 Thank you very much for having me. So I'm here, I think in part, as a cautionary tale to stress for you or make clear for you how well your financing system is working. So I'll give you some gory details on what's happening in the US. And the US obviously has some of the greatest research universities in the world. And I think worldwide is perceived as being a center of excellence for higher education. But we also have an entire sector of schools that follow the financial model that Professor Schmidt described as a fantasy. We have schools with graduation rates of 5%, 10%, quite a few of them. And those are schools that take the subsidy for the first year, and then the student drops out. So this can happen. It is not just a bad nightmare. It's actually a possibility. All right, so first, mostly I'm going to give you a lot of background on the US and then explain our student loan system and how it's working and not working to give you some perspective on the policy debates we've got going on right now. So this is a statistic and a graph that is widely circulated in our media. This is outstanding student debt, the stock of student debt. So the red line is student debt. The other lines are other forms of household debt. So what's not on this picture is mortgages, because that would throw the scale off completely. And we'd have to have it go above the building. So what we have here are student loans, credit cards, auto loans, and HELOC is a form of a second mortgage line of credit that you take out on your home. And the main thing to see here is that one of the lines is monotonic, and the others are not. So during the recession and financial crisis, other forms of credit dried up. It was harder for people to get hold of credit. And the student loans did not, because student loans in our country are not based on people's credit worthiness. They just go out based on somebody's need to go to school. So this one trillion figure is circulated a lot, and it's a fearful figure. I think it's more like 1.2 trillion right now, but it is the headline number. So what I'm not showing you in this presentation, I'm giving you sort of the not dry facts, they're interesting facts, but I'm not showing the headlines. So the public conversation around student debt is extremely fraught in our country. So this one trillion is taken as a disaster. Is there an equivalent figure that floats around here? Do you talk about outstanding student debt as a number? Okay, so you do, and as it is, you know, okay, but this is the number that's out there. Okay, so the active policy debates that we've got right now are how to reduce defaults. So we have a repayment system quite different from yours. I'll go into some detail, but the basic idea is that people pay in the 10 years after they take out their loan, after they come out of school, and with a level payment. It's like a mortgage payment, it's a mortised, it's not flexed, it's not flexed with income, it's just a flat payment. And what do you know? A lot of people straight out of school can't pay their loans right off the bat, and we have a very high default rate. We've got seven million borrowers in default. So that makes for a lot of news, and a lot of people who are suffering quite a bit. It's 21% of undergraduate borrowers default at some point. Our levels of individual indebtedness are actually not terribly different from yours, they're in the same order of magnitude. But because we've structured it in the way that we have, that you have to pay it all in the first 10 years, it does not flex with income. It means that the same payments for roughly similar incomes turn into a disaster. So a key lesson I think of the comparison between Australia and the US is that it's not at all, it's not all about the level of debt. The repayment system is hugely important. How do you have people repay a given level of debt? And in the US, unfortunately, the focus is on what's the dollar amount of the debt as opposed to what is the structure by which we have people repay debt. All right, so here's an outline of what I'm gonna tell you about. I'll give you background on post-secondary education in the US. It's funded quite differently from the system in Australia and it's governed quite differently, and that matters for finance policy quite a bit for how we finance schools. I'll go into then more detail on student loans in the US and the key policy debates. So let's start out with something about the structure of post-secondary education in the US. And I don't know if you've noticed, I keep saying post-secondary education as opposed to higher education. We have a pretty, from a student funding perspective, our funding system is the same for higher education and what in England is called further education and what here is called vocational education. So the system of grants and loans that we have are exactly the same for all of those levels of schooling. So when you're hearing numbers from me about what share of people go into college, what share dropout, it's a mashup of Harvard University and the schools that have that 5% graduation rate. They're all treated the same when it comes to the student finance end of things. So 80% of our undergraduates go to public institutions. That includes the four-year institutions, what you would call higher education. We call them, so BA institutions, also includes community colleges, much of which would probably fall into further education or vocational education in this country, but not all of it. There are some academic degrees as well within the community colleges. Those public universities are not federal public, they're states. Our individual states run these universities. We have no federal universities, except for the military academies. But University of Michigan is a creature of the state of Michigan. University of Virginia is a creature of the state of Virginia. Those states fund those institutions, control the tuition levels, decide on policies. So the finance of the students is federal. The governance of the institutions is local. So you might guess right off the top that's gonna cause some interesting tensions. Okay, so 80% are at the publics. 