181–190 of 771 posts
Earlier quoted context omitted.
> lenders that are taking on too much risk The lenders are taking no risks since these loans cannot be discharged through bankruptcy. There are also very large late fees and penalties that can triple (or more) the amount owed.
In other words, the government gave the leaders license to do "predatory".
Also fascinating is the increased room and board (square area requirement per student) due to the lack of experience sharing rooms in the family as family sizes have collapsed to sub replacement levels.
It is free money for lenders because backed by the Govt AND protected against bankruptcy. It is Free money for colleges because they know they will get paid regardless. Remove this "free money guarantee" and watch how market corrects itself. When students can file for bankruptcy and/or the debt is not guaranteed by Govt, lenders would now use the same criteria they use to issue credit cards to 18 year olds. Hint: It'…
Is that true these days? At my university 20 years ago, the credit card companies would bribe 18-year-old freshmen to sign up for their cards.
Government lending and a lack of price controls are the ultimate root cause. The government extends near-unlimited credit to student borrowers that goes way beyond their credit-worthiness, academic performance, graduation rates for the school, prospects for employment based on field of study, etc. And universities have clued into the fact that students who can pay any price, will pay any price. The ceiling of what st…
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…
The one problem with this scheme is that it turns colleges into job training and nothing else. They would most likely drop any major that doesn't make a lot of future money. There is still value in providing philosophy courses and music and art and all the other things that don't lead directly to high paying jobs.
So the philosophy department will still be earning - just less.
They could also charge a higher percentage of future income to make up for the loss of earnings.
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And interestingly both have predominantly grown in "administrative" costs
No no don't let the Physician cartel get out of this. Year over year they get at least 5% pay increases with US tax dollars. Not to mention, they get private pay increases by weaponizing the ACGME to keep residency slots low. Residency does not need to be paid. Outside of the Medical industry, people pay for their college. For some reason Physicians make tax payers pay for their education and a decent salary.
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.
Exactly the opposite. In 2023, a degree is a prerequisite (or effectively so) to a lot of jobs. This was less true in 1983 than it is now.
I've worked with dozens of self taught programmers, designers, operators, etc. Look at how much more information is available via the web now vs what was available in 1983.
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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 for federal loans. But the government has "protected" all loans - private education loans are also unable to be discharged by bankruptcy, for example.
Private education loans are mostly an issue for non-accredited schools, since usually you can cover the full costs, with better terms, with federal loans at accredited schools. They are also less than 8% of the volume of student loans. They are basically a whole different (and much smaller) policy issue.