"End student loans, don't make them cheaper"

[spikespiegal]

cause employers are advertising for people with ten years experience in three different fields at entry level wages.

Man, hear that. I work in information technology and get a hoot at seeing long term, unfilled jobs sitting vacant for years because the job qualifications are absurd. Usually it's because some HR drone wrote the application and doesn't realize that somebody who's an RPG programmer likely doesn't have a Cisco Certification or has 3 years experience servicing iPhones.

My solution to the entire student loan debate might sound socialist, but I think it will satisify both political leanings. Every 6-8 years or so the Dept of Commerce defines those top 40-50 job skills or BA degrees that are in critical need by the U.S economy in general, and then those specific degrees are either heavily subsidized by the Government at discounted load rates, or just plain free. Also get the the public universities onto the program, even if you have to threaten them with losing state or govt funding. This will force them to stop giving away all the free tuition to some idiot getting a degree in literary arts or sports medicine. Make those clowns pay the 12% loan rates. Those people getting the degrees that are in need to stay competitive in a global economy should be getting additional assistance.

 

[Kntx]

Student loans should be un-socialized. There must not be a "too big to fail" mentality to them, that is what causes bubbles and crashes just like "affordable housing". Student loans should be given by private banks seeking a profit. Therefore in order to get a loan, you should have to submit a business plan to show what degree you will work on, how long it will take, what kind of job you will get when you graduate, how much you will make, and how long it will take to pay back the loan. Banks wouldn't give $100k loans to morons who want to get a masters in women's studies at a private school, and neither should the US taxpayers.

Yes if there is anything the financial crisis has taught us, it's that the banks will never give loans to morons who could never possibly repay!!

 

[dmcowen674]

"End student loans, don't make them cheaper"

http://www.startribune.com/opinion/commentaries/159449755.html?page=all&prepage=1

This is a case where I'd like some middle-ground. I don't think we should go back to the days when only wealthy people could afford to send their kids to college and perpetuate undeserved class distinctions. On the other hand we can't just fund any tuition increase. A lot of this money should go towards shoring up affordable public colleges and universities.

Do you really think a College Education is necessary for Mickey D and Wally World jobs?

 

[Infohawk]

Apprenticeships, aka on the job training, should be a baked into most companies.

They should be, but it's tough to legislate this. The only way this happens naturally is when there isn't enough labor. With billions of third-worlders participating in our labor market, there isn't much hope of that being the case anytime soon.

 

[QuantumPion]

Yes if there is anything the financial crisis has taught us, it's that the banks will never give loans to morons who could never possibly repay!!

They won't if they don't have a federal government to dump the toxic loans on. Which is why we should probably get the federal government out of the student loan business ASAP before the exact same thing happens again.

You do know that the cause of the housing bubble was banks giving bad loans (under pressure from the federal government to provide loans to the under privileged for affordable housing) because they could immediately dump them on FNMA, right?

 

[Exterous]

The fact that it might have been easier to get a job when graduating from college 20 years ago isn't relevant; the fact is that 20 years ago, you were still going to have a much harder time finding gainful employment with only a liberal arts degree as opposed to an engineering or another of the aforementioned degrees. That's my point and people in this thread keep losing sight of this fact. The problem may be worse now because of the economy, but this is not a new development and will always be true.

My point is about the validity of pursuing a liberal arts degree which means it most certainly is relevant because it granted an economic benefit to the graduate. Every data point that I have found for any year has shown that a person with a degree in art, music, drama etc is more likely to be employed than someone without a college degree - regardless of the economic situation of the country. It is true that having a liberal arts degree made you more likely to get a job than not going to college 20 years ago and it is still true today.

So - we have established that there is a clear benefit to getting a degree - any degree. Are some better than others? Absolutely. Is it worth the cost? Now this is where the big change occurs and the critical analysis skills must be put to work - which we often neglect to provide our children. The cost (inflation adjusted) per year of college in 1988 was $2800. For about another $1800 you could stay on campus. So for about $12,000/19000 you could get a degree that would always result in a lower chance of being unemployed.

