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People by and large are rational. When students and parents know that student loans can be forgiven by PSLF & IBR & PAYE, at the margin students will borrow more than they otherwise would and enter non-profits and government service at higher rates simply to take advantage of loan forgiveness. Absent PSLF, at the margin some of those students would choose the for-profit private sector rather than the public sector or non-profit.
Or would they? Presumably if they didn't offer PSLF the wages would be higher.
But these are mostly 18 year olds who have no credit, have probably held nothing better than a McJob in their life if that. All you've got are their hs transcripts. They couldn't get a "real" loan if they tried - no one would give an 18 year old a decent car loan, much less a mortgage. They can get a credit card with a limit of $1000 maybe.
Exactly. And the government shouldn't give them a loan either. The beauty of the academic system is that those who are qualified for college and cannot afford it get financial aid in the form of grants (out of the endowment). Those that can afford it, pay for it out of pocket.
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Originally Posted by redguard57
Admissions offices do screen for potential. If you're going to one of the expensive schools - they are going to screen you already. Community colleges & 4th tier publics that don't really cost that much more than CCs are the open enrollment ones. They are not the ones driving the debt problem since they're already much cheaper.
These schools are a bigger problem than the debt problem. They trick students into thinking they are getting a college education.
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Originally Posted by redguard57
There are for-profits although I think most of those are scams & should close.
This, among other things like closing low quality non-profit schools that don't prepare students to contribute to academia.
The root cause of the student loan problem, of course, is many decades of unwarranted excess demand resulting from student subsidies. At the end of the day, far too many 18 year olds go to college compared to what they would have done absent those unwarranted subsidies. Excess demand drove up prices. Excess revenue at colleges encouraged excess expansion of fixed costs (plant & equipment & labs) and the creation of new incremental colleges that would never have been formed in the first place absent those student subsidies.
The huge student loan burden of 20-somethings has profound economic implications and consequences. There is no easy way out. Those students are delaying household formation, delaying marriage, delaying childbearing, and delaying autonomy because of those debts.
The first rule of problem solving is sometimes said to be the old adage "if you find yourself in a hole, stop digging." We have a very real hole. We need to stop digging -- stop offering massive subsidies to students to attend college. We need to educate high schoolers and their families that college is not the only pathway to financial security or the middle class. We need to educate high schoolers and their families about the financial consequences of choosing college over other alternatives. Some colleges need to close.
One of the great things that happened in the Great Recession were some tough kitchen table discussions where parents told aspiring high school juniors and seniors that paying for college away from home was not a financial option.
The root cause of the student loan problem was everyone thinking they were suitable for college...
An even bigger factor is Americans got the absurd idea to greatly reduce student-teacher ratios (driven no doubt quietly by college professor orgs). 30 years ago, Dad and his fellow students were supporting that cost in ratios of 20 or 30 to 1. Now Junior and 9 colleagues are splitting that cost. Anytime you divide a bill fewer ways, cost soars. But based on our falling standing globally on matters relating to education, dividing it fewer ways did not drive quality up. It just drove cost up.
Historically, professor to student ratios were much lower. Often as low as 5:1. Take a look at Oxford University from the 1100s to 1800s... and then even U.S. universities prior to the Great Depression.
This thread is full of a bunch of elitism, survivor bias, and just plain cluelessness.
Yes, it's true we have too many colleges. Colleges do the job high schools used to do, and they charge quite a bit for it. We could fix the higher ed problem if we spent a few trillion on improving K-12. Before WWII, high school was the equivalent of college today, with only about half of all young Americans completing it - graduation rates in the 1950s were about 55-60% for white students, about 20% for black or hispanic students. Back then there were jobs you could get with an 8th grade education.
I've looked at my parents transcripts - they took latin in 12th grade. LATIN! The reason they could teach them Latin is because they had weeded out a bunch of kids by that point & only the smart ones were left. Today that culling takes place in graduate school.
Make high school great again.
Last edited by redguard57; 06-12-2016 at 02:43 PM..
This thread is full of a bunch of elitism, survivor bias, and just plain cluelessness.
Yes, it's true we have too many colleges. Colleges do the job high schools used to do, and they charge quite a bit for it. We could fix the higher ed problem if we spent a few trillion on improving K-12. Before WWII, high school was the equivalent of college today, with only about half of all young Americans completing it - graduation rates in the 1950s were about 55-60% for white students, about 20% for black or hispanic students. Back then there were jobs you could get with an 8th grade education.
I've looked at my parents transcripts - they took latin in 12th grade. LATIN! The reason they could teach them Latin is because they had weeded out a bunch of kids by that point & only the smart ones were left. Today that culling takes place in graduate school.
Make high school great again.
I be one of those 50s high schoolers. What you are preaching is simply nonsense. I actually had latin in the ninth and tenth grade and can read it still.. But that is not because we were brighter. It is because latin was the in language in that era. I would think Spanish would make a whole lot more sense. The core stuff was not a whole lot different than today. Algebra and Trig and Physics and Chemistry have not changed greatly. Maybe a little stronger today than back then. My senior year of high school I actual took 16 regents credits in one year and worked a good half time. I am bright but it was not a challenge. Played basketball and ran track on the side.
So no we were not much different. I think the big difference is score keeping. We no notice that the poor and minority do not get educated. And that is probably the biggest difference.
The poor get grants, and as long as they are private, it isn't a concern to me as a taxpayer. All can get scholarships if they deserve them. My godson had his Bachelor's plus 1/2 an MBA paid that way despite being upper middle class.
Last I checked most federal pell grants cost the taxpayers money.
I applied for over 100 private scholarships and grants. Didn't get a 1. Many need based scholarships were set at about 50k for family income. I don't know of most with living barley above that could send their kids to school without loans.
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