Rigby5
Diamond Member
When I started college in 1969, tuition was $100/semester.
Colleges were "land grant", meaning they were heavily subsidized.
Colleges were "land grant", meaning they were heavily subsidized.
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Profting like big dogsWell, when was the last time any of you went to college without the govt subsidizing the cost?
I'm not saying that the student loan system is not misusued it is. But the lenders are profiting.
That makes no sense.
If we allow the profit motive of universities to become our dictates, then the college educated would drop by about 90%. Very few can afford to pay the real costs of a college education. Colleges are heavily subsidized by the government because they improve our economy and quality of life.
They are a good investment even though they lose money.
Not at all. You start out with the premise that is student loans vanished schools would suddenly become affordable. This is simply not the case.
What has made the cost of college increase is simple supply and demand. In 1985 when I went to college, only 18% of the population had bachelor degrees. Now that number is up to 42%.
30 years ago, when I first got into supply chain and procurement, you didn't need a bachelor's degree to do so. by the mid aughts, they were required, and today, they are looking for people majoring in that specifically.
The second reason why colleges are spiraling out of control is because of prestige things that attract students, such as star teaching staff, athletic programs, amenities, stadiums, etc. I mean, it's great if a college attracts a Nobel Prize winner to be on it's academic staff, but most student's won't get him as an instructor, they'll end up a TA or adjunct professor who is underpaid and overworked.
And to be fair, college is overrated. I feel I got far more out of my time in the Army than I did my time in college, but the main reason I joined the Army to start with was to pay for college. Go figure.
You start out with the premise that is student loans vanished schools would suddenly become affordable
The second reason why colleges are spiraling out of control is because of prestige things that attract students, such as star teaching staff, athletic programs, amenities, stadiums, etc.
For example:Not at all. You start out with the premise that is student loans vanished schools would suddenly become affordable. This is simply not the case.
What has made the cost of college increase is simple supply and demand. In 1985 when I went to college, only 18% of the population had bachelor degrees. Now that number is up to 42%.
30 years ago, when I first got into supply chain and procurement, you didn't need a bachelor's degree to do so. by the mid aughts, they were required, and today, they are looking for people majoring in that specifically.
The second reason why colleges are spiraling out of control is because of prestige things that attract students, such as star teaching staff, athletic programs, amenities, stadiums, etc. I mean, it's great if a college attracts a Nobel Prize winner to be on it's academic staff, but most student's won't get him as an instructor, they'll end up a TA or adjunct professor who is underpaid and overworked.
And to be fair, college is overrated. I feel I got far more out of my time in the Army than I did my time in college, but the main reason I joined the Army to start with was to pay for college. Go figure.
A 2017 study from the Federal Reserve Bank of New York found that the average tuition increase associated with expansion of student loans is as much as 60 cents per dollar. That is, more federal aid to students enables colleges to raise tuition more. Salaries rise; bureaucracies expand; more courses — from “History and Analysis of Rock Music” to “Ultimate Frisbee” — are offered; dorms, dining halls, and recreational centers become more lavish.
he had an epiphany: Colleges were incredibly inefficient businesses, and the student‐loan program enabled them.
He was stunned to learn how big Penn State’s budget was, about $5 billion [in 2014], and how quickly it grew. (Penn State’s budget is currently $7.7 billion
“Schools were able to hike tuition since students now had expanded access to loans,” Mitchell summarizes.
Federal student loans went up. So did tuition, college budgets, and the debt that students carry for years. This system isn’t working.
A 2015 study found that a dollar of subsidized (non-PLUS) student loans increases published tuition by 58 cents at a typical college, with larger effects once reductions in institutional financial aid are taken into account. An NBER paper issued last year concluded that changes to federal student loans are more than sufficient to explain tuition increases at private nonprofit colleges. And a 2014 analysis found that for-profit colleges eligible for federal student aid charged tuition 78% higher than that of similar but aid-ineligible institutions.
It is in the interests of a nation for its citizens to produce the maximum wealth/gdp. Education is key to this. Higher education is considered part of collective effort, just as defense and other essential collective matters, in many countries. It is not free education, it is investment education. Costs are paid over time in increased productivity and quality of life. Trying to interpret this concept as "free stuff" is propagandistic.
Costs are paid over time in increased productivity and quality of life.
It is not free education, it is investment education.Quality of life for who? Me? Or the student? How does it improve my quality of life if someone else gets an accounting degree or a business degree and goes off in life to make a good living? It benefits them, but unless they get a degree in one of the stem fields and has some ground breaking discovery, it doesn't affect my life in the slightest.
