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Student debt could cause another financial crisis.

As of 2012 student loan debt was over $1 trillion dollars, and more than 850,000 student loans were in default. [61] According to the National Association of Consumer Bankruptcy Attorneys, student loans are “beginning to have the same effect” on the economy that the housing bubble and crash created. [62] Former Secretary of Education William Bennett, PhD, agrees that the student loan debt crisis “is a vicious cycle of bad lending policies eerily similar to the causes of the subprime mortgage crisis.” [63] On Feb. 3, 2012, an advisory council to the Federal Reserve also warned that the growth in student debt “has parallels to the housing crisis.” [64] As of Jan. 2013, the rate of default on student loans hit 15.1%–a nearly 22% increase since 2007. [65]

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