1) Move most good careers that do not require a college degree out of the country for the benefit of shareholders
2) Tell everyone born between 1980 and 1995 that they'll be unable to compete in the global marketplace if they don't get at least some post-high school education, and imply that the mere presence of a degree will help instead of having a specific type of degree
3) Have next-to-zero standards for public funds used in grant and loan programs for college education, meaning people can take out loans for any sort of degree program at almost any sort of institution
4) Hold these debtors to standards that aren't applied to other types of debtors. You cannot discharge them through bankruptcy, it's very difficult to renegotiate, and SCOTUS has said that the chief executive of the note-holding institution (in this case, the President of the United States) cannot use discretion in deciding who he gets to forgive for loans.
You forgot the most important part. The people agreeing to these debts, by definition, do not have an education in complex debt instruments that cannot be discharged.
Taking our a vast loan to study English literature might seem unwise, but it’s something I could definitely see a starry eyed 17 year old deciding to do.
The bulk of education debt in the U.S. is not about undergrad degrees in English literature or the like. By and large, it gets incurred either for lucrative postgrad degrees (MBA, law, medical etc.) or for earning degrees at "non-traditional" for-profit colleges.
To this day, almost two decades after I left my philosophy PhD program (without a PhD), I still have massive student loan debt.
Even if I had completed my degree, though, philosophy PhDs aren't particularly lucrative. Tenured professors at major universities do ok, but the road to getting tenure-track jobs and then tenure is littered with the bodies of grad students.
I don't think starry-eyed 21 year olds deciding what to do are much different from starry-eyed 17 year olds deciding what to do.
It's worth noting, by the way, that the United States has a shortage of medical doctors.
What the U.S. actually has is a group of people intent on keeping their doctor wages high by limiting supply through regulation and bottleneck creation.
As a med school dropout (best decision of my life), were I to "go back" to early college: I would have instead pursued a BSN (which my college offered!), to set myself up into eventually becoming a nurse practitioner. That way, if I decided to not complete graduate school, I'd still have an applicable role/job within medicine. Were I to have graduated that program, I also would have been able to practice much earlier (albeit limited scope, per US State).
Instead, what does an uncredentialled Chemistry Bachelor do after dropping out of medical school? ...I became an electrician, which allowed me to help people without sacrificing my lifestyle.
If your goal also includes "make substantial sums of money," I always recommend to preMeds they consider all the different ways someone can make money helping people without having to sacrifice your entire early adulthood.
The majority of my medschool classmates refer to me as "the dumbest smart guy they know," but in confidence several have expressed jealousy at not having to work so much (for IMHO so little, as physicians). Just cogs in an overly-complex, wealth-extracting machine...
Nurse practitioners are the overused. If you are on medicaid, at least in my state, you are almost guranteed to be seen by a nurse practitioner rather than an actual pyschiatrist. Even if you aren't on medicaid, which medicaid is usually better than any other marketplace insurance for selection of providers and service, getting seen by a nurse practitioner is very common.
Additionally, while many may be knowledgable about the medications they prescribe, I have had nurse practitioners prescribe me medication they didn't even know existed, as in during my session I asked for a specific medication based on a personal recomendation from a freind in the field, they didn't know what the medication was and looked up on google and then prescribed it to me.
There are good nurse practitioners, but they simply should not be prescribing long term pyschiatric medication with the level of schooling they have.
It takes 2 years to become a nurse, and 3 years to become a nurse practitioner. Additional certification is required to prescribe certain medications, but even then the amount of training and classes a nurse practitioner will take to understamd medications is very small compared to a psychiatrist.
It's absurd. NP's have been the solution to psychiatist shortage and it seems no one cares. Most likely, because anyone who knows is zombified by SSRIs by shit NPs or is in the medical field so their vision is already clouded by bias. Nurse takeover is a joke. Anybody with 2-3 years of schooling should be relagated to changing bedpans and putting in IVs. Not functioning as psuedo doctors.
>they didn't know what the medication was and looked up on google and then prescribed it to me.
How human that this practitioner admitted to not knowing something; then took the time to look up the drug's factsheet; and then trusted you enough to take your friend's personal recommendation.
>There are good nurse practitioners
Agreed. And terrible physicians, as well as good.
>...but they simply should not be prescribing long term pyschiatric medication with the level of schooling they have.
Agreed – with the additional thought that even physicians overprescribe these mind-altering substances in far-too-abundance.
>NP's have been the solution to psychiatist shortage and it seems no one cares...Nurse takeover is a joke.
I think most people "on psych meds" really just need better friends / families / societies / healthcare . It is most unfortunate that we are our own worst enemies, sometimes; particularly in allowing US healthcare expenditures to be highest with no obvious benefit (to patients).
It all made me so sick decades ago that I quit before even starting.