As far as increased productivity, that's not necessarily true. It depends on what your degree is in. If you get a degree in art history or philosophy, your productivity impact is going to be quite limited to the rest of the world, whereas a sanitation worker or road construction crew will have a much bigger productivity impact, without a college degree. .
Now, I do understand that we need to be able to keep up with the rest of the world in education, bit we need to do it in the right areas. Also, we need to look at why other countries can offer low cost, or free college. What factors play into why they can do that, as opposed to why we can't. We're already taxed highly here in the states, and the government keeps finding ways to take more, so, when they start wanting to give free education to people, it tends not to set well.
Neither did the Republicans.PLUS it doesn't address the underlying problem, sky high tuition costs fueled by government backed loans no student would otherwise qualify for. But because student loans is a Dem money skimming racket Dems won't lift a finger to fix the real issue.
I'm not suggesting that schools would become affordable if loans vanished, but if loans were handled through lending programs that were not backed by the government, schools would have to rein in their budgets as private lenders would be a bit more stringent than the government.
Sure, a prestigious school will attract a higher price, but, that could be because government will pay it, where a private lender may not.
I get it, federally backed student loans have opened up the possibility of college to a lot of people, but it has also helped drive up tuition rates.
Since the government is the Ultimate guarantor yes it is going to impact the economy because it will add to that portion of the dollar that is the debt portion. Right now that is about 85 Cents per dollar unit. This will push it up a few pennies per dollar. At the same time though it should stimulate an enormous spending spree that can only benefit the consumer I would think. Hard to say on that second one.Student Loan Forgiveness Is an Idea Whose Time Has Gone
Student Loan Forgiveness Is an Idea Whose Time Has Gonewww.bloombergquint.com
OR
Is Student Loan Forgiveness Finally Coming? Here’s What We Know for Sure
Separating the facts from mere speculation and rumors about debt cancellation.www.chron.com
Since people aren't making the payments now, I don't see how forgiveness would add to consumer demand. But it would increase the overall debt if the govt would just assume the "dollars." But the fed is trying to reduce consumer lending without killing corporate ability to raise private loans with issuing bonds. The Fed CAN raise the amount of funds banks hold and that takes money "out" of the economy.
so, and this is jmo, anyone taking on debt to buy a new boat or car or whatever that they don't REALLY need is absolutely NUTs given the economy and Ukraine. Seinna tells us we can't raise taxes even a few %pts on people making 500K a year. IF someone can show they're working 40 hours a week, kill the loans. Maybe they'll do the sensible thing and put anything extra in the bank, or god forbid get married to somebody and someday buy a house with 30 year mortgage and have a kid.
I would say what happened with the housing industry in 2008 would indicate otherwise. The banks got greedy, gave people loans for houses they damned well knew they couldn't afford. Or you can look at the For Profit Universities that cheated thousands of poor kids who couldn't make it into a real college, and they are still going after those people for debt.
I trust the government a lot more than I do the banking industry...
But only because no one regulated the pricing.
I think it would be interesting do do an audit to find out where all this money goes.
Well they are not actually forgiven.... the debt always ends up somewhere..... those same students will be paying their loans back with a diminished dollar every time they go to the grocery store.If all student loans are "forgiven" then ALL DEBT must be forgiven.
All contract laws must be eliminated.
Then only liberals will loan.......right?
I'm not sure it would set off a spending spree because people are not paying the loans now. That was my inflation question. But yeah, it would add to the overall debt. And the Fed is trying to "claw back" it's bond purchases to have less money in circulation in the economy. So, forgiving the debt might be counterproductive that way. But if borrowers are forced into losing houses or getting evicted to pay the loans, that would also be counterproductive to fighting inflation without igniting a recession. So, I just don't know.Since the government is the Ultimate guarantor yes it is going to impact the economy because it will add to that portion of the dollar that is the debt portion. Right now that is about 85 Cents per dollar unit. This will push it up a few pennies per dollar. At the same time though it should stimulate an enormous spending spree that can only benefit the consumer I would think. Hard to say on that second one.
You do know that once a mortgage is signed that the money doesn't really come from anywhere..... the Treasury produces New Units that electronically appear in the seller's bank account. Unless the whole thing is a 100% cash deal.I would say what happened with the housing industry in 2008 would indicate otherwise. The banks got greedy, gave people loans for houses they damned well knew they couldn't afford. Or you can look at the For Profit Universities that cheated thousands of poor kids who couldn't make it into a real college, and they are still going after those people for debt.
I trust the government a lot more than I do the banking industry...
But only because no one regulated the pricing.
I think it would be interesting do do an audit to find out where all this money goes.