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Dear Supporter,

The Payback Stress Index: A New Way to Measure the Pain of Student Debt

Last week, President Obama rolled out a new strategy to help college students manage the growing burden of student debt. According to PPI economist Diana G. Carew, relief can’t come too soon for America’s college grads.

In fact, Diana has invented a creative new way to measure that burden -- "The Payback Stress Index.”

In PPI's recent memo, "The Payback Stress Index: A New Way to Measure the Pain of Student Debt", she found that paying off college debt was 58 percent more economically stressful for students who graduated in 2010 compared with students who graduated in 2000. The reason? Incomes for college graduates have been falling, even as tuition costs rise relentlessly.  

The president’s “Pay as you Earn” program would let students cap loan payments at 10 percent of their income. That would help, but it doesn’t go to the heart of the problem: college costs too much and graduates earn too little. What we really need, says Carew, is a determined effort to create a high innovation economy that will produce better jobs for college graduates.

I hope you'll take a look.

Download the memo.



Will Marshall
President, Progressive Policy Institute

Enriching the Progressive Debate