Generation Z and the Fractured American Dream: Class Divide, Debt, and the Search for a Future

For Generation Z, the old story of social mobility—study hard, go to college, work your way up—has lost its certainty. The class divide that once seemed bridgeable through education now feels entrenched, as debt, precarious work, and economic volatility blur the promise of progress.

The new economy—dominated by artificial intelligence, speculative assets like cryptocurrency, and inflated housing markets—has not delivered stability for most. Instead, it’s widened gaps between those who own and those who owe. Many young Americans feel locked out of wealth-building entirely. Some have turned to riskier bets—digital assets, gig work, or start-ups powered by AI tools—to chase opportunities that traditional institutions no longer provide. Others have succumbed to despair. Suicide rates among young adults have climbed sharply in recent years, correlating with financial stress, debt, and social isolation.

And echoing through this uncertain landscape is a song that first rose from the coalfields of Kentucky during the Great Depression—Florence Reece’s 1931 protest hymn, “Which Side Are You On?”

Come all you good workers,
Good news to you I’ll tell,
Of how the good old union
Has come in here to dwell.

Which side are you on?
Which side are you on?

Nearly a century later, those verses feel newly urgent—because Gen Z is again being forced to pick a side: between solidarity and survival, between reforming a broken system or resigning themselves to it.

---

The Class Divide and the Broken Ladder
Despite record levels of education, Gen Z faces limited social mobility. College remains a class marker, not an equalizer. Students from affluent families attend better-funded universities, graduate on time, and often receive help with housing or job placement. Working-class and first-generation students, meanwhile, navigate under-resourced campuses, heavier debt, and weaker professional networks.

The Pew Research Center found that first-generation college graduates have nearly $100,000 less in median wealth than peers whose parents also hold degrees. For many, the degree no longer guarantees a secure foothold in the middle class—it simply delays financial independence.

They say in Harlan County,
There are no neutrals there,
You’ll either be a union man,
Or a thug for J. H. Blair.

The metaphor still fits: there are no neutrals in the modern class struggle over debt, housing, and automation.

---

Debt, Doubt, and the New Normal
Gen Z borrowers owe an average of around $23,000 in student loans, a figure growing faster than any other generation’s debt load. Over half regret taking on those loans. Many delay buying homes, having children, or even seeking medical care. Those who drop out without degrees are burdened with debt and little to show for it.

The debt-based model has become a defining feature of American life—especially for the working class. The price of entry to a better future is borrowing against one’s own.

Don’t scab for the bosses,
Don’t listen to their lies,
Us poor folks haven’t got a chance
Unless we organize.

If Reece’s song once called miners to unionize against coal barons, its spirit now calls borrowers, renters, adjuncts, and gig workers to collective resistance against financial systems that profit from their precarity.

---

AI and the Erosion of Work
Artificial intelligence promises efficiency, but it also threatens to hollow out the entry-level job market Gen Z depends on. Automation in journalism, design, law, and customer service cuts off rungs of the career ladder just as young workers reach for them.

While elite graduates may move into roles that supervise or profit from AI, working-class Gen Zers are more likely to face displacement. AI amplifies the class divide: it rewards those who already have capital, coding skills, or connections—and sidelines those who don’t.

---

Crypto Dreams and Financial Desperation
Locked out of traditional wealth paths, many young people turned to cryptocurrency during the pandemic. Platforms like Robinhood and Coinbase promised quick gains and independence from the “rigged” economy. But when crypto markets crashed in 2022, billions in speculative wealth evaporated. Some who had borrowed or used student loan refunds to invest lost everything.

Online forums chronicled not only the financial losses but also the psychological fallout—stories of panic, shame, and in some tragic cases, suicide. The new “digital gold rush” became another mechanism for transferring wealth upward.

---

The Real Estate Wall
While digital markets rise and fall, real estate remains the ultimate symbol of exclusion. Home prices have climbed over 40 percent since 2020, while mortgage rates hover near 8 percent. For most of Gen Z, ownership is out of reach.

Older generations built equity through housing; Gen Z rents indefinitely, enriching landlords and institutional investors. Without intergenerational help, the “starter home” has become a myth. In America’s new class order, those who inherit property inherit mobility.

---

Despair and the Silent Crisis
Behind the data lies a mental health emergency. The CDC reports that suicide among Americans aged 10–24 has risen nearly 60 percent in the past decade. Economic precarity, debt, housing insecurity, and climate anxiety all contribute.

Therapists describe “financial trauma” as a defining condition for Gen Z—chronic anxiety rooted in systemic instability. Universities respond with mindfulness workshops, but few confront the deeper issue: a society that privatized risk and monetized hope.

They say in Harlan County,
There are no neutrals there—
Which side are you on, my people,
Which side are you on?

The question lingers like a challenge to policymakers, educators, and investors alike.

---

A Two-Tier Future
Today’s economy is splitting into two distinct realities:

• The secure class, buffered by family wealth, education, AI-driven income, and real estate assets.

• The precarious class, burdened by loans, high rents, unstable work, and psychological strain.

The supposed democratization of opportunity through technology and education has in practice entrenched a new feudalism—one coded in algorithms and contracts instead of coal and steel.

---

Repairing the System, Not the Student
For Generation Z, the American Dream has become a high-interest loan. Education, technology, and financial innovation—once tools of liberation—now function as instruments of control.

Reforming higher education is necessary, but not sufficient. The deeper work lies in redistributing power: capping predatory interest rates, investing in affordable housing, curbing speculative bubbles, ensuring that AI’s gains benefit labor as well as capital, and confronting the mental health crisis that shadows all of it.

