (which advises collegians on loans and debts), there are approximately 37 million Americans with some outstanding student loan debt. This spring another 1.7 million will graduate with bachelor’s degrees, as well as 833,000 with associate’s degrees, 696,000 with master’s degrees, 102,000 with professional degrees, and about 74,000 with doctorates (happily, Starbucks should have no problem filling its ranks with the latter). The cumulative student loan debt which right now stands at approximately $870 billion will no doubt increase even more.

The prospects of repaying such crushing student loan burdens look bleak for recent graduates, considering that over half are unemployed and the remainder are “underemployed” — a result, for far too many, of having bought into the Pelosi propaganda that a creative writing, womyns’ studies, or theatre major would work in the Obama economy. In fact, “only three of the 30 occupations with the largest projected number of job openings by 2020 will require a bachelor’s degree or higher to fill the position — teachers, college professors and accountants…[c]ollege graduates who majored in zoology, anthropology, philosophy, art history and humanities were among the least likely to find jobs appropriate to their education level….”

A proper discussion of whether American society wrongly promotes college at the expense of less-costly, more marketable vocational training is beyond the purview here. Instead, I wish to focus on the veritable legion of programs for repaying student loans which already exists — and which are woefully under-reported by the media and our government spokespersons.

The largest and most potentially lucrative loan repayment source is the U.S. military. For certain enlisted jobs, up to $65,000 of student loans can be repaid (the maximum currently authorized by Congress). At this juncture only the active duty Army will allow that $65k maximum (for a three-year enlistment, 1/3 per year), but all the other branches except the Marines have some form of substantial loan repayment available (albeit usually for a four-year hitch): Army Reserves, $20,000; Air Force and Navy active duty and Reserves, $10,000; Air National Guard, $20,000.

Note that the qualifying jobs are generally shortage ones that require extensive training. In the Army, as of last week (when I spoke to a recruiter), the only slots that would pay back $65k in loans were 68A (Biomedical Equipment Specialist) and 68D (Operating Room Assistant). But either of those positions would translate well into a civilian health care job, and the aformentioned zoology majors with poor job prospects would probably find the training amenable. Other Army enlisted jobs that often qualify for substantial loan repayment are 35F (Intelligence Analyst) and 35M (Human Intelligence Collector) — the latter of which usually are sent to Defense Language Institute in Monterey, CA, for extensive foreign language training.  Again, as with the zoology major and a medical field job, one would think an unemployed, debt-laden anthropology major would find such a prospect tantalizing, to say the least.

In addition to loan repayment, the Army, Navy, and Air Force offer the opportunity to save money for college or graduate school, via the Montgomery GI Bill, as well as various bonuses for certain jobs and/or possession of college credit.  (Caveat: the maximum monetary award to any individual is $65,000, and the GI Bill and loan repayment programs are mutually exclusive.)  For example, enlisting with a college degree in any field (even creative writing!) nets you a $5,000 bonus; having 60+ hours of college credit, $4,000; and over 30 hours, $3,000.

In addition,  “qualified applicants who possess civilian skills that the Army needs, such as proficiency in certain foreign languages, X-ray certification or specialties in animal care” may qualify for $5,000. There is also a special bonus, ranging from $10,000 to $20,000,  for anyone fluent in certain Middle Eastern languages.  If one decides to stay in (and, admittedly, survives IEDs during the inevitable Afghanistan tour) to make senior enlisted (E-7 and up), bonuses for infantry, intelligence, Special Forces, and “Explosive Ordnance Disposal” (think The Hurt Locker) range from $18,000 to $150,000 for reenlistments. (And remember: the military gives you regular pay, and allowances for housing and food — as well as free medical and dental care — in addition to these bonuses, loan repayment, and the Montgomery GI Bill.)

Most folks with college degrees probably wouldn’t want to stay enlisted. In that case, they could do one enlistment, get student loan debts repaid, then obtain a commission by either going back to school in an ROTC program, or attending officers’ school. In fact, anyone in college now should seriously consider ROTC, which exists at over 1,000 American colleges and universities, in order to head off student loan debt in the first place — easily done, since some of the branches have two-year, as well as four-year, programs.

The Reserve Officers Training Corps will pay for tuition and room and board and supply a monthly stipend, after which the recipient must serve as an officer, usually for four to six years. The military (especially the Army) will even pay for graduate school (separate from the military post-graduate schools, such as the Army War College), generally covering all tuition and fees and paying the officer his regular salary while in school. There are also programs that will pay for law school for Army officers and medical school for members of any branch.

Yes, many American college graduates would balk (or worse) at the idea of joining the military — especially during what is still wartime. For those folks, there are a number of other federal and state programs that will repay student loans. For the Occupy Wall Streeters, or even just the unicorns-and-rainbows set, they’ll always have the Peace Corps option, which will not only allow loan deferment, but cancellation of 15% of certain student loans for each year of service. Americorps will give you $4725 toward student loans for a year of service. Under the National Defense Education Act, up to $17,500 in student loans can be forgiven if one teaches math or science in a low-income area. The Department of Health and Human Services will repay most of a nurse’s loan through the Nursing Education Loan Repayment Program for those who serve in “remote and/or economically depressed regions.”  There are other more obscure programs, such as the one for anyone with a degree in law enforcement who agrees to serve as a state trooper in Alaska for five years.

My point is that we probably don’t need any new massive government programs and spending to address the student loan debt program. The 2011 budget of the federal Department of Education is  $71 billion. If that money were transferred to the military and injected into the student loan repayment program, some 2.8 million college grads could have their debt paid off at the rate of $25,000 each — probably a far better return on our tax money that anything the DOE currently does. Of course, the military is not configured to absorb almost 3 million new members, and not nearly that many college grads would be willing to join the military.  But some, perhaps many, would — especially if President Obama or President Romney were to appeal to them with half as much eloquence as our current commander-in-chief did recently, speaking in Afghanistan about why we are still there over a decade after the 9/11 attacks.

The military could certainly use a few — nay, a lot more — good men and women, and if such service were linked, rhetorically and, let’s admit it, financially to helping solve the individual and collective student loan debt, then whoever holds the office of POTUS next would be providing true leadership on these twin crucial issues of providing for the common defense while simultaneously promoting the general welfare.