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High tuition costs mostly stem from the Omnibus Budget Reconciliation Act 1993

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Re: High tuition costs mostly stem from the Omnibus Budget Reconciliation Act 1993

#301

Post by imtringued »

lapcat wrote: post #279
willcipriano wrote: post #247

Earlier quoted context omitted.

> Is college solely the domain of the upper middle class? Pretty much. At least the sort of degrees that leave you 100k+ in debt with no way to repay it. Poor kids don't have the luxury of making mistakes like that. > for example subsidies for solar panels mostly go to the wealthy+upper middle class, but it still benefits everyone. Only if you ignore opportunity costs. Those same dollars could've resolved food insecu…

> Pretty much. At least the sort of degrees that leave you 100k+ in debt with no way to repay it. Poor kids don't have the luxury of making mistakes like that. How do you figure? Poor kids qualify for federally subsidized student loans. I suspect the whole debate is a bit skewed because it tends to ignore admissions. You can't go to an expensive college if you can't get admitted to an expensive college. Your family b…

Why should we mourn the fact that poor people avoid a life of student debt slavery? These aren't private loans that can be discharged. They will stay with you for the rest of your life if you can't pay then.

Honestly, your post is one of the most vile and disgusting comments I have ever seen on HN. You think people can't have upward mobility unless they spend $100k per year on tuition? Even if we assume the loan can be discharged, it is incredibly elitist to assume that you need an elite education just to get anywhere in life. No, you don't need an educational institution, that is just a crutch. You need discipline, motivation, a work ethic which can't be bought with money. After that you just need any good college, because learning doesn't happen in a confined geographic location defined by a critical mass of elites, it happens in your head.

I don't know where these authoritarian people like you are coming from, telling others that they are worthless if they don't sign up for a life of financial suffering. It sounds to me like you want to be a gatekeeper for upward mobility while sneakily creating artificial guilt in the form of student debt that must be repaid because it is moral to pay debts, even if the conditions of those debts would be considered immoral by any sane person.

Re: High tuition costs mostly stem from the Omnibus Budget Reconciliation Act 1993

#302

Post by AbrahamParangi »

wahern wrote: post #290
AbrahamParangi wrote: post #281

Earlier quoted context omitted.

Cheap capital raises prices everywhere- for homes, for equities, for land, and certainly for education. Student loans are cheaper than cheap, they are government subsidized and not even close to their appropriate cost.

> Student loans are cheaper than cheap, they are government subsidized and not even close to their appropriate cost. Interest rates on government-subsidized college loans aren't that cheap. Undergraduate loans are the cheapest. They were particularly cheap in the early 2010s and during the COVID pandemic. But over the past 20 years the rate has been ~4-5%, and generally greater than mortgage rates.[1][2][3] Subsidize…

They're really cheap relative to what the market rate for that sort of loan would be in a free market. That the loans cannot be defaulted on is another form of subsidy.

Re: High tuition costs mostly stem from the Omnibus Budget Reconciliation Act 1993

#303

Post by bumby »

imtringued wrote: post #299
bumby wrote: post #272

Earlier quoted context omitted.

> Why would the fact that the loans are now from the government mean that universities no longer had to compete on costs? I think an economist would say that the loans increase the number of "customers" who could now afford to go to college. Accordingly, when the demand increases faster than the supply, an economist would say increases prices are the result. There's an old op-ed by former Education Secretary William…

It doesn't make sense because competition is supposed to lower prices regardless of how the money was obtained. If competition is driving prices down then you would expect that people are falling for the veblen goods trap which has nothing to do with loans.

If the government gave out guaranteed subsidized car loans of $70k to anyone and everyone, do you think average car prices would go down?

The theory is that anytime you subsidize anything, you tend to increase consumption of it. Increased consumption tends to increase price. It's unclear to me that is always the case in practice, but that's my layman's understanding.

Re: High tuition costs mostly stem from the Omnibus Budget Reconciliation Act 1993

#304

Post by bumby »

imtringued wrote: post #300
AbrahamParangi wrote: post #281

Earlier quoted context omitted.