Florence Reece’s song endures because its question has never been answered—only updated. As Gen Z stands at the intersection of debt and digital capitalism, that question rings louder than ever:

Which side are you on?

---

Sources

• Florence Reece, “Which Side Are You On?” (1931).

• Pew Research Center, “First-Generation College Graduates Lag Behind Their Peers on Key Economic Outcomes,” 2021.

• Dēmos, The Debt Divide: How Student Debt Impacts Opportunities for Black and White Borrowers, 2016.

• EducationData.org, “Student Loan Debt by Generation,” 2024.

• Federal Reserve Bank of St. Louis, Gen Z Student Debt and Wealth Data Brief, 2022.

• CNBC, “Gen Z vs. Their Parents: How the Generations Stack Up Financially,” 2024.

• WUSF, “Generation Z’s Net Worth Is Being Undercut by College Debt,” 2024.

• Newsweek, “Student Loan Update: Gen Z Hit with Highest Payments,” 2024.

• The Kaplan Group, “How Student Debt Is Locking Millennials and Gen Z Out of Homeownership,” 2024.

• CDC, Suicide Mortality in the United States, 2001–2022, National Center for Health Statistics, 2023.

• Brookings Institution, “The Impact of AI on Labor Markets: Inequality and Automation,” 2024.

• CNBC, “Crypto Crash Wipes Out Billions in Investor Wealth, Gen Z Most Exposed,” 2023.

• Zillow, “U.S. Housing Affordability Reaches Lowest Point Since 1989,” 2024.

The Student Loan Mess Updated: Debt as a Form of Social Control and Political Action

[Editor's note: The FY 2023 FSA Annual Report is here.] 

In 2014, the father-son team of Joel Best and Eric Best published The Student Loan Mess: How Good Intentions Created a Trillion Dollar Problem. Their argument was that rising student loan debt posed a major social and economic problem in the United States, exceeding $1 trillion at the time of publication (predicted to reach $2 trillion by 2020). This "mess" resulted from a series of well-intentioned but flawed policies that focused on different aspects of the issue in isolation, ultimately creating unintended consequences.

Key Points of the 2014 book:

History of Federal Involvement: The book explored the evolution of federal student loan programs, highlighting how each policy change created new problems while attempting to address the previous ones.

Cost of College: Rising tuition fees along with readily available loans fueled the debt crisis, as students borrowed more to cope with increasing costs.

Repayment Challenges: The authors delved into the difficulties graduates face repaying their loans, including high interest rates, complex repayment plans, and limited income mobility.

Societal Impacts: The book examined the broader societal consequences of student loan debt, such as delayed homeownership, reduced entrepreneurship, and increased economic inequality.

Beyond the Mess: While acknowledging the complexity of the issue, the authors discussed potential solutions, including loan forgiveness programs, income-based repayment plans, and increased government regulation of for-profit colleges.

Overall, "The Student Loan Mess" provided a critical historical analysis of the factors contributing to the crisis and suggested pathways towards a more sustainable system of higher education financing.

Expansion of Federal Loan Programs (1960s-1990s):

The creation of federal loan programs initially aimed to increase access to higher education.

This led to rising tuition costs as universities saw guaranteed funding, with less pressure to remain affordable.

Loan eligibility expanded, encouraging more borrowing even without clear career prospects for graduates.

Cost Explosion and Predatory Lending (1990s-2000s):

College costs skyrocketed due to various factors, including decreased state funding and increased administrative spending.

Loan limits were raised, further fueling the debt increase.

Private lenders entered the market, offering aggressive marketing and deceptive practices, targeting vulnerable students.

Recession and Repayment Struggles (2008-present):

The Great Recession exacerbated loan burdens as graduates faced limited job opportunities and stagnant wages.

Complex repayment plans and high interest rates created a challenging landscape for borrowers.

The rise of for-profit colleges further complicated the issue, often saddling students with debt for degrees with low earning potential.

Growing Awareness, Advocacy, and Reform (2010s-present):

Public awareness of the student loan crisis grew, leading to increased advocacy and demands for reform.

Issues like predatory lending, debt forgiveness, and income-based repayment gained traction.

In 2010, the Health Care and Education Reconciliation Act made a significant change to the federal student loan system. Previously, the government guaranteed private loans, meaning it reimbursed lenders if borrowers defaulted. In turn, lenders received subsidies for participating. The Act ended these subsidies for private lenders, resulting in over $60 billion saved that could be reinvested in student aid programs.

Debates on the role of government and private lenders in financing higher education continued.


Next Chapters?

Since 2014, almost ten years after the Student Loan Mess was published, several major developments have unfolded concerning student loan debt:

Growth and Persistence:

Debt continues to climb: While the growth rate has slowed somewhat, outstanding student loan debt has surpassed $1.7 trillion and remains a significant burden for millions of borrowers.



 

Racial and socioeconomic disparities persist: African American and Latinx borrowers disproportionately hold a higher amount of debt compared to white borrowers, exacerbating economic inequalities.

Policy Changes: 

https://x.com/The Biden-Harris administration has provided $136.6 billion in debt relief. 

Expansion of income-driven repayment plans: Options like Income-Based Repayment (IBR) and Pay As You Earn (PAYE) have been expanded, allowing borrowers to adjust their monthly payments based on income.

Public Service Loan Forgiveness (PSLF) challenges: Legal uncertainties and administrative backlogs have plagued PSLF, leaving many public servants struggling to qualify for loan forgiveness.

Temporary pandemic relief: During the COVID-19 pandemic, federal student loan payments were paused and interest rates set to 0%. Payments resumed in 2023.