Is the benefit worth the cost? I would argue that it was simply from the absence of reports to the contrary and that, even now, the low end payscale of a liberal arts major is equal to the median pay scale for a non-degreed worker (so, there are financial advantages as well)

Now it costs more than $8300 a year for a college education for a total above $33,000. God help you if you stayed on campus as that will more than double your cost - an additional $9000 a year. With your education costing almost 3x as much you have to be much more cognizant of what you will make on graduation and if your expected pay will be worth it. But before you can really figure that out you really need to know the effects on compound interest - which is generally not taught in schools. So kids have no idea that $33,000 is really $50,000 that will take 15 years to pay off. That $70,000 loan is going to cost you $105,000 over 15 years. Clearly the economic benefit of a liberal arts degree is no longer worth the cost (and we are starting to price out other degrees)

The benefits of the degree have little changed. The cost of it has changed dramatically. Its is a small but important difference - one that society is just now catching onto. You always heard about the lower unemployment rate and improve pay from a college degree. It wasn't until recently that the economic cost could so greatly overshadowed the economic gain

There is blame on both sides -- while the banks had little to lose and kept the money flowing, the fact of that matter is that people need to exercise some freaking common sense when it comes to loans and do research -- whether the loan is for education, cars, houses, etc. This "boo hoo, poor me, the bank got me!" excuse people are using is ridiculous. I've never had these issues -- why do you suppose that is?

How is it that we realized that people needed limits set for all other loans but student loans? I am not aware of a single other loan that will give out this much money for no risk based guidelines on limits. We have obviously realized that there are potential downfalls to a riskless lending practice yet we allow a one to be provided to one of the most naive segments of our population. This, combined with age based ignorance, is why I take a more lenient stance on student loans than home mortgages

If I had to guess as to why you never had those issues? Well, first you simply could not have had the college cost issue based on when you attended college. Second, you benefited from at least one of the following:
Good genes
Good education
Good parental involvement

Schools dont teach finance. A large number of parents have no good advice/education to give to their kids. Not everyone gets the genes necessary to be predisposed to the type of critical thinking needed to figure out everything on their own before getting $30k + in debt

 

[Exterous]

Cliffs:
This will continue to happen until we reform private student loans or fix the education system and teach finance. (So we better reform lending because I don't see the school system getting better any time soon) It would be fool hardy to depend on teenagers to rectify the situation on their own

 

[CountZero]

Thanks, that was my point. When I was in high school in the late 80s, it was already very apparent that employers had no interest in liberal arts degrees and that the best course of action would be:

1. Major in engineering, science, or accounting finance.
2. If you were 100% sure you'd go to grad school, do liberal arts and then do law or something of that nature.

The fact that it might have been easier to get a job when graduating from college 20 years ago isn't relevant; the fact is that 20 years ago, you were still going to have a much harder time finding gainful employment with only a liberal arts degree as opposed to an engineering or another of the aforementioned degrees. That's my point and people in this thread keep losing sight of this fact. The problem may be worse now because of the economy, but this is not a new development and will always be true.

You miss the point. You complain about the extreme end of things with French Literature majors that have 200k in debt. You miss completely the middle ground. Decent degrees and fairly large amounts of debt. Science is a perfect example (you even cite it) a Bs Chem or a Bs Physics is only a little more useful than a liberal arts degree. So that would be a bad move unless you plan on doing grad school, a plan that could be derailed and now you have a BS Chem, debt and no good job.

Even if you look into the investment from every angle sometimes stuff doesn't work out. Why is it you can walk away from bad financial decisions in numerous other areas (failed business for example) but not a student loan. It is an anomaly that has created a broken and bloated system.

Straight discharge isn't the answer for obvious reason but a system to erase the debt via a form of bankruptcy should be done. Zero risk lending is a bigger hazard than a 200k French lit degree IMO.

 

[1prophet]

Lol how many teenagers do you know that do what their parents tell them ot take their parents advice?

Probably not to many, but on the other hand how many teenagers do you know continue on or struggle with the habits and values they picked up from their parents day to day activities while growing up?

 

[IndyColtsFan]

You miss the point. You complain about the extreme end of things with French Literature majors that have 200k in debt. You miss completely the middle ground. Decent degrees and fairly large amounts of debt. Science is a perfect example (you even cite it) a Bs Chem or a Bs Physics is only a little more useful than a liberal arts degree. So that would be a bad move unless you plan on doing grad school, a plan that could be derailed and now you have a BS Chem, debt and no good job.

