Dec. 29, 2005
 
COMMENTARY: Boomers Face College-Loan Squeeze
 
The Providence Journal
 
A unanimous Supreme Court found this month that the government can withhold Social Security money to collect on old student loans. Much as this could impose a hardship on some retirees, the decision is just. Ten years ago, students were defaulting in droves on educational loans from the federal government; today, a smaller fraction continues the trend.
 
Yet, needless to say, students are not owed these resources. Those who shrug off their obligation make a mockery of those who do repay, often at great sacrifice.
 
To reach its decision, the court had to determine the combined effect of several overlapping statutes. James Lockhart, a postal worker disabled by diabetes and heart disease, had brought suit three years ago to block a $93-a-month reduction in his benefits. He said he needed all of his monthly allotment (around $900) to pay for food and medicine.
 
Lockhart had taken out about $80,000 in federally guaranteed loans to attend school in the 1980s. He argued that a statutory time limit prevented Social Security monies from being taken for debts more than 10 years old. The court disagreed, citing a 1991 law that got rid of time limits on collecting student loans.
 
The ruling undoubtedly will spell difficulties for Baby Boomers who retire in the coming years with outstanding student loans. The goverment's brief in the Lockhart case noted that about $33 billion in student loans is currently in default. Debtors who hope to see their Social Security checks intact will have to face the music, and fairly soon.
 
Unfortunately, the other side of the coin is that the newest generation of college graduates is being saddled with a staggering amount of debt -- as colleges raise their tuitions yearly at considerably more than the inflation rate. Two-thirds to three-quarters borrow money to cover their bills. And they graduate with average debts ranging from $17,000 to almost $23,000, depending on whether they attended public or private institutions. The load expands with graduate education. Yet Congress is considering cutting back on loans, and states have reduced their support for higher education.
 
It is fine for Congress to get tough with debtors. But at the same time, it should not trap students in a high-stakes game. Now more than ever, a comprehensive strategy for keeping higher education affordable is needed. This will require help from federal and state governments, as well as colleges and universities.
 
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