The rising cost of college is causing long-term problems for this generation of graduates. Now that Americans are beginning to recognize the damage student loans are doing, will the government focus on making college more affordable? Or is this just the way things are?

According to a new Gallup-Lumina Foundation poll, many Americans feel that college is no longer affordable. Just 17 percent of white Americans polled believe that “education beyond high school is affordable to anyone in this country who needs it” and only 19 percent of black people polled believe the same.

Hispanics are far more optimistic in their view of college affordability. By way of the Gallup poll, more than 50 percent of Hispanics polled responded that college is affordable to those who live in America.

Separated into three categories of white, black, and Hispanic, the gulf between how Hispanics feel about the cost of higher education compared to whites and blacks is staggering. That may mesh with how some view the outlook and direction of the country.

But this study also mentions the rising cost of tuition and the copious amount of debt that students are saddled with upon exiting college. According to Gallup, tuition at a “public four-year college has increased by more than 250% over the past three decades.”

That’s likely why many students carry an average of $30,000 in student loan debt and why some in the federal government want to extinguish student loan debt when filing for bankruptcy.

This new study is another in a long line of studies that show just how un-affordable higher education has become for some. With the rising cost of tuition and student fees, many students are being priced out of the ability to attain a college degree.

Even Senator Elizabeth Warren called out the federal government for its student loan problem. She said that outstanding student loan debt needs to be refinanced and that “college affordability and student debt” are issues that need to be included in the re-authorization of the Higher Education Act.

The cost is turning off some students as they are afraid of amassing thousands of dollars in debt and ruining their financial future. If anything, this shows just how dire the situation has become and why the federal government needs to act on fixing the problem.

Just how bad is this college debt problem, anyway?

Consider this. In the fall of 2012, 66 percent of high school graduates from that year were enrolled in college, and that number does not include students that waited longer to enroll or non-traditional adult students.

Currently, there is a call for a more affordable college education, which makes sense. It comes on the heels of a recession that undercut the value of a college education. Even those with a college degree were not immune to the financial hit that the economy took and those still paying off their student loans were often left without the very job they had always assumed would pay off their educational debts.

A study by the Urban Institute found that almost 300,000 Americans with master’s degrees were on public relief, along with 30,000 with doctorates. The average debt of a college graduate is $35,200 and that can take decades to pay off.

For black students, this issue can be even worse. A Gallup poll found that in the last 14 years, around half of black college students graduated with student loan debt exceeding $25,000. This is compared to 35 percent of white students had loan debt that high.

Often the only way for black students to afford a college education is by taking on these loans. Four out of five black students take student loans to attend college and typically have nearly $4,000 more student loan debt compared to white students, according to a 2013 report by The Center for American Progress.

There is deep inequality here in the U.S. In 2013, the median income for black households was $34,600, and the poverty rate is 27%, nearly three times that of white Americans.

Furthermore, college students with high debt tend to suffer long-term health issues

According to a new study via Gallup.com, college graduates “who took on the highest amounts of student debt, $50,000 or more, are less likely than their fellow graduates who did not borrow for college to be thriving in four of five elements of well-being: purpose, financial, community, and physical.”

The survey has an area of 25-years as Gallup only polled individuals who graduated college between 1990-2014. What the study found is that graduates who are burdened with $50,000 or more in student loan debt may struggle to repay their loans, which in turn has causes them to delay making large purchases, e.g. buying a new home.

Those saddled with debt are unable to save as much as their counterparts who do not have as much debt or none at all, and Gallup’s “thriving gap,” percentages between those with $50,000 in debt less the percentage of student’s without it, shows an 11 point percentage spread between the two parties.

The study also found that more recent college graduates seem to be performing worse than those who graduated before 2000. Those who obtained a college degree between the years of 1990-1999 are doing better socially, physically, and in purpose.

Student loan debt now outweighs credit card debt and has surpassed $1 trillion. With wage growth still stagnant and many individuals going without full employment, this will mean more health issues and many former graduates with void savings accounts as well.

Even the coveted private school does not pay off right away

Ivy League schools are prestigious, with many students vying for acceptance and few earning a spot as an attendee. However, for people seeking the cushiest early-career salaries, the Ivy Leagues aren’t paying off instantly.

Princeton, Harvard, Yale and Columbia don’t make it into the top 30 universities for starting salaries. The University of Chicago, a tie for fourth, doesn’t make the top 200.

The PayScale survey tells us that Princeton, the highest performing Ivy League school offers its graduates a median starting salary of $60,000 – earning is the 34^th highest in the country.

And spending a year’s worth of salary for one year of higher education at Harvard does not always lead to great career results.

According to U.S. News and World Report, a recent Brookings Study shows that “other schools may either not cost as much and yield a similar salary and success of loan repayment, or they may cost about the same but generate higher earnings potential.”