No, I'm not missing the point. The fact of the matter is that for more and more jobs, you're going to need to have a 4 year degree. Most people will have to go into debt to get those degrees. My point is that you should play the odds and go for a degree that gives you the best chance at landing a job. I never said you'd be guaranteed a job, but you have to play the odds. I understand that with the economy the way it is these days that there are lots of unemployed grads even in the sciences. I get that. I'm saying you should still pick a major which has the best chance of employment even though it may not work out. Like it or not, a 4 year degree is STILL your best chance at finding decent employment and I don't think many people have a choice but to get one.

Even if you look into the investment from every angle sometimes stuff doesn't work out. Why is it you can walk away from bad financial decisions in numerous other areas (failed business for example) but not a student loan. It is an anomaly that has created a broken and bloated system.

I agree with you.

Straight discharge isn't the answer for obvious reason but a system to erase the debt via a form of bankruptcy should be done. Zero risk lending is a bigger hazard than a 200k French lit degree IMO.

Definitely agree here, and I think that lenders AND universities need to bear some of the brunt of this.

EDIT: See my post below. I want to be clear -- I am in no way defending the current system and in fact, I think it sucks. But, I'm pragmatic enough to know that at least for now, most will need to have some amount of debt in order to give themselves the best shot at a decent job and that's why I say that you might as well research options and pick the one with the best chances.

 

[IndyColtsFan]

My point is about the validity of pursuing a liberal arts degree which means it most certainly is relevant because it granted an economic benefit to the graduate. Every data point that I have found for any year has shown that a person with a degree in art, music, drama etc is more likely to be employed than someone without a college degree - regardless of the economic situation of the country.

Agree with the bolded. Now, how do those majors compare to accounting/finance, engineering, or other science majors? That is my point. I never said that an art degree wasn't better than no degree; what I said was that if you're going to spend the money on a degree, go for something that has the highest potential of employment. Obviously even liberal arts degree holders have lower unemployment in general than someone with only a HS diploma, but what are the numbers for accountants?

So - we have established that there is a clear benefit to getting a degree - any degree.

Yes, I never argued otherwise.

Are some better than others? Absolutely.?

Now we're getting somewhere.

Is it worth the cost? Now this is where the big change occurs and the critical analysis skills must be put to work - which we often neglect to provide our children. The cost (inflation adjusted) per year of college in 1988 was $2800. For about another $1800 you could stay on campus. So for about $12,000/19000 you could get a degree that would always result in a lower chance of being unemployed.

Is the benefit worth the cost? I would argue that it was simply from the absence of reports to the contrary and that, even now, the low end payscale of a liberal arts major is equal to the median pay scale for a non-degreed worker (so, there are financial advantages as well)

Now it costs more than $8300 a year for a college education for a total above $33,000. God help you if you stayed on campus as that will more than double your cost - an additional $9000 a year. With your education costing almost 3x as much you have to be much more cognizant of what you will make on graduation and if your expected pay will be worth it. But before you can really figure that out you really need to know the effects on compound interest - which is generally not taught in schools. So kids have no idea that $33,000 is really $50,000 that will take 15 years to pay off. That $70,000 loan is going to cost you $105,000 over 15 years. Clearly the economic benefit of a liberal arts degree is no longer worth the cost (and we are starting to price out other degrees)

The benefits of the degree have little changed. The cost of it has changed dramatically. Its is a small but important difference - one that society is just now catching onto. You always heard about the lower unemployment rate and improve pay from a college degree. It wasn't until recently that the economic cost could so greatly overshadowed the economic gain

Agree about costs accelerating.

How is it that we realized that people needed limits set for all other loans but student loans? I am not aware of a single other loan that will give out this much money for no risk based guidelines on limits. We have obviously realized that there are potential downfalls to a riskless lending practice yet we allow a one to be provided to one of the most naive segments of our population. This, combined with age based ignorance, is why I take a more lenient stance on student loans than home mortgages

If I had to guess as to why you never had those issues? Well, first you simply could not have had the college cost issue based on when you attended college. Second, you benefited from at least one of the following:
Good genes
Good education
Good parental involvement

Schools dont teach finance. A large number of parents have no good advice/education to give to their kids. Not everyone gets the genes necessary to be predisposed to the type of critical thinking needed to figure out everything on their own before getting $30k + in debt

I understand, but at some point, something has to give and people need to accept responsibility for their own actions. I also favor mandatory financial education in high school.