10% are at private non-profit institutions. And that ranges from Harvard, Swagmore to much smaller private institutions that you've never heard of. But these institutions loom large in the public imagination. So the number of times Harvard is mentioned in the Congressional Record, Farrot strips the number of students who actually attend Harvard. And Harvard's tuition gets a lot of public attention as well. But really, only 10% of undergraduates attend these institutions, which are our top research institutions. And then now, 10% of undergraduates attend private for-profit institutions. And that's where those 5% graduation rates are largely coming from. But even some of our community colleges have graduation rates that low. Okay, so it's not just them. This for-profit sector was 2% of undergraduates as recently as 10 years ago. So during the Great Recession, when we provided subsidies to students, really pushed them to go into college in order to let them escape a weak labor market. We pushed on that demand side, but we didn't do much on the supply side of opening capacity for more slots for students at the public institutions. And as a result, they went off to the for-profits and that sector grew enormously. And that's caused a lot of the problems that we've seen in terms of our student loan debt and our defaults. So in terms of our public sector and its funding, states give money to the schools. So there are federal funds that flow to our public institutions, but it's research. Pretty much that's research funds, National Science Foundation, other things. But the institutional subsidies come from the states. Because they get money from the states, they can charge below-cost tuition. And that is where cheap tuitions that our public institutions have come from. At the private non-profits, the schools charge a high sticker price, I'm gonna call it. And many of them then take that in cross-subsidized low-income students. So they charge one thing, but then they give a grant with the other hand to reduce the price. A few of them have large endowments that let them subsidize the cost of everybody. But it's a small minority of the private schools have large endowments. Harvard's got, I think, a $13 billion endowment right now. It's the second largest nonprofit in the world. Anyone know the first? Catholic Church. So Catholic Church and Harvard. And then there's the private for-profits. And they just charge high tuition and rely on federal student funds to subsidize the cost. They don't have any of their own endowment funds. So here's what tuition and fees. This is in the public eye a lot, lots of angst around this. The top there, remember, is 10% of students. That's the private non-profits. This is in real inflation-adjusted terms. So 30 years ago, typical tuition in fees were 10,000, and now it's 30,000 in that sector. So 10% of students, but a very high percentage of the chattering classes, children, go to these schools. So the New York Times spends a lot of ink discussing what's going on at these private schools because their kids go to or aspire to go to those schools. Public four-year, you can see an increase, but it was starting from a very low base. In 81, 82, typical tuition was below $3,000 at these schools, and now it's closer to about $7,000. So it has doubled, but in dollar amount, it's gone up by a smaller amount. And at the bottom, our cheapest schools there are the community colleges, the public two-year institutions. And again, those prices of the green and the red lines are kept where they are by the subsidies from the states. The institutional subsidies that states give to those institutions keep their prices down. And if they don't give money to those institutions, the prices go up. So what happened during the Great Recession is that states ran out of money. And one of the places where states can adjust prices for users is higher education. So what does state spend money on? K-12 education. We can't charge students for that. So if we run out of money, we can't charge for K-12 education, elementary secondary education. In the US, unfortunately, we spend a lot on prisons. We haven't yet figured out how to charge prisoners for their stays. Healthcare, that's defined by laws about cost sharing for Medicaid and Medicare with the federal government, no room to adjust there. When they run out of money, they adjust on what they provide to their higher education institutions, which then, in turn, increase prices if they're given less money. So this is average state appropriations for higher education per $1,000 in personal income. And you can see there's a steady drop. It's not just about the recession. That's at the very end there. But there's been a drop over time in how much states are committing to their institutions, which is where this long-term trend of the rising tuition prices comes from. So rising tuition prices in the public sector, which are 80% of students, are not from rising costs of providing education. They're coming from a shift in who pays. And it's shifting from the state paying, through general tax revenues, to individual students paying instead. So it is not a galloping away costs. It is a shift in who's paying. And that tends to get lost in the discussion. All right, here's the structure