On the other hand, going to an elite military or tech school might just be your best bet. For example, graduates of the United States Naval Academy at Annapolis earn a median annual salary of over $80,000 over their first five years post-graduation, earning the school the top number of surveyed schools.

Now granted, the nation’s traditionally elite schools distinguish themselves with a salary growth near graduates’ mid-career. Graduates from Ivy League and like schools see their pay jump significantly when they are more than ten years past graduation. But the quick payoff that many students expect after graduating from Harvard or Yale may not happen.

On the flip side, there are options today, especially with online courses. With less red tape than the traditional college format, online students can earn credits while still working full time, maintaining families and dealing with illnesses. Whether students take just one course remotely or obtain an entire degree, they can take on the demands of college life more readily.

Each year online learning initiatives becomes less of a fringe movement and more of an incorporated and accepted, form of education. More than 6.7 million people took at least one online class in the fall of 2011, and 32 percent of college students now take at least one online course during their matriculation. It is even becoming commonplace for high schools to require all students to take an online class before graduation as a way to prep them for the “real world” of secondary education.

The flexibility and convenience of online learning are well known but what is not as readily talked about is the way distance education promotes diversity of the college population. With less red tape than the traditional college format, online students can earn credits while still working full time, maintaining families and dealing with illnesses. Whether students take just one course remotely or obtain an entire degree, they can take on the demands of college life more readily – leading to a student population with more variety.

The Babson Survey Research Group recently revealed that while online college student enrollment is on the rise, traditional colleges and universities saw their first drop in enrollment in the ten years the survey has been conducted. This drop is small – less than a tenth of one percent – but its significance is big. A trend toward the educational equality of online curriculum is being realized by students, institutions, and employers across the board. The benefits of a college education through quality online initiatives are now becoming more accessible to students that simply cannot commit to the constraints of a traditional campus setting.

A controversial experiment that could lead the way to even more college credit accessibility is MOOCs or massive open online courses. As the name implies, these classes are offered to the general public at a low cost, or no cost, in the hopes of earning their students college credit. California-based online course provider Coursera recently had five of its offerings evaluated by the American Council on Education for college credit validity. Four of the courses were recommended for college credit by ACE, and one was endorsed for vocational credit, providing student work verification through a strict proctoring process.

These credits are not earned through community colleges or online-institutions; Duke University, the University of California at Irvine and the University of Pennsylvania are on Coursera’s list of places the courses will earn credit for students that pay a nominal fee. Students that obtain these credits through Coursera can approach any higher education institution and seek their inclusion in a degree program, but the final discretion is up to the particular school.

MOCCs are certainly in an infancy stage and do not provide a “sure thing” yet for students that participate. In the Babson survey mentioned earlier, only 2.6 percent of schools offer a MOOC, but an additional 9.4 percent are building a MOCC plan. The potential for further diversity and equality in education through MOCCs is certainly on the horizon. This form of online learning means that students do not have to commit to an entire course of study to obtain credits or even commit to a particular institution upfront.

MOOCs will further eliminate the socio-economic barriers that keep promising students from seeking out college credits. Students are given more flexibility in scheduling at an affordable price. Though the MOOC trend has its dissenters, I believe it will win over even the most skeptical and increase accessibility for all people that seek higher education. After all, at one time the mention of online courses raised a few eyebrows in the educational community and look how far the concept has come.

Plus, not everyone is paying full price for a college education. In fact, a vast majority are paying below the advertised price.

By way of NPR.org, the National Association of College and University Business Officers conducted a study “of tuition discounts at private, nonprofit, four-year colleges and universities.”

The information released in the survey suggests that all colleges that were surveyed offered some sort of discounts to its students.

“They estimate 89 percent of first-time, full-year freshmen received some discount in 2014-2015. Of those students, the average grant they received is estimated to cover 54.3 percent of tuition and fees.”

That’s at least half off of student fees and maybe tuition

Still–even with the steep discounts, it’s not enough to curb the rising rate of students who carry too much debt. At least this survey doesn’t go into detail as to how these discounts may offset the full cost of college or how it impacts the load of debt that students carry post-graduation.

While the study is a brief overture into how some schools attend to the full cost of college, it also shows just how expensive some schools are if nearly 90 percent of freshmen can utilize discounts. Wouldn’t it be nice to have a college system that was just plain affordable for all students, without the trappings of all these discounts and needing to spend so much time tracking down the money to attend?

Who wants to make college affordable again?

As it stands, things may not be looking good

According to a study, there is a correlation between the rising cost of Medicaid and declined spending on higher education. Created by Moody’s Analytics for The National Commission on Financing 21st Century Higher Education, the study suggests that state budgets will constrict spending on higher education because of the high cost of Medicaid.