I've said it in other threads, but I'll repeat it here. I used to be one of the biggest defenders of degrees and education, but since I've been in the workforce, I understand that in all but a few positions, degrees aren't necessary. A one or two-year training program would prepare someone just as well for the majority of positions out there. There is no rhyme or reason to require a BS/BA for someone to be an admin assistant, for example. A vocational school training track for an office worker is more than adequate.

The same goes for IT. I've interviewed candidates with degrees who were clueless and I've interviewed candidates without degrees who were sharp. The whole system is set up in the wrong way and even though you and others might think I'm supporting the current system with my comments and me chastising the parents/kids, nothing could be further from the truth. I just know that the system isn't going to change and most will have to accept some debt to give them the best chances at securing a career and that means, unfortunately, getting a 4-year+ degree in most cases. And I think that's wrong. The current system is draining far too much capital out of the economy and tying those resources up for years when they could be used in a better way.

 

[First]

lol, your threads/posts are funny.

 

[Jhhnn]

People going into six figure debt are going to have issues even with a job waiting for them unless they happen to be a doctor, and even that may no longer be true in a few years.

Average debt is currently ~$25K for grads who borrow, 50% higher for those atteding for-profit schools-

http://www.huffingtonpost.com/2011/11/03/average-student-debt-2525_n_1073335.html

I think you'd miss the point if you were bludgeoned with it. Seriously, this isn't a difficult concept. When you evaluate a degree program, you must look at it as an investment. NOTHING in life is guaranteed. NOTHING. BUT, you need to evaluate the job prospects in a field, average salaries, etc. before assuming debt. The "extreme examples" in my argument are NOT extreme examples. Student loan debt has exceeded credit card debt. Every day we are confronted with stories of people in loads of school debt who can't afford to get out from under it, and guess what? Many of these people HAVE JOBS. Someone graduating with tens of thousands of dollars in debt for an art history degree is an idiot and that degree virtually has no chance of landing a higher-paying job to start out with and will be stuck in debt for YEARS.

Those who think going to college is about the "experience" and "finding yourself" and "discovering boundaries" are naive. While all those things can be included, the primary focus should be on finding a major with a future.

Did I say any of that silly stuff? Increasingly, no major has a real "future". The more people with "future" degrees, the fewer of them that will have such a future.

Let me guess, you're a liberal arts professor? If so, let me say -- LOL!

Enormous fail in that, standard for those who believe what they want to believe. I work with my hands, and my head, and have my entire adult life.

Color me shocked -- Jhhnn going off on another partisan rant with no substantive contribution and saying "You clearly don't know" without showing he knows anything at all and offering no solutions, just complaints. Enough of your bitter, whiny partisan rants. What is your solution? If you can't answer that, don't bother responding.

As if you've offered any solutions, yourself.

The answer is in the concept of ownership, and of asserting that at the polls. Righties always view private ownership as absolute, regardless of the effects on the rest of the country. When capitalism fails to deliver, as it does currently, then the ownership concept needs to be broadened to assert responsibility to the society as being part of the rights of ownership. If we want more people to have ownership, then we must necessarily prevent the very few from owning it all.

 

[OVerLoRDI]

Employers want people who know the job without training, and believe youth are lazy and entitled. That last part is certainly partly true, but too generalized. I don't think university should be free. If it's free, it becomes meaningless and you do become entitled like those kids in Quebec. However, indebting our students so much is hurting society. Loans should be harder to get, and more restricted on what they can be spent on. I knew kids who spent their loans on everything but school.

This is wisdom. Student loans should be handed out based on aptitude. Similar to college acceptance.

 

[werepossum]

Want to pay cheaper college costs or not get hit with a huge loan payment after graduating. Here's some tips:

1) Go to an in-state college.
2) Get your first two years of courses (ie, the prerequisites) at a community college or junior college
3) Live off-campus either sharing an apartment or living with relatives
4) Take relevant courses to your degree. Don't take fluff that you don't need.
5) Rent books or buy used
6) Take online courses
7) Only borrow what you need for the classes. Don't take extra because it's like "free money"
8) Work while you study so you can pay for some of your costs with cash.