of aid that goes to students at the student level. I showed you how the institutions are funded. This is how students are funded. Students essentially get portable grants and loans that they can take to any institution they want to in the country. And when I say any institution, I kind of mean it. We're pretty lousy at regulation. So go free market, says the US, even though it's pretty tough to have a well-functioning free market in education. We've let institutions pretty much open up their doors and use these funds to educate students. And that's where that very large, quite low quality for-profit sector has come from. So the federal government provides over 180 billion per year to 20 million students. Some of that is repayable. That's the loans. Some of that is not repayable. For example, our Pell Grants. Those are aimed at students with below median household incomes. Who gets the Pell Grants? And they're about a max of $6,000 per year or so. Exchange rate is currently 0.72, in case you need a, it was 0.75 about two days ago, but I'm pleased to say it's now 0.72. It's getting cheaper and cheaper for me to stay here. There's tax credits. So we started using our tax system to fund individual students as well. So people who have tax liability but then have students in school can get money back. This tends to go to people with above median incomes. Actually, with incomes as high as $180,000. So that's really not getting more people into school. It's just kind of subsidizing people who are sending their kids to school anyway. There are much smaller, but still substantial aid programs at the state level. And then the colleges that have the money provide aid to students. Harvard does not charge full freight. It takes that endowment and uses it to fund scholarships for students. But all of that is dwarfed by the federal funds. All right, so there's your quick background on post-secondary education in the US. Here's a quick background on student loans and the role that I think that they play in this very complicated finance system. So education, economists think of education as an investment. Like a house, you've got costs you need to pay in the present. If you are gonna buy a house and pay full freight for it, you need to pay a million dollars today but then get a stream of services for the rest of your life from that house. That's pretty expensive to do in the short term. And so you need liquidity. You get a mortgage that lets you pay a small amount each year. Similarly, education is an investment that produces costs in the present. There's tuition costs, but there's also the fact that you've foregone your earnings. You're not working. And then there's the effort you have to go through to actually learn. The student loans and student finance are the classic example in economics of a market failure. That an individual student cannot go out there on the private sector and find a bank that just on the basis of their individual earnings promise will give them tens of thousands of dollars. So the private sector is not gonna do that. You can get tens of thousands or millions of dollars for a house because if you don't pay, they'll take your house with a car, ditto. You can get a loan pretty quickly for your car because if you don't pay, they'll take your car. Problem with human capital is you can't yank it out of a person. So basically it's an unsecured loan and so the private sector won't do it and this is why everywhere in the world we see the public sector stepping in to take care of this funding. Okay, here's what's been happening in the US in terms of funding. So in the 10 years from 2001 to 11, annual borrowing doubled from 56 billion to 113 billion. Now that can happen for good reasons. More people go to college, right? That might make us happy. Or it can happen because the same number are going but they have to borrow a lot more. So if we parse it out during that period, enrollment indeed was up 32%, but that does not explain 100% increase in borrowing. Borrowing per full-time equivalent student, we have quite a few part-time students went up 54%. And that's on two different margins. Both students who didn't borrow it all before are now borrowing and those who did borrow are taking out larger loans. So explaining why this is happening has been a focus of a lot of discussion. So first candidate, first suspect, is that tuition prices are up and that's why people are borrowing more. But remember I mentioned the phrase sticker price. That's those trends that I showed you, the 10,000 went to 30,000. Those are sticker prices. Those are the posted prices. They are not the net prices that students pay once you take account of their grants, both from the federal government, the state government, the institutions and their tax credits. If you look at what's happened to net prices, so this is a little difficult to see, but the big light colored circles are the sticker prices. Bottom is the private schools, bigger circles. Top is the public schools. The darker circles are the net price. So that's what students are actually paying. And so what you see is that the dark circles are growing less than the light circles. So in 2011-12, if you look at the public schools, the net typical net price was about $2,500 as opposed to it was $1,900 in 1996, 97. So that's a $600 increase. It doesn't account for the huge increases in borrowing we've seen at public schools during that time. Same with the private schools. Another Canada explanation is growing income inequality. So in the US, income is down or stagnant at best in most of the income distribution. So even with slight increases in the net price, if that is getting loaded on to diminishing household income, then families