The Merits of Achieving Debt: An Open Commencement Address to the Class of 2016

Graduation
“Graduation” (source: Wikimedia)

Graduates of the Class of 2016, like you, I am no one in particular. There are more than 7 billion Homo sapiens breathing, breeding and being worldwide. In collector’s terms, our species lacks rarity.

To tie that sentiment into the pomp and circumstance of the day, the National Center for Education Statistics (NCES) estimates that, this year alone, roughly 3.3 million Americans will earn a high school diploma. That is as though the entire city of Los Angeles simultaneously embarked upon the market with equal credentials each and every year.

The take-away? Go to college.

But the NCES also estimates that, this year alone, roughly 2.8 million Americans will graduate with a Bachelor’s, Master’s or Doctorate. That is as though the entire city of Chicago simultaneously embarked upon the market with a higher education each and every year.

Individually, we are surplus. You have likely heard the analogy: identical little ants, marching off to work. Some are trampled underfoot, others squished below a grubby thumb. Still, most survive to contribute to the communal cause, the market.

The market exists to grow. To grow, the market needs unspectacular you and no-one-in-particular me but more so you because you can do the same work as your elders for far less money. The market justifies this age bias in the vague terms of “experience.” But, when you receive your first year-end review, look at your metrics. Do you produce on-par with your elders whose paychecks are fattened by past promotions? I imagine you will or your employer will find someone who does.

Unlike your elders, you graduating no-ones-in-particular stand at a proverbial crossroads. Here, you make a choice. Do you trod the road less traveled by? A road equally lain and just as fair? Or do you feed the thing that must grow or collapse? The thing that – by fostering advancements in medicine, agriculture and technology – has made possible the very existence of 7 billion You’s worldwide.

You choose.

Statistically speaking, you have no worries. Not all of you, of course; there are outliers in every large sample. But the average You, the average graduate, is young and healthy. You have no spouse or children who depend upon you financially. You have no career to speak of. Maybe you brew espresso at a local coffee shop or wait tables at some chain restaurant; your work at this stage in your life is nothing to build upon. Your résumé is not enhanced by a stint at Applebee’s. If Applebee’s doesn’t make you happy, you can move laterally to Chili’s or TGI Friday’s with negligible repercussions. Here’s the kicker, though. If what you do does make you happy, you can stay. College, career, marriage and procreation are not involuntary stages of human development but choices made.

Nothing truly ties you down.

But before you depart, diploma in hand, inflated by a reckless sense agency – before you strike-out on excursions of self-discovery in a world that is as wide as ever but far more accessible – look to your left. That no-one-in-particular needs you. Look to your right. That no-one-in-particular needs you, too. A market of no-ones-in-particular cannot thrive, cannot grow, without a surplus of no-ones-in-particular and the market must grow. The market exists to grow.

That is why it is imperative that, beginning this very day, you accumulate debt.

Some people may call higher education a racket. It is. College tuition varies but most reliable sources estimate that tuition at a public university will cost an in-state student nearly $10,000 per year. Out-of-state students can expect to pay nearly $24,000 per year. Add to that another $10,000 every year to eat and share a moldy and cramped dorm room with a perverse and unhygienic stranger and nearly $1,300 for textbooks. That makes the comprehensive college experience “worth” more than $85,000 for an in-state student and more than $141,000 for an out-of-state student.

Do those numbers seem absurd? They are. Especially when you consider that out-of-state students pay higher tuition than in-state students at public universities because the in-state student or the in-state student’s parents and all other tax-paying no-ones-in-particular – in short, all of us (regardless of whether we or our dependents went or plan to go to college) – we all pay taxes that fund our state’s public universities. Still, an in-state student can expect to pay $85,000 for a degree at a public university that is subsidized by taxes.

All that comes with a caveat. We expect a 4-year degree to take 4 years to earn. However, NCES has found that students graduate with a “4-year” Bachelor’s degree at a rate of 59% in 6 years. I did not misspeak; only 59% graduate in 6 years with a 4-year degree. So, say you’re among the average. Statistically speaking, you are. College may cost you around $127,800 at a public, in-state university. All this to get a job so you can earn money, right? Isn’t that why people go to college?

But don’t be discouraged. Institutions abound that specialize in supplying high-interest loans to unexperienced, untested and uncredited You – fresh out of your parents’ nest. Like tuition, student-loan interest rates vary but often run around 5.5% to 6.5%. For the sake of easy math, we’ll call it 6%. That means that you can add around $7,600 every year that you don’t pay off your $127,800 4-year degree that you earned in 6 years. Granted, that $7,600 will drop little by little with each payment you make and fiscally savvy parents now save-up for their children’s college tuition from conception. In practice, the average debt with which a college graduate limps away is around $35,000. The College Board has found that it takes 11 years for the average graduate to pay-off his/her loans. In terms of take-home money, a college grad can expect to be 33 years old before he/she begins out-earning his/her high school classmates who did not go to college.