I'd like to know the percentage of students/graduates who are buried by student loans that did any of these. I'm guessing very little. There's a whole hell of a lot you can do for yourself instead of whining for more help from the government.

Excellent post. How many idiots whining about crushing student loans are financing pizzas for ten years?

The students that have to repay the loan?

One of the points that the original article makes is that Federal Aid has the unintended effect of raising student costs.

If you were to graph the rise in student aid, you would find that it matches the rise in college costs. It also correlates with the declining state support for public universities. After all, why should the state legislators support the public university when the university can, and does, transfer the cost to the students?

That is, all of this aid seems to benefit the schools and the states but not the students.

I think that you can see who loses...

Uno

QFT People to have an unfortunate tendency to not care what something costs as long as someone else pays for it, or even as long as they can put off paying for it.

 

[werepossum]

My point is about the validity of pursuing a liberal arts degree which means it most certainly is relevant because it granted an economic benefit to the graduate. Every data point that I have found for any year has shown that a person with a degree in art, music, drama etc is more likely to be employed than someone without a college degree - regardless of the economic situation of the country. It is true that having a liberal arts degree made you more likely to get a job than not going to college 20 years ago and it is still true today.

So - we have established that there is a clear benefit to getting a degree - any degree. Are some better than others? Absolutely. Is it worth the cost? Now this is where the big change occurs and the critical analysis skills must be put to work - which we often neglect to provide our children. The cost (inflation adjusted) per year of college in 1988 was $2800. For about another $1800 you could stay on campus. So for about $12,000/19000 you could get a degree that would always result in a lower chance of being unemployed.

Is the benefit worth the cost? I would argue that it was simply from the absence of reports to the contrary and that, even now, the low end payscale of a liberal arts major is equal to the median pay scale for a non-degreed worker (so, there are financial advantages as well)

Now it costs more than $8300 a year for a college education for a total above $33,000. God help you if you stayed on campus as that will more than double your cost - an additional $9000 a year. With your education costing almost 3x as much you have to be much more cognizant of what you will make on graduation and if your expected pay will be worth it. But before you can really figure that out you really need to know the effects on compound interest - which is generally not taught in schools. So kids have no idea that $33,000 is really $50,000 that will take 15 years to pay off. That $70,000 loan is going to cost you $105,000 over 15 years. Clearly the economic benefit of a liberal arts degree is no longer worth the cost (and we are starting to price out other degrees)

The benefits of the degree have little changed. The cost of it has changed dramatically. Its is a small but important difference - one that society is just now catching onto. You always heard about the lower unemployment rate and improve pay from a college degree. It wasn't until recently that the economic cost could so greatly overshadowed the economic gain



How is it that we realized that people needed limits set for all other loans but student loans? I am not aware of a single other loan that will give out this much money for no risk based guidelines on limits. We have obviously realized that there are potential downfalls to a riskless lending practice yet we allow a one to be provided to one of the most naive segments of our population. This, combined with age based ignorance, is why I take a more lenient stance on student loans than home mortgages

If I had to guess as to why you never had those issues? Well, first you simply could not have had the college cost issue based on when you attended college. Second, you benefited from at least one of the following:
Good genes
Good education
Good parental involvement

Schools dont teach finance. A large number of parents have no good advice/education to give to their kids. Not everyone gets the genes necessary to be predisposed to the type of critical thinking needed to figure out everything on their own before getting $30k + in debt

Good points.

 

[Jadow]

Even if you look into the investment from every angle sometimes stuff doesn't work out. Why is it you can walk away from bad financial decisions in numerous other areas (failed business for example) but not a student loan. It is an anomaly that has created a broken and bloated system.

Straight discharge isn't the answer for obvious reason but a system to erase the debt via a form of bankruptcy should be done. Zero risk lending is a bigger hazard than a 200k French lit degree IMO.

i agree as long as its not the taxpayers picking up the tab. get govt out of student loans. and let the banks evaluate risk as they see fit and charge rates accordingly.

