While looking at most media coverage and news analysis about the current economic crisis, you will find almost no references to how the situation is affecting young people. There is little, if any, talk of what is happening in our nation’s schools and universities. However, for a number of reasons, it is easy to see that young people are being hit especially hard.
Young working families
Most of the families that have bought homes under the terms of an adjustable rate mortgage in recent years are first-time buyers, which means many are inevitably younger families. These young families, who saw home ownership as something outside of their reach, were taken in by the low introductory interest rates of the adjustable rate mortgages.
Figures issued in early 2004 show that in age brackets of 35 and above, 70-80 percent of people already owned their homes at that time. For ages below 35, the figure was around 40 percent — so it is clear that families under 35 have been the driving force in home sales in the housing boom from the mid- to late-’90s up through today.
With the resetting of their adjustable rate mortgages, many of these young families are finding themselves unable to make their monthly payments and are facing foreclosure.
This is the same generation which has been targeted by the credit card industry, payday loan scanners, and other financial predators. Credit card debt alone has risen more than 104 percent in the past decade for people aged 18-24, with high interest rates and hidden fees piling on more with each bill. Many youth, who can only find jobs at or near the minimum wage, have been forced into living in a “minimum monthly payment” mindset.
But young homeowners are not the only ones feeling the heat of the current crisis. States are beginning to predict budget shortfalls due to drops in tax revenue, which will hit financially strapped public schools and universities even harder. Already, the Florida teachers’ union, the FEA, is opposing the plan of that state’s Republican-dominated Legislature to implement $20 billion in property tax cuts for the wealthy to supposedly confront the fiscal crisis facing public services.
The crunch that students in higher education have been feeling for a long time is also getting tighter in the current economic atmosphere. Many state universities started off the new school year with yet another round of tuition increases as legislatures slashed their budgets even further. One example is the University of Pittsburgh, where the United States Student Association (USSA) says the tuition increase is 6.5 percent this year, which translates into an average of $1,000 more in charges for each student. Pennsylvania today only provides 11 percent of the university’s operating budget, down from a high of 32 percent in 1975.
The situation for students in the University of Illinois system, which instituted an increase of tuition and fees of 11.6 percent this year, is similar. Over the past decade, costs at the U of I have rocketed upward by more than 250 percent — five times the average rate of income growth and eight times the rate of inflation.
The situation in these two schools is being repeated across the country. Though many public universities have been forced to seek out ever-larger amounts of private financial support, it is usually the students who end up footing the biggest part of rising costs.
Youth and students are not just taking these attacks lying down, however. There have been significant battles on the education front in particular.
After intense lobbying by the USSA and other youth organizations, Congress recently passed (and President Bush was pressured to sign) the College Cost Reduction Act (HR 2669).
The passing of the bill represents the most significant increase in aid to students in more than 60 years. It will bring about an increase in the Pell grant maximum to $5,400 from $4,050, mandates a halving of Stafford Loan interest rates by 2013, limits the amount of debt repayment to 15 percent of monthly income after college, and expands loan forgiveness options for students who go into public service fields after graduating.
The victory in the fight for HR 2669 sets the stage for pushing the fight for education affordability and accessibility to a higher level. Many youth and student groups have fought for passage of the DREAM Act to help make college more accessible for immigrant youth. Although the Senate rejected the bill on Oct. 24, the Young Communist League USA has vowed to work for its passage in 2008.
With next year’s election battles already heating up and politicians courting support, young people have to continue ramping up the struggle to make sure that the issues important to them — education, jobs, an end to the war, and affordable housing — get the attention they deserve.
C.J. Atkins is a youth activist from Arkansas.