Wednesday evening I went to an OWS-Occupy Philly rally. I was hoping to get a sense of what OWS-Philly was planning to do, now that the city has evicted them from Dilworth Plaza. I didn’t get a clear sense of what the next phase is, though I suspect that warmer weather and a hot campaign season will revive OWS nationally. But I did note a laser-like focus on the banking industry, in addition to the Philadelphia Youth curfew law, expanded in October, which is widely seen to be racism by proxy.

Many of the OWS speakers advocated pulling money out of local banks. Now that Meg and I are saving for our retirement, and finally have our finances roughly in order, it was hard for me to wrap my head around what I’d have to do to try and completely extricate myself from the banking system. Even cashing checks from Penn would be a problem, seeing that without an account, I’d have to pay some kind of fee.

But the challenge does raise the question for the most effective means of changing the role that student debt plays in higher education. As I have argued previously, a large part of the rise in student debt can be seen as an inefficient federal subsidy that passes the provision of support for higher education through various financial institutions, rather than providing grants directly to students and schools. Among circulating proposals is this petition, which will formally ask Congress to forgive federal student debt (I signed, and I note that they are close to reaching their goal 675K signature goal).

Another proposal is from the Occupy Student Debt Campaign. In seperate pledges for students, faculty, and non-debtors, they propose that students should refuse to make payments on their loans as soon as they reach the goal of one million signatures. I’m not sure that I support this tactic. For one, I assume from the association with Occupy Wall Street that the campaign is construed as part of a broad attempt to crack down on Wall Street abuses. But this doesn’t align with the fact that 90% of student debt is held by federal and state institutions, not private banks. As a practical matter, while I’m sure that mass defaults would achieve some short term goals in terms of freeing students from crushing debt, I have to think that the political effect would be overwhelmingly negative. It’s hard to imagine a response in which federal and state legislatures opt to put even more money into higher education.

And yet some sort of broad adjustment is demanded; 8.6% unemployment can not sustain the level of student debt that we are seeing. This is a professional and particularly academic problem. I was fortunate enough to finish my Ph.D. without carrying any student debt; it was a boon to earn my degrees at state schools with full scholarships. Tuition at UT-Austin was $2,500 a semester in the late 90’s when I started as an undergrad. In the humanities, we worry about the over-production of Ph.D.s. But if the accrued debt required to make it all the way through the bachelor’s, master’s and doctorate become prohibitively expensive, it’s hard to see how this will lead to the kind of adjustment we want.