might need to borrow more to sustain similar prices over time. So college costs for most of our income distribution are a rising share of income. Most of our income growth has come from the top 1%, top 5% of the income distribution. Rest of the distribution has been flat or sinking. And the last candidate that people have been exploring is that even holding constant price, holding constant income, that families are just less likely to save for college than they once were and more likely to fund current consumption. So what we see from the House of Finances is that parents contribute less to their kid's college costs than they once were. That what used to be funded by family savings has now shifted over into borrowing instead, which might be a completely rational response. So families might prefer to mix their portfolios in that way, but it contributes to rising student debt. There's also some evidence that students' expectations for, and parents' expectations for their children, for their quality of their lives while they're in school are higher than they once were. And you can find grumpy professors all over the United States who will give you anecdotes about the spas and the climbing walls and so forth in the dorms at their schools. So part of it at least is that life is getting a bit better for students, which again might be a rational thing. Having people who are emissarated while they're students and earn quite a bit of income when they get out of school is not something that would fit the most economic models of utility maximization. All right. Last thing to tell you about how student loans work in the US is our very interesting public-private partnership in this market. So it is not solely a government function. We've got the private sector involved as well. So if we look in the past, the way our student loan system began and the way it functioned until about 10 years ago was that the federal government guaranteed the loans. So if a student defaulted on a loan, the federal government would come and make good on that loan to whoever had given it out. The federal government paid interest while the student was in school and set loan terms and eligibility. So this is not sounding like a very free market, right? Basically you're setting terms on who you can loan to, who is eligible, you're guaranteeing if they don't pay. But we like not having big government, right? So we like to sort of have this fiction that it was actually a private sector provision. The private lenders basically took applications, gave out the money that the feds gave them to give out collected payments, kept records, communicating with borrowers. But it really, in terms of rates, interest rates, terms of the loans, none of that was a free market. It was just that the private sector was administering this loan system for the federal government is one way to think about it. Since a shift in policy a few years ago, we stopped having the banks give out the loans. So the banks were cut out of the process of giving out the loans. The federal government now also gives out the loans. It's called the direct loan system. The old system was called the fell family, something. Old system, new system, direct loans. So the private lenders no longer take the applications, make the loans, they just administer repayment. So once the student comes out of school, they handle the collections. And as I said, collections and repayment are the big problem we have in our system right now. So I think this relationship here is part of the problem. There is an additional product called private loans. Private lenders sell products labeled student loans. They have been as much as 10% of loan volume in past years, but now they're smaller again. They're more prevalent among graduate students. So if you hear about medical students or lawyers who are borrowing $100,000 a year, they're doing it through some sort of private loan program. So private banks give out student loans. These are not student loans in the way that I described them before. So a student loan is, from an economic perspective, it's giving somebody a loan solely based on their earnings potential, nothing else. These things require a credit worthy cosigner or a credit record of your own. So they are predicated on somebody having a credit record and assets that could be seized. So they're consumer credit. I think of these as consumer credit. They're like credit cards or other consumer loans. And they've got much worse terms than public loans. We've got a problem of consumer knowledge and information where students often do not seem to know the difference between these loans and the federal loans. And they're getting snookered into borrowing on these bad terms sometimes by institutions, colleges that partner with these banks to offer these loans and to list them on student aid letters right next to the federal loans that are of much better terms. So I think dealing with these is largely an issue of consumer protection. It's a, if we had the will, it would be a relatively easy problem to solve. All right, so there have been tensions in this public-private partnership that is our student loan system. So during the financial crisis, private credit markets froze up. And there were states where students couldn't get loans for the start of school in that September. So that was a big problem. There were a series of scandals in which it was revealed that banks were bribing schools to get access as the preferred lenders to students. Because I described all of the ways in which the market was defined, regulated, controlled by the federal government. But you probably are familiar that when you've got public-private partnerships, the private part of the partnership