Student Debt
Floor Speech
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Mr. BOOKER. Mr. President, it is an honor to stand here with a chorus of my colleagues speaking about an issue that goes to the core of the idea of this country; that is, every generation will be better than the one before. It is the idea that in this Nation we should lead globally in enriching the lives of our citizenry.
The Presiding Officer and I talked a few seconds ago. He said he was going home after this to put his kids to bed. I hope the Presiding Officer doesn't mind me sharing that. I know the Presiding Officer is going to teach his kids the same thing my parents taught me: Work hard and play by the rules so you can go to college and try to achieve your dreams.
When I have traveled all over the State of New Jersey--North Jersey and South Jersey, from urban towns to suburban towns and even rural towns--I have heard the same kind of frustration, which is the rising costs of college. Not only that, I see more and more people who try to take on the challenge of paying for those rising costs and find themselves saddled with staggering debt. The facts reflect the sentiments, frustrations, concerns, and anguish that I hear.
Today the average student graduates from college with around $29,000 in loans. That is up from an average of $27,600 in 2011 and $23,792 in 2010. In fact, right now in New Jersey 16 percent of my constituents are carrying student debt. That is over 1 million New Jerseyans who are weighed down by this significant financial obligation.
Let me put this in perspective because it has a ripple effect within our economy. Take, for example, our housing. Housing is such an important driver to economic development, and it is an important driver to jobs. Owning a home is a dream many people in America have as well. Well, the reduced purchasing power due to high student debt levels is holding back people's ability to help drive our economy forward.
The housing industry, which is still recovering from a crisis, is an example. The National Association of Realtors cited student loan debt as a primary reason for the decline in housing purchases among first-time buyers. Of 20 percent of first-time buyers who find it difficult to save for a downpayment, 54 percent of first-time buyers said student loans make it tough to save money. According to a recent survey by the National Association of Realtors, about half of all the people polled in a survey said student debt was a huge obstacle to buying a home. According to the Federal Reserve of New York, from 2009 to 2012 home ownership rates fell twice as much for 30-year-olds who had a history of student loans than it did for those who don't.
This is a problem which is impacting families, and it is stifling people's ability to participate and make our economy robust. It is making job growth a challenge. It has many different layers.
What I want to focus on for the last few moments is my desire to keep America No. 1. When it comes to educating our populous, we should be and have been historically top in the globe, especially at the higher education levels. When we created programs that many of my colleagues have cited--I heard Senator Durbin speak about programs that literally took him from a lower middle-class environment to achieving his dreams. Accessing affordable college loans allowed him to achieve his dreams. We created these programs because we understood that the workforce in this Nation is essential for economic competitiveness. Indeed, in a global knowledge-based economy, it is the knowledge of the people that drives the economy forward. Without highly skilled workers, America simply won't be able to compete in this new global economy. This wisdom has been understood for decades, for generations. You educate your workforce to the highest levels on the globe, and your economy will lead the globe.
Well, today we are seeing challenges, and we are seeing this reality change. Today the average price of a college degree in the United States has climbed to $13,856. Compare that with some of our critical global competitors. Take the UK, for example. In the UK, the average cost is $5,288 for a higher education. Take Germany, another one of our global competitors. German students pay a mere $933. Those competitive economies understand that they don't want to put up barriers so their young people can learn. They want to remove them.
The cost of college in America puts our young people at a severe disadvantage compared to their peers around the world. It is not a level playing field. We are asking our kids to compete globally, but we are putting up barriers that are unique to this economy.
When the cost of college in the United States is now more than 51 percent of the median income in America--let me say that one more time. The cost of college in America is now 51 percent of the median income in America, while the cost of college in Germany is just 4.3 percent of that country's median income. When the United States has one of the highest percentages of adults--we are one of the top in the globe for adults 55 to 64. That generation of Americans which had the kinds of student loan programs and opportunities Senator Durbin talked about are at the top, but only 43 percent of Americans ages 25 to 34 have a degree. Instead of that younger group being at the top, America has now--compared to our competitors--fallen to 16th place globally.
In other words, older Americans who benefited from a rational system of affordable college and abundant affordable loans are leading. Madam President, 55- to 64-year-olds are leading the globe in the percentage of population with a college degree. The younger we are getting in our country, the lower we are falling in our competitiveness with our competitors in terms of the kids who have college degrees. We wonder why that is. It is because the ability to afford college has been getting more and more difficult.
I am encouraged by my colleagues. We should be doing everything to encourage forthcoming generations to pursue higher education so we don't slide further in global rankings and compromise our long-term ability to compete. That is
why I am standing here right now. That is why I am proud to cosponsor Senator Warren's newly introduced legislation, the Bank on Students Emergency Loan Refinancing Act, which would allow those with outstanding student loan debt to refinance at the lower interest rates currently offered to new borrowers. It simply allows them to refinance loans the way you can with a mortgage and other types of loans. This will make us more competitive.
I commend a lot of my colleagues who spoke here. I especially commend Senator Harkin, Senator Reed, and Senator Gillibrand, who have been so active in calling attention to this issue.
We cannot afford for the cost of obtaining a higher education to be decades of crushing debt. It is unacceptable. The legislation we are talking about today seeks to lighten the burden on student borrowers and to put money back in their pockets and to help fuel our economy but, more importantly, to help everyone understand that in this Nation we are still doing everything possible to lead the globe in education.
There is a lot of work to do. My team is trying to focus on some issues I saw as mayor. For example, when I was mayor we worked with schools and financial aid counselors to help families simply fill out these forms that are necessary to obtain aid.
The College Board estimates that 2.3 million students do not fill out the free application for financial aid form, better known as the FAFSA form. They don't fill it out because of its complexities. They don't fill it out because of issues that make it difficult to even report what is necessary. As a result, many qualified students are skipping this process because they find it complex and burdensome. They are not even getting into college, not even afforded that pathway to cultivate their genius and apply it to our economy.
So much more can be done. This should be a national call to make college as affordable in this generation as it was for past generations. Past generations in America led the globe and drove the top economy on Earth because of that education, but now we are raising the wall and shutting out more of our young minds from this pathway because of unaffordable colleges.
For individuals, a college education translates to more than just odd job opportunities, more than just higher earnings, it is an ascent up the economic ladder.
The PRESIDING OFFICER. The Senator's time has expired.
Mr. BOOKER. Mr. President, I will conclude with this: In a recent study, it was found that the United States could add $500 billion to the gross domestic product over the next 15 years by increasing the number of workers with postsecondary education by 20 million--more workers, a greater economy, a more successful America, and a nation that leads the globe. Let's do and learn from what our parents and grandparents knew and did in this body and around the Nation.
Let's make college affordable for our citizens.
I thank the Presiding Officer and yield the floor.
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