Debt cancellation debates: Proposals for broad-based student loan forgiveness have gained traction, with several Democratic lawmakers pushing for different cancellation amounts. However, these proposals have faced legal and political hurdles. In 2023, the 9th Circuit Court ruled in favor of mass cancellation of loans from predatory for-profit colleges (Sweet v Cardona). A few months later, the US Supreme Court struck down President Biden's plan for debt relief to more than 30 million Americans.

Increased attention to for-profit colleges and online program managers: Scrutiny of predatory practices and low graduate outcomes at for-profit institutions has intensified. Gainful employment rules have been reestablished, but whether they will be enforced is in question.  


Looking forward:

The future of student loan debt remains uncertain. Key questions include:

Will broad-based loan forgiveness materialize?

Can income-driven repayment plans be made more effective?

How will future administrations address affordability and access to higher education?

What role will the private sector play in financing higher education?

How will declining enrollment numbers and skepticism about the value of higher education affect student loan debt and debt relief?  

Will higher ed institutions be held accountable for the debt of their former students and alumni?

Can higher education reduce consumer costs and provide value to consumers and communities at the same time?  

How will student loan debt affect disability, retirement, and life expectancy among long-term debtors?     

Policy Drivers:

Economic factors: A strong economy could increase government revenue, potentially enabling broader debt forgiveness or increased funding for higher education access initiatives. Conversely, an economic downturn could make policy interventions more challenging.

Elections and political pressure: Public opinion and the results of future elections will influence the political will for reform. Continued activism and pressure from advocacy groups could sway policy decisions.

Legal challenges and court rulings: Lawsuits over debt cancellation programs and loan servicer practices could impact the legal landscape and shape future policy options.

Private sector involvement: Developments in the private student loan market and potential regulations of lending practices could affect access to credit and repayment options.

Consumer Decisions:

Debt burden and economic outlook: The level of outstanding debt and future job prospects will significantly influence borrower behavior. Increased debt loads could incentivize riskier repayment strategies or delaying major life decisions like homeownership.

Awareness and financial literacy: Improved understanding of loan terms, repayment options, and alternative financing methods could empower borrowers to make informed decisions.

Government programs and incentives: Changes to income-driven repayment plans, loan forgiveness programs, and other government initiatives will directly impact consumer choices about managing their debt.

Emerging Trends:

Alternative financing models: Innovations like income-share agreements and skills-based financing could disrupt traditional loan structures and offer new options for students.

Technology and automation: Increased use of technology to streamline loan management and repayment could improve efficiency and transparency.

Focus on affordability and value: As concerns about the value proposition of higher education grow, there might be a shift towards emphasizing affordable options and skills-based learning.


How does student loan debt affect the lives of Americans?

Student loan debt has a profound impact on the lives of millions of Americans in various ways, affecting not just their finances but also their major life decisions and overall well-being. Here's a breakdown of some key areas:

Financial Impact:

Burden of debt: The average graduate has over $40,000 in student loan debt, significantly impacting their monthly budget and disposable income. This can limit savings for retirement, emergencies, and major purchases like a house.

Lower credit scores: Missed payments or delinquencies can negatively affect credit scores, hindering access to future loans and increasing interest rates on other forms of credit.

Delayed milestones: High debt burdens may cause individuals to delay major life milestones like buying a home, getting married, starting a family, or pursuing further education due to financial constraints.

Career Choices:

Job dissatisfaction: To make loan payments, some graduates might feel pressured to stay in high-paying but unfulfilling jobs, sacrificing career satisfaction for financial stability.

Entrepreneurial risk: The fear of financial failure due to debt may discourage individuals from pursuing entrepreneurial ventures, hindering innovation and economic growth.

Limited career mobility: Debt may lock individuals into specific career paths based on earning potential, restricting their ability to pursue desired career changes.

Mental and Emotional Wellbeing:

Stress and anxiety: The constant pressure of debt repayment can lead to significant stress and anxiety, impacting mental and emotional well-being.

Lower self-esteem: Feelings of financial instability and hopelessness can negatively impact self-esteem and overall life satisfaction.

Stigma and discrimination: Some individuals may face social stigma associated with student loan debt, further exacerbating the emotional burden.

Societal Impact:

Economic inequality: Student loan debt disproportionately affects certain groups, like minorities and low-income students, perpetuating and widening economic inequality.

Lower homeownership rates: High debt burdens can hinder homeownership, negatively impacting the housing market and contributing to wealth disparities.

Reduced consumer spending: Debt-burdened individuals have less disposable income, limiting their purchasing power and affecting the overall economy.


Social Class and Student Loan Debt

There's a well-documented and intricate relationship between social class and student loan debt, characterized by significant inequalities and disparities. Here's a breakdown of some key points:

Higher burden on lower classes:

Borrowing rates: Individuals from lower socioeconomic backgrounds are more likely to borrow student loans due to limited family resources and higher college costs compared to their income.

Debt amounts: Borrowers from lower socioeconomic backgrounds often take on larger debt loads due to higher tuition fees and living expenses, often exceeding their earning potential after graduation.

Repayment challenges: They face greater difficulty repaying loans due to lower-paying jobs, making them more susceptible to delinquency and default. This hinders wealth accumulation and upward mobility.

Contributing factors:

Limited financial support: Lack of parental financial support or savings forces students from lower socioeconomic backgrounds to rely heavily on loans for college expenses.

Limited college options: Limited access to affordable, high-quality educational institutions often steers individuals towards for-profit colleges with deceptive practices and low graduation rates, leading to high debt with limited job prospects.

Ongoing Debate

There is ongoing debate on solutions to address the student loan crisis, with proposals ranging from broad-based loan forgiveness to reforms in higher education financing and income-driven repayment plans. The future of student loan debt and its impact on Americans remains uncertain and depends on various factors, including policy decisions, economic trends, and individual financial choices.

