In the Red: The burden of student debt at Georgetown

September 26, 2013

Leah Brown (COL ‘16) wakes up at 9:30 a.m., finally giving in to her alarm after hitting snooze a couple times. As an RA, she lives alone, so her alarm hasn’t disturbed anyone. She rolls out of bed and pads into the hallway, slipping into the empty bathroom. Under the harsh lights of her Reynolds dorm bathroom, she washes her face and brushes her hair, then heads back to her room to get dressed. After that comes breakfast, a piece of fruit she swiped from Leo’s the night before. She has to choose her Leo’s meals carefully and stretch out her 10 meals so they last the week.


Leah’s story is one of many across the country. According to the Federal Reserve Board of New York, 39 million people held outstanding student debt as of late 2011, averaging out to $26,000 in debt each. This debt is a combination of private and federal loans.

On the surface, the situation at Georgetown appears to be worse than the average. Last year, the Institute for College Access and Success published a study indicating that, as of 2011, 39 percent of Georgetown students graduate with an average of $28,035 in debt—$1,435 more than the national average.

Of the 56 percent of Georgetown undergraduates that receive some form of external financial aid, 40 percent receive direct aid from the University in the form of a package that meets “full demonstrated need,” according to the Office of Student Financial Services. These packages are a combination of subsidized federal loans, scholarships, and federal work-study.

In 1978, Georgetown committed to meet 100 percent of students’ “demonstrated need,” but that term has its limitations.  Need often looks different on paper than it does in reality—income statements and FAFSA forms lack the nuance necessary to convey a student’s financial reality.

Andy Vondall’s (SCS ‘14) situation reflects the potential inaccuracies of the forms. He is finishing up his requirements to enter a joint master’s program in Pharmacology and Law in the School of Continuing Studies, but, as neither an undergraduate or a graduate student, he fails to qualify for most federal aid packages. He is working for Sen. Max Baucus (D-Mont.) as an advocate on the Committee on Indian Affairs and usually attends classes at night or online to fit in school around work.

The myopia of financial aid forms is a result of the massive bureaucracy in which both students and the University operate. “Growing up having to struggle to find money is like being at the DMV for your entire life,” said Katherine Morgan (SFS ‘15), a recipient of financial aid. “You’re always asking, ‘Are they going to send me back if the entire bubble isn’t filled in?’”

At least, taking out federally subsidized loans as part of a University aid package makes students eligible for various Department of Education loan repayment plans, including income-contingent repayment. Private loans are an entirely different matter. According to the Institute for College Access and Success, 39 percent of indebted Georgetown graduates carry nonfederal debt. “The horror stories come from students who take out private debt,” said Dean of Financial Student Services Patricia McWade.

Private student loans target a particularly vulnerable group. Christopher Kelly (COL ‘14), CEO of the Georgetown University Alumni and Student Federal Credit Union, sees the difficulties incurred by private loans through his work with clients. Since students are young, have little to no prior proof of good credit, and lack a steady income, they are considered an “insanely risky” group of borrowers by private banks, according to Kelly. Under Kelly’s management, GUASFCU has worked to ensure that private loans, if they must be taken out, are managed in the most appropriate way for Georgetown students.

“The difference is that we know our clients,” Kelly said. “We know that they’re trustworthy.” According to McWade, Georgetown students have an extremely low default rate. Only 0.5 percent of the 2011 cohort of borrowers couldn’t repay their loans on time. Therefore, GUASFCU ensures a low interest rate, which can be as little as half as much as private banks offer. It also doesn’t charge pre-payment penalties, an extra fee banks often add in order to ensure a steady stream of revenue if borrowers want to pay their loans early.

“I was looking at our clients’ statements, and all of them have good jobs and will be able to pay back their loans,” Kelly said. “I was just struck by the injustice of it.”


After breakfast, Leah heads to Lau. For her Foundations of Social Theory class, every week brings a new book to read, and there is no space in her budget to buy that many books for a single class. Instead, she checks out the texts she needs on a weekly basis, combing the shelves for her required books.


The predicament that Leah faces is theoretically tackled in the financial aid package, since there is $1,200 built into the estimated yearly cost of attendance in order to compensate for the cost of textbooks. Many families are scrimping for cash as it is and cannot afford the increasing book prices.

“There’s an extra layer of finances,” said Brandon Anderson (COL ‘14). Anderson is a student veteran who has worked extensively as an advocate for indebted students, partnering with the Georgetown University Student Association this past summer to push Congress to halt the planned doubling the rates of subsidized Stafford loans. “In order to buy my books here, I have to run up my credit cards,” he said.

Taking into account the struggles of students like Anderson, Georgetown is taking steps in order to ensure greater accessibility to education. The Office of Financial Student Services partners with GUASFCU to organize eight financial literacy workshops for all students throughout the year, in addition to providing both entrance and exit counseling for students on financial aid.

A major part of the limitation on aid is the relatively small size of Georgetown’s endowment. The University’s capital campaign, launched in Oct. 2011, was designed to bring in $1.5 billion in revenue from donors in order to expand the pool of funds available for a multitude of projects. The University plans to allocate one-third of raised funds to increase student scholarships. 80 percent of this money will go toward undergraduates.

In order to create a more ambitious recruiting strategy to increase socioeconomic diversity at Georgetown, the University realized its endowment needed an aggressive injection of cash. “We … acknowledge that it is not easy, cheap, or free to make the sacrifice it takes to come to Georgetown,” said R. Bartley Moore (SFS ‘87), vice president for the Office of Advancement. “The [small] endowment is a limitation. … We identified early that student aid needed to be a priority.”

