It couldn’t be a sunnier, more beautiful day to exit your lives — or enter them — depending on how you care to look at it. After all, here you are four years later in your graduation togs with your parents looking on, waiting to celebrate. The question is: Celebrate what exactly?
In possibly the last graduation speech of 2015, I know I should begin by praising your grit, your essential character, your determination to get this far. But today, it’s money, not character, that’s on my mind. For so many of you, I suspect, your education has been a classic scam and you’re not even attending a “for profit” college — an institution of higher learning, that is, officially set up to take you for a ride.
Maybe this is the moment, then, to begin your actual education by looking back and asking yourself what you should really have learned on this campus and what you should expect in the scams — I mean, years — to come. Many of you — those whose parents didn’t have money — undoubtedly entered these stately grounds four years ago in relatively straitened circumstances. In an America in which corporate profits have risen impressively, it’s been springtime for billionaires, but when it comes to ordinary Americans, wages have been relatively stagnant, jobs (the good ones, anyway) generally in flight, and times not exactly of the best. Here was a figure that recently caught my eye, speaking of the world you’re about to step into: in 2014, the average CEO received 373 times the compensation of the average worker. Three and a half decades ago, that number was a significant but not awe-inspiring 42 times.
Still, you probably arrived here eager and not yet in debt. Today, we know that the class that preceded you was the most indebted in the history of higher education, and you’ll surely break that “record.” And no wonder, with college tuitions still rising wildly (up 1,120% since 1978). Judging by last year’s numbers, about 70% of you had to take out loans simply to make it through here, to educate yourself. That figure was a more modest 45% two decades ago. On average, you will have rung up least $33,000 in debt and for some of you the numbers will be much higher. That, by the way, is more than double what it was those same two decades ago.
We have some sense of how this kind of debt plays out in the years to come and the news isn’t good. Those of you with major school debts will be weighed down in all sorts of ways. You’ll find yourselves using your credit cards more than graduates without such debt. You’ll be less likely to buy a home in the future. A few decades from now, you’ll have accumulated significantly less wealth than your unindebted peers. In other words, a striking percentage of you will leave this campus in the kind of financial hole that — given the job market of 2015 — you may have a problem making your way out of.