You are right in the context of the power NP's have compared to regular doctors. The primary difference in an NP and a doctor practically is pay. They do so much similar stuff, even though they shouldn' be allowed to. NP's prescribing meds, like a child with bazooka shooting at mentally ill people.
Out of curiosity, why cannot hospitals fund residency slots on their own with some riders (the resident should work in the same hospital for x years)?
It seems odd that the medical profession is not willing to invest in the training of the next generation of professionals without government help.
They do sometimes. People don’t realize how much of medicine, generally, is funded through the government. Additionally, society gives medicine a lot of leeway to act selfishly because the core practice of healing is so altruistic.
Broadly, it’s the same issue that all jobs have: it’s cheaper to hire pre-trained professionals than to hire and train.
Because they need to support their executives and capital projects / debt service. That’s the discretionary budget… training doctors doesn’t improve the bottom line.
Hospitals are really quasi-government entities. Their pricing structures have price controls based on Medicare reimbursements. A third of hospital revenue is Medicare and Medicaid.
Both programs have been slowing rate growth, which in turn impacts private insurance as well. The institutions haven’t been successful in reducing cost growth. ACA built out regional cartels^H provider networks, essentially eliminating competition.
I was trying to keep my comment short. Such a regulatory regime would be expected to close such obvious loopholes.
In much the same way that a doctor in $FOREIGN_COUNTRY cannot practice telemedicine in the USA, I would expect the regulations to make a distinction between software (and services provided by software) developed by foreign and licensed programmers.
>much the same way that a doctor in $FOREIGN_COUNTRY cannot practice telemedicine in the USA...
U.S. retired doctor here. This is a fascinating possibility that never occurred to me until I read your comment. Could a foreign doctor not set up a system whereby she/he could appear to be in the U.S. while being in a country that's essentially unreachable by U.S. authorities? And take payment in cryptocurrency?
> Lobby the government to prohibit anyone from practicing programming without a license.
No way you're getting consensus on this one, but even if you could, it's too hard to stop. If you charge for compilers, and only provide them to licensed developers, hippies will make and distribute compilers for free.
Also, the vast majority of software bugs are annoying at worst, with no death potential. Powers that be would react a lot more aggressively if stack overflows routinely led to bodies on the pavement.
Considering the number of ransomware attacks and other viruses that infect hospitals, it wouldn't surprise me if stack overflows had quite a large body count.
Why not both? Even better if you have to obtain accreditation as a professional in every different market because EU software is different from US software is different from Indian software...
Let's do note that on that graph which mapped a variety of increased costs, the only thing that increased faster than college costs was the cost of medical. That's connected to the shortage of doctors. Regulatory capture isn't just an issue with higher ed.
This is really a weird requirement and most other places in the world don't have it, without suffering any setbacks when it comes to outcomes of treatments.
Imagine that every programmer would have to study, say, Latin for 4 years before being allowed to code.
Agreed. It might make some sense to require undergrad chemistry and biology for med school applicants but presumably that could be squeezed into 2 years of undergrad. Possibly a customized curriculum could teach it faster or as part of med school.
Well, the OP did say “the bulk of” — some people, like you, are surely carrying debt for non-lucrative degrees.
But the pipeline of lawyers, doctors, MBAs, etc. is quite a bit larger than self-pay philosophy PhDs, and a large fraction of those professional degrees are full-freight, $70k/year (plus living expenses!) of pure debt.
Not all lawyers and doctors are the same. Consider public defenders. And physician compensation can vary dramatically depending on whether they're a general practitioner or specialist, rural or urban, etc.
Ironically, the ones we need the most are paid the least.
Of course, that's assuming students finish their degrees and get jobs. Plenty of people drop out of school, and they don't get refunds! Law students fail to pass the bar, etc.
Yes, and indeed, this is exactly the argument used by the Public Service Loan Forgiveness program, in which public defenders / nonprofit lawyers / rural nonprofit doctors’ loans are written forgiven after 10 years of public service so they are not saddled with a lifetime of debt they can’t pay off due to choosing careers in public service. You’re in a supposedly “lucrative” career with a high debt load, but choosing not to pursue the typical high-income pathway.
That program has many gotchas, but at least this reflects a recognition that debt creates incentives that society may not want.
For Law, it's not just about not passing the bar. It's about getting into a top 10 law school and getting a top clerkship. And then getting into a top firm. Yeah, some people don't end up on that train and do OK but it's probably not a great ROI even if they pass the checkmarks.
It’s an implication of a system that pays commensurate to what one contributes to the economy rather than commensurate to what one contributes to society.
> I left my philosophy PhD program (without a PhD), I still have massive student loan debt
In humanities fields, if the department thinks you belong in the program, they pay you to attend. They'll give you fellowships, TAships, and RAships. If they don't give you those, they're telling you not to attend. This is a harsh truth.
