University students in US face higher tuition and loan debt

Tuition increases vary by school, with some students facing hikes of 20 percent or more. In some states, this trend has been building since the late 1990s, exacerbated by the more recent state funding shortfalls and recession. States have sought to balance their budgets—often made worse as a result of tax cuts—by cutting spending on education and Medicaid, the two largest state-funded programs.

Since 2000, cuts in tuition aid programs and a 35 percent increase in public university fees have combined to price many low-income students out of higher education. The tuition increases, rising at some schools by double-digit percentages each year, far outpace general inflation, as well as the 4.7 percent increase recorded by the Higher Education Price Index, which measures the relative cost of goods and services specific to the functioning of universities.

Working class students who do choose to attend colleges have few means of offsetting the increases in school costs beyond borrowing heavily from loan programs and relying on high-interest credit cards. The College Board reported that an estimated 25 percent of students may actually be financing their educations with credit cards. Students in graduate and postgraduate programs, in particular, fall back on private lenders. A report by the American Council on Education (ACE) found that almost half of all graduate degree recipients in 2004 used credit cards for school expenses, carrying a median balance of $3,900.

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http://wsws.org/articles/2005/aug2005/tuit-a03.shtml