Sunk Cost: Who’s to Blame for the Nation’s Broken Student Loan System and How to Fix It

by Jillian Berman

Exposes the forgotten origins of the student loan system, how politicians have attempted to fix it, and the life-altering damage borrowers face.

 

Student-loan horror stories are a dime a dozen. But students today are faced with a seemingly insurmountable Research consistently shows that the clearest viable option to financial stability is a college degree. But if and when Americans decide to pursue diplomas, student loan payments quickly follow, and even after securing full-time employment, many borrowers struggle to make ends meet for years. In Sunk Cost, journalist Jillian Berman explores how the nation’s student loan program went from a well-intentioned initiative aimed at helping low- and middle-income students afford college to one that traps borrowers in long-term debt.

 

Berman interviewed dozens of borrowers and policymakers and dug into the archives to unearth the true causes of the student loan problem. A couple of generations ago, policy makers generously subsidized Americans’ college educations because they knew it would be advantageous for the entire a more educated population meant better quality of life for all. But today, higher education is viewed as an individual goal, so students and their families are expected to be on the hook for it themselves. Berman explains how this enormous shift happened, which industries benefit from it, and what it means for college-going Americans today. She shares real-life stories of college graduates who are being crushed under some of the harshest consequences of the student loan system. These borrowers pursued higher education in hopes of a better life and yet some have been trapped in debt for decades, making it difficult to put food on the table, much less imagine a life beyond debt.

 

By connecting personal accounts to the policy history of student loans, Berman makes clear that if American society continues to push students toward higher education, but fails to truly subsidize it, the financial strain will become unbearable for all but the most privileged. The current system is broken, but Berman proposes that significant changes are possible, and will require political will from state lawmakers and Congress, along with a philosophical shift, to tackle one of the largest consumer finance challenges of our time.

 

320 pages, Hardcover

Published April 8, 2025

Reviews

[Dona's Books · Rating 4 out of 5]

Pre-Read Notes:

This was an arc that got away. This happens when I receive a copy from publishers that is not accessible. When this happens, I most often need to wait for the book to come out, and then I find an accessible copy on Libby, if I can. That's what I did here.

Final Review

I thought I wanted to know what this book says, but I didn't really. It's kind of heartbreaking that slowly but surely our presidents and the congresses that serve them have whittled away new generations' access to the great US dream.

Thank you to Jillian Berman, University of Chicago Press, and NetGalley for an advance digital copy of SUNK COST. Accessible copy available on Libby. All views are mine.

[Jill Elizabeth · Rating 4 out of 5]

What a fascinating dissection of a complex and oh-so-timely issue this was... Berman does a great job capturing the multiple elements that play into the burgeoning student loan crisis. The history was interesting and the writing engaging. It's a long and involved book - but it's a complicated and involved issue, so that didn't surprise me. The writing style is easy enough to get into though, and with the sections divided as they are and replete with anecdotes and personal stories, it's quicker to read than you think it will be (and you can always skim if a particular piece of history is not to your taste or feels too detailed for you).

Thanks to NetGalley and the publisher for my obligation-free review copy.

[Isaiah · Rating 4 out of 5]

I got an ARC of this book.

This was my first real dive into the student loan system. I took out student loans when I was 17 and was given zero help. I was not told that I was supposed to give back the extra money or that I would even be offered more money than I would not need. I was just told that I had to use a certain lender (through the school), because if I worked ten years in a certain way I could get them forgiven. So I did that. That was the only information I was provided. I am lucky and my loans are paid off. I know how lucky I am. I still do not work in the field of my undergrad degree. I have done everything in my power to not have to do loans for my masters. I have watched as my friends drowned in their loans.

The difference between my friends and me? I got more schoalrships, I went to a cheaper school, and my grandmother made the payments on my loans as my graduation present. She paid them off to shame my cousins and siblings for not going to school. I was lucky that I had that family support. Family support that relied on a divorce, becoming disabled through building submarines by hand, and a few other lined up just right to be able to afford to make more than the minimum payments.

I am lucky. This book just was hundreds of pages of why I was lucky. I wasn't prey for a predatory school, despite my age. I wasn't in the military and dealing with that extra layer of awful. There are so many reasons I was lucky.