>That's not generally true. I attended a state university, and the department simply didn't have the funding to pay for its graduate students.
I mean, maybe? I know a number of state schools, certainly not all of them, but plenty that can afford paid spots for PhD students in the humanities that are certainly enough for someone to support themselves on. It doesn't pay as well, nearly as well, as jobs that humanities student with a good GPA from a good university can get in the private sector, but its not bad at all.
They're not denying your experience. They are, however, pointing out you didn't do your research Well when picking programs to apply to.
I've been in different universities and the experiences for the same departments very considerably. You specify on your application whether you want your admission to be conditional on funding. One communications department for example would typically admit only 2 to 3 students per year on funding. I thought it was very competitive to get into. But of course if you tell them you're willing to pay your own way admission becomes much easier.
Other departments may not be that upfront with the deal but all people applying to grad school should understand these Dynamics.
> They are, however, pointing out you didn't do your research Well when picking programs to apply to.
That's presuming a whole hell of a lot, and it's insulting. You know absolutely nothing about me or my history except what I've already said, which is not much.
I'm not here to be second-guessed by anonymous rando strangers.
We're wondering if you were perhaps mislead somewhat, because in our experience its quite rare for a department not to have any funded PhDs with stipends.
> We're wondering if you were perhaps mislead somewhat
I wasn't. But I'm not going to write an autobiography here. I already regret revealing personal details in this thread.
> in our experience its quite rare for a department not to have any funded PhDs with stipends.
Who is "our" and what is your "experience"? Are you referring to Telemakhos and yourself? Are either of you even former humanities PhD students? And how many departments have you surveyed such that you can make a judgment of rarity?
I'll be very honest with you, I've never met a humanities PhD student without funding who should've been pursuing a PhD, and if the department you were in was so poorly funded that it couldn't give out stipends, then it's likely that you would've never found a job in academia afterwards anyway.
Look, its not your fault, some people don't end up in the right undergraduate programs, they don't meet the right people, make the right connections, and get into good PhD programs with funding. In any other case, if you don't have a lot of money and time to waste, its almost always a bad idea.
> I've never met a humanities PhD student without funding who should've been pursuing a PhD
1) In your entire life, how many humanities PhD students without funding have you met? Perhaps you think that, somehow, you've magically met most of them, since you seem to believe there aren't that many.
2) It's just your opinion whether an individual "should've been pursuing a PhD".
> if the department you were in was so poorly funded that it couldn't give out stipends, then it's likely that you would've never found a job in academia afterwards anyway.
My former department has placed many tenure-track positions.
I think what may be going unsaid is there are some predatory practices that puff up the idea of a PhD to get people to attend a department that is otherwise struggling. It sounds like what you describe is rarer in better programs. That shouldn’t be taken as personal or an immutable law, just a general observation.
> I think what may be going unsaid is there are some predatory practices that puff up the idea of a PhD to get people to attend a department that is otherwise struggling.
No, it was already said:
>>> We're wondering if you were perhaps mislead somewhat
To reiterate, I was making a general point. You making it personal does not negate that point. If you re-read what I wrote, I was not implying you were mislead, but also that it isn’t rare in lesser programs. Not everything has to be true about you and your personal experience to be valid.
So your point is that well-renowned graduate programs are on an equal financial footing as those that are less well regarded?
I think it’s fairly well established that better programs have better funding. This generally results in more funding for PhD prospects. It’s great that you want to share your anecdotal experience, but don’t pretend that it means it’s a incontrovertible generalizable truth.
>Nobody here has any evidence
When someone relies on absolute language like “nobody” or “everyone”, it’s a clue they are making an emotional rather than a reasoned argument. In this case, there is data about funding and PhD opportunities.
> So your point is that well-renowned graduate programs are on an equal financial footing as those that are less well regarded?
No. I don't know where in the world you got that from what I said.
> I think it’s fairly well established that better programs have better funding.
It's not that simple. Funding can vary widely by university and department. You want to make it uniform, but it's not.
The reputation of a program is determined by a number of factors, and it can change over time. A lot depends on the particular professors who happen to be there at a certain point. And sometimes giant public universities are able to compete with smaller elite private universities by sheer size, i.e., the size of the faculty.
>No. I don't know where in the world you got that from what I said.
I’m trying to be generous by helping to clarify what you mean otherwise it comes across as someone arguing for the sake of arguing.
>You want to make it uniform
Not at all, and that was never said or implied. My point is the opposite; that programs differ in funding. I just take it a step further to make the point that lower funding leads to less funded PhD opportunities. Take early during COVID; funding temporarily dropped when many foreign students could no longer attend meaning it was easier for a self funded student get into a top program (I know because that’s what I did.) That same funding dynamic plays out with lower ranked schools because they tend to get much less research dollars.
>the reputation of a program is determined by a number of factors
Again, I don’t think anyone is disputing this. The point is about how reputation is related to funding and funding is related to PhD opportunities.