often finds ways to find profits. And these lenders were finding ways to manipulate and gain the system to make money. And they were using it to bribe schools to gain access as preferred lenders. There were gamings of interest guarantees. One cohort of students would have a certain interest guarantee. This is how much the bank was guaranteed to make off the student loan. Another cohort would have a different interest guarantee. And there was all sorts of interesting stuff going on with that. All of this got bad enough. That's that we then had the passage of laws that got rid of the private banks actually making the loans. It was this sort of blow-up that led to that. So present, the high default rate, the 21% of undergraduates default rate that I referred to, appears to be at least partially explained by poor servicing by the private banks. So a pretty high proportion of those who go into default. Default is not paying for 150 days, 180 days. That's a federally defined condition. Good proportion of them were never actually successfully contacted by the servicer. They didn't have a good address or phone number for them when they came out of school, didn't get hold of them, and they just went into default immediately. We've had a number of policy efforts to try to create hex-like, help-like systems where people pay as a percentage of their income. We make them available if somebody's in distress in some way. If they have a very high debt, very low income, they're allowed to apply to such a program. Lots of paperwork to apply to the program, lots of work for the servicer to lead the borrower through this process and little reward to the servicer for doing so. So guess what, they don't do it. So they have not been putting people into these programs. So we've got government saying we need more people to be taking up these income-based plans and not providing incentives to the private servicers to do the work to get people onto the plans. Okay, so our headlines in the U.S. answer yes for 3A. I think we don't have a debt crisis but rather a repayment crisis. So here are the numbers on student borrowing in the U.S. So this is borrowing per student and it's six years after college entry. So what we're capturing here is undergraduate borrowing. Median time to finish a four-year degree in the U.S. is six years. So the median BA takes six years to finish their degree. Half of college students, and I'm saying this is post-secondary, half of those who attempt any post-secondary education get a degree, half drop-out. If you look at this by institution, you'll see places, as I said, with a 95% drop-out rate and others with a 95% graduation rate. So these numbers here include, these are not just BAs, these are take all the people who started school in 2009, follow them forward six years and see what they borrowed. So bundled in here are people who complete a BA, who complete a two-year degree, who complete nothing. Probably 60% of these people didn't complete any sort of degree. So first thing to notice is the big fat lump of fuchsia and that is the people who did not borrow. I see, by the way, purple ties were what we're supposed to wear. Are you purple or are you red? Oh, I think he's purple and then Miguel also has a purple tie on. Pink, oh I'm color blind and Lorraine is purple today. So purple people don't borrow. So 44% of people borrowed nothing at all. I actually borrowed, I'm still paying my student loans right now. So 44% don't borrow at all. 25% borrow but less than $10,000. Another 16% borrow between 10 and 20, 8% borrow between 20 and 30 and so forth. You have to get, when you get up to 50,000 to 75,000, we've got 1% of students and then 1% borrow 75,000 or more. The media coverage is concentrated in that top 1%. So the media coverage is about people who have $100,000 in debt, $150,000 in debt. The political coverage, unfortunately. So the Hillary Clinton campaign just rolled out its higher education platform and included a friendly YouTube video with student stories. Every student in the four students they had, all of them had debt north that were in that 1%. So the media narrative is about high debt levels. The data do not indicate high debt levels. This is from another data source. This was a student level, take college students, look at them, see who borrows. This is a household level take on this. So the Federal Reserve Bank of New York has used credit records to look at what proportion of households have student debt. Now, so this is among those households that have student debt, what does the distribution of student debt look like? They can't tell who college students are. They can't tell who's gone to college. So all they can do is sort of find the people who have some debt and look at the distribution. But the numbers here in the previous slide are quite consistent with each other. So among those who have any debt, 40% of them have between, whoops, have between one and $10,000 in debt, 30% up to 25,000 and so forth. These numbers are gonna include graduate students. The last one was undergraduates only. This is gonna include graduate students. But still the numbers indicate that a quite high proportion of people, so those little lines there add up to about 4%. 