College tuition increases at a greater rate than inflation. I can’t say where all that money goes. However, the average president of a public university can expect to amass around $430,000 every year. That salary is nearly 9-times the national average for household income and trumps the President of the United States’ measly $400,000 per year, and a university president’s bloated salary is just one of many.

But student loans are such a small part of the racket. There are countless opportunities to achieve debt. The average house in the United States costs nearly $190,000. A new car costs, on average, more than $30,000. A wedding will likely cost you more than $26,000. Conversely, the average contested divorce costs anywhere from $15,000 to $30,000. And, statistically speaking, you will get married. If you get married, you will get divorced – statistically speaking, of course.

Take-on as many loans as you dare and take as long as you need to pay them back but you are expected to pay. The market needs your debt and needs you to pay your debt, which is fair because you need things – shiny things, cutting-edge things like wristwatches with banking apps that help you pay for more things just like your smart phone, which helps you pay for things, because the card and cash in your wallet was somehow inefficient at helping you pay for things.

The market needs your debt. You need the market. Ergo, you need debt.

Debt is the new family. When my parents were wed, the average American male married at 23 and the average American female married at 21. For the first 90 years of the Twentieth Century, Americans married in their early 20s. Now, we’ve shifted that milestone to our late 20s. Men marry at 28 and women at 26. Fewer Americans are assuming familial responsibilities at a young age. Debt makes that okay. Debt is the baby you must nourish. Feed it. Clothe it. Sacrifice your dreams so your credit score may flourish. Why do you need a good credit score? So you can achieve more debt! Debt keeps you at home at night and in a cubicle during the day. Debt keeps young people tethered to the market.

Do you think you can escape it? Quite the contrary. Life is a series of unexpected expenses. If it is not student loans, it is cancer or a complicated/pre-mature birth or an ill-advised investment or keeping up with the Joneses. But for many of you, especially at this stage in your life, that which settles you into a cookie-cutter suburb or high-rise apartment when you could be experiencing the greatest wonders on Earth will be student loans.

Embrace it. Who needs to backpack to Machu Picchu or build houses for the destitute in Haiti or sip tea with monks atop the Himalayans or teach conversational English to eager students in Thailand or help establish sustainable agricultural practices and fight hunger in the Amazon or bring basic healthcare principles to remote communities in Tanzania? You should embark upon these adventures now – when it is easiest, when it is doable, when you are young and healthy, when you have no major responsibilities and no dependents. Don’t think you’re privileged enough? Check out the Peace Corps. They’d love to steal you from the market.

What if you do want to go to college? What if you hope to accumulate debt like a good no-one-in-particular? But what if that debt comes from majoring in the Liberal or Fine Arts because the Arts make you happy? Good enough, you’ve earned debt, but here’s the truth: the market does not need your happiness. The market needs engineers, lawyers and doctors. The market needs calloused laborers and white-collared managers. So, you like graphic design? Major in advertising. You like literature? Major in communications. You like performing arts? The market has nothing for you. I don’t know; maybe, you can teach kindergarten or like something else or do something you don’t like.

Think of your parents and grandparents who, long ago, made that decision to accumulate debt and shiny things. A population increasingly dependent upon social security and Medicare cannot survive without tax-paying You dutifully at work and supporting the market that, through investments projected to grow as fast or faster than inflation, secures someone else’s social status.

Besides, those hypothetical adventures of goodwill and self-discovery have all been done before but have yet to end human strife. After all, build a house and you’ve sheltered one family. Immerse yourself in the market and you’ve filled a gas tank in a pontoon boat for each of America’s 4 million annual retirees. Can you imagine what repercussions may arise if the market lost an entire generation to personal growth and goodwill?

Do you want to be a doctor? Great. How about an astronaut? Good for you. Your aspirations matter little so long as you and all other no-ones-in-particular now and always accumulate debt. The market depends on it.

Oh, and congratulations. You’ve done it. You’ve graduated, just like millions and millions of no-ones-in-particular each and every year.

Carpe diem!

Caps and tassels are in the air but commencement addresses are the worst – so full of fluff, cliché and Godspeed. So few are honest. It got me thinking; what would be the most relevant yet disheartening commencement address that all graduates should though no graduate wants to hear? Well, this is what I came up with. The numbers are real. (That is, the numbers came from credible sources.) I didn’t make any of it up. Hope you enjoyed it. Hope it made you a little angry. Hope you share it. And I hope it got you thinking and, maybe, talking.

Good luck out there, graduates! It’s a mad world.

– DC

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