> otherwise it comes across as someone arguing for the sake of arguing
It's funny how you don't think this applies to you, especially since you came in almost a day after the HN discussion started and long after everyone else stopped replying. In this way, you prolonged an argument that had already come to an end.
> That same funding dynamic plays out with lower ranked schools because they tend to get much less research dollars.
Well, the humanities tend not to get a lot of research dollars, period.
> The point is about how reputation is related to funding
And my point is that they're not as closely related as you seem to believe.
>Well, the humanities tend not to get a lot of research dollars, period.
And it’s no coincidence that the humanities have the highest rate of self-funded PhDs.
>my point is that they’re not as closely related as you seem to believe
You may need to explain why govt research grants and endowments tend to follow the higher ranked institutions. And if you look at some of the ranking structure, they are explicitly tied to financial aid which is tied to endowments. I’m not saying it’s perfect or ideal, but ranking, money, and graduate positions are all intertwined.
> Are either of you even former humanities PhD students?
I have my PhD in Greek and Latin. I applied to many schools for my PhD program and, on the advice of professors who had told me what I repeated above, accepted admission to the department that gave me the best aid offer, not necessarily the one with the best reputation. They were right, and I never paid a dime for my education.
> accepted admission to the department that gave me the best aid offer, not necessarily the one with the best reputation.
That's a personal choice, but it's an obvious tradeoff with downsides. If you have a non-monetary goal — after all, pursuing a PhD in the humanities would be a crazy way to make money — then why would you let money stand in your way?
> They were right, and I never paid a dime for my education.
They were right in what sense? You could also never pay a dime for your education by never pursuing a PhD. Regardless, you spent valuable years of your life on it. That's a big investment, and time is more precious than money.
I am glad that you admitted, though, that some more prestigious schools may have less financial aid. There appeared to be a kind of denial of this reality before.
> Tenured professors at major universities do ok, but the road to getting tenure-track jobs and then tenure is littered with the bodies of grad students.
I'm reminded of that quote from Interstellar: "I never really fully considered the possibility that I wasn't the one."
Almost 60% of U.S. undergraduate students take out either federal or private loans and there are 5x as many undergraduate students as graduate students in the U.S.
For those downvoting:
54% of US graduate students take out student loans, while around 55% of US undergraduate students take out loans. The average undergraduate student loan debt is around $29000, while the average debt for graduate school borrowers is $71000. Given that there are five times as many undergraduate students as graduate students and given that a greater number of undergraduate students take out loans, the average graduate school debt would have to be nearly $150k to be greater than the undergraduate debt.
Of course it was based on the number of dollars, but based on which figures? It was an assertion conjured out of thin air. If there are five times as many undergrad students as grad students and a similar percentage of grad students had to take out student loans, then this would mean that students are incurring on average five times more debt for graduate school. This is without taking into consideration that a far higher percentage of US graduate students are international students.
It looks like graduate debt was approaching the majority and could in fact be a majority in 2024: "If these trends continue, graduate loan disbursements may exceed undergraduate disbursements in the next few years." https://sites.ed.gov/ous/files/2023/08/OCE_GraduateDebtRepor...
You're conflating current disbursements with the outstanding debt, which is what the original assertion was on. Either way it is looked at though, their assertion is wrong.
> You're conflating current disbursements with the outstanding debt
No, I was just googling for stats, and that's what I was able to find. Here's something else though: "46% of federal student loan debt belonged to graduate student borrowers in 2017." https://educationdata.org/average-graduate-student-loan-debt
My Harvardlaw Lawyerbro literally ended a family dinner argument by telling Littlelawyerbro "which law school did you attend? UT? So then not Harvard?"
In this particular conversation Harvardbro was obviously and factually incorrect, but his pompous rhetoric usually gets everybody else to silence themselves (not in awe).
Interestingly, Harvardbro only got accepted into the two schooltypes you mentioned (and no 2nd tiers).
> I could definitely see a starry eyed 17 year old deciding to do.
That's the addendum to the "most important part." These people without an education in complex debt instruments are the vast majority of the time either children, or were children quite recently. Even when it comes to the ones in grad school, I have jeans older than their legal ability to sign contracts.
Plenty of smart people who get liberal arts degrees from top schools do just fine. I know plenty of them even though I have engineering degrees myself. They may not get FAANG salaries in general--unless they end up in management--but plenty of people I know are just fine.
>Plenty of smart people who get liberal arts degrees from top schools do just fine.
There's research that also shows smart people who get degrees from "non" top schools do just fine as well. They studies those who got accepted to top schools but went to "lesser" ones. Implying top schools select people who will be successful regardless, rather than helping make people successful. It's important to not confuse the causal relationship.
* It's also worth noting the authors of those studies found a caveat with people on the lowest ends of the socioeconomic strata getting more benefit from the top schools.
