O’Malley was schooled at home on stu­dent debt trou­bles

The Washington Post Sunday - - BUSINESS - Michelle Singletary

Demo­cratic pres­i­den­tial can­di­date Martin O’Malley sur­ren­dered— just like many other par­ents.

When his daugh­ters were choos­ing their col­leges, he let them have their way. He didn’t want to crush their dreams, and he ended up with crush­ing debt.

Last week, O’Malley spelled out a pro­posal to help stu­dents grad­u­ate debt-free from public col­leges and univer­si­ties by in­creas­ing Pell grants and au­to­mat­i­cally en­rolling bor­row­ers in in­come-based re­pay­ment plans. One key part of his plan calls for help­ing stu­dents and par­ents re­fi­nance their debt at lower in­ter­est rates.

O’Malley knows of what he speaks. In an­nounc­ing his pro­pos­als, he re­vealed that his fam­ily has ac­cu­mu­lated more than $339,200 in stu­dent loans, the bulk of which are par­ent PLUS loans. He and his wife bor­rowed to ed­u­cate their daugh­ters, Grace, 24, who at­tended Georgetown Univer­sity

is a public school teacher in Bal­ti­more, and Tara, 23, who at­tended the Col­lege of Charleston in South Carolina and is now an ad­min­is­tra­tive as­sis­tant for the United Na­tions Foun­da­tion in the Dis­trict. The cou­ple still has two sons to get through col­lege, Wil­liam 17, and Jack, 12.

When O’Malley was gover­nor of Mary­land, he fought to have the state univer­si­ties freeze tu­ition. Even with his vast po­lit­i­cal and le­gal ex­pe­ri­ence, O’Malley couldn’t win a key ar­gu­ment with his daugh­ters that state schools were a good bar­gain.

“I’m blessed with strong-willed women inmy life,” he gen­tly laughed dur­ing a phone in­ter­view while cam­paign­ing in New Hamp­shire. “I wanted them to go in-state. But I lost the vote.”

I can em­pathize with O’Malley’s dilemma. His fa­ther, a World War II vet­eran, grad­u­ated from Georgetown. His daugh­ter pleaded to have the same op­por­tu­nity, although his fa­ther went on the G.I. Bill. And once you al­low the first child to go outand of-state, it’s hard to deny the sec­ond.

We can sec­ond-guess the wis­dom of the O’Mal­leys’ de­ci­sion, and I do. But now that they’ve made it, I hope the fam­ily — given their public plat­form— will use their ex­pe­ri­ence as a cau­tion­ary tale that, for most fam­i­lies, it’s not okay to cave to an 18-year-old whose dreams of a par­tic­u­lar col­lege will cre­ate decades of debt.

“I don’t want to hold us up as a metaphor of ev­ery fam­ily,” O’Malley said. “We are very lucky in that both of us are work­ing and hope­fully will con­tinue to work. I think one thing that is true for all of us as Amer­i­cans, it’s not good for our coun­try or our econ­omy to sad­dle [fam­i­lies] with the sort of debt thatwe have. A lot of fam­i­lies don’t have the abil­ity to go into that sort of debt.”

To­tal out­stand­ing stu­dent loan debt has reached $1.3 tril­lion. When we talk about the stu­dent­loan cri­sis, we mostly fo­cus on the amount of debt be­ing ac­cu­mu­lated by stu­dents. But there’s not enough em­pha­sis on the amount par­ents are bor­row­ing. PLUS loans for par­ents have reached al­most $69 bil­lion, ac­cord­ing to Depart­ment of Ed­u­ca­tion data.

“Bet­ter we have the debt than [our chil­dren] have the debt,” O’Malley said.

That’s a sen­ti­ment many par­ents hold. And even as public ser­vants, the O’Mal­leys (Katie O’Malley is a Bal­ti­more Dis­trict Court judge) may be able to man­age the debt load. But are other fam­i­lies re­ally think­ing through whether they can?

As Con­sumers Union points out, PLUS loans, which are also avail­able for grad­u­ate stu­dents, have much higher bor­row­ing lim­its. The or­ga­ni­za­tion, in a let­ter urg­ing the Depart­ment of Ed­u­ca­tion not to lower bor­row­ing stan­dards for PLUS loans, made some im­por­tant ob­ser­va­tions.

“Loans to grad­u­ate stu­dents are made on the prom­ise that they will see an in­crease in salary from their ed­u­ca­tional at­tain­ment that en­ables them to re­pay the loans they bor­rowed,” wrote Suzanne Martin­dale, a staff at­tor­ney for Con­sumers Union. “Par­ents, on the other hand, do not see an in­crease in their in­comes from their chil­dren’s ed­u­ca­tion. . . . They have no guar­an­tee that their chil­dren will help pay the loans back, or will even fin­ish school. For these rea­sons, al­low­ing par­ents to bor­row many thou­sands of dol­lars in PLUS loans raises unique con­cerns.”

We’ve heard prom­ises on the cam­paign trail this year about help­ing fam­i­lies af­ford col­lege. And we do need some leg­isla­tive in­ter­ven­tion so that many peo­ple won’t be priced out of a col­lege ed­u­ca­tion.

But we also need to press upon par­ents and their chil­dren that dreams can come true with­out go­ing to col­leges that re­sult in a heavy debt load.

As we wrapped up our con­ver­sa­tion, I asked O’Malley an ob­vi­ous ques­tion. What’s the plan for their sons? “I hope to make a com­pelling ar­gu­ment with them to choose more af­ford­able op­tions for their par­ents,” he said. “Imay put your col­umn un­der their pil­lows.”

Hey, gover­nor, I’m will­ing to do an in-per­son in­ter­ven­tion.

Newspapers in English

Newspapers from USA

© PressReader. All rights reserved.