 

[Exterous]

Agree with the bolded. Now, how do those majors compare to accounting/finance, engineering, or other science majors? That is my point. I never said that an art degree wasn't better than no degree; what I said was that if you're going to spend the money on a degree, go for something that has the highest potential of employment. Obviously even liberal arts degree holders have lower unemployment in general than someone with only a HS diploma, but what are the numbers for accountants?

I would think you of all people would recognize that employment % is not the end all be all in deciding what you want to do for the rest of your life. Not to mention that if we only had people going for the sections with the highest employment people would go into Agriculture before business, social work before any engineering, elementary education before IT, family and consumer sciences before accounting and nursing before, well, anything.

You can't play the odds. You can only guess and there have been too many surprises to make it seem like you could pick a winner:

In 2008, 98% of MBA grads received job offers within 3 months of graduation. In 2009 it dropped to 74% and its only gotten worse since then. So you, as an enterprising your man look and say "Hot damn! Only a 2% chance of not finding a job right out of college? I'll take it!" Only to learn that after your 4 years of hard work your unemployment chances had risen by 13x the original rate. Who would have thought a social work degree would be better?!

You go into a degree in architecture which had an unemployment rate of 6% only to find out it was 12% when you graduated 4 years later. Who would have thought you'd be better off with a degree in dance or art?!

Nursing, which has been an employment safe haven for the last 10 years now might hit 7% in the next couple of years - nearly tripling since 2011. Do you bank on the shortage to continue? Its still kind of a low rate but that sudden increase was fast! Will the health care bill change this? Should I then become a teacher as their unemployment rate might be 5% in 2015? Or is that a bad decision because of the high cost of education and low pay.



The problem is not the degree but the cost of the degree. I am harping on liberal art degrees and need to get a degree not for the sake of liberal arts degrees but because they are the low hanging fruit. They will be the first to suffer from our drastic tuition increases. Its easy to say "Oh, well they should choose a better degree. They didn't play the odds right" and, yes, by and large I would agree with you if the tuition cost trend wasn't up,wages stagnant and employment statistics changing so drastically in 4 years or less. But we are well on our way to making it an irresponsible decision to choose 'important' majors. Teaching is no longer an economically smart choice. Architects have long been priced out. Civil Engineering is getting there. Chemistry, biology, an MBA, marketing are all becoming economically irresponsible choices to make and it shows no signs of slowing down. People getting sky high in debt to get a liberal arts degree isn't the problem - its a symptom of the problem. Just saying 'choose a better degree' isn't going to fix the root cause even though it screws over the people who guessed wrong

I understand, but at some point, something has to give and people need to accept responsibility for their own actions.

I guess we will just have to disagree on how much we can hold a teenager accountable for when we have failed to prepare them at pretty much every level of their upbringing for this decision and stick them in a job market/economy that the best and brightest with years of experience can't figure out let alone someone who is just starting their adult life

I've said it in other threads, but I'll repeat it here. I used to be one of the biggest defenders of degrees and education, but since I've been in the workforce, I understand that in all but a few positions, degrees aren't necessary. A one or two-year training program would prepare someone just as well for the majority of positions out there. There is no rhyme or reason to require a BS/BA for someone to be an admin assistant, for example. A vocational school training track for an office worker is more than adequate

I completely agree. Now - how do we fix the situation? IMO we are stuck with a cultural shift decades in the making. We can't quickly fix people's mind sets about requiring a college degree when hiring. We can't quickly fix the cultural emphasis on getting a college education. We can't quickly get universities to reduce their tuition cost. Employment statistics for degrees are erratic and students cannot quickly respond to these sudden changes due to the education time requirement

I honestly do not have a good idea on how to get out of the cycle we are currently in. The only thing I can think of is bring down the cost of a college education and make it harder to attend - financially and academically. Now I don't mean financially as in high cost I mean financially in terms of limiting the amount of aid given. If you really want that liberal arts degree go for it with the understanding that loans arent going to pay for all of it so you better work your butt off to get it. It should at least be realistically attainable - which it isn't right now. Increase the risk for banks on loans. Perhaps they can be discharged if you make 95% of payments for the first 5 years and 100% of payments after the next 10.

