111–120 of 771 posts
The thought that public universities should “run like private businesses” is a disease of neoliberalism. They largely succeeded in running like businesses, but it’s all the wrong metrics. public goods should not be profit centers for state or federal government budgets.
Can we talk about the inflation related to the value of the degree as well? A college degree in 1983 is worth alot more than one in 2023.
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Worse than just "backed by the federal government," the loans are basically protected by the government. Being one of the small list of things you can't bankrupt out of, the risk in giving out the loans has been fully pulled from the lenders. It is frustrating to hear the discourse over the inappropriate students that are taking on too much debt, all the while ignoring the lenders that are taking on too much risk. At…
Eh I think the impact of the federal government on undergraduate costs is largely overstated. The limits for dependent students, which is most undergrads, is really small over 4 years. https://studentaid.gov/understand-aid/types/loans/subsidized... You can only borrow $31k over 4 years. That isn't a lot at all.
But PLUS loans themselves have no cap, so the amount of potential federal impact on potential costs for this population—which, as you note, is most undergraduate students—is infinite, not $31K over four years.
I'd like to see a new funding model for universities. I'd like to see universities be able to register for a share of tax revenue from their students post-graduation. For example "This course costs 5% extra income tax for 20 years". Then, you pay nothing for the course, but after you graduate you pay a 5% higher tax rate, and that extra money goes to the university. The IRS would administer the scheme since they alre…
Ultimately, I think it's a market non-optimal way if you're the university since student loans allow you to decouple pricing entirely and completely derisk the student.
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Worse than just "backed by the federal government," the loans are basically protected by the government. Being one of the small list of things you can't bankrupt out of, the risk in giving out the loans has been fully pulled from the lenders. It is frustrating to hear the discourse over the inappropriate students that are taking on too much debt, all the while ignoring the lenders that are taking on too much risk. At…
Eh I think the impact of the federal government on undergraduate costs is largely overstated. The limits for dependent students, which is most undergrads, is really small over 4 years. https://studentaid.gov/understand-aid/types/loans/subsidized... You can only borrow $31k over 4 years. That isn't a lot at all.
People can get unsubsidized loans that still come with the same constraints around inability to discharge in bankruptcy for vastly more money.
It’s essentially all unsecured student loans (i.e. effectively the entire student loan market) that have this risk free model for lenders.
It would all be completely toxic trash otherwise that no lender would issue. A student with no assets, no income, and no credit history to preserve has no downside to just declare bankruptcy after school and get $200k or whatever essentially for free.
Makes sense when you have student loans backed by the federal government. If an 18 year old with no money and no credit history gets accepted into a qualifying university, she will be able to receive a loan since the bank knows that the government will protect their investment if she fails to pay them back. So now young people have this easy access to credit, and universities can greatly increase tuition and fees wit…
This theory makes sense but since the loan is essentially risk free, why are private student loan interest rates roughly 10%?
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It's unfortunate, but to me this feels like half of the root of the problem. One half is easy access to loans, the other half is student debt relief programs. Between the two, colleges know they can charge absurd prices and pocket the money. It's awful, and I wish someone was doing something to stop this. It cannot go like this forever.
>the other half is student debt relief programs ...which student debt relief programs? Afaik there are no widely used student debt relief programs.
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Private high school costs have also gone up astronomically and there are no federal loans for them. [0] https://educationdata.org/average-cost-of-private-school
Where does it say that? Btw private school looks quite affordable. I used to think my neighbor was rich, they were, but for only $20k/yr you can send 2 kids to private school? That is cheaper than daycare.
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Eh I think the impact of the federal government on undergraduate costs is largely overstated. The limits for dependent students, which is most undergrads, is really small over 4 years. https://studentaid.gov/understand-aid/types/loans/subsidized... You can only borrow $31k over 4 years. That isn't a lot at all.
This is wrong. You’re mixing up subsidized loans with the ability to get loans. People can get unsubsidized loans that still come with the same constraints around inability to discharge in bankruptcy for vastly more money. It’s essentially all unsecured student loans (i.e. effectively the entire student loan market) that have this risk free model for lenders. It would all be completely toxic trash otherwise that no l…
Literally says "Subsidized and Unsubsidized Aggregate Loan Limit $31,000-No more than $23,000 of this amount may be in subsidized loan"
Just confirms most people have no clue how small the limits actually are.
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Proper solution is government to stop guaranteeing the loans and to allow people to put them in bankruptcy. Prices will collapse to what people are willing to pay in real time, or save up for.
The government cannot and will not do that, because such a policy would have racially disparate impacts.