A shocking story appeared in the American media recently: US federal police marshals arrested a man for non-payment of a student loan.
It was one of those stories that sound outrageous until you learn more details.
The arrest was not for not paying his student debt but for failing to appear in court for defaulting on his student loan.
Ignoring a court order – about anything – is a serious mistake.
However, the case drew attention to the scale of America’s student debt problem.
About 43 million Americans owe almost US$1.3 trillion in student loans.
That’s more than either car or credit card loans.
Some former students struggle for decades to pay off their loans.
This means they delay buying homes or starting a business, with obvious repercussions for the wider economy.
Some analysts believe that student debt is even forcing younger people to delay marriage and children.
Many blame colleges for luring them into borrowing so much to pay for tuition.
There is certainly evidence that the availability of loans – guaranteed by the government – has fed into rising tuition costs.
Inevitably, it has become a major political issue.
The Democratic Party presidential candidates Hillary Clinton and Bernie Saunders are competing for younger voters who demand free or heavily subsidized college.
Think tanks are proposing new approaches, such as giving colleges incentives to reduce tuition costs for students from poorer families.
Hong Kong’s student loan problem limited
Fortunately, Hong Kong does not have a problem of this scale.
Around a year ago, the Ombudsman criticized the government’s main student loan scheme for its poor management of unpaid debts.
But the problem is relatively limited (around 13,000 cases totaling HK$200 million [US$25.7 million] out of over 100,000 loans).
And the bulk of these loans are non-means-tested and aimed at working people who study part time.
Maybe the system is being abused, but we are not luring a large number of our youngsters into long-term debt.
We do, however, share the basic assumption of most Americans: going to college is essential to having a good career and will pay back financially.
Unlike the United States, Hong Kong does not have a wide network of for-profit colleges.
Instead, we have subsidized universities offering full degree courses to around 20 percent of high school leavers.
Other qualified students study overseas.
Then we have a lot of students who pay for associate degree and diploma programs.
Many of this group will get some sort of loan to help them.
Why many college graduates will be disappointed
But luckily, their tuition costs – and the debts they take on – are nowhere near the US$30,000-a-year levels that many US students face.
I say “luckily”, because many of these students gaining (for example) two-year college qualifications will not find the sort of work they hope for.
They dream of high-paying and high-status positions.
A Central Policy Unit study on the “post-’80s generation” found the number of jobs in management and the professions has been growing, but the number of college graduates is growing faster.
The result is that young people leave college and go into lower-level clerical or sales jobs.
They – and their parents – feel disappointed.
Meanwhile, the pay for many skilled jobs in construction, hospitality and the clothing industry compares favorably with entry-level positions in local banks or big conglomerates.
Training for such skills is available and at low cost, but our society has a bias toward white-collar work.
This is hardly surprising.
The media and the behavior of the wealthy send the message that financial and professional occupations have prestige.
Time to discard bias toward academic qualifications
Within schools and families, there is clearly a bias in favour of particular academic and educational qualifications.
This doesn’t just apply to Hong Kong.
Canadian officials are worried that young people want humanities degrees when major employment opportunities exist for electricians.
In Singapore, some believe the high status of business is creating a shortage of transport engineers.
Ideally, we should recognize the status and worth of other sorts of career – as in Germany, where apprenticeships and careers in practical and technical fields are highly respected.
But we have to recognize that demand for college education – and the affordability of college – is a major part of the whole challenge we face in improving social mobility.
The US student loan problem is the result of a well-intentioned policy of opening up opportunities.
US colleges also use affirmative action, financial aid and other measures to increase diversity of students and give the less advantaged a helping hand.
They are even exploring new ways of testing applicants to avoid biases toward the middle class.
Hong Kong, with its dissatisfied young, needs to be imaginative in creating a fairer and more level playing field in education and career opportunities if it is to build a more united and harmonious society.
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