Considering where Georgetown was only two years ago, this fundraising points to a significant jump in Georgetown’s ability to provide aid to students in need. At the beginning of the Campaign for Georgetown, $115 million of a total of $1.16 billion of the portfolio was dedicated to scholarships.

The ambition is that, through an increase in alumni donations, Georgetown can commit $245 million of the endowment to scholarships, raising usable funds from $5.7 to $12 million annually. This amount would be in addition to the University’s other two sources of financial aid, the GU Fund, valued at $7.14 million at the end of Fiscal Year 13, and current-use funds, which approximate $5 million this year.

So far, the campaign has raised just over half of that goal, $257 million of which will be for scholarships.


Leah calls home. Both her sister and her brother are in school, and, since her father is working on his doctoral thesis in Urban Studies at the University of New Orleans, it’s her mother who picks up the phone. They chat for a while about her day. “We’re so proud of you,” her mom says. “Keep working hard.”


The emotional pressure of taking on debt—whether it be federally subsidized or private—is still a burden that tugs at students in addition to the daily obligations of academics, extracurriculars, and maintaining a social life.

For Anderson, the pressure is acute. As a first-generation college student, he is expected to contribute to his younger siblings’ education at the very least, if not help out his family with rent and utilities. Vondall feels a similar obligation. Being Native American, there are a specific set of challenges that he faces. “Most Native families don’t have that family structure where you can call home and ask your parents or grandparents for a little money,” he said. “In that way, they’re just like every other impoverished demographic.”

Reilly Poppert (SFS ‘15) receives direct financial aid from Georgetown, but, because of his parents’ employment situation, he has also taken out private loans in order to pay for school. His father is employed with the Navy, but his income comes in on a project-by-project basis rather than in a steady salary. “There’s always the probability looming that there won’t be money coming in,” Poppert said. In order to ensure his continued enrollment at Georgetown, he preferred to take out a private loan instead of hoping that his family’s expected contribution could be continually adjusted.

Despite the private loans, he will still take next semester off in order to take an internship at the State Department, since it will cost less money than it would for him to remain at Georgetown. “My father graciously allowed me to use his benefits on the GI Bill … [but] with my brother going to college soon, I need to be conscious,” Poppert said.

But, for most students, unpaid internships are not a sustainable path. “The need to have an internship in order to work is taking away from the democratizing effect of education,” said Joseph McCartin, a history professor at Georgetown and director of the Kalmanovitz Initiative for Labor and the Working Poor.

The rise of the unpaid internship is a large contributing factor to the impoverishment of students and recent graduates characteristic of today’s labor market. Georgetown students are familiar with the pressure to take prestigious but unpaid internships, which are often viewed as a prerequisite to employment. Scott Fleming (COL ‘72), head of the Office of Federal Relations, pointed to the GUSA Summer Fellows program, which pays for the housing of students who stay in the District to intern over the summer, as well as to some White House internships that only take up half the summer, which free up time for students to work. Nonetheless, these programs are selective, and only a lucky few will have access to those benefits.


Leah’s phone buzzes with a new text. It’s from one of her close friends. “Hey!” it reads. “We’re going to get dinner at Filomena tonight. Want to come?” She smiles for a second at the absurd idea that she could spend $25 on a single meal, then texts back, “No, sorry :( Swamped with work.”


“The financial aid office at Georgetown really works,” Vondall said. “Other institutions really just don’t care.” However, despite the best efforts of the Office, there is also an intangible cost that can’t be factored into an algorithm for the cost of living. There are obvious material differences between students, as presented in their dress and eating habits, but there are more subtle social and academic pressures that needle at lower-income students.

It’s a pressure that is experienced by a wide spectrum of Hoyas. Nate Tisa (SFS ‘14), GUSA president, related his own experience: “I felt the impact freshman year … I’d hear people talk about countries they’d been and things they’d done, and I couldn’t afford to go home for Thanksgiving,” he said.

It was this experience that Tisa carried as he worked with student governments at other colleges to bring a petition to Capitol Hill. In July, the subsidized Stafford loan rate was set to double if Congress refused to act. While Congress eventually passed a measure that would tie Stafford loan rates to financial markets, students could see rates rise in the coming years.

According to McCartin, the push for change at both the federal and campus levels needs to come from students. “Student voices are the most powerful tool we have,” he said.

Meanwhile, students on financial aid remain cowed by a culture of silence. In the drive to achieve, many feel that their troubles will be viewed as insignificant in comparison to many of the global problems we study in the classroom. “In being ‘Men and Women for Others,’ we don’t talk about ourselves,” Morgan said.

McWade agrees that there are limited venues for a frank discussions about socioeconomic class and how it affects student experiences on the Hilltop. “We have great conversations about gender and other issues,” she said. “It’s time for a conversation on class.”


The birds never stop chirping on Georgetown’s campus, but tonight, as the glow of the streetlights touches the corners of her window, the noise is distinct. She draws her bedcovers around her and tries to fall asleep, readying herself to do it all again tomorrow.

Julia Tanaka
Julia Tanaka doesn't do anything for the Voice anymore. She is sad about it.


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Why does college cost so much? Why do so many tenured profs enjoy a cushy career and nice salaries? Why is there a bloated bureaucracy?

It’s simple economics. Our society has, for whatever reason, decided that credentials matter. So that pushes up demand. Then the government steps in and offers loans to students. So you have a classic case (similar to the causes of post-WWII inflation) of too many dollars chasing, in this case, too few services.

Let’s face it—far too many college courses are a joke. And far too many college profs, as demonstrated by the Duke Lacrosse case, are boneheads and in an ideological straitjacket.

Outside of science and other disciplined fields, most college profs couldn’t hack it in the real world with a real job. That’s the sad truth. And they’re “teaching” students.

Nick Santaniello

Nothing short of amazing