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Why has college gotten so expensive in the last 30 years? A blank check in 1993

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Re: Why has college gotten so expensive in the last 30 years? A blank check in 1993

#21

Post by _red »

disown wrote: post #7

No, the real reason was that country wasn't producing enough jobs for the expanding labor force so we artificially created a new requirement to keep young people out of the job market for an additional 4+ years. Credentialism is a tool governments/businesses use keep control of the labor situation. The college tuition fiasco is a private/public creation. Now who wears the pants in the private/public relationship, tha…

I think your analysis is right, but there is another pernicious issue.

We now inhabit a world where no one is encouraged or even expected to do a trade (well except for the modern slave caste: illegals). The result is lots of HS grads who should be getting an Electricians degree instead trying to do a 4 year program.

The result not only inflates tuition cost, but also leads to 'degree inflation', that is everyone now has a degree. Therefore, this amps up the arms race so a Bachelors is no longer special, thus maybe a Masters or PhD is needed.

The colleges are all too happy to force kids into a lifetime of debt to sell them useless basket weaving and gender studies degrees.

Re: Why has college gotten so expensive in the last 30 years? A blank check in 1993

#22

Post by bachmeier »

asciident wrote: post #17
pnutjam wrote: post #11

Colleges already make the large majority of their money from international students. I'm not sure closing the door on low income students is the way to go. There are literally thousands of universities in the U.S. The Federal system was (pre-trump) getting pretty aggressive about cutting loans to bottom of the barrel universities. This needs to keep happening, and there needs to be guarantees of credit transfer. That…

I believe you've been misled about "large majority of their money from international students" and am curious where you got this information from. From the data I've looked at, the net revenue a vast majority of colleges make are under 2% from international students. For R1 universities (the national ones you've heard of), it's still under 10% , and finally even if you look at undergraduate tuition only (ignoring gra…

"Most profitable" would be correct for most universities.

Re: Why has college gotten so expensive in the last 30 years? A blank check in 1993

#23

Post by apsec112 »

bachmeier wrote: post #19

How did this hit the front page of HN? There's literally no analysis in a piece on a topic that has been analyzed to death. The hypothesis is that increased availability of loans in 1993 is responsible for the rise in tuition between 2010 and 2020. Just stated as a fact, with nothing to back it up. Okay. The most obvious answer that is cited by literally everyone that looks at this topic is that it's partially caused…

Cuts in state funding don't explain the rapid tuition increases at private universities.

Re: Why has college gotten so expensive in the last 30 years? A blank check in 1993

#24

Post by veilrap »

dnautics wrote: post #13
CincinnatiMan wrote: post #8

Earlier quoted context omitted.

I don’t know that there’s any groups deciding on something but rather individuals acting in their best interest, getting a degree, that ruins it for everybody else. An arms race among individuals.

> I don’t know that there’s any groups deciding on something Credentialism is exactly that. If in the pre-covid era you went to Washington, DC, you will see huge illuminated ads in the metro stations for companies, for example "graduate school" (literally the name of one company I saw) which offer super sketchy master's degrees. This is because if you have a master's degree, you get a mandated pay bump in your salary…

That sounds like bad regulations and bureaucracy more than credential-ism, but I agree that is horrifying.

A blanket pay bump for "Master's" degrees written into the code? Clearly that's going to be gamed.

If any auditing actually went into the source and value of the credentials then they could be appropriately valued or ignored, depending on the case.

Re: Why has college gotten so expensive in the last 30 years? A blank check in 1993

#25

Post by vonmoltke »

jefftk wrote: post #10

> the feds should handle student loans the same way they handle medicaid/medicare reimbursement. I'm not sure how anyone looks at our health care reimbursement system and the decides that's the approach to apply to fix anything else? Personally, I'd like to see: * Employers are allowed to test students to see what they can do, but not evaluate them based on whether they went to school or where. * Make student loan de…

> Lenders will be much less willing to pay high tuitions in cases where students are unlikely to be able to pay it back

The federal government is the lender. That's the central point of the post.

Re: Why has college gotten so expensive in the last 30 years? A blank check in 1993

#27

Post by hinkley »

fatnoah wrote: post #2

Is this surprising to anyone? Colleges battle each other to provide amenities, loans are easy to come by, and the colleges have nothing to lose when the students default. I remember my first day of college (in 1993!) and remember part of registering was signing all of these forms where my options were a) take out loans and go to school or b) don't take out loans and don't go to school. I had no idea what it meant to…

Also students are not yet used to thinking about debt, or how things are paid for really, which means that the whole practice is predatory. Those perks are paid for from imaginary money as far as they're concerned.

