>> i'm ali velshi, the news has become this thing where you talk to experts about people, and al jazeera has really tried to talk to people, about their stories. we are not meant to be your first choice for entertainment. we are ment to be your first choice for the news. to begin, versus four years at a residential programme when the diploma, the credential looks the same to the world. value versus perception. it's real. it's forcing tough choices on families that would otherwise be happy to reward their hard-working high schooler. >> high school senior karen gonzalez of centerville virginia will head to radford university, college. >> i got the red folder. it was crazy, i cried.

i told mum the big news. she jumps up and down. >> the daughter of two peruvian immigrants, karen said not going to college was not an option. >> i want to get my education. >> early in the progress, it was clear she didn't just need good grades, but money too. and lots of it. >> as soon as i applied to different colleges, and i saw tuition, it made me feel disappointed, thoughing that other students have the ability to say "i want that one", or "no, i don't like that, i want that." me i felt weird because i had to limit my choices. >> she had dreams of studying at old dominion or virginian commonwealth. it's become a family affair to pay for her third choice, a less expensive school.

>> my dad has two full-time job, one at wal-mart delis and one at rudies for the airport. every time he gets a pay check he'll divide it. i plan on doing work study at radford. i'll work while i'm at school. >> most american college students share the story. the average student loan debt tops $29,000, which is nearly double what seniors owed in 1989. according to the college board the school year adds average cost for tuition and fees were 30,094 at private. 8,093 for state residents at public colleges and 23,203 for out of state residents at hub bike colleges. being in the red is not just an individual problem, but an evolving national one. collectively student loan debt is more than a trillion dollars.

>> a report from dimos says rising fees are linked to funding cuts at college. a funding cut of the great recession. this is an author. >> it is cuts to state funding that is it the rising cause students are paying the cost for the holes in the state budget, lives. >> 49 states have seep an average -- seen an average cut in funding of 27% per student. most are raising fees and cutting resources to cover operational overhead, meaning while students pay more, it doesn't translate into better quality teaching. the result millions of 20 somethings, and during the economy immediately cash strapped after graduation, unable to spend money on much else, other are than student loans. hilton smith calls it a debt for diploma system. >> the students who are paying $300 or $500 towards reducing

debt is $300 to $500 that they could spend on a down-payment of a house or a new car or other things that would recirculate in the economy. >> the rules made it difficult to forgive student debt. when it defaults, it set off a vicious cycle. savings. >> this person saw going into default first hand. after earning a bachelors in journalism and a masters in international relations, she red. >> i ignored it. it was a big mistake. >> when she decided to face reality she was faced with an ugly truth. >> i signed into my account and it was 92,000.

>> it caused upheaval. she got a job. how do i get the 7 to a 6. it was a game. >> she is carrying a 20,000 debt, but at the expense of not doing anything else. storeys likes this weigh heavily on the high school seniors. >> i'm scared for my father. i hardly see him now.

the modern market in higher ed, this time on inside story, joining us philip yeaingel, the former interim chancellor. marie big im, a director of college counselling at a greenhill school in dallas texas, and from new york, a correspondent for al jazeera velshi. >> let me start with you philip. you have seen it from the inside. tell the people who are watching why it is that tuitions have risen so fast. what is driving the costs? >> as in your set up piece, the biggest single factor increasing

student tuition rates at public universities is the decline in state support for the universities. in fact, it really seems as if the american dream is in danger of turning into a nightmare. the students can see the land of tonny, but can't get to it. as you decrease the state support, the expenses of the university continue, and the only way - or the major way that a university has to make up for that is, in fact, to increase tuition. at the same time most universities are getting more and more sensitive to the impact this has on students, and so they will often have a combination of an increase in tuition and some form of cuts within the university to try to decrease over all expenses. >> were there no other choices

as administrators like yourself looked at what could be done to econ omize, what could go first. is tuition the only fall-back position for closing what could be a budget deficit? >> depend on the magnitude of the deficit. there are opportunities within universities, and you can encompass them in the concept of focussing on student first. that is, that as you make decisions on expenditures, you ensure that your first priority is for the students, because after all these days the whole equation is flipped. it used to be in public universities, the state support paid for most of the educational costs. today it's the student's tuition that paid for the majority of the educational costs. in that framework it's important for universities to focus on

expenditures that enhance and improve and sustain the student experience as students. that means that sometimes some of the other programs and missions at universities, that they have taken on, may have to be diminished or fall by the student. >> as the trend conditions, have you seen the kids you advise not only make decisions on where their grades will take them, but where their budgets will? >> absolutely. and i work at independent schools, so i have students whose families can afford to pay the full freight, students whose families struggle, and students whose families have no means to pay for the college education. when i started in this profession 20 years ago, aspirations were important and families would say we'll go out of our way to make it possible. now i see families all along the

income spectrum asking questions about cost, about what you get from the cost, ways to pay for college, and what that might mean for the future. >> does that mean hard-nosed decisions. are parents saying about dream school a, the one the kid was shooting for "sorry, you are not going there." absolutely. more and more families are having a real and honest conversation. i can recall a moment this year in our office when i overheard a group of seniors mulling over choices and a girl said to a boy "i'm proud of you getting into college x, are you excited to attend." and the bay said "no, i'm going to college? a. yes." >> he said "that's your dream.". he said "college y gave me the school.". >> patricia, when we look at the way markets work, there was an idea. i heard it a lot, that this

would hit the wall, that families would say sorry, we are not spending that kipd of money. it didn't happen, is college more like buying a luxury car than it is between choosing detergents. >> college is a ticket to the middle class. all the studies show if you go to college and earn a degree, you make more than a high school graduate. that's why people pay to play, if you will. huge student loan debt burdens are having a knock-on effect on to the economy, and one of the ways i like to describe it is you have to think of the economy as an eco system, and young people are in that system. when we crush them with debt, we deny them the choice of participating in the economy in a meaningful way, and by that i mean

consumer sentiment. for example, homes. for every home construction job, that creates three to four jobs for people sharing goods in that home. so you can see how all along the food chain that student debt is having an impact not just on student debtors, but all of us. >> we'll take a short break. when we come back, we'll talk about college education and the marketplace. what decisions are families making, what is driving them. this is "inside story".

>> on the stream, >> they sacrifice their lives for the country. so why are some are some of america's men and women in uniform stuggling to put food on the table join us on the stream. on aljazeera america

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♪ the u.s. launches air strikes against the islamic state in northern iraq and washington says it wants to prevent a genicide. ♪ hello and welcome, i'm from al jazeera's headquarters in doha and good to have you here with us, also ahead. the three-day cease fire end in gaza with both sides launching attacks against each other. uneasy alliance and the