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Under federal rule, colleges must leave grads better off or lose financial aid

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Re: Under federal rule, colleges must leave grads better off or lose financial aid

#71

Post by bruce511 »

dataflow wrote: post #58
3eb7988a1663 wrote: post #37

Earlier quoted context omitted.

Also unclear how it works for the PhD pipeline. If you roll straight from bachelor's to a doctorate program - you have abysmal earnings for the next 5-6 years of your life.

Unless a program has a habit of sending the majority of its undergrads into PhDs, that part might not be so hard to resolve -- just exclude everyone who does that from the measurement sample.

Who decides who should be included or excluded from the statistics?

The govt? In this era of open hostility to institutions that won't toe the line? Who are looking for ways to punish what they don't like?

Or perhaps the college? If they decide then can they pick and choose who goes into what statistic? Does a drop-out (like say Bill Gates) get included or excluded?

Do we even accept the premise, that education's sole goal is higher salaries?

This whole rule is performative. It merely gives power to the powerful to exercise in whatever way they like.

Re: Under federal rule, colleges must leave grads better off or lose financial aid

#72

Post by true_religion »

theahura wrote: post #39
dataflow wrote: post #11

Earlier quoted context omitted.

> I feel like I have not really heard a compelling reason why student debt should not be dischargeable thru bankruptcy like (afaik) all other forms of debt. According to Reddit [1] it was to discourage students from immediately declaring bankruptcy upon graduation. I don't see why they couldn't have put a time limit on it though, if that was the reason. Say you can't declare bankruptcy for 7 years after you leave sch…

> There is no evidence that students were actually doing this in any significant numbers. premature optimization is the root of all evil. Seems like we shouldve actually shown that kids would do that before putting it into law

They wanted to permit/compel all students to get loans. When you set the bar on the floor like that, you need to handle the obvious case of people who are given loans that they could never pay off normally.

In American tradition, it was handled with the worst possible compromise that would enrich already monied interests.

Re: Under federal rule, colleges must leave grads better off or lose financial aid

#73

Post by arjie »

There are many programs that exploit credentialism to funnel public money into highly endowed universities. People leave with Bachelors degrees, Masters degrees, and even PhDs in fields that have no purpose but to serve the student as a crop to extract money from the government for. This kind of structure where the student has learned so little that no one finds their extra credentials worth the slightest wage premium is exploitative of students, certainly, but it also has knock-on effects as these under-educated over-credentialed people are then forced to request student loan waivers.

An atrocious way to take public funds and transfer them to private institutions. These kinds of things work so long as our economy is growing, but this kind of extractive behaviour will hurt us if we can't find the next great thing the next time.

Re: Under federal rule, colleges must leave grads better off or lose financial aid

#74

Post by WalterBright »

janalsncm wrote: post #53
ashton314 wrote: post #21

This is not great. The purpose of higher education is not to get you a job. That's certainly a nice side-effect and I hope that all my students will be able to support themselves through good employment. The university is there to educate you, not train you. It's to turn you into a better thinker, a better person, and someone more capable of living well. Making art and humanities programs demonstrate some kind of pec…

> The purpose of higher education is not to get you a job. This is the line universities give, knowing full well that the only reason students pay exorbitant tuitions is because bachelor’s degrees are necessary for most salaried jobs in the US. Schools want to have their cake and eat it too. If education isn’t about the money they should have no problem charging lower tuition rather than paying their presidents milli…

If one thinks doing simple derivatives is a chore, I'd suggest a career other than engineering.

I've known many engineers who practiced math avoidance. None of them were worth much as engineers.

I know a recruiter who would ask engineering candidates what is 20% of 20,000, without using a calculator or phoning a friend. He was surprised at how many could not, and it was an easy way to filter out the no hires.