I see a problem here. Why are English majors in Management positions? With LLMs, I don't see a value on an English degree anymore. So I personally believe it's just a money sink at this point. I don't believe art can be taught in universities as a degree program. Universities should only be for domains that have tangible value.
LLMs are the exact antithesis of what an English degree teaches you: how to communicate effectively and with context, and to understand nuance in what other people say. LLMs make things that sound good but have no real depth to them.
My university english was class was more about writing an essay on what the different colors in the Great Gatsby meant. Evidently this was true across many colleges since it was trivially easy to go on sparknotes, get the answer to that exact prompt, and get an easy A.
My university computer science classes included professors who thought that "vim was what the kids used now" and that the best way to teach operating systems was to give a lecture on how compiler authors break your code with optimizations. Maybe this is an indictment of their teaching and not the entire field?
You might understand this but I would like to believe and employer won't.
Anyways, my main point is universities should focus more on tangible skills - accounting, engineering etc and should not have random useless degrees of little value. Maybe English major is still valuable, but I personally don't see the tangible value in it - other than being an English teacher.
You don't think about things from the perspective of someone who actually owns or starts a business, you think about things as someone who is an employee and wants to promote skills that help others get employed: accountant, engineer. Something great about engineers and accountants is that they don't ask too many questions, because many have bad social skills: many of them would never, on their own, be able to run a business or make deals or do the most important things involved in managing relations between large groups of people and making sure a product and/or service is delivered to happy customers and shareholders get paid off. Therefore, they don't constitute a threat to a business owner.
A student who studies English, on the other hand, is given skills specifically to critically engage with a text in such a way that they can ask these kinds of questions about why they are doing what they are doing, why they are talking to certain people and not others, why, even, they ought to study one thing or another, why one guy runs the show and they do all the work. None of this is very helpful if you want to be a good worker bee who meets all their deadlines and collects a pay check and goes home at the end of the day and never thinks about doing anything more with their life, but, if you want to have more in the world, you need to know how to question it.
I hate to use an example, but look at Alex Karp, CEO of Palantir. He has a PhD from the Institut für Sozialforschung, also known as the Frankfurt school, which is a research center whose members feature quite prominently on the syllabus of many English classes at the university level. Not exactly the same, but his education bears a remarkable resemblance at an advanced level to what many students with undergraduate degrees in English would have. But you wouldn't know that as an engineer; you would just be some employee, entirely replaceable.
Well that's the thing, there is a tiny market for your art historian or english Phd or whatever humanities specialty. And to get english professors you need english Phds and english students, who need an english professor. there is a need albeit a small one.
the universities also fairly say "choose your major we can't choose it for you"
so if too many people go for that english degree, at best you can make them aware the job market is tiny. But it is their choice to take their shot at their passion, a hypercompetitive field, not far different than being a hollywood actor.
the issue isn't any of that, that's all fine, the issue is why does it cost a gorillion dollars to get that english BA degree.
the spirit of it all is "pure learning is purely good, let us have you learn", and so we have english majors, that's all fine spirited, the issue is somewhere along the line someone at this so-called non-profit decided it costs 9999 gorillion dollars to reimburse the educator for this degree
There are many many universities and colleges and students/parents can make decisions about the curricula they choose, Which will in turn, over time, lead those schools to focus on what the market wants. Obviously you disagree about those choices but there you go.
Yeah, I did all that too. Why would English possibly be important? My job is to write code, all that matters is how well my programs work, whatever. Then I found out in the real world that I deal with other people and a lot of my job (and life!) is explaining and convincing people, not just writing good code. So, even though I went to school to be good at programming, I can see the value in people going to school to be good at communicating.
English is the global lingua franca. It’s how we interact with and transmit information, including ideas about accounting, engineering, etc.
It’s very fair to argue about the ROI of the average undergraduate English degree given the outrageous prices that universities are charging for them. But if you cannot see the tangible value in English language expertise, I don’t really know what to tell you.
I'm not sure an English degree vs. a history degree vs. a political science degree vs. just just working on the school newspaper is super useful. But certainly fluency and the ability to communicate is.
What the hell do LLMs have to do with anything on this topic? If anything, they commodify low-level tech folks just like past tools have. I'll mostly hire a smart liberal arts major so long as they're respectful of tech and other domain expertise over someone who thinks it's only about (probably narrow) technical smarts.
no one actually good at math is going to become a K-5 teacher, they’re gonna get paid, so it creates a doom loop where each new generation of primary school teachers get progressively shittier at math.
i have literally witnessed students in a senior level discrete math class struggle with simple algebraic operations. they were on the math education track.
Exactly - 12 years of education to get children ready to be citizens and not single class on how to manage a bank account, or even the most basic education about investments or actual wealth building.
Instead, all I was told was to go to college.