The Student Loan Debt Movement

There has been an organized effort for student loan debt relief since the 2010s. This movement, using direct action, lawsuits, and lobbying has had some gains, putting pressure for accountability for schools that use predatory practices--and getting debt relief for hundreds of thousands of debtors.  The most notable organization has been the Debt Collective.  

Image of Ann Bowers, courtesy of the Debt Collective

There have been legal allies too, such as the Harvard Project on Predatory Student Lending (PPSL) and the Student Borrower Protection Center (SBPC).    

Named plaintiffs Theresa Sweet (L) and Alicia Davis (R) outside the federal district court in San Francisco on November 6, 2022, three days before the final approval hearing in Sweet v Cardona (Image credit: Ashley Pizzuti) 

Resistance to Debt Relief

The reasons why some people might not support student loan forgiveness. Some conservatives believe that it is unfair to forgive the debts of those who willingly took out loans, while others believe that it would be a waste of taxpayer money. Additionally, some believe that student loan forgiveness would not address the root causes of the problem, such as the high cost of tuition.

It is important to note that not all conservatives oppose student loan forgiveness. Some support income-based repayment plans or public service loan forgiveness. Additionally, some believe the government should focus on making college more affordable, rather than simply forgiving existing debt.

According to a 2019 poll by the Pew Research Center, 54% of Republicans and Republican-leaning independents opposed forgiving all student loan debt, while 37% supported it.

Student Loan Debt Power Analysis: Who Benefits from Inaction?

There are elites and elite organizations who are (at least on the backstage) against student loan debt relief: student loan servicers (e.g. Maximus, Nelnet, Navient, and Sallie Mae), big banks, large corporations, and the US military. For them, debt serves as a way to get others to do their bidding. Debt is essential as a leverage tool to recruit and retain workers. Debt relief could also create more competition for better, more meaningful jobs, which some elites may not want for their children. States may be unwilling or unable to further subsidize higher education if elites are unwilling to pay. This situation is likely to worsen as Medicaid budgets are used for a growing number of elderly and increasingly disabled Baby Boomers.  

Related links:

Borrower Defense Claims Surpass 750,000. Consumers Empowered. Subprime Colleges and Programs Threatened.

 

People's Rally for Student Debt Cancellation to be held outside Supreme Court, February 28, 2023  

 

Department of Education: Over half of federal student loan borrowers were not paying before Pandemic (Alan Collinge)

Student Loans and a Brutal Lifetime of Debt (Dahn Shaulis and Glen McGhee)

Maximus, Student Loan Debt, and the Poverty Industrial Complex

SLABS: The Soylent Green of US Higher Education

I Went on Strike to Cancel My Student Debt and Won. Every Debtor Deserves the Same. (Ann Bowers)

An Email of Concern to the People of Arkansas about the University of Phoenix (Tarah Gramza)

Higher Education FOIA Requests to US Department of Education

Student Booted from PhD Program Over AI Use (Derek Newton/The Cheat Sheet)

336: Student Says He Was Expelled Over False Accusation of AI Use

Issue 336

This one is going to take a hot minute to dissect. Minnesota Public Radio (MPR) has the story.

The plot contours are easy. A PhD student at the University of Minnesota was accused of using AI on a required pre-dissertation exam and removed from the program. He denies that allegation and has sued the school — and one of his professors — for due process violations and defamation respectively.

Starting the case.

The coverage reports that:

all four faculty graders of his exam expressed “significant concerns” that it was not written in his voice. They noted answers that seemed irrelevant or involved subjects not covered in coursework. Two instructors then generated their own responses in ChatGPT to compare against his and submitted those as evidence against Yang. At the resulting disciplinary hearing, Yang says those professors also shared results from AI detection software. 

Personally, when I see that four members of the faculty unanimously agreed on the authenticity of his work, I am out. I trust teachers.

I know what a serious thing it is to accuse someone of cheating; I know teachers do not take such things lightly. When four go on the record to say so, I’m convinced. Barring some personal grievance or prejudice, which could happen, hard for me to believe that all four subject-matter experts were just wrong here. Also, if there was bias or petty politics at play, it probably would have shown up before the student’s third year, not just before starting his dissertation.

Moreover, at least as far as the coverage is concerned, the student does not allege bias or program politics. His complaint is based on due process and inaccuracy of the underlying accusation.

Let me also say quickly that asking ChatGPT for answers you plan to compare to suspicious work may be interesting, but it’s far from convincing — in my opinion. ChatGPT makes stuff up. I’m not saying that answer comparison is a waste, I just would not build a case on it. Here, the university didn’t. It may have added to the case, but it was not the case. Adding also that the similarities between the faculty-created answers and the student’s — both are included in the article — are more compelling than I expected.

Then you add detection software, which the article later shares showed high likelihood of AI text, and the case is pretty tight. Four professors, similar answers, AI detection flags — feels like a heavy case.

Denied it.

The article continues that Yang, the student:

denies using AI for this exam and says the professors have a flawed approach to determining whether AI was used. He said methods used to detect AI are known to be unreliable and biased, particularly against people whose first language isn’t English. Yang grew up speaking Southern Min, a Chinese dialect. 

Although it’s not specified, it is likely that Yang is referring to the research from Stanford that has been — or at least ought to be — entirely discredited (see Issue 216 and Issue 251). For the love of research integrity, the paper has invented citations — sources that go to papers or news coverage that are not at all related to what the paper says they are.

Does anyone actually read those things?

Back to Minnesota, Yang says that as a result of the findings against him and being removed from the program, he lost his American study visa. Yang called it “a death penalty.”