96% of people are borrowing less than $100,000, including graduate debt. Our big, big debts are medicine and law and business, those are the three. That's where the biggest debts are coming from. Those students make good money and they don't default in their loans, actually. So there's actually an interesting, you see over time that defaults have been going up and debt has been going up and so people have sort of said, aha, one causes the other, but if you break it out into which populations are borrowing and which populations are defaulting, the undergraduates are borrowing at fairly low levels, defaulting at high levels. The grad students explain most of the growth in high-level debt and they default at a rate of about 3%. So grad students, by definition, they already finished their BA. So they're people who have succeeded in getting a BA and going to grad school, so they're pretty positively selected. So our default problems are not driven by debt levels but how we repay our debt, which is where you actually have a success story. This is, if you take that same New York Fed data and follow it over time, this is what the trends look like. I'm assuming that these are gonna be online in some way? Yes, yes, there's nothing here that's, I see people snapping pictures, but it's gonna be online if you wanna get it. It's on my website too. All right, so typical debt for somebody who graduates with a public BA is about $25,000. So here I'm kind of looking at how does $20,000 fit into the US economy? What does that number mean in the US economy? Our interest rates have flipped back and forth between, in the past, our interest rates were set statutorily, which led to an exciting debate every few years. So let's argue about interest rates. Now we have a fixed spread with treasuries, so that debate has gone away. So there's a fixed spread with our US treasuries, but here's a range of rates that have held over the past 10 years or so. The first one there is how the typical payment is set up. 10 years, a more tized, flat. So 20,000 in debt at 6.8% would be $230, cut it in half to 3.4%, and the debt is $197. So in present terms, I highlight this because most, a lot of the discussion in DC, in Washington DC, is around relieving pressures on repayers by reducing interest rates. And my point here is that even with a 3.4 percentage point cut in the interest rate, the payment only goes down by about $30, right? So most of debt, unsurprisingly, is the debt as opposed to the interest on the debt. So there's only so much you can do with it. If we used one of our income-based plans and somebody's annual income was $32,000, they would pay $190 a month, and it would be the same, whatever the interest rate, because it's income-based. We have another plan which nobody likes at all. It's a graduated plan, it's a fixed step. Your payments go up at a fixed rate, and there you could start out as low as $127. And to give perspective on what these numbers look like compared to other typical debt in the US, average new car loan in the US is $27,000, which you can't get a 10-year loan on your car, which is good, a five-year loan, about $500 a month. iPhone plan in the US is about $110 a month is probably a relevant one for young college students as well, $110, $120. So these numbers are not crazy large, especially for people who graduate with a BA. I have not shown you information on earnings in the US, but the winners in our economic system in the US are the people with the BA. The super-duper winners are the top 1%, right? But if you look at earnings trends in our country, people who don't have a BA flat or if you don't have a high school degree, down, down, down, and people with a BA in the case of women, up in the case of men kind of flat compared to other people they're doing relatively well. All right, default rates, all right? So this is what we focus on as a measure of sort of failure in our system. Clock, okay. If you go back to the 2000 code, we have this two-year cohort default rate, which is the share of people who default on their loans within two years of getting out of school and starting repayment. The definition of default is a political one. So sometimes it's been 120 days without payment, other times it's been 180 days, other it's been 210 days. Therefore this trend from an economic perspective is uninterpretable, but it's going up. You think with the fact that it's getting looser and looser would tend to drive this down and that it's going up anyway indicates that things are getting quite bad. So this is within two years, but if you open the window up three years, four years, five years, the default rate goes up. That's where that 21% for undergraduates came from. If you expand it beyond two years, you start to see the 21. I'm showing this here because the Department of Education uses this information to regulate colleges. If a college has a default rate above a certain threshold for more than two years, it can get kicked out of the aid programs, including the grants. So it can cease getting grants and getting loans. That threshold is about 30%. So if they have a 30% default rate, they get kicked out. And this actually has had some bite. So in the 90s, about 1,000 schools, mostly small schools, mostly for-profit schools were kicked out of the student loan program and the grant program as well because their default rates were too high. This is probably the only tool actually that we have to regulate college quality in the US. We don't have measures of earnings that we use or test scores or employability. This is pretty much the lever we have that we use to say whether a college is good or not is their default rate on student loans. This is a more consistently measured metric which is a percentage of outstanding student loan debt that is 90 or more days delinquent. This is from the Federal Reserve Bank. And there, it's a consistent measure and it's consistently going up. And you can see the spike at the end there. I suspect what that last bit is, is people who went into school during the recession coming out, but this sort of persistently high delinquency even as the finances are getting better on other types of debt is worrying to people. So delinquency, late