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"If they don't use it then they lose the funding even if the spending is wasteful. Some programs generally are and only created or expanded for the purpose of being used. So what do you think the universities going to do"
Here's a novel idea: don't spend it. You should read up a bit more on how a number of higher education organizations operate, BTW - while it is true that some funds are specific, schools do have the capability to keep cash assets (they're not taxed like business in the US) on hand as a basis for other investments (a method employed by a number of smaller but well endowed private schools).
What's "broken" in higher ed is that a degree has become the marker previously held by a high school diploma + OTJ training. "Degree required" is now common for the most low level positions in a surprising number of fields, thus people who should not be taking out large loans are now forced to mortage their future. Making taxpayers cover the balance of the school's fees won't change that dynamic...
Oh, and athletics only fund a portion of their real costs.... but as an economist you knew that already.
I don't think any president will do anything. Federal loans are already super relaxed.
This. Go get an unsecured personal loan for 20K/year. Let us know how that works out, ok?
07-23-2012, 03:10 PM
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n/a posts
Quote:
Yes I see what you're saying JasonF, but that assumes that programs should be balanced like a business for instance libraries pay a yearly fee to journals so that students can access to them and don't generate any revenue.
The library is furthering the university's mission. Also, those journals are largely paid for out of research grant dollars.
Quote:
Universities in general tend to have athletic programs especially football or basketball because they generate a lot of revenue for the school.
They generate revenue, yes. The problem is that their expenses are more than the revenue they bring in. The vast majority of schools are subsidizing athletics.
Money that should be being used to pay for education is being diverted to sports. How does one justify putting students in more debt so that the football team can travel around the country and have swanky digs on campus?
Here's a novel idea: if it sounds like a novel idea, then it probably isn't since it's a lot more complicated than a quick soundbyte.
Funding from state governments has been decreasing for several decades as I've stated earlier. Universities get funding from the state to operate and if they don't end up using it then it gets cut. What the university doesn't have in funding from the state gets passed to the students. With that said what is the university going to do? Lose the funding, not invest in any capital projects, still have the same high rates, and not remain competitive against schools that are doing the opposite to attract students or use the funding, still have high tuition rates, and attract students in the false hope that more students will allow the school to stop increases in tuition. And while that is going on the universities still take on as much debt as they financially or legally can to prevent sharp increases in tuition(in many states it's illegal for universities to increase tuition by a certain % each year) as well as for maintenance or any improvement projects that need to be done.
What's "broken" in higher ed is that a degree has become the marker previously held by a high school diploma + OTJ training.
Another urban myth: that a college degree is now the new high school diploma. The days where one could get by with simply having a high school degree are over barring you go into a modestly paying vocational field. The dynamics have changed greatly over the past 50 years. We live in a globalized society where workers compete not only domestically, but internationally as well. One could by on a high school diploma because the US was at the peak of industrialization 50 years ago and many people held a decent paying job in that field. That's been on the decline for several decades because workers in emerging markets are willing to do it for less.
What's taken it's place are skilled service sector jobs. Observe the solid and dotted red lines:
We still have manufacturing jobs here primarily because they are jobs that can't be done by low skilled workers in emerging markets. Instead our manufacturing workers build things like airplane engines and cars. Countries such as Japan and Germany also have a manufacturing base like ours though they arguably have the comparative advantage.
As noted, we there's been a rise in high skilled service sector jobs that have slowly been replacing manufacturing jobs. This phenomena is known as creative destruction. Jobs are created and destroyed all the time because they're no longer necessary or technological advances makes it easier to perform a task. Many of these jobs require degrees(even if non-specific) and/or certificates that shows competency. Note that a company will outsource or hire in the event of one of two things:
1) When it's worker is willing to do it for less
2) Or there isn't an abundant supply of skilled labor to needed perform a certain job
I'm not saying this as a protectionist since I believe in free trade, but our workers also compete with skilled laborers in other developed countries as well. Blaming students and cutting education isn't going to solve the problem is higher education, it's just going to erode the middle class and land us in the bottom of the barrel. Companies will just hire workers from countries to perform jobs that our workers can't. We need to invest in education to remain competitive international and that starts by stopping tuition increases from outpacing inflation so it becomes affordable again.
Quote:
Originally Posted by JasonF
The library is furthering the university's mission. Also, those journals are largely paid for out of research grant dollars.
They generate revenue, yes. The problem is that their expenses are more than the revenue they bring in. The vast majority of schools are subsidizing athletics.
Money that should be being used to pay for education is being diverted to sports. How does one justify putting students in more debt so that the football team can travel around the country and have swanky digs on campus?
Hey I'm not going to be able to get to your links tonight since I need to start getting ready for tomorrow, but I will get around to them.
And yeah I was using the library as an example of a benefit that universities provide to students that isn't revenue neutral.
In regards to sports teams, it's cultural at this point, but I think we should adopt what European and Canadian universities do and separate them. People who want to do it can join a sports club. With that I do agree with you.
Octa, I think you need to read my post again, as you seem to have missed the point.
Increased availability of financial aid doesn't cause tuition to go up, as the article you linked pretty clearly establishes.
What it does do, however, is take away the incentive institutions would otherwise have to keep costs under control. States cut funding for higher education, and in response schools raise tuition instead of cutting back on things like athletic programs that can't support themselves and "diversity programs" and such that serve only to waste money.
Mostly correct. Athletic programs are a separate entity from the university in most cases. Some of the better athletic programs actually donate money back to the university. There are some schools that charge some pretty high athletic fees per credit. These schools still often have some of the cheapest tuition.
The issue I think is that student loans cannot be written off in bankruptcy. Why should someone be able to discharge credit card debt they spent on tvs, fancy furniture, etc., and not be able to write off crushing debt they got doing what they had been told from birth was necessary to become a successful person? It's going to be a crucial issue but a politically difficult one.
Yeah, lets "help" and bailout people with student loan debt.
After about 80% of those people that have useless college degrees take a step back and remove themselves from the workforce so that other people that did feed at the federal trough can perform their jobs.
Amazing - "help" when the interest rates are already subsidized and the terms were/are essentially manipulated by the government.
And I assume "help" eventually means student loan forgiveness programs, so that after all of that debt is erased and/or taken care of by the government with tax dollars - those "students" that have graduated can then go out and get a huge mortgage for a house they can't afford, finance new vehicles, and put money in their IRAs and 401ks.
This whole charade of a student loan problem needs to be exposed for what it is. Grown up children that do not want to pay back their loans - so that they can use their money for other things like new homes, cars and funding their own bank accounts since they would not have to pay back their college loans.
I don't think help is coming because the lobby is probably too powerful. My opinion however is that if the school had been deceptive, then, they should be open to lawsuit or a refund. As with any advertisement, schools have to play fair. It's not ok to cheat or lie or mislead.
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