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With 17 percent of borrowers behind in their payments or in default on the nation’s $1.2 trillion in college loans, it’s not surprising that student debt is emerging as a campaign issue for the 2016 election. It’s not only an important public policy problem, but also a matter that resonates with young millennials and might lure them to the polls on election day, according to a Washington Post analysis on May 24.

But some proposals, such as eliminating student debt at public colleges or reducing interest rates, might not target the borrowers who are struggling the most. An April, 2015, Urban Institute report points out that student debt isn’t a problem for the typical undergraduate student, but rather for smaller groups of atypical students.

“I read so much about how student debt is ruining people’s lives, but most people with student debt are just doing fine,” said Sandy Baum, one of the co-authors of “Student Debt: Who Borrows Most? What Lies Ahead.”

“It’s really important to understand exactly which are the people who are borrowing unmanageable amounts of money. There’s not one solution for all of them,” Baum added.

Baum, a long-time expert in college costs and student debt, studied the most recent data at the National Center for Education Statistics. In an interview, she identified three categories of student debtors who deserve attention.

1. Graduate students  

The reason that the “average” student’s debt is so high — almost $23,000 — is because the figure includes the loans of graduate students, who are permitted to borrow unlimited amounts from the federal government up to the cost of attendance. Sixty-five percent of 2012 graduates who borrowed $50,000 or more were graduate students.

Lawyers accounted for 8 percent of graduate students with high debts. Doctors accounted for 5 percent.

“People think of student debt as an undergraduate problem, but it’s really graduate students,” Baum explained.

Many of them find high-paying jobs after graduation. With the downturn in the legal field, some law school graduates might be suffering. “But these are people with B.A.’s,” said Baum. “You can argue they knew what they were getting into.”

Of course, these students would welcome a reduction in student loan interest rates. But Baum argues that the savings would be a “windfall” to upper-income Americans. Low-income Americans tend to have smaller debts, she said, and wouldn’t benefit as much.

2. For-profits

At first glance, there’s been an alarming increase in the number of four-year college graduates with very large debts. Back in 2004, only 1 percent of students who earned a bachelor’s degree that year had borrowed $50,000 or more, adjusted for inflation. That grew to 10 percent in 2012.

With colleges hiking tuition prices well above the inflation rate, heavy debts aren’t surprising. Still, they’re not commonly carried by conventional undergraduates.

“Those who do have this high level of debt disproportionately are in the for-profit sector, independent of their parents, or in school for more than four years,” wrote Baum and her co-author Martha Johnson.

Graduates of for-profit schools accounted for a quarter of the students who were graduating from college in 2012 with more than $50,000 in debt, but they constituted only nine percent of all degree recipients. By contrast only six percent of students who earned their degrees from a public four-year school had such a high level of debt. At private non-profit colleges, 12 percent of graduates had high debts, still less than half the rate of the for-profits.

3. Dropouts

People who didn’t complete their degrees account for 59 percent of the students with low debts, that is, debt between $1 and $10,000. Those without college degrees are less likely to pay back their student debt, not only because they often can’t get a high-paying job, but also because “some people feel ripped off and they shouldn’t have to pay it back,” explained Baum.

One sign that smaller debtors like these are driving the default rates is that the average debt of people in default is roughly $14,000, much less than the average student’s debt of almost $23,000. It’s not a small universe of people; 41 percent of those who start college fail to complete a four-year degree in six years. Completion rates are even lower at community colleges.

How to help these students with their debts is a tough problem. “You don’t want to say, ‘if you don’t graduate, we won’t make you pay,’” explained Baum.

There is already help, though, for many students. The federal government already has special repayment programs in place, including three different ways to lower monthly payments based on your income. If you’re under 150 percent of poverty line, you pay nothing. Above that, borrowers pay 10-20 percent of their income.  And if you enter public service, the federal government can wipe out your student debt after 10 years.

The programs are still new and people complain about bureaucratic red tape, but they’re good news for the teaching profession. Those who received master’s degrees in education accounted for 17 percent of the graduate students with $50,000 or more in debt. A public school teacher can qualify for both pay-as-you-earn loan payment reductions and public service debt forgiveness. After 10 years of teaching, and making income-based payments, a public school teacher’s student loan should disappear.

The student debt debate, at least in political circles, often ignores that.

This article also appeared here

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