Re: Under federal rule, colleges must leave grads better off or lose financial aid

#75

Post by dlcarrier »

dataflow wrote: post #11
hankbond wrote: post #7

I feel like I have not really heard a compelling reason why student debt should not be dischargeable thru bankruptcy like (afaik) all other forms of debt. I am curious what the ramifications would be if higher education institutions had to (in some form) co-sign the debt being issued. I do get that not all education should be purely for economic reasons, but as an autodidact I feel that "learning for the sake of lear…

> I feel like I have not really heard a compelling reason why student debt should not be dischargeable thru bankruptcy like (afaik) all other forms of debt. According to Reddit [1] it was to discourage students from immediately declaring bankruptcy upon graduation. I don't see why they couldn't have put a time limit on it though, if that was the reason. Say you can't declare bankruptcy for 7 years after you leave sch…

That answer is still begging the question of why it matters that bankruptcy rates stay low.

It's obvious that bankruptcy costs the lender, but how that cost gets absorbed is very important here. A mortgage or a car loan are secured debts, where the lender can repossess and sell the collateral, to pay off most or all of the losses if the borrow defaults on the loan. A student loan is an unsecured debt, so any defaults have to come out of the interest of the rest of the borrowers serviced by that loan program.

The more borrowers default on their payments, the higher the interest rate is needed to cover the write-downs. Without any protections against defaulting, interest rates would have to be near those of credit cards, while limiting when student loans can be discharged limits how much needs to be written down, which keeps interest rates lower.

Higher interest rates would not only make student loans cost more, it would also reduce their availability and increase the default rate, which could create positive feedback, causing the rates to increase significantly faster than inflation. Combine that with incentivization for college attendance already causing tuition itself to increase significantly faster than inflation, which itself makes student loans increasingly necessary, allowing student loans to be discharged during bankruptcy could have compounding effects on the fragile system that currently props up college attendance rates.

That still leaves the question of why the government should incentivize a significant portion of their constituency to be in college, (more than 1 out of every 13 US adults are currently enrolled) but I'll have have leave that question for politicians or maybe even voters.

Re: Under federal rule, colleges must leave grads better off or lose financial aid

#77

Post by phyzix5761 »

hankbond wrote: post #7

I feel like I have not really heard a compelling reason why student debt should not be dischargeable thru bankruptcy like (afaik) all other forms of debt. I am curious what the ramifications would be if higher education institutions had to (in some form) co-sign the debt being issued. I do get that not all education should be purely for economic reasons, but as an autodidact I feel that "learning for the sake of lear…

Because its usually tax payer money that is used to fund these loans. If people started declaring bankruptcy tax payers would mandate that federal student loans stop existing as a matter of principle. People hold the value that its good to help students as long as they pay back at least what was given to them (adjusted for inflation).

Re: Under federal rule, colleges must leave grads better off or lose financial aid

#78

Post by [deleted] »

ashton314 wrote: post #21

This is not great. The purpose of higher education is not to get you a job. That's certainly a nice side-effect and I hope that all my students will be able to support themselves through good employment. The university is there to educate you, not train you. It's to turn you into a better thinker, a better person, and someone more capable of living well. Making art and humanities programs demonstrate some kind of pec…

[deleted]

Re: Under federal rule, colleges must leave grads better off or lose financial aid

#79

Post by bee_rider »

throw2ih020 wrote: post #9
hankbond wrote: post #7

I feel like I have not really heard a compelling reason why student debt should not be dischargeable thru bankruptcy like (afaik) all other forms of debt. I am curious what the ramifications would be if higher education institutions had to (in some form) co-sign the debt being issued. I do get that not all education should be purely for economic reasons, but as an autodidact I feel that "learning for the sake of lear…

What would stop graduates from declaring bankruptcy early in their careers to discharge their debt, before they use their education to build a lifetime of earnings and assets?

Bankruptcy is still inconvenient. But mostly, people would be less able to get loans and then colleges would get to pick between reducing prices or having only a few rich students.

Re: Under federal rule, colleges must leave grads better off or lose financial aid

#80

Post by tadfisher »

janalsncm wrote: post #41

> But this new test, known as "do no harm," raises some thorny questions about the purpose of college. Like: Is it just about making more money? If this is a fair question to ask students, then it is a fair question to ask the schools as well. They are the ones charging enormous amounts of money to students for this. This doesn’t prevent people from learning to paint or play the clarinet. It prevents students from ta…

If I want a philosophy degree then it's my God-given right to pay $240,000 plus interest for it. Maybe it shouldn't be subsidized, though.
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