Because money from the Affordable Care Act will start to slow by 2020, many states will have to allocate more funds for Medicaid, which in turn will cause a decrease in discretionary spending.

So, many states that are struggling with budget deficits or have deeply cut funding for higher education will likely face more financial issues.

The study portends that Medicaid will outrun state revenues. If that potential trend holds, then higher education truly is in trouble.

To further foreshadow the problem, higher education spending is only expected to grow by as little as four percent each year. Any growth may look good on the surface, but that type of spending will likely cause many colleges and universities to reshuffle their spending priorities.

Louisiana’s budget crisis led Governor Bobby Jindal to look at cutting a record $600 million from higher education. Because of the loss of funding, Louisiana State University (LSU) planned to file for academic bankruptcy. That will mean that LSU will be forced to raise tuition and student fees, likely pricing some students out of attending the university.

Likely more states that face this crisis of funding will attempt to raise revenues and cut higher ed funding. Unfortunately, education funding is usually the first to get cut when state funding gets tight. Because this issue isn’t supposed to shock state budgets for at least another five years, hopefully, states will take precautions now to prepare for the issues down the road.

Here’s who’s talking about solutions

U.S. Senator Marco Rubio spoke about his efforts in his home state of Florida, and perhaps on a federal level, to make college attendance a shared cost. Rubio is no stranger to college debt. When he arrived at the U.S. Senate, he still had $100,000 in outstanding student loans. Rubio has been upfront about his modest upbringing and also the power his education gave him but he has acknowledged that the cost is too high. The basics of his college plan would allow private investors to pay for the tuition of college students in exchange for a portion of their earnings later on. This would mean the students acquired no traditional debt and would not start out their careers in the hole – at least not in a typical way.

While I like the out-of-the-box thinking of this plan, it raises more questions than answers. At least when a student takes out a federally-backed loan or even a private one that meets federal regulations, there is some protection for the student. I worry that allowing too many private investors in on the college lending game could mean more financial pressure on the borrowers. And what happens if a student finds him or herself unemployed for a long period of time? Or unable to work due to injury? These are all issues that would certainly be addressed before legislation was drafted and approved but there are already some red flags that pop up in this hands-off government approach to college debt reform.

Another college payment idea that is arising across the country is a state-run repayment program that is similar to Rubio’s private investor one. Already in Oregon the Pay It Forward program has been approved (though not yet enacted) that will give students their public college education upfront, free of cost, in exchange for paying the state a portion of their earnings post-college. Supporters bill it as a “debt free” alternative to a college education, but like Rubio’s plan there is still money owed at the end of the college term that does impact actual earnings. It will be interesting to keep an eye on Oregon in the coming years to see how the program impacts the first groups of students who take advantage of it.

What if a public college education was completely free, though? That’s the approach Tennessee Governor Bill Haslam wants to take when it comes to the state’s community colleges. At his State of the State address, he called for free tuition at Tennessee’s community colleges to improve the state’s reputation as one of the least educated. Haslam proposed that the money to pay for it come from the state’s lottery earnings that would be placed in a $300 million endowment fund. While a short-term solution, I’m not sure that this is a sustainable payment plan. But if even one class of students in the state can take advantage of it, that may make a huge positive impact on Tennessee’s long-term economic outlook.

And of course, President Obama has some of his solutions as well. For example, during his 2015 State of the Union address, he laid out proposals to revamp the tax code by raising taxes and fees on the wealthiest Americans and largest financial institutes. The additional money from these taxes would be used to pay for free tuition for two years of community college.

Obama’s plan would give many people in America the opportunity to receive an education– something that many people in our country have always wanted, but could never afford.  The President points out that more people will have the ability to obtain a degree, and we will also see a more competitive nation with a stronger middle-class economy.

In his proposal for free tuition, Obama highlights that students would need to maintain a 2.5 GPA, attend at least half time and be on track to graduate on time. The proposal would not be exclusive to recent high school graduates.

The President estimates the cost of the free tuition program at $6 billion a year

I think community colleges are the key to an affordable education, especially when paired with 4-year college initiatives. If community college becomes more affordable, I think that some students may not have to work full-time as they take classes so that they could quicken the pace of their attendance.

Here are some other ways that the President has increased access to college education:

Enforcement of the DREAM Act. The Development, Relief and Education for Alien Minors, or DREAM, Act will an estimated 2.1 million young people in the U.S. with access to an education and amnesty from deportation. While Obama’s administration has stressed the ethical points of this act, rightfully so, it offers may economic benefits for America as well.

The Center for American Progress estimates that the DREAM Act will create 1.4 million new jobs by the year 2030 and that it will infuse some $329 billion into the U.S. economy.

