On a warm October evening in 1932, Franklin Delano Roosevelt stood on a Pittsburgh baseball field and delivered an impassioned speech on the improbable subject of passion: the federal budget. “At some point, somewhere in this campaign, I have to talk about dollars and cents, and it’s a terrible thing to ask you to listen to the federal budget story for forty-five minutes, but I’m going to ask you to do it,” he said Crowd. At the back of the park, a two-year-old black girl named Betty Ann sat on the shoulders of her father, Robert, who was pointing hard at the man he was sure would become president. Robert was a die-hard Republican—his grandfather, an enslaved Virginia man, had been emancipated by President Abraham Lincoln. Still, he felt compelled by Roosevelt’s message. Hard times had led him to start paying out of his own pocket for the reporters at the Pittsburgh newspaper Black, which he ran. To his chagrin, his wife had begun to stand in relief lines to support Betty Ann and her sisters. When Robert cast his ballot for Roosevelt a few weeks later, he cried in horror at voting against Lincoln’s party. He then became a staunch Democrat and threw himself fervently into local politics until falling ill five years later. He had two final wishes: that his wife take over his role as leader of the Democratic community, and that Betty Ann and her sisters go to college.
The family got on well with both: as community leader, Robert’s wife maintained the family home as the backbone of the community, and Betty Ann, who requested that she and her family members be called only by their first names, grew with a steady stream of neighbors up through the house. Although her mother had no money, Betty Ann was a strong student and earned enough scholarships to earn a bachelor’s and a master’s degree in education. Over the next few decades, she worked as a public school teacher in Pittsburgh and Harlem, and was a single mother raising two children. But she grew increasingly frustrated by the signs of educational inequality — moldy lunches, substandard reading materials — that plagued her classrooms. “I thought the only way to change things was to get an advanced degree,” she told me.
In 1983, at the age of 52, Betty Ann enrolled in law school at New York University. As a middle-aged black woman, she wasn’t your typical NYU law student. Her white male classmates secretly shoved her books off the long library tables, and once as she stood by her locker, a classmate waved a ten thousand dollar tuition check signed by his father in her face. Betty Ann had borrowed twenty-nine thousand dollars in federal bonds. Today she owes $329,309.69 in student debt. She is ninety one years old.
Americans ages sixty-two and older are the fastest growing demographic of student borrowers. Of the 45 million Americans with college debt, one in five is over 50 years old. Between 2004 and 2018, student loan balances for borrowers over fifty increased by five hundred and twelve percent. Perhaps because policymakers saw college debt as a burden for aspiring young people, inaction seemed a reasonable answer, as if time itself would solve the problem. But in an era of falling wages and rising debt, Americans aren’t aging out of their student loans—they’re aging into them.
Credit assumes that what we cannot afford today can be repaid tomorrow by the more affluent self—a self that is more affluent because of riches leveraged by these debts. Perhaps no form of credit embodies the myth of a wealthier future self better than student loans. Under the vision of free-market economist Milton Friedman, student loans emerged in the 1950s as an outgrowth of “human capital” theory, which posited the self primarily as an investment entity. Borrowing money for education was not only a sound investment—borrowers certainly got high-paying jobs that would allow them to repay the loan—but it was also smart macroeconomics: people with higher education would boost the country’s GDP. Education would be a side effect.
But the rise of aging debtors challenges the premise of human capital education. Eroding union density, falling wages, and skyrocketing tuition have made college less a route to high-paying jobs and more an escape from the lowest-paying ones. Those who have incurred debts are increasingly unable to repay them; many have not even received diplomas. The student debt crisis is particularly bad for black borrowers. Racial wealth inequality means black borrowers borrow more money to go to college and have credit longer, effectively paying more for the same degree than their white classmates. Four years after graduation, nearly half of black graduates owe more than their starting balance, compared with just 17 percent of white graduates. As a researcher and organizer at Debt Collective, the nation’s first debt collectors’ association, I’m familiar with the idea of debt as a bad tax – those who have least end up paying most. But it was a revelation for me when I realized that elders are the fastest growing group of student debtors. I’ve come to understand that debt is also a time tax—it conquers the future and corrodes the present, wearing down health, wealth, and the pursuit of happiness.
Older student debtors are not exceptional cases within the mounting student debt crisis; Indeed, their experiences are indicative of its distinguishing features. Rising interest rates, looming balances, flawed debt relief practices, and declining wages are forcing borrowers to carry on loans for longer periods of time, pushing up student debt for generations. Older debtors shuffle their income between credit card bills, house payments, car loans; Student debts, which are often the furthest removed from everyday life, are paid off last – or not paid at all. For aging borrowers with declining incomes, the crisis is acute: borrowers from students over sixty-five are defaulting with the highest interest rates. In 2015, more than a third of borrowers in their age group defaulted on their student loans.
“Years of erosion of labor rights have meant wage power hasn’t kept pace with student debt,” Randi Weingarten, president of the American Federation of Teachers, told me. As such, student loans do not take working-class people; they merely change the accounting of the people living in it. For example, 50-year-old David Ormsby had been working at a Detroit hardware store for eight years when he decided to go back to school. “I wouldn’t call it a dead end job,” he said, but felt he wouldn’t get any further without an advanced degree. In 2005, he began studying part-time at a local university for a bachelor’s degree in supply chain management while raising his two sons and working more than fifty hours a week. Today he holds nearly $90,000 in student debt. The degree helped him secure a job in the automotive industry with higher pay and more satisfaction than his previous job. Even so, the monthly loan payments of five hundred dollars are difficult to cope with. Ormsby has started taking a second job delivering groceries to help pay off his loan. “Going back to school was a good thing,” Ormsby said, but he’s frustrated that he’ll be in his 70s before he can start saving for retirement.
Although most senior student borrowers borrowed money for their own education, about a third borrowed for a child or grandchild. Unlike direct federal loans, which have credit limits, parents can borrow virtually unlimited amounts — up to the full cost of attendance each year — to fund their children’s education through a program called Parent Plus. Parental loans are often associated with punitive conditions such as significantly higher interest rates and few relief options. Parent Plus recipients are only eligible for one type of income-controlled repayment program that requires credit consolidation; any opportunities for forgiveness of public service loans are extremely limited. Some parents have to pay loans even if their child dies. Eighty-year-old Calvin Nafziger pays $250 a month on personal loans for his son, who died three years ago. “I’ll probably be dead myself before I pay them off,” Nafziger said.
Student debt can plague borrowers to their last breath, jeopardizing even the government’s meager protection for the elderly: Social Security. Defaulted student loans can result in the Department of Education ordering a garnishment on tax refunds, wages, and Social Security. In 2015, the Social Security of more than two hundred thousand debtors over fifty years of age were garnished. One of them was Olivia Faison, a retired analytical chemist who is now seventy-one years old. Faison studied biology, chemistry and music at Queens College in the early 1980s. “I was very fortunate to be able to get a college education with very little debt,” she said. She received scholarships that paid for most of her degree and borrowed about nine thousand dollars for the rest. After graduating, she worked in private industry for several decades. But when her company downsized in the early 2000s, she was laid off. As an older black woman looking for a job in the sciences, Faison struggled to get a foot in the door at other companies. Many potential employers asked her to submit her references as part of the application. But because she still owed money for her bachelor’s degree, Queens College refused to issue her transcripts. (CUNY ended this policy, known as the Transcript Ransom, last year.) “My path to finding employment after 2001 was very inconsistent,” Faison said; For the next thirteen years she worked mostly on temporary jobs. As her income dwindled, her loan payments became sporadic.