I think the biggest take away is school should be free. We should want to had a more educated public. We should celebrate learning and growing, instead of using it as way to further control the masses and financially terrorize those that try.

[Andrea · Rating 5 out of 5]

Thank you to the University of Chicago Press and NetGalley for an ARC.

Sunk Cost details the creation and evolution of the student loans and how it contributes to the financial crisis so many borrowers find themselves in today. A detailed, well-documented history is interspersed with personal anecdotes from people who have suffered from contact with the industry, making it quite readable (I’d say even enjoyable, but the subject matter is rage-inducing) and above all a highly compelling argument that individual student loans are not just an issue of personal responsibility but part of a broad issue. As Berman puts it, “the blame for the student debt crisis rests with a nation that insists on a college degree for economic stability but refuses to fund it.”

It’s tragic how the GI Bill and student loans, from their inception, have been used to swindle people who just want to improve their lives and how repeated efforts to install better regulations have been stymied. I thought I was fairly cynical about student loans having financed my advanced degree with loans, but it turns out I was not cynical enough. Certainly not about loans, and not about higher education in general. Berman explains, in lucid prose and plenty of references, how higher education has served as a way to elevate the higher castes and make education and unemployment less tenable for anyone else throughout our country’s history (immigrant populations, women, people of color). Powerfully, Berman argues that our treatment of higher education as a necessary and public good but one that should be financed at the individual level, things are unlikely to improve.

Highly recommended if you’re interested in higher education.

Books cited I’d like to read:

Eaton, Charlie. Bankers in the Ivory Tower.
Rivera, Lauren. Pedigree: How Elite Students Get Elite Jobs.
McMillan Cottom, Treasure. Lower Ed: The Troubling Rise of For-Profit Colleges in the New Economy

[Lily · Rating 4 out of 5]

In this fascinating history of the student loan system in the United States, Jillian Berman explores how the problem began, how politicians attempted to fix it, and the long-term consequences of serious student debt. Interviewing borrowers and policymakers as well as working with archives, Berman seeks to find the true cause of the student loan problem and how it evolved from a tool meant to help students to a system that traps and cripples borrowers for years after graduation. Highlighting the American perspective of higher education, Berman’s journalistic skills really show throughout this book and give readers some really useful and fascinating insights into this larger system. The book is full of details from interviews and documents from the archives, and Berman does a fantastic job breaking down the information so all readers will understand it. The mix of personal and policy is really well done, and it brings the massive experiences of student loan debt to the forefront of the book and the larger conversation. Giving readers the chance to understand this accepted reality of higher education, Berman’s book is a brilliant exploration of this topic, and the meshing of personal and policy is absolutely the highlight of this well-written book.

Thanks to NetGalley and University of Chicago Press for the advance copy.

[Brandi · Rating 5 out of 5]

This is a topic that I am very interested in, but phew does it cause a bit of rage. In this book, Berman gives an in-depth look at the origin of our student loan system, the GI bill, PLUS loans, the increasing cost of education & loan dispursements, and a lot about predatory loans from for profit colleges. Working in finance/credit I can’t believe how many of those loans I saw - and they nearly never amounted to well-paying jobs. With the growth of well-named colleges jumping into certificates - are they really worth it? What about a non-target school? Really makes you think.
Berman also discusses how things have changed over the years, painting a scary picture for the future. Finally, she explains other ways we can help to fix this.

I would highly recommend this book as an introduction to the problems within the student loan industry.

Thank you Net Galley & University of Chicago Press for an advanced copy of this book for an honest review.

[Mike Heenan · Rating 4 out of 5]

Thank you to NetGalley, the author, and the publisher for this complementary ARC in exchange for my honest review!

This is a fascinating historical study of the student loan system in the US from early Pell grants to the current structure. This is a complex issue and there is lots of great information on how we got to where we are now, with many students unable to pay off their loans. There were lots of interesting anecdotal stories to help paint the big picture of how a variety of overlapping issues affect different types of people.

I would have appreciated a bit more comparison on what other nations are doing - is there a viable solution out there? As someone working in the higher education space in another country, I think the sole focus on the US was a missed opportunity.

Overall, it's an enjoyable and relatable read - it leaves you thinking about how things could possibly get better for future generations of students.

[nat lost the plot]

DNF 25%

[Mary Elizabeth Campbell]

At the end of the day, Reagan is always the problem