Pell Grant Increases. The President has also pledged to double the amount of funding available in the form of Pell Grants over the next three years. Unlike student loans, Pell Grants do not need to be repaid. For the 2011–2012 school year, the maximum award amount was $5,550.
While a Pell Grant cannot cover all of the college costs, it goes a long way towards covering in-state tuition or community college courses. All students can apply for the program, too, and students receive aid awards based on financial need and cost of attendance.

By 2017, the maximum amount awarded to students is expected to rise to $5,975. By 2021, the Congressional Budget Office estimates that 820,000 more Pell Grant awards will also be available. The money will come, in part, from restructuring to the distribution of federal student loans. By implementing a direct student loan program, instead of a bank-subsidized one, $68 billion will also be saved by the year 2020.

Higher College Tax Credits. The Obama-Biden administration plans to triple the current tax credits available to students and parents of students paying college expenses, too. The American Opportunity Tax Credit gives a $2,500 tax credit maximum per student and students can claim it for four years.

According to the IRS, up to 40 percent of the credit is refundable, up to $1,000, to people that file even if no taxes are owed. In addition to courses and fees, the new tax credit also covers related costs like books, supplies, and required class materials.

Income-Based Loan Repayment. President Obama has often said that he believes that paying for college should not overwhelm graduates. As a reflection of this, he has pledged to expand income-based repayment options to keep the bills from college from becoming unmanageable. Around two-thirds of college students have a debt of over $23,000 upon graduation. This can be especially difficult for students that want to enter public service jobs and those who face unexpected financial hardships like unemployment or serious illness.

Beginning in 2014, students can limit payments to 10 percent of income – a reduction from 15 percent in the previous law – which means a reduction of $110 per month for unmarried borrowers that owe $20,000 and make $30,000 per year. An estimated 1 million borrowers will be positively impacted by this change in repayment options. Also, borrowers that make monthly payments will be allowed debt forgiveness after 20 years. Public service workers like nurses, teachers, and military employees will receive debt forgiveness after just ten years.

Many Americans wish they could pursue their dream of a college education, but they just do not have the means to follow through with their plans. I appreciate Obama’s focus on the future of America’s children, inclusion and equality, and college affordability.

But as much as the President has done to make college affordable, here’s another big idea to transform the state of college affordability today: a free college education.

Free college: the ultimate solution?

Yes, free college

This is something that presidential hopeful Bernie Sanders hopes to accomplish, in addition to easing the student loan burden that many college graduates carry now.

Currently, student loans are thought of as the cost of doing business. But costs are rising in an out of control manner, and each class that finishes college graduates deeper and deeper in the hole. According to the Boston Globe by way of commondreams.org, the class of 2015 will carry a student loan debt of $56 billion and is “the most indebted class in history.”

What if there was no cost to obtain a college education and it was viewed as a basic right, much like the K-12 public school system? It seems that the knee-jerk response is to claim that the nation can’t afford it. The trillion-dollar college education industry, coupled with the lending companies that “help” finance these endeavors, would feasibly go under if students did not have to find, earn or borrow the tens of thousands necessary to prove they care about their career.

Perhaps that’s true. But how would the economy as a whole look if college student debt disappeared? Instead of taking the first, low-paying job that came along to desperately find the cash to start repaying loans, maybe students would hold out for the perfect job where their talents and education could be best utilized. Instead of the nearly 22 million young adults living at home with their parents, maybe those kids would invest in their housing and start contributing to that industry faster. Parents who save every penny to pay for college would feasibly have more cash to put back into other aspects of the economy, strengthening whatever industries they touched.

When the facts are examined, it seems that the only ones truly benefitting from the current higher education model are the institutions themselves and the companies that support lending. In the second quarter of this year, private lender Sallie Mae reported $543 million in net income. In 2013 alone, Sallie Mae has spent over $1.2 million lobbying against legislation meant to relieve some of the college debt strain. Much like the skyrocketing healthcare industry costs over the past two decades, colleges and lenders have been left to their own devices with improper regulations.

The result is the “soaring college costs” we hear so much about today. According to the College Board in 1992 one year of college at a public four-year institution cost around $7,500 in today’s dollars. Now that cost is $10,000 higher. Private nonprofits cost around $17,000 in 1992; today the cost is nearly $24,000.  The cost of college is a runaway train at this point. College costs have risen faster than the inflation rate for decades.

While an economy hindrance, the high price tag of a college education has very little resistance when observing the nation’s population as a whole. Colleges and lending companies have, for the most part, gotten “a pass” because the pursuit of knowledge is deemed a worthy one where the price should never be considered an issue. Under the guise of a better-educated workforce, colleges and lenders have been able to get away with more than any other industry providing a basic, American service. What would the reaction be if utility costs rose that quickly, or the price of a gallon of milk?

For a college education to have the intended impact on the individual and society as a whole, it needs to be affordable – or completely free. It is a basic American right.