payments are getting better on credit cards, on home loans, on car loans. They're still going up here. And I and others think that the servicing is basically what's going on. The underlying economic fundamentals are getting a lot better, but we suspect that the servicing is what's going on. We have a new agency called the Consumer Financial Protection Bureau that came out of the financial crisis. Elizabeth Warren helped to set it up. She led the setting it up. And they spent a lot of time focused on student loans. And what they've concluded through their regulation is that the servicing is a big chunk of what's going on here. The debts and defaults are relatively small if you compare those debts that are in good standing to those that are in default. It's the inverse of what you'd expect. And it's because of what I just said. The grad students are on the right and the undergraduates are on the left. So the total debt in default is in the neighborhood of $10,000, $15,000. So it's not huge debts that are in default. Okay, income-based repayment. So here's what we have in terms of income-based repayment in the US. The standard repayment, as I said, is a 10-year fixed, a more ties loans, mortgage-style loan. If people are in trouble, they can apply for one of our income-based repayment loans. There's now four or five of them. Pay-as-you-earn, income-based repayment, something else. It's fairly confusing for the students. The key is that it's not the default. It's not the automatic thing that people get enrolled into. You can only get enrolled in an income-based plan if your debt rises above a certain level and your income falls below a certain other level and then you jump through a bunch of hoops. So there is a lot of effort that has to be exerted by both the borrower and the servicer to get somebody into it. It's not universal. It's not easy. There's a lot of applications and annual renewal. So each year you have to renew your eligibility based on the previous year's tax data. And it's not automatic. So you've got a system in which year-to-year earnings go up and down, payments go up and down. All of this is backward-looking. So you become eligible by using information about last year's taxable income. And your payments are set based on last year's taxable income. I compare this to, or I think it's analogous to having an unemployment system that gives you unemployment benefits based on how long you were unemployed last year. Not great as a form of insurance. So it does not flex in meal time as people's earnings go up and down. And in our labor market, which is quite fluid, lots of contingent work, lots of part-time work, especially young people, their earnings can go up and down on a weekly basis, much less on a monthly or an annual basis. So what I and others have proposed, and there's several pieces of legislation now floating around Congress, would be to make income-based repayment the default option, the automatic option that people get enrolled in when they start repayment, that there's no income or debt requirements that it occur through paycheck withholding. You can start to get a sense where we get the inspiration for this, right? And that it's automatic. It automatically adjusts with earnings as do in our country, taxes, social security contributions to Medicare and Medicaid. So conceptually, this is a big lift for people. So lots of debate. There's some convergence underway with both people in the Republican Party and the Democratic Party, supporting it surprisingly to me, more support in the Republican Party. In the Democratic Party, there is a big focus on the debt crisis. And it's the debt crisis, in my opinion, is being what's called the debt crisis is being used as a political tool to get more money into higher education, which is a fine goal, but to do it based predicated on the idea that we've got a debt crisis is not terrific. And in fact, I think there are people who would prefer not to see the repayment system repaired because if it were, it would make the crisis go away, right? So if we made it such that people were not defaulting on small amounts, then the problem would look better and there'd be less incentive to restructure the finance of higher education. So unfortunately, I think students are being used as a political football in a game in higher education finance. So the active proposals running around at this point, there's a consortium of student aid groups that had a cleverly named proposal called Automatic for the Borrower. If you grew up under REM, you know the reference. In the Senate, Rubio, Republican, Barry, Warner, Democrat, Petrie both have proposals out there and I worked on a project with the Brookings Institution to put together a proposal. So I don't see any of this happening during this political cycle. I mean, I think the presidential campaign needs to move through. The rhetoric of the Democrats at this point is reduce the cost of college, make college debt-free and nobody's really interested in paying attention to fixing repayment for the existing borrowers. But I'm hoping that once things die down and people actually get back to work, we'll see some movement here. We need more data. Data's always good. So we lack data that would let us, we don't have any data that lets us link earnings and indebtedness in the US. And that's what you would need to actually really calibrate a well-functioning IBR system. What's the contribution rate gonna be? 3% a year, 4% a year. Is it gonna be progressive, rising with earnings? Is it gonna be self-funding? Or are we gonna have subsidies? All that stuff. We need more data to do us right. And that's how a good researcher always ends their presentation. Give us more data.