So... the people that made me woefully sheep like and "financially innocent" then sent me to the wolves because they believed in me.
Seriously, they made huge changes to the way people were accepted into college - created High School "career counseling" (college/University recruiters) to tell everyone kid they were smart enough to go, and the dumber down tests convinced enough to convince the rest.
The loans went up each year - the costs more than doubled between my Freshman and Sophomore year and just never stopped going up - the more you owe the more you HAVE to finish to get the job to pay the loans.
Before all this, when less than 1% of all student loans had been defaulted on, the loan debt was made unforgivable by 6 people - a committee of bankers created by the people in Congress they bought.
It was setup so that of a millennial "Wins" it means they can afford to pay their loans - so the bank wins. If we lose we still have to pay/often must pay more with all the fees and added interest - bank still wins.
During the time I lived thru all this I was reading shit about how lazy all f are bc we don't own as many houses as we are supposed at our age - this is still true to this day actually.
This is an intolerable and disgusting thing for a society to do to an entire generation - any group is wrong but to plan out the demise of a generation of, at the time all this was first set in motion, we were literal Elementary Students.
These loans destroyed lives, relationships, sets parents against their children, divided families.
> Exactly - 12 years of education to get children ready to be citizens and not single class on how to manage a bank account, or even the most basic education about investments or actual wealth building.
I kind of disagree with this. At least in my high school this was definitely taught, but at the time we were all dumb 14-17 year olds who didn’t care about any of that stuff we just wanted to know what is needed to get an A and then forget about it, and that was the good students!
A problem about teaching life stuff in schools is that I don’t think many of the teenagers in high school are in a place where they can absorb that stuff long enough for it to be relevant many years later.
I really don't understand the people who complain that they weren't taught about debt and loans and checking accounts. You were given a 6th grade math education, and you were taught how to read. High school classes cannot be expected to teach every possible circumstance or decision you'll find yourself in. At some point you have to self-start.
realistically, the complaint isn't about lack of things being taught at school (tho it's framed that way).
The real complaint is the lack of being told exactly what to do that leads to a path of automatic success. What they were told to do did not lead to automatic success, but is in fact, fraught with traps and dangers, most of which is avoidable but only for those with the foresight.
But i am a believer of personal responsibility, and that following the crowd (or common advice) without thinking critically about it will merely lead sheep to slaughter.
you can teach someone about financial concepts, without having the actual monies. These are not physical activities requiring actual mediums like driving or swimming. They are mental concepts - an extension of critical thinking and maths, with a bit of instruction following mixed in.
Good luck. In math, it's extremely difficult to teach the mental concepts and critical thinking. Unless you have a gifted teacher, most schools just teach you rote memorization and solving countless duplicate problems that use the same technique.
> Exactly - 12 years of education to get children ready to be citizens and not single class on how to manage a bank account, or even the most basic education about investments or actual wealth building.
California became the 26th state a few months ago to require all students to take a personal finance course before graduating. About half the remaining states require students to take a combined personal finance/economics course (source: https://www.ngpf.org/blog/advocacy/how-many-states-require-s...).
It's a tough problem that reenforces itself. The high availability of loans allows colleges to charge exorbitant rates, and for most, the exorbitant tuition rates necessitate the use of loans, which allows the tuition rates to go even higher.
Fresh High School grads are a terrible demographic where good credit is concerned, there aren't many 18 year olds you could loan 6 figures to and expect to see that money again.
But now we're so deep in this rabbit hole that neither side has incentive to back down. Nothing shy of government intervention, or mass protest of the system, is likely to change it in my opinion.
> not single class on how to manage a bank account, or even the most basic education about investments or actual wealth building.
Not everything can be, or is supposed to be, taught by schools. Your parents should've taught you those things, and if they didn't do that they failed you.
> Your parents should've taught you those things, and if they didn't do that they failed you.
Please be charitable. Your comment is unnecessarily mean. Unless you know the commenter personally, I don't think anyone can diagnose the commenter's upbringing from a single Internet comment.
I don't think they're referring to GP and his/her parents specifically. Until very, very recently, it was well accepted that there were a lot of things it your parents' responsibility to teach you. Expecting parents to teach their children things is not even remotely mean or unreasonable.
But objecting to schools teaching things in the event that parents don't is unreasonable because it punishes the child for their parents not living up to expectations. And on the particular topic of this thread, it punishes all of us because it's generally detrimental to society for people to take on massive un-serviceable debt due to a lack of financial education.
In a situation where the person's parents are hoping their child will be the first to be university educated with the hope that their education would help them break the cycle of poverty (i.e. they are not university educated themselves or that they don't have enough high school education to be able to teach their child about the pitfalls of taking an interest-bearing loan), what happens?
There's this famous saying that: "You cannot teach what you do not know".
> Your parents should've taught you those things, and if they didn't do that they failed you.
