The Student Loan Scam: The Most Oppressive Debt in U.S. History, and How We Can Fight Back

The Student Loan Scam: The Most Oppressive Debt in U.S. History, and How We Can Fight Back

The Student Loan Scam: The Most Oppressive Debt in U.S. History, and How We Can Fight Back

The Student Loan Scam: The Most Oppressive Debt in U.S. History, and How We Can Fight Back


An in-depth exploration and exposé of the predatory nature of the student loan industry Alan Collinge never imagined he would become a student loan justice activist. He planned to land a solid job after college, repay his student loan debt, and then simply forget the loans ever existed. Like millions of Americans, however, in spite of working hard, Collinge fell behind on payments and entered a labyrinthine student loan nightmare. High school graduates can no longer put themselves through college for a few thousand dollars in loan debt. Today, the average undergraduate borrower leaves school with more than $20,000 in student loans, and for graduate students the average is a whopping $42,000. For the past twenty years, college tuition has increased at more than double the rate of inflation, with the cost largely shifting to student debt. The Student Loan Scamis an exposé of the predatory nature of the $85-billion student loan industry. In this in-depth exploration, Collinge argues that student loans have become the most profitable, uncompetitive, and oppressive type of debt in American history. This has occurred in large part due to federal legislation passed since the mid-1990s that removed standard consumer protections from student loans-and allowed for massive penalties and draconian wealth-extraction mechanisms to collect this inflated debt. Collinge covers the history of student loans, the rise of Sallie Mae, and how universities have profited at the expense of students. The book includes candid and compelling stories from people across the country about how both nonprofit and for-profit student loan companies, aided by poor legislation, have shattered their lives-and livelihoods. With nearly 5 million defaulted loans, this crisis is growing to epic proportions. The Student Loan Scamtakes an unflinching look at this unprecedented and pressing problem, while exposing the powerful organizations and individuals who caused it to happen. Ultimately, Collinge argues for the return of standard consumer protections for student loans, among other pragmatic solutions, in this clarion call for social action.


Being the poster child for defaulted student borrowers is a difficult job to have—and I never imagined I'd be known as the crusader for student loan justice. The truth is that I never considered student loans to be an especially interesting topic. College debt, I believed, was a necessary evil—to be repaid expeditiously and then forgotten even more quickly. However, what I once thought of as an uninteresting issue has come to dominate my life.

Over the course of earning three degrees in aerospace engineering at the University of Southern California, I managed to accumulate about thirty-eight thousand dollars in student loans. In 1998, when I graduated, these loans had grown to fifty thousand dollars, and I consolidated them with a friendly-sounding organization called Sallie Mae—an organization that at the time I believed was part of the federal government.

My plan was simple: graduate with a bulletproof education, get a fine job in my field, repay my loans, and let life blossom beyond that. I yearned for a simple, middle-class life—a wife, a family, and a house; typical cultural aspirations that I shared with most of the people in the blue-collar town in the Pacific Northwest where I grew up.

In late 1998, I found a job at an exceptionally good college, Caltech, as an aeronautical research scientist. The salary wasn't high, but, at thirty-five thousand dollars, it did just cover my rent; food; basic necessities, like a car and utilities; and my monthly student loan payment, which amounted to about 20 percent of my take-home pay.

In early 1999, I was slightly short on my student loan payment. I called the lender and was assured that as long as I con-

Search by... Author
Show... All Results Primary Sources Peer-reviewed


An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.