From a bird's-eye-view, America's student loan problem is a wildfire raging out of control. Since 2002, the country's total load of education debt has increased 500 percent to around $1 trillion. That growth, combined with rising delinquency rates and the occasional woeful tale of an undergraduate borrowing $120,000 to finance their education, has been a recipe for panic.
So today, let's try a different perspective, by looking at what average students are actually borrowing. At four-year public colleges, the total debt at graduation barely budged over most of the last decade. At non-profit private schools, its rate of growth slowed down. Even at for-profit schools, per-student debt didn't rise as fast as it did in the 1990s.
In short, chances are that student debt isn't growing as fast as you think.
To illustrate the trend, I've graphed the government's estimates of the average amount borrowed by bachelor's recipients who graduated in the 1992-93, 1999-2000, and 2007-2008 school years, bringing us up to date with the Department of Education's newest data (all amounts are in 2009 dollars). As you can see, there are really two separate narratives here. At public institutions, borrowing roared in the in 90s, then basically plateaued. At private schools, both for-profit and nonprofit, borrowing also roared in the 90s, then kept on rising at a steady, but thankfully less torrid, clip.