UW–Madison’s Eleni Schirmer has authored an article for The Nation that is headlined, “It’s Not Just Students Drowning in Debt. Colleges Are Too!”
Schirmer is a joint doctoral candidate with the School of Education’s Department of Educational Policy Studies and Department of Curriculum and Instruction.
In the article, Schirmer explains a culprit for both student and institutional debt is declining public support for higher education. But whereas student debt has been in the political limelight, institutional debt has received little attention.
“Just as decreased state funding has caused students to go into debt to cover tuition and fees, universities have taken on debt to keep their doors open,” Schirmer says.
She continues: “Institutional debt at public colleges in the United States has more than doubled, jumping from $73 billion in 2003 to $151 billion in 2012. As schools borrow more, greater proportions of their budgets service that debt through interest and fee payments. Between 2003 and 2012, university interest payments jumped from $6 billion to $11 billion annually. Similarly, in 2003 public colleges spent an average of $519 on interest payments per full-time student. By 2012, they were spending $750 on interest payments per student — a nearly 45 percent increase.”
Schirmer notes that whereas student debt is intimate, “determining the work we seek and how much of our wages we take home,” institutional debt is far less visible.
“Most students and workers pass through campus unaware of their institution’s dependency on debt financing in any of its basic terms, such as the amount their school owes and what the money was borrowed for — much less who lent it and under what conditions. Lack of budgeting transparency, in combination with complex financing streams, makes these matters intimidating, if not unintelligible, for many, including the workers and students paying the cost.”
Learn more about this issue by reading Schirmer’s article at thenation.com, here.