With friends like these.

Also interesting is that, according to the coverage:

His academic advisor Bryan Dowd spoke in Yang’s defense at the November hearing, telling panelists that expulsion, effectively a deportation, was “an odd punishment for something that is as difficult to establish as a correspondence between ChatGPT and a student’s answer.” 

That would be a fair point except that the next paragraph is:

Dowd is a professor in health policy and management with over 40 years of teaching at the U of M. He told MPR News he lets students in his courses use generative AI because, in his opinion, it’s impossible to prevent or detect AI use. Dowd himself has never used ChatGPT, but he relies on Microsoft Word’s auto-correction and search engines like Google Scholar and finds those comparable. 

That’s ridiculous. I’m sorry, it is. The dude who lets students use AI because he thinks AI is “impossible to prevent or detect,” the guy who has never used ChatGPT himself, and thinks that Google Scholar and auto-complete are “comparable” to AI — that’s the person speaking up for the guy who says he did not use AI. Wow.

That guy says:

“I think he’s quite an excellent student. He’s certainly, I think, one of the best-read students I’ve ever encountered”

Time out. Is it not at least possible that professor Dowd thinks student Yang is an excellent student because Yang was using AI all along, and our professor doesn’t care to ascertain the difference? Also, mind you, as far as we can learn from this news story, Dowd does not even say Yang is innocent. He says the punishment is “odd,” that the case is hard to establish, and that Yang was a good student who did not need to use AI. Although, again, I’m not sure how good professor Dowd would know.

As further evidence of Yang’s scholastic ability, Dowd also points out that Yang has a paper under consideration at a top academic journal.

You know what I am going to say.

To me, that entire Dowd diversion is mostly funny.

More evidence.

Back on track, we get even more detail, such as that the exam in question was:

an eight-hour preliminary exam that Yang took online. Instructions he shared show the exam was open-book, meaning test takers could use notes, papers and textbooks, but AI was explicitly prohibited. 

Exam graders argued the AI use was obvious enough. Yang disagrees. 

Weeks after the exam, associate professor Ezra Golberstein submitted a complaint to the U of M saying the four faculty reviewers agreed that Yang’s exam was not in his voice and recommending he be dismissed from the program. Yang had been in at least one class with all of them, so they compared his responses against two other writing samples. 

So, the exam expressly banned AI. And we learn that, as part of the determination of the professors, they compared his exam answers with past writing.

I say all the time, there is no substitute for knowing your students. If the initial four faculty who flagged Yang’s work had him in classes and compared suspicious work to past work, what more can we want? It does not get much better than that.

Then there’s even more evidence:

Yang also objects to professors using AI detection software to make their case at the November hearing.  

He shared the U of M’s presentation showing findings from running his writing through GPTZero, which purports to determine the percentage of writing done by AI. The software was highly confident a human wrote Yang’s writing sample from two years ago. It was uncertain about his exam responses from August, assigning 89 percent probability of AI having generated his answer to one question and 19 percent probability for another. 

“Imagine the AI detector can claim that their accuracy rate is 99%. What does it mean?” asked Yang, who argued that the error rate could unfairly tarnish a student who didn’t use AI to do the work.  

First, GPTZero is junk. It’s reliably among the worst available detection systems. Even so, 89% is a high number. And most importantly, the case against Yang is not built on AI detection software alone, as no case should ever be. It’s confirmation, not conviction. Also, Yang, who the paper says already has one PhD, knows exactly what an accuracy rate of 99% means. Be serious.

A pattern.

Then we get this, buried in the news coverage:

Yang suggests the U of M may have had an unjust motive to kick him out. When prompted, he shared documentation of at least three other instances of accusations raised by others against him that did not result in disciplinary action but that he thinks may have factored in his expulsion.  

He does not include this concern in his lawsuits. These allegations are also not explicitly listed as factors in the complaint against him, nor letters explaining the decision to expel Yang or rejecting his appeal. But one incident was mentioned at his hearing: in October 2023, Yang had been suspected of using AI on a homework assignment for a graduate-level course. 

In a written statement shared with panelists, associate professor Susan Mason said Yang had turned in an assignment where he wrote “re write it, make it more casual, like a foreign student write but no ai.”  She recorded the Zoom meeting where she said Yang denied using AI and told her he uses ChatGPT to check his English.

She asked if he had a problem with people believing his writing was too formal and said he responded that he meant his answer was too long and he wanted ChatGPT to shorten it. “I did not find this explanation convincing,” she wrote. 

I’m sorry — what now?

Yang says he was accused of using AI in academic work in “at least three other instances.” For which he was, of course, not disciplined. In one of those cases, Yang literally turned in a paper with this:

“re write it, make it more casual, like a foreign student write but no ai.” 

He said he used ChatGPT to check his English and asked ChatGPT to shorten his writing. But he did not use AI. How does that work?

For that one where he left in the prompts to ChatGPT:

the Office of Community Standards sent Yang a letter warning that the case was dropped but it may be taken into consideration on any future violations. 

Yang was warned, in writing.

If you’re still here, we have four professors who agree that Yang’s exam likely used AI, in violation of exam rules. All four had Yang in classes previously and compared his exam work to past hand-written work. His exam answers had similarities with ChatGPT output. An AI detector said, in at least one place, his exam was 89% likely to be generated with AI. Yang was accused of using AI in academic work at least three other times, by a fifth professor, including one case in which it appears he may have left in his instructions to the AI bot.

On the other hand, he did say he did not do it.

Findings, review.

Further:

But the range of evidence was sufficient for the U of M. In the final ruling, the panel — comprised of several professors and graduate students from other departments — said they trusted the professors’ ability to identify AI-generated papers.