Cheap capital raises prices everywhere- for homes, for equities, for land, and certainly for education. Student loans are cheaper than cheap, they are government subsidized and not even close to their appropriate cost.

From a macroeconomic theory perspective that is completely incorrect. There is zero empirical evidence for this. Interest rates have been zero in Japan for decades and the biggest effect they had was keep inflation near 0%. Cheap capital lowers the prices of all non-monopoly goods. Monthly payments on your mortgage are lower which reduces the cost of housing, it becomes cheaper to produce food or anything that can be…

>Monthly payments on your mortgage are lower which reduces the cost of housing

Just trying to understand your perspective, but this is based on an existing mortgage, correct? What does it do for the price of a new mortgage? I was under the impression that cheap capital tends to inflate home prices.

Re: High tuition costs mostly stem from the Omnibus Budget Reconciliation Act 1993

#305

Post by AbrahamParangi »

imtringued wrote: post #300
AbrahamParangi wrote: post #281

Earlier quoted context omitted.

Cheap capital raises prices everywhere- for homes, for equities, for land, and certainly for education. Student loans are cheaper than cheap, they are government subsidized and not even close to their appropriate cost.

From a macroeconomic theory perspective that is completely incorrect. There is zero empirical evidence for this. Interest rates have been zero in Japan for decades and the biggest effect they had was keep inflation near 0%. Cheap capital lowers the prices of all non-monopoly goods. Monthly payments on your mortgage are lower which reduces the cost of housing, it becomes cheaper to produce food or anything that can be…

This is conflating prices consumers see with broader financial access to capital. We may trivially see that when consumers can access cheap capital too, prices for consumer goods rise (housing loans, auto loans, college loans, credit cards, BNPL).

Re: High tuition costs mostly stem from the Omnibus Budget Reconciliation Act 1993

#306

Post by devwastaken »

gamblor956 wrote: post #297
devwastaken wrote: post #293

Earlier quoted context omitted.

Too bad, I don't want to be fired. The tech program is bad, it's bad because there is not funding and instructors are a revolving door due in part to that. We have private industry instructors hire on, look at the state of the institution, and run. The only things that can be even partially funded are classes and dedicated individual student projects. There is 0 budget outside of that. Alumni don't make enough to be…

And I'm telling you that if your school was for-profit, it would be even worse. For-profit schools are significantly worse than non-profit schools in every way. And it seems that your real beef is that the taxpayers have decided not to provide adequate funding to the school for basic supplies. You should take that up with your fellow taxpayers, not the school.

Public schools are for profit, that profit comes out of tax payers against their will. Just because they have a tax free status doesn't mean they're not lining their pockets with money. Given the massive artificial increases in costs - they are. I've seen it happen in realtime.

This doesn't even approach the problem that industry and academics are seperated worlds. Unis lie and tell you everything is "in demand" yet students graduate and no one will even look at them.

The most funding for effective programs comes from private industry. Companies will spend far more than state or federal on real programs as long as they're not attached to universities. That tells you something right off the bat. High schools get far more money than us.

Private industry should be the one footing the bill and are the most knowleable about what industry wants. We do not yet have a system of this so you don't have any examples to base your claim from. For this to happen we need to first remove all higher public education funding to force companies to build their own.

Before you make bogus claims about "general education" there is nothing learned about humanities or general knowledge at a uni that isn't better done with a YouTube video. The instructors don't know how to teach and can't engage students with effective knowledge.

Re: High tuition costs mostly stem from the Omnibus Budget Reconciliation Act 1993

#307

Post by bumby »

devwastaken wrote: post #294
bumby wrote: post #276

Earlier quoted context omitted.

> Across the board no more public funding, if it's worthwhile then private industry will fund it like they do for any other trade. If you think university is solely vocational training, then this makes sense. However, that leaves a lot, including fundamental research unfunded. Research seems to suggest that reductions in public funding is the single most important variable in increases in tuition. I'd be worried that…

Can't increase tuition if there's no public institutions. :). You can't fix the ship. The political culture is far too ingrained. This makes perfect sense when you realize that public means government controlled and funded. Of course it's going to be largely politically motivated. As an example there are now new required classes that preach about equality and white privilege with dubious accreditation. Not as a conce…

Honestly, how would you propose to generate the political will to just get rid of public institutions? This sounds more like a libertarian pipe dream than a pragmatic solution.