Re-vitalize vocational training programs

Clamp down on the 'for profit' colleges and universities. Honestly, I'd like to see them exempt from federal aid unless their costs are below a certain amount. Either create national standards rankings of degree granting institutions or make them report certain metrics so people can more easily tell how valid that degree really is. Make those easily accessible esp for High Schoolers

 

[tcG]

University education is so expensive precisely because it's largely a public good funded through taxpayer money. We should focus on what's making it so expensive in the first place.

 

[IndyColtsFan]

Average debt is currently ~$25K for grads who borrow, 50% higher for those atteding for-profit schools-

http://www.huffingtonpost.com/2011/11/03/average-student-debt-2525_n_1073335.html

$25K is not bad. If you can get a quality degree and come out only $25K in the hole, that's pretty good.

As far as for-profit schools -- well, I agree with those who say that we should clamp down on aid for those.

Did I say any of that silly stuff? Increasingly, no major has a real "future". The more people with "future" degrees, the fewer of them that will have such a future.

I think you have a very pessimistic view of the future.

As if you've offered any solutions, yourself.

I'm not the one throwing partisan jabs in every post and blaming one side of the political spectrum for every problem under the sun. You are and act as if you have the answers, which you don't. I don't claim to have them. I read these threads to see who might have good ideas.

The answer is in the concept of ownership, and of asserting that at the polls. Righties always view private ownership as absolute, regardless of the effects on the rest of the country. When capitalism fails to deliver, as it does currently, then the ownership concept needs to be broadened to assert responsibility to the society as being part of the rights of ownership. If we want more people to have ownership, then we must necessarily prevent the very few from owning it all.

I don't disagree with that last line. The CEO-centric culture in the US is causing its downfall, IMO.

 

[IndyColtsFan]

--snip--

Whew, there's a lot to respond to! Rather than respond to every point (it is getting late), I'll just throw out a summary. Suffice it to say, I don't think a kid should JUST look at placement percentages to determine a major. It isn't as if one major and one major alone gets jobs, there are several options.

Agree about the MBA -- it is an extremely unwise investment IMO unless your company foots the bill. I know 4 people who have received MBAs in the last 8 years from good programs and none really advanced. Fortunately, two of them got it for free and were just out the time they invested; the other two went into debt (one significantly) to get it and I can still remember her breaking down and crying when she realized she went into debt for nothing. That's anecdotal, but it seems to be a common occurrence throughout the country.

As far as the "hot professions" go, it is cyclical. When IT was super hot back in the 90s, everyone and his brother ran out and got the hot cert of the time, the MCSE. Unfortunately, the market was flooded with credentialed IT people who weren't qualified and it led to a depression of wages in our profession and a large amount of distrust on the part of employers for anyone with our cert. The MBA is the MCSE of this decade IMO and once that loses steam, I'm sure enterprising schools will invent yet another "hot" business degree.

Lastly, I agree that the cost of the degree is the problem, but where can we really cut the cost down? I'm talking about public institutions and not the UoPs of the world.

EDIT: You also bring up some other good points for me to consider. Maybe I've been too hasty forming some of my conclusions and I need to re-evaluate.

 

[IndyColtsFan]

lol, your threads/posts are funny.

Not sure who you're speaking to, but would you care to add to the discussion?

 

[Exterous]

It isn't as if one major and one major alone gets jobs, there are several options.

Sure, but you are taking a significantly larger than ever financial risk that your bet is the correct one.

As far as the "hot professions" go, it is cyclical. When IT was super hot back in the 90s, everyone and his brother ran out and got the hot cert of the time, the MCSE. Unfortunately, the market was flooded with credentialed IT people who weren't qualified and it led to a depression of wages in our profession and a large amount of distrust on the part of employers for anyone with our cert. The MBA is the MCSE of this decade IMO and once that loses steam, I'm sure enterprising schools will invent yet another "hot" business degree.

Agreed - which is why there will be even more problems with people trying to choose a degree. The cost of education goes up. More and more people are obsessed with the degree that will offer the best chance of employment which means an ever higher % of people will flock to that sector. This will cause that degree's demand will crash even faster - leaving a very large number of people in a huge amount of debt and no job. Look how quickly the MBA degree changed. 13x in a year! Nursing went from 2.2% unemployment in 2011 to about 4% less than a year later

A college education has usually had the issue of trying to marry inelastic supply with elastic demand. Unfortunately while the economy has made demand more elastic, the higher cost of education has made the supply significantly more inelastic in addition to pricing out certain degrees

*Stops swinging bat. eyes dead horse*

Lastly, I agree that the cost of the degree is the problem, but where can we really cut the cost down? I'm talking about public institutions and not the UoPs of the world.