Several professors and students agreed with the accusations. Yang appealed and the school upheld the decision. Yang was gone. The appeal officer wrote:

“PhD research is, by definition, exploring new ideas and often involves development of new methods. There are many opportunities for an individual to falsify data and/or analysis of data. Consequently, the academy has no tolerance for academic dishonesty in PhD programs or among faculty. A finding of dishonesty not only casts doubt on the veracity of everything that the individual has done or will do in the future, it also causes the broader community to distrust the discipline as a whole.” 

Slow clap.

And slow clap for the University of Minnesota. The process is hard. Doing the review, examining the evidence, making an accusation — they are all hard. Sticking by it is hard too.

Seriously, integrity is not a statement. It is action. Integrity is making the hard choice.

MPR, spare me.

Minnesota Public Radio is a credible news organization. Which makes it difficult to understand why they chose — as so many news outlets do — to not interview one single expert on academic integrity for a story about academic integrity. It’s downright baffling.

Worse, MPR, for no specific reason whatsoever, decides to take prolonged shots at AI detection systems such as:

Computer science researchers say detection software can have significant margins of error in finding instances of AI-generated text. OpenAI, the company behind ChatGPT, shut down its own detection tool last year citing a “low rate of accuracy.” Reports suggest AI detectors have misclassified work by non-native English writers, neurodivergent students and people who use tools like Grammarly or Microsoft Editor to improve their writing. 

“As an educator, one has to also think about the anxiety that students might develop,” said Manjeet Rege, a University of St. Thomas professor who has studied machine learning for more than two decades. 

We covered the OpenAI deception — and it was deception — in Issue 241, and in other issues. We covered the non-native English thing. And the neurodivergent thing. And the Grammarly thing. All of which MPR wraps up in the passive and deflecting “reports suggest.” No analysis. No skepticism.

That’s just bad journalism.

And, of course — anxiety. Rege, who please note has studied machine learning and not academic integrity, is predictable, but not credible here. He says, for example:

it’s important to find the balance between academic integrity and embracing AI innovation. But rather than relying on AI detection software, he advocates for evaluating students by designing assignments hard for AI to complete — like personal reflections, project-based learnings, oral presentations — or integrating AI into the instructions. 

Absolute joke.

I am not sorry — if you use the word “balance” in conjunction with the word “integrity,” you should not be teaching. Especially if what you’re weighing against lying and fraud is the value of embracing innovation. And if you needed further evidence for his absurdity, we get the “personal reflections and project-based learnings” buffoonery (see Issue 323). But, again, the error here is MPR quoting a professor of machine learning about course design and integrity.

MPR also quotes a student who says:

she and many other students live in fear of AI detection software.  

“AI and its lack of dependability for detection of itself could be the difference between a degree and going home,” she said. 

Nope. Please, please tell me I don’t need to go through all the reasons that’s absurd. Find me one single of case in which an AI detector alone sent a student home. One.

Two final bits.

The MPR story shares:

In the 2023-24 school year, the University of Minnesota found 188 students responsible of scholastic dishonesty because of AI use, reflecting about half of all confirmed cases of dishonesty on the Twin Cities campus. 

Just noteworthy. Also, it is interesting that 188 were “responsible.” Considering how rare it is to be caught, and for formal processes to be initiated and upheld, 188 feels like a real number. Again, good for U of M.

The MPR article wraps up that Yang:

found his life in disarray. He said he would lose access to datasets essential for his dissertation and other projects he was working on with his U of M account, and was forced to leave research responsibilities to others at short notice. He fears how this will impact his academic career

Stating the obvious, like the University of Minnesota, I could not bring myself to trust Yang’s data. And I do actually hope that being kicked out of a university for cheating would impact his academic career.

And finally:

“Probably I should think to do something, selling potatoes on the streets or something else,” he said. 

Dude has a PhD in economics from Utah State University. Selling potatoes on the streets. Come on.

(Editors note: This article first appeared at Derek Newton's The Cheat Sheet.)

Will Maximus and Its Subsidiary AidVantage See Cuts?

Maximus Inc., the parent company of federal student loan servicer Aidvantage, is facing growing financial and existential threats as the Trump administration completes a radical budget proposal that would slash Medicaid by hundreds of billions of dollars and cut the U.S. Department of Education in half. These proposed changes could gut the very federal contracts that have fueled Maximus's revenue and investor confidence over the last two decades. Once seen as a steady player in the outsourcing of public services, Maximus now stands at the edge of a political and technological cliff.

The proposed Trump budget includes a plan to eliminate the Office of Federal Student Aid and transfer the $1.6 trillion federal student loan portfolio to the Small Business Administration. This proposed restructuring would remove Aidvantage and other servicers from their current roles, replacing them with yet-unnamed alternatives. While Maximus has profited enormously from servicing loans through Aidvantage—one of the major federal loan servicers—it is unclear whether the company has any role in this new Trump-led student loan regime. The SBA, which lacks experience managing consumer lending and repayment infrastructure, could subcontract to politically favored firms or simply allow artificial intelligence to replace human collectors altogether.

This possibility is not far-fetched. A 2023 study by Yale Insights explored how AI systems are already outperforming human debt collectors in efficiency, compliance, and scalability. The report examined the growing use of bots to handle borrower communication, account resolution, and payment tracking. These developments could render Maximus’s human-heavy servicing model obsolete. If the federal government shifts toward automated collection, it could bypass Maximus entirely, either through privatized tech-driven firms or through internal platforms that require fewer labor-intensive contracts.

