Saturday, September 4, 2010

Love, Marriage, and Student Loans

We like to think of ourselves as hard-headed, tough-minded realists. We imagine that we have passed beyond vulgar superstition and subjective bias to have an objective take on reality.

No metaphysical doodads for us. We are men and women of science, except, of course, when it comes to love and marriage.

Then we retreat into mewling sentimentality. True love, we believe, conquers all, and marriage is just the socially sanctioned way to live your love to the fullest.

We imagine that if two people really, really love each other they can climb any mountain, endure any crisis, suffer any indignity, overcome all obstacles, and prevail.

Sometimes I suspect that we have sentimentalized marriage because it no longer seems to be like a very realistic life choice.

Anyway, when it comes to marriage we are letting our inner adolescents think for us. At some point we will all look back at this brain fever and feel a large measure of embarrassment.

For now, whenever anyone dares to suggest, as I do occasionally, that marriage involves a complex set of calculations, both social and economic, he is greeted with howls of derision.

Yet, a minimal understanding of human social history will tell you unambiguously that romantic love has rarely been the basis for marriage.

Marriage is a social institution; it involves something resembling an arrangement; it is fueled by character and compromise. As the old song didn't tell you: love is not all you need.

I am not saying that there should not or need not be love in a marriage, but I am saying that love will not solve everything.

Lately, it has not been doing all that well at solving the problem of student debt.

Yesterday I read two fascinating reports about the fallout from what Glenn Reynolds at Instapundit has been calling the higher education bubble. See especially his article in the Washington Examiner here.

The Washington Post reported that aggregate student loan debt has now surpassed $840,000,000,000. It is still climbing. Link here. Let's call that the macro level of debt. It doesn't quite rate with the mortgage market, which is well into the trillions, but it is held by young people who are having trouble finding work. When they do find work their salaries are barely sufficient to allow them to make their monthly payments.

To show us what the problem looks like on the micro level, the New York Times has offered an article, based mostly on anecdotes, about how student debt affects the decision to marry. Link here.

Some young people are so in love that they are happy to start out their lives with an overhang of $250,000 in debt. Others are not so happy. One man, upon discovering that his beloved would be bringing $170,000 worth of debt into a marriage, broke off his relationship.

It sounds like we've invented a new social custom: the reverse dowry. At the time of Hammurabi-- that's in 18th century B.C. Babylonia-- it was customary for a bride's family to offer her future husband money or property at the time of a marriage. Link here.

Some less-than-charitable souls believe that a dowry was something like a payoff to take a daughter off of her father's hands. Others saw the dowry as a contribution to the future prosperity of the young couple.

Today, student loans function as something like a reverse dowry. Clearly they are not gender specific; plenty of young men accumulate massive amounts of debt in college. Yet, more women than men gain a higher education these days and women have, in general, less earning power than men.

As the Times reports, students are allowed to pay off their student loans over time... over a period of twenty or thirty years.

$1200 a month for decades... how does that make you feel about your true love?

If that is your situation, every night, when you go to bed, you should pray for inflation.

Of course, there are student loans and then there are student loans. There's debt and then there's debt. Some student loans remain relatively manageable, within the $20,000 range. They are like credit card debt. Most couples can deal with it.

When you arrive at the kinds of numbers the Times is talking about, from $170,000 to $250,000, you are dealing with something that is more like a mortgage.

Of course, some jobs pay so well that $250,000 is going to feel like chump change. Unfortunately, there are fewer and fewer of them. Many a young lawyer has just finished law school with over $200,000 in debt only to discover that most of the great associate jobs in major law firms, the ones that paid salaries high enough to service the debt, have vanished into thin air.

Unfortunately, the debt has not. It's one thing to pay off six figure debt on a salary of $175,000. Quite another to do it on a salary of $50,000.

How are these new realities going to effect dating and courtship?

How many young women will know that they are going to be bringing more debt than dowry to their future marriages and thus, in despair of finding a suitable husband, will start engaging in behavior that makes it less likely that they will find a relationship?

How many women will feel forced to seek out future husbands who are very wealthy?

How many men, saddled with their own student loans and poor job prospects, are going to be looking at women as potential mates?

How many of them will start avoiding the women who might be wonderful spouses in favor of women who they could never take home to their mothers?

As the Washington Post suggests, the current situation is creating a society divided between those who finish college without debt and those who finish with a mountain of student loans.

Next we should ask ourselves how this debt burden is going to affect the housing market? If millions of young people are saddled with decades worth of monthly debt payments for their student loans, how are they going to go out and buy a new home.

If you thought that we were nearing the end of the housing crisis, think about the fact that the new generation has too much debt and too few job prospects. Where is the next generation of home buyers going to come from? Having mortgaged their future to the educational establishment young people are not soon going to be in the market for new homes.

In the past people were happy to go into debt in order to give their children a chance to better themselves through higher education. Nowadays the cost of that higher education has become such a burden that it is transforming many of the best and brightest young Americans into indentured servants.

38 comments:

David said...

linked at Chicago Boyz

ck said...

The feminists(angry,ugly lesbian bitches) have painted all the decent, honorable women into a corner. By taking over the "family courts" system, any successful male with a bright future will rent rather than own. You can get a really hot mistress for a 100K a year, and trade up every 4 or 5 years, and keep all your stuff.

Emanuel said...

I think I've figured out the real reason why going to university is so expensive.

When you go to university, you have to pay the entire year's tuition before the year starts. However, of all students, very few have the money to pay that. Therefore, they go to a bank to get a student loan. However, the bank doesn't just give money to anyone, because they fear that you might not pay them back. Therefore, the student needs to guarantee the bank that they will pay back. This is where the government steps in and says to the banks: "We will give you the money for this student's tuition immediately, and after this student graduates and gets a job, he will pay the government back." After this, you get the loan and go to university.

Now, imagine that the government didn't pay for student's loans. Therefore, there would be millions of students without money for university, therefore millions of students will not attend universities, and universities will be empty, without any students. However, these universities still have to pay bills, taxes, professors, etc. So, they can either pay these from their savings, or they can decrease their prices by a lot so that students could afford going to university without bank loans.

Stuart Schneiderman said...

Thanks, Emanuel, that's very insightful and very helpful.

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