I know some trade schools have attempted instead to do a risk sharing model where they are entitled to some fraction of your income for n years after graduation, but I don't think people are comfortable with that, especially at that age. They still imagine they will be millionaires by 32 and that means the school may get several times what you would owe with just normal loans.

Also you'd probably see more people getting paid under the table.

Re: Why has college gotten so expensive in the last 30 years? A blank check in 1993

#28

Post by Spivak »

jefftk wrote: post #10

> the feds should handle student loans the same way they handle medicaid/medicare reimbursement. I'm not sure how anyone looks at our health care reimbursement system and the decides that's the approach to apply to fix anything else? Personally, I'd like to see: * Employers are allowed to test students to see what they can do, but not evaluate them based on whether they went to school or where. * Make student loan de…

> Employers are allowed to test students to see what they can do, but not evaluate them based on whether they went to school or where.

This would never work. People who went to high-prestige schools want to signal that to their employer and when barred would find other ways to signal like "Interned in Dr. Blah's group at the MIT media lab" or "Secretary of the Princeton chapter of the Phi Beta Kappa."

> Make student loan debt dischargeable in bankruptcy.

This is a fine solution iff you want to make the market exclude all academic endeavors that aren't high-probability profitable. This would basically destroy all specialized scientific research, education degrees, agricultural science, all high-level maths, biology, ecology, zoology, environmental research. When people want the market to decide these thing I imagine they think that "those silly liberal arts degrees" is what will get cut but forget that science doesn't pay either.

Re: Why has college gotten so expensive in the last 30 years? A blank check in 1993

#29

Post by citilife »

jefftk wrote: post #10

> the feds should handle student loans the same way they handle medicaid/medicare reimbursement. I'm not sure how anyone looks at our health care reimbursement system and the decides that's the approach to apply to fix anything else? Personally, I'd like to see: * Employers are allowed to test students to see what they can do, but not evaluate them based on whether they went to school or where. * Make student loan de…

Any time you provide increased funding to a customer, the price of the goods will go up. This is the same reason raising the minimum wage would likely increase prices of other goods.

An easy-ish solution to this is:

1. Breaking up unions/lobbies - AMA for reference is the limiting factor in the number of doctors. They limit the number of medical students intentionally, inflating doctors wages (and university costs). Administration costs for universities also have high overhead and should be reduced.

2. [Agree] Student loans should be dischargeable via bankruptcy

3. Government shouldn't offer student loans. Instead, offering grants and / or work programs. I went to a junior college for 2.5 years, while working and saving up. Then went to UIUC. I took on some loans, but it was subsidized by my own funds. This leads to more responsibility / accountability so people don't take loans to "party".

Re: Why has college gotten so expensive in the last 30 years? A blank check in 1993

#30

Post by throwawaygh »

asciident wrote: post #17
pnutjam wrote: post #11

Colleges already make the large majority of their money from international students. I'm not sure closing the door on low income students is the way to go. There are literally thousands of universities in the U.S. The Federal system was (pre-trump) getting pretty aggressive about cutting loans to bottom of the barrel universities. This needs to keep happening, and there needs to be guarantees of credit transfer. That…

I believe you've been misled about "large majority of their money from international students" and am curious where you got this information from. From the data I've looked at, the net revenue a vast majority of colleges make are under 2% from international students. For R1 universities (the national ones you've heard of), it's still under 10% , and finally even if you look at undergraduate tuition only (ignoring gra…

Look at the bottom line, not the top line.

PhD students are incredibly cheap and do a lot of the revenue-generating work; namely, classroom teaching and research. PhD students earn between $20K/yr and $30K/yr in stipend. For the university, that is damn close to the ALL-IN cost! The university pays no FICA taxes and does not contribute to retirement for these employees.

For this reason, in high-demand fields like Computer Science, 60+% of PhD students are foreign nationals. And the domestic students are often over-represented at top-tier universities. So there are lots of CS departments where the majority of the revenue-generating employees are foreign nationals making $20K/yr all-in.

A PhD student instructing or leading recitations for university courses makes less than 1/2 of what a first year high school teacher makes.

A PhD student doing research is bringing in typically $100K - $200K in grant money but only receiving about $30K of that. Also, again, the "2x multiplier" used to calculate the total cost of a normal employee doesn't apply here because the university does not pay FICA taxes, doesn't contribute to retirement, and often gets great tax breaks and gifts to cover things like real estate (=office space). For universities the "total cost of a PhD student" multiple is more like 1.2x salary.

Professors are managers. Deans and so on are executives. PhD students are the "bread-and-butter" employees of the university. They are the ones who do the bench work/coding and the vast majority of face-to-face teaching. Without international PhD students, universities' total cost of operation would skyrocket.

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