On the health and human services side of the business, Maximus is also exposed. The company has long served as a contractor for Medicaid programs across several states, managing call centers and eligibility support. But with Medicaid facing potentially devastating cuts in the proposed Trump budget, Maximus’s largest and most stable contracts could disappear. The company’s TES-RCM division has already shown signs of unraveling, with anonymous reports suggesting a steep drop-off in clients and the departure of long-time employees. One insider claimed, “Customers are dropping like flies as are longtime employees. Not enough people to do the little work we have.”

Remote Maximus employees are also reporting layoffs and instability, particularly in Iowa, where 34 remote workers were terminated after two decades of contract work on state Medicaid programs. Anxiety is spreading across internal forums and layoff boards, as workers fear they may soon be out of a job in a shrinking and increasingly automated industry. Posts on TheLayoff.com and in investor forums indicate growing unease about the company’s long-term viability, particularly in light of the federal budget priorities now taking shape in Washington.

While Maximus stock (MMS) continues to trade with relative strength and still appears profitable on paper, it is increasingly reliant on government spending that may no longer exist under a Trump administration intent on dismantling large parts of the federal bureaucracy. If student loan servicing is eliminated, transferred, or automated, and Medicaid contracts dry up due to funding cuts, Maximus could lose two of its biggest revenue streams in a matter of months. The company’s contract with the Department of Education, once seen as a long-term asset, may become a political liability in a system being restructured to reward loyalty and reduce regulatory oversight.

The question now is not whether Maximus will be forced to downsize—it already is—but whether it will remain a relevant player in the new federal landscape at all. As artificial intelligence, austerity, and ideological realignment converge, Maximus may be remembered less for its dominance and more for how quickly it became unnecessary.

The Higher Education Inquirer will continue tracking developments affecting federal student loan servicers, government contractors, and the broader collapse of the administrative state.

Forced Birth, Broken Systems: What Happens When Medicaid Is Cut, Planned Parenthood Is Defunded, Abortion Is Illegal, and Pell Grants Are Slashed

The United States is entering a reproductive and economic crisis with profound and long-lasting effects, not only on public health but on higher education, labor markets, and the basic social contract. With proposed Medicaid cuts threatening to remove 11 to 14 million people from coverage, the defunding of Planned Parenthood already underway in multiple states, abortion outlawed or criminalized in much of the country, and Pell Grants—long the financial lifeline for working-class students—now on the chopping block, the consequences for vulnerable Americans are becoming existential.

Medicaid currently funds 43 percent of all births in the United States, serving as a critical support system for low-income families and especially for women of reproductive age. Cutting this program will mean millions of people, including many students, will lose access to contraception, prenatal care, or safe childbirth. The simultaneous defunding of Planned Parenthood eliminates one of the few affordable sources of reproductive healthcare for millions more, including STI testing and abortion referrals. In states where abortion is now illegal or nearly impossible to access, people without resources are being forced into parenthood—regardless of age, circumstance, health risks, or consent.

The result is not a resurgence of “family values” but a public health disaster. Maternal and infant mortality will rise, especially among Black, Indigenous, and Latina women who already face disproportionate risk. Rural and underfunded hospitals will be pushed to the brink, taking on a wave of uncompensated labor and delivery cases they cannot afford. Many of these same states reject Medicaid expansion and other social supports, leaving poor women and their children with no safety net at all.

And now, the same lawmakers pushing forced birth are demanding cuts to federal student aid. Pell Grants, the cornerstone of college affordability for low-income students, are under threat of restructuring and reduction—some proposals aim to tie eligibility to higher credit loads or academic benchmarks that working students with family responsibilities often cannot meet. Forcing students to take 15 credits a semester to qualify for full funding, while stripping away healthcare, reproductive autonomy, and economic security, creates an impossible trap. The cruelty is calculated.

The consequences for college students—especially women, people of color, and those from working-class backgrounds—will be devastating. A student who becomes pregnant without access to abortion and Medicaid may be forced to carry the pregnancy to term without adequate medical care. Without affordable childcare or family support, many will be unable to complete their degrees. Financially, these students face lifelong setbacks: medical debt, increased student loans, and diminished earning potential.

Planned Parenthood has long been a crucial resource for college students seeking contraception, health screenings, or reproductive counseling. Mental health will suffer across campuses, with increased trauma, anxiety, and depression tied to forced pregnancy, criminalization, and economic desperation. College counseling centers are not equipped to manage this crisis.

Criminalization of abortion and related care also threatens student safety and autonomy. Students could face surveillance, arrest, or disciplinary action for seeking abortion pills, traveling out of state for care, or even sharing information. Faculty and staff may be legally targeted for offering assistance or referrals. The chilling effect on campuses will be immediate and severe, undermining both student health and academic freedom.

Meanwhile, slashing Pell Grants will make college completely unaffordable for thousands. Many will be forced to take out higher-interest loans—or drop out altogether. These financial constraints will disproportionately affect students at community colleges and regional public universities, the very institutions most likely to serve student parents and low-income learners. With every cut to Pell, with every denial of childcare, with every forced birth, the ladder of social mobility collapses further.

This is not just a reproductive rights issue or an education issue. It is a deliberate strategy of control and abandonment. The same communities being forced into parenthood are being stripped of the tools to escape poverty—higher education, healthcare, and bodily autonomy. This is economic warfare dressed in moral righteousness. And it is reshaping the future of who gets to survive, succeed, or dream in America.

Colleges and universities cannot remain silent. Faculty, administrators, and student organizations must speak out against the coordinated assault on reproductive freedom and educational access. Campus activism is already rising, but it is likely to be met with increased repression—funding cuts, surveillance, and political intimidation. Institutions that claim to support equity, justice, and student success must match words with action.