Ah....great question. I don't have a great answer. I suspect that a large part of the increase is facility costs for the University but I haven't had access to a major University's building budget for a number of years. There is the mentality that a University must be an ultra-high tech, ultra modern facility with apartment style living for students. If we can scale back the living and tech costs with a scaling back of the money available I think that would go a long way. The downside is that Universities won't make the first step because the availability of money will just cause the student to go elsewhere. So I guess it comes back to a reduction in the supply of aid

I could be completely wrong though

 

[zephyrprime]

Allow me to translate from "employer speak" to English. When a US employer says that they can't find skilled employees, what they really are saying is that they can't find someone with 10+ years of experience, multiple degrees and/or certifications, and willing to work at an entry-level salary.

Exactly. People are morons for actually believing what employers say - as though they had any credibility or record for being honest. Being "skilled" has only ever been marginally about education. It's a joke to hear on the news them talking about more "education" as though that's what employers wanted. News flash: education doesn't have much to do with the work world and it never has in any idealized past. Education is very theoretical and the workplace is very applied. Even my csci degree doesn't have that much to do with my programming job even though it is much more directly relevant to my position that most degrees are.

When employers say "skilled" they are talking about skills that can only be learned on the job and not at any school. Skills that can be learned at school they just take as a given which makes perfect sense because there are lots of people who pay to learn those skills at school but far fewer who have the skills that can't be bought but can only be learned on the job. Of course skills that can be bought are more common that skills that can't be bought. Duh! We as a society just need to learn not the take every complaint by employers seriously.

 

[zephyrprime]

Lastly, I agree that the cost of the degree is the problem, but where can we really cut the cost down? I'm talking about public institutions and not the UoPs of the world.

First off, we must remember that college used to be fairly cheap. People used to be able to pay their own way through college with a part time job if they lived at home as recently as the 70's (and college used to be even cheaper before then).

The cost of college is rising for several reasons.

The availability of loans. The more money the government makes available, the more colleges will charge.

Outsourcing of jobs and monetary inflation. Monetary inflation has actually been very high in the past three decades. People don't see the inflation though because of cheap imports from China which balances out the monetary inflation with price deflation. However, imports are all products, not services. So, everything that is a service shows the true extent of inflation in the last few decades (school, doctors, plumbers - all of these things have risen in price way faster than official inflation numbers.) However, entry level jobs that colleges students have have had pay rate rises that only match inflation. It's well known that median incomes in the US have been stagnant since the late seventies.

But most important of all, the reason college has risen in cost so much is because of supply and demand. The number of people wanting to go to college has greatly risen: http://3.bp.blogspot.com/-2tREDj_DUAE/T7hejWVcVII/AAAAAAAARn0/r8M0L4cZPxI/s1600/college.jpg

As can be seen, the price of college has risen to match. Classical economics would dictate that as demand increases, supply would increase to match. This is only partially true with colleges. The thing with college is that *reputation matters*. Also, colleges do not behave as logical business entities.

(First off, let me say that if the buyers want more supply, they will have to pay a higher price to get that increased capacity. There is no way around this in any industry.)

So, since reputation matters, new colleges cannot spring up fast enough to provide more supply into the marketplace. Buyers do not esteem new colleges as much as existing colleges. Economics would dictate that existing colleges would increase in capacity to serve more students. This only partially happens. Colleges do not let themselves increase in size as much as the marketplace demands because colleges care about "community". Like I said, they don't act as logical business entities. Also, a logical business would open up branch offices. A college will not do this. If a Harvard were a business, they would have dozens of Harvard franchises built all around the nation to meet increasing demand. But Hardvard isn't a real business. So supply is contrained.

These things will take care of themselves though. Once the nation hits the point where there isn't increasing enrollment anymore, prices will go down. Also, as wages in china rise, the cost disparity of services will go down as well.