Student Debt, 20 Years Later: Still Screwed, Just in More Expensive Cities

In 2005, total U.S. student loan debt was around $500 billion. That was already a problem. But in 2025? We’re closing in on $1.8 trillion. Let that sink in. Nearly four times higher, in just two decades.

And it’s not just the total number. It’s what we’ve told an entire generation of kids: “Go to college, take out the loans, it’ll all work out.” We’ve sold that lie on repeat, all while turning higher education into a predatory lending scheme with zero accountability, unlimited price increases, and no escape hatch. It’s like subprime mortgages without the house. So while you can’t get a plumber, an HVAC guy and we worry about”who will do those jobs” part of it is we’ve trained kids to “expect a job” and get paid by a big corporation to be mediocre and have work-life balance. That era is over.

In 2005, the average student loan borrower graduated with around $18,000 in debt. Manageable, maybe even reasonable, especially if you got a job that paid decently. But in 2025? The average borrower exits with $38,000 to $40,000—and many with far more. Public Service Loan Forgiveness candidates carry an average of $88,260, which makes sense if you’ve gone to grad school, law school, or med school. Average med school debt? Try $199,000. Law school? $140,000 and up. And if you want a dual MBA-JD? You’re borrowing like you’re buying a house—and getting a diploma instead.

The kicker? Student debt can’t be discharged in bankruptcy. It’s the one form of debt that sticks to you for life—no matter how broke, unemployed, or underwater you become. You can rack up a million in gambling debts and walk away with a Chapter 7. But take out $70k to get a sociology degree from a private college? That’s forever. And guess who backs most of these loans? The tax payer. About 92% of all student loan debt is federally owned. Trump should sell the student debt portfolio and use the proceeds to pay down the debt. Sadly, that’s not even on the table which means the government will continue to enable the whole system: colleges keep raising tuition, lenders face no real risk, and 18-year-olds with no income, assets, or financial literacy get handed blank checks and a four-year pass to avoid reality. It’s truly insane.

Where does it leave students? Post graduation, the average student starts making about $64,000/year, which sounds fine until you realize that monthly loan payments average $536. That’s about 10% of gross income—before rent, food, taxes, insurance, or anything else. And it gets worse when you live in a city.

Take Denver. Rent’s near $2,000/month. Groceries are up 20% since 2020. Restaurant prices? Forget it. Minimum wage here is $17.50 plus tips, which sounds generous until you go out for dinner and realize everyone has to charge more to survive. It’s no surprise people are moving out of downtown and fleeing to the suburbs—or out of state altogether. Denver now ranks among the top five most expensive U.S. cities, depending on the metric.

So what happens when you saddle millions of young people with massive debt, feed them false promises, and send them into overpriced cities where their degrees are increasingly worthless?

You get a political revolution. Which is exactly what we saw in the Mayoral primary in NYC. Zohran Mamdani is about as progressive as it gets. He wants rent freezes, $30/hour minimum wage, and hike property takes on what he called “white neighborhoods.” But we shouldn’t be surprised because what’s fueling progressive mayoral wins in cities like Chicago (Brandon Johnson), L.A. (Karen Bass), and New York is that old capitalist pitch—go to school, get a job, climb the ladder—isn’t working. It works for banks who make loans and lever capital into trading. It works for asset owners who control the hiring. But it isn’t working for the 32 million or so students that have graduated with debt since 2005. So when capitalism doesn’t deliver? People turn to socialism, or at least its newer cousin: debt relief, wage hikes, rent control, free college, guaranteed income.

We didn’t get here by accident. We built this mess. We told kids that college was the only way. We gave schools blank checks and no oversight. We created a generation of indentured professionals and told them it was empowerment. Now we wonder why they vote the way they do.

The truth is, we need to blow up the model. Not with forgiveness alone—though some level of forgiveness may be necessary—but with structural accountability. If a student can’t discharge the loan in bankruptcy, then neither should a school be able to raise tuition by 5–10% a year with no consequences.

If we’re underwriting loans federally, we should tie approval to job placement rates, expected income, or actual ROI. Want to borrow $200k for a theater degree? Great—find a private lender who’ll take that bet.

And maybe, just maybe, we start teaching kids a different path. How to budget. How to build a business. How to think in terms of ownership, not employment. Because there are a million businesses out there right now that could be started with sweat, grit, and a $10k loan. But no one tells kids that. We hand them a hundred grand in student debt and say “good luck.”

It’s madness. And it’s time we stopped pretending it isn’t.

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