This moment demands more than statements and symbolic gestures. It requires direct resistance and solidarity. It requires fighting for healthcare as a human right, for fully funded Pell Grants and student supports, and for the fundamental freedom to make decisions about one’s own body and future.

In this looming dystopia—where reproductive autonomy is criminalized, education is devalued, and poverty is legislated—the very notion of a democratic and just society is at risk. If higher education is to mean anything at all, it must stand against this assault. Otherwise, it becomes just another engine in the machinery of inequality and control.

Presidents’ Alliance Reaffirms Higher Education’s “Steadfast Commitment” to Immigrant, Refugee, and International Students

For Immediate Release: November 6, 2024
Contact: Michael Earls at michael@npagency.com

Washington D.C. – As the nation reflects on the results of yesterday’s election, the Presidents’ Alliance on Higher Education and Immigration reaffirms our steadfast commitment to undocumented, immigrant-origin, international, and refugee students, and policies that recognize their essential role in the future workforce and leadership of our country.

Miriam Feldblum, Executive Director of the Presidents’ Alliance, stated:

“A central mission of higher education is to educate and equip individuals from all backgrounds to unleash their talent and potential. That belief underscores our advocacy for policies and supports that provide opportunities for international students, refugees, and Dreamers with and without DACA. In a post-election environment of uncertainty and anxiety for many on our campuses, our commitment to students, staff, and faculty from around the world remains steadfast, as does our belief in their essential role in our nation’s economic vitality and competitiveness.”

Nancy Cantor, President of Hunter College at CUNY and Co-Chair of the Steering Committee of the Presidents’ Alliance, stated:

“The presence of diverse students, staff, and faculty from around the world enriches the learning experience, advances knowledge, spurs scientific and technological innovation, and brings fresh perspectives to our campuses, communities, and the nation. Together, we remain committed to advancing our shared vision of a welcoming, innovative, and thriving future—one that draws on the strengths and talents of every individual, regardless of background or immigration status.”

On November 15th at 2:00 p.m. EST, the Presidents’ Alliance will be hosting a virtual briefing, to discuss post-election priorities and prospects for higher education and immigration policy. To register for the briefing, please click here.

Below, find a collection of resources and information for campuses to support undocumented, refugee, and international students in this post-election period.

Resources Read the Presidents’ Alliance 1-page guide, Five Ways Campuses Can Support Non-Citizen Students and Employees Post-Election
Presidents’ Alliance Directory: Resources to Support DACA recipients, Undocumented Students, and Institutions of Higher Education
Higher Ed Immigration Portal directory: Beyond DACA: A Directory of Resources for Undocumented Students & Individuals
Community resources: find “Know Your Rights” resources from Informed Immigrant and ACLU and see Switchboard’s guide, “Safety and Security in Polarized Political Environments” Additional Upcoming Post-Election Webinars hosted by UC Immigrant Legal Services Center: Traveling While Undocumented (Friday, November 22, 2024)
Safety Planning for Immigrants (Friday, December 13, 2024)
 

The nonpartisan, nonprofit Presidents’ Alliance on Higher Education and Immigration brings college and university presidents and chancellors together on the immigration issues that impact higher education, our students, campuses, communities and nation. We work to support undocumented, international and refugee students, and advance forward-looking immigration policies and practices at the federal level, in our states, and across our college campuses. The Alliance is composed of 550+ college and university presidents and chancellors of public and private colleges and universities, enrolling over five million students in 42 states, D.C., and Puerto Rico.

How College Broke the Labor Market (PolyMatter)

Related links:

The College Dream is Over (Gary Roth)

Credential Inflation Makes College Degree Not Worth the Cost (Randall Collins)

College Meltdown 3.0 Could Start Earlier (And End Worse) Than Planned 

Higher Education, Technology, and A Growing Social Anxiety

The Student Loan Mess Updated: Debt as a Form of Social Control and Political Action

Student Loans and a Brutal Lifetime of Debt

A People's History of Higher Education in the US

Get Wise, Guys: The Perils of the Sports Betting Culture

The NCAA Calls it a Nightmare 

It's easy to get caught up in the excitement of betting on college sports, the potential for quick money, and the social aspect of it all. But let's peel back the curtain and examine the real dangers that lurk beneath the surface of the sports betting culture.  

The Illusion of Easy Money
While it may seem like a simple way to make extra cash, the reality is much more complex. The odds are stacked against you, and the house always has an edge. Chasing losses can lead to a dangerous cycle of debt and despair.

The Mental Toll
The emotional rollercoaster of sports betting can take a significant toll on your mental health. The highs of winning can be fleeting, while the lows of losing can be devastating. The constant stress, anxiety, and disappointment can lead to serious mental health issues.

The Social Impact
Gambling addiction can strain relationships with friends and family. It can lead to isolation, secrecy, and a breakdown of trust. Your academic performance may suffer as you prioritize betting over your studies.

Get Wise, Stay Wise
While it's tempting to indulge in the thrill of sports betting, it's important to approach it with a level head. If you are underage, don't do it.  If you are over 25 and don't have an addiction, stick to a few small bets and a small budget, and know when to walk away. Don't drink or do drugs before, during, or after wagering. If you find yourself struggling with a gambling addiction, seek help immediately.  And if someone notices problems before you do, consider them an ally, and listen. 

Remember, the true joy of sports lies in the game itself, not in the financial outcome.

The National Problem Gambling Helpline (1-800-GAMBLER) is operated by the National Council on Problem Gambling. The helpline serves as a one-stop hub connecting people looking for assistance with a gambling problem to local resources. This network includes 28 contact centers which cover all 50 states and the U.S. territories. The National Problem Gambling Helpline offers call, text and chat services 24/7/365.