The problem of financially illiterate people doesn't go away when we find someone to blame for not teaching them. Parents "should" teach a lot of things they often don't, and one of the values of schools is that they plug some of those gaps to help produce better educated members of society. Whether or not schools are the right place to teach those things is irrelevant if the end goal is for people to actually have the right knowledge to be successful.
Plenty of parents do not know how to manage their finances any more than any other things that they do not know, which a school is supposed to be responsible for teaching. Financial literacy is one of the most important things that a person can learn. Society would surely benefit if classes were taught on the subject in high school.
Financial literacy for the average person consists of two things: do not buy things you don't really need / don't spend more than you have, and compound interest. I can't speak for anyone else but I did learn what compounding interest was in school.
I can't imagine a whole class being dedicated to these topics, but then people who only need to fill out a 1040 also complain they "weren't taught how to do taxes"; i.e., fill out a form with simple instructions provided.
At some point we have to recognize the bar is already pretty low. There is no wizardry involved in "financial literacy" unless you start getting into advanced investment / retirement topics. It just takes a very simple attitude shift. The problem is not that most people are too uneducated to figure out that a 40k/year job doesn't pay for a 100k degree: they learned that in elementary school. The problem is they never even think about it, and if they do, they don't care. I don't even mean this in a negative way: it's a lifestyle that would stress me right into the psych ward, but millions of Americans never worry themselves about how they're going to pay for something so long as they can keep the lights on and eat this month.
If they did care, they would go to cheaper schools to get the degrees; look how many of these degrees come from outrageously priced private schools when cheaper options are readily available. Look at how many people drive around 50-80k SUVs. Americans complain a lot about prices but they are not actually that price sensitive. They just assume they can do whatever they want and the system at large will just work everything out.
> Financial literacy for the average person consists of two things: do not buy things you don't really need / don't spend more than you have
Great, now take out a mortgage at a good time, predict interest rate and house prices manage your savings and plan your retirement, be self-employed for a year and correctly identify what is tax deductible and what isn’t, recognise when you are being sold a bad financial product.
There are all things a middle class person needs to deal with.
> Great, now take out a mortgage at a good time, predict interest rate and house prices
Nobody can do this. It’s not part of basic financial literacy. A few people who make careers out of investing or real estate attempt it and many of them fail.
If you are a normal person, you find a house that needs your basic needs in a decent area that you can afford and you buy it. You don’t try to throw darts at a board to figure out if the housing market is going to crash or the fed is going to lower rates. If you could reliably predict these things it’s your day job.
> manage your savings
Simply putting your savings into a savings account pr even under a mattress is more than most Americans do and is self-evident. Are there more optimal places? Maybe but if it matters to you you have the time to figure it out; Americans are doing well to accumulate 500 in emergency savings anywhere. Worrying about 5% interest money markets vs maybe an index fund for some portion is pointless at that level. (Ed - median emergency savings is 5k. This doesn’t require management.)
> plan your retirement
This becomes important as you approach retirement age, sure. Until then all you need to worry about is stuffing away as much money as you can because of that “compound interest” thing.
> self-employed for a year and correctly identify what is tax deductible and what isn’t
There’s a public website for the IRS where this is all laid about, but even Americans with easy
standard taxes pay an accountant because they don’t want to add a few numbers together and look at a tax table.
> recognise when you are being sold a bad financial product.
If you are worried about “financial products” and you’re not at retirement age, all you need to know is “it’s a scam” or you’re very rich.
> Not everything can be, or is supposed to be, taught by schools. Your parents should've taught you those things
Who is the genius that decided that you need a school and government neurotics to teach a kid to play basketball, but post gold-standard factional reserve banking is best taught by parents?
And who taught your parents, and their parents before? Do we go all the way back to cavemen for investment wisdom? You’ve got a bootstrap paradox.
Also in 1970’s we dropped the gold standard and the whole game has changed, did someone issue free adult education to being all the parents at the time up to speed?
The system is complete nonsense, you’ve got to be on copium.m to defend it.
If we taught money properly maybe voters would not elect fools and frauds to run things
What if I lost my parents before they got the chance to teach me that?
What if I was raised in a foster care and I never knew who my parents were?
And what if my parents don't know these things themselves?
There are many ways that this logic goes wrong. The school should teach that because it is very important lesson to engage in a society and be a good citizen.
Edit: Sorry I meant people raised in orphanages not foster care. I wasn't in focus enough while writing this. Sorry if this caused hard feelinga for anyone
This kind of argument might hold water if there were an epidemic of 12 year olds aimlessly drifting across the countryside with no adults taking care of them. But there's not, and you're not really making any point.
If you are assuming a guardianship role over a child, however temporary, you have a responsibility to teach them things, full stop.
I've known several foster parents over my life who would be outraged at the implicated that they are somehow lesser to the children they raised and are raising.