Re: High tuition costs mostly stem from the Omnibus Budget Reconciliation Act 1993

#308

Post by bumby »

devwastaken wrote: post #306
gamblor956 wrote: post #297

Earlier quoted context omitted.

And I'm telling you that if your school was for-profit, it would be even worse. For-profit schools are significantly worse than non-profit schools in every way. And it seems that your real beef is that the taxpayers have decided not to provide adequate funding to the school for basic supplies. You should take that up with your fellow taxpayers, not the school.

Public schools are for profit, that profit comes out of tax payers against their will. Just because they have a tax free status doesn't mean they're not lining their pockets with money. Given the massive artificial increases in costs - they are. I've seen it happen in realtime. This doesn't even approach the problem that industry and academics are seperated worlds. Unis lie and tell you everything is "in demand" yet…

>profit comes out of tax payers against their will.

And there we have it. The "taxation is theft" heuristic that snaps your perspective into focus.

>Private industry should be the one footing the bill and are the most knowleable about what industry wants.

Are there any instances where you think this breaks down? There are some industries that very likely would not exist without initial government support because the initial risk was too great or the payoff too vague. I'm not sure aerospace would exist, for example, without the public shouldering the bulk of the initial risk. (That shouldn't be conflated with the stance those industries can't mature to a point where privatization is better).

Re: High tuition costs mostly stem from the Omnibus Budget Reconciliation Act 1993

#309

Post by credit_guy »

wahern wrote: post #290
AbrahamParangi wrote: post #281

Earlier quoted context omitted.

Cheap capital raises prices everywhere- for homes, for equities, for land, and certainly for education. Student loans are cheaper than cheap, they are government subsidized and not even close to their appropriate cost.

> Student loans are cheaper than cheap, they are government subsidized and not even close to their appropriate cost. Interest rates on government-subsidized college loans aren't that cheap. Undergraduate loans are the cheapest. They were particularly cheap in the early 2010s and during the COVID pandemic. But over the past 20 years the rate has been ~4-5%, and generally greater than mortgage rates.[1][2][3] Subsidize…

> and generally greater than mortgage rates

Mortgages are secured by a real asset. You stop paying the mortgage, the bank gets the house.

Student loans are unsecured.

Re: High tuition costs mostly stem from the Omnibus Budget Reconciliation Act 1993

#310

Post by lapcat »

imtringued wrote: post #301
lapcat wrote: post #279

Earlier quoted context omitted.

> Pretty much. At least the sort of degrees that leave you 100k+ in debt with no way to repay it. Poor kids don't have the luxury of making mistakes like that. How do you figure? Poor kids qualify for federally subsidized student loans. I suspect the whole debate is a bit skewed because it tends to ignore admissions. You can't go to an expensive college if you can't get admitted to an expensive college. Your family b…

Why should we mourn the fact that poor people avoid a life of student debt slavery? These aren't private loans that can be discharged. They will stay with you for the rest of your life if you can't pay then. Honestly, your post is one of the most vile and disgusting comments I have ever seen on HN. You think people can't have upward mobility unless they spend $100k per year on tuition? Even if we assume the loan can…

> Honestly, your post is one of the most vile and disgusting comments I have ever seen on HN.

> I don't know where these authoritarian people like you are coming from, telling others that they are worthless if they don't sign up for a life of financial suffering.

Wow, this is completely nuts! You've wildly, recklessly misinterpreted me. I strongly urge you to reread the HN guidelines. https://news.ycombinator.com/newsguidelines.html

What I believe is basically the exact opposite of what you seem to think I believe. I was actually arguing in defense of immediate student loan debt forgiveness (evidenced by my other comments on this article such as https://news.ycombinator.com/item?id=31570258). By the way, I also support government-subsidized higher education for everyone, like we have for high school. Of course I don't want people in debt slavery! Seriously, your comment was unhinged. Maybe you need to take some time off the internet.

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