The Two Gilded Ages
by John Lawrence, December 8, 2019
The first Gilded Age was in the 1890s. The second Gilded Age is today. By the midpoint of the first Gilded Age about 4000 families owned as much wealth as the remaining 11.6 million. Today in the second Gilded Age the 3 richest Americans own as much wealth as 50% of the rest of the population or 160 million people. In the first Gilded Age 87% of private wealth belonged to 20% of the population and the bottom 40% had no wealth at all. Today in the second Gilded Age the top 0.1% of the population own as much wealth as the bottom 90% while the bottom half of Americans own negative net wealth meaning they're actually in debt.
In the first Gilded Age student loan debt was zero. Today there is $1.6 trillion in student loan debt. Authorities don't want you to know this but as late as 1980 the total amount of student loan debt was zero. During the 1980-1981 school year, an average student paid just over $2,000 each year for tuition, room and board at a public, four-year school. People could work their way through college or their parents could afford to help them on a middle class income. I was on a work-study program in the 1960s where I went to school a quarter and worked a quarter. I graduated in 5 years instead of 4. There was no grade requirement to participate in this program as I was barely in the upper third of my class and just barely gained entrance to Georgia Tech. I did do well on the SAT test or whatever the college admission tests were called at that time.
Today there are much better options to gain an education than going to a 4 year college and taking on an enormous amount of debt that you will never be able to pay off. That means you will never be able to get a mortgage and own a house. You will be in debt peonage for the rest of your life. The college industry has falsely advertised that you will make more money over a lifetime than a non college graduate. That is simply not true, but no matter how much money you make, what difference does it make if all you do with that money is to pay on your student loan plus paying rent. You will still be in debt when you retire and the government will take your student loan debt payments out of your social security.
That is why Elizabeth Warren's plan to tax wealth is a good one. It's the only thing that will reduce the inequality gap which is growing exponentially. Most Americans have been led to believe that the American Dream is to have a good paying job requiring a college education. Wrong! Financially speaking, the American Dream should be to acquire wealth at least not to end up at the end of your life a debtor no matter how much money you've made. I'm not talking wealth like Jeff Bezos or Bill Gates has. I'm talking wealth as in a fully paid for house and maybe some rental property. It could include a stock portfolio as well, but stocks have a way of plummeting about the time you want to convert them into cash. This is not as likely to happen with real estate. Since pensions are a thing of the past, it's a good idea to own enough wealth to support a decent lifestyle for the rest of your life. That means rental property which is the gift that keeps on giving. It doesn't run out if properly managed whereas a fixed amount in savings will run out probably sooner than expected.
There are a lot of good paying jobs that one can qualify for which don't require a college education or that provide free training. One can also migrate to Europe and attend great universities there for little or no money. In 2014, Germany's 16 states abolished tuition fees for undergraduate students at all public German universities. This means that currently both domestic and international undergraduates at public universities in Germany can study for free, with just a small fee to cover administration and other costs per semester. Education is free in Italy and free education is available to children of all nationalities who are residents in Italy. People of Italian descent can also claim full dual citizenship in Italy and gain many other advantages like access to visa free travel throughout the European Union and access to universities in other countries. As an EU citizen, you are entitled to study at any EU university under the same conditions as nationals.
In short any American who goes to a 4 year college and accumulates student loan debt usually at the rate of $25,000 a year is a sucker. Also a 4 year degree doesn't buy you much in the labor market. You need at least a Masters Degree. And don't forget bankruptcy protection is not available to student loan debtors. More than sufficient reason to vote for Bernie Sanders or Elizabeth Warren. They will not only make public universities free, but will restore bankruptcy protection for those currently in student loan debt.