I think I mistyped what I mean. I meant people who were raised without parents in orphanages not foster care. Excuse my mistake and sorry if anyone felt anything negative from my comment.
And yet kids from foster families tend to have massively worse outcomes than others.
The US is obsessed with racial inequality, but from your life's perspective, it is better being black than being a foster kid, and no one bats an eye on the latter. Harvard won't certainly introduce any pseudoquotas on foster kids anytime soon.
I took out around $20k in loans to study literature starting in 2001. Graduated in 2005. Rent was $150 a month. Played a lot of poker and disc golf. Studied and learned a bit. Had a 75% scholarship to help with tuition. Had a $300/semester book stipend as part of that and just bought penny books off Amazon (one of the benefits of an English degree) and pocketed the difference.
Basically for 5-8% or so of my (estimated) lifetime I was completely free to goof around. Great value for someone who dislikes working.
Consolidated the loans after I graduated at 1.5% interest. Finished paying them off in 2021 with the Biden Bucks.
Pretty sure that kind of deal doesn’t exist anymore.
State school was hella cheap (it was back when Florida’s lotto money mostly went to scholarships for in-state students). I think full sticker price would’ve been around $2500/year for tuition+fees at the time?
I also started with enough credits to be nearly to (the equivalent of being in) junior year and took the bare minimum credits to keep the scholarship.
1. I took more in loans than I technically needed for school and spent it on living expenses like video games, gambling, fun stuff, etc.
2. I signed up for 4 classes a semester, often in things unrelated to my degree. Figured since I had 4 years of scholarship (and 4 years of loans available), I may as well just hang around and have fun.
3. By my math, (feel free to double check) 2021 minus 2005 is not 20. Loan payments didn’t start until after graduation. It was about $50 a month for minimum payments when I started paying and around $150 at the end. Don’t remember the exact way the payments increased over time. It was just steps, but not related to income.
Heh, I paid off all my student debt, about that much, with the starting bonus from my first job after school. America educations are basically free if you don't do some goofy shit like go into debt to study literature.
US is outrageously safe. People are just terrible at assessing actual risk vs. perceived risk. What specifically do you think is unsafe about the US?
Healthcare, yah that kinda sucks. We’ve got a really high ceiling and a really low floor. Other countries have a lower ceiling and a much higher floor. A significant problem in the US is that people don’t know how to navigate the health care system. That raises the floor quite a bit for the average person.
Lol no it was $150. This was Gainesville, Florida and I split a horrible studio apartment with a friend of mine.
It was located in a low lying area and once after a tropical storm we had to wade through hip-deep water to get to class (the apartment itself was miraculously high and dry). Coming home one night I saw a little gator swimming along near me as I trudged through it.
After we graduated my roommate moved to Manhattan for an engineering job. His month’s rent up there was significantly more than he paid for a year in college.
I ended up moving to Portland, Oregon in 2007 and my first rent here was $550. Now in 2024, I’ve finally tacked on that missing 0 and my rent is now around $1500.
1985-87 my partner and I rented a just fine spacious 1 bdrm with a 10 min walk to the Math building on the East side of Gville for $200/month. We both had graduate school stipends. The 4 apartments all had cool tenants. Geckos in the stairwell. It was glorious, even w/o AC.
I ended up finishing at ASU. This highly educated ChE/Math imbecile took out a $12K student loan near the end because it was "free"[1]. Got to silicon valley and started learning the maths about house loans and income tax interactions and took a glance at the student loan interest payments (something like 6%? I don't remember) and freaked out. Paid it down immediately. Needless to say we advised the daughter different.
[1] The application was like: name, address, and school. Less than a page.
I remember rent was $1800 per semester for my friends, and they split that 3 ways. So about $600 for 4 months, or $150/month. To be fair, it was a bit of a dump. But that's less you have to worry about when having parties. I had a slightly nicer single room and closer to campus with parking and it was $1200 per semester, or $300 month. This was slightly over a decade ago. I was curious and did a quick check - seems the single rooms are about $600/mo and I saw a 3 bed for $800/mo. Still really cheap considering all the inflation that happened over the past decade.
Big state U is in the middle of nowhere, and in those years I was paying closer to $250, but I could see if you were willing to compromise on quality or quantity of personal space, getting that down to $150 without even hitting bottom.
My apartment shared with three other roommates in that era was $750 (four bedrooms and a giant living room in a trendy neighborhood of a decent sized city). So $150 checks out.
I went to college before I had internet access and my decision on what college degree to get and where to go to get it was based upon the salary I would receive upon graduation and my ability to repay my loans. I went to the library to figure these things out for myself.
Nowadays, you don't even have to get up out of your chair. If you are a young person and you make stupid decisions on your college education and student loans, that's a YOU thing.
I personally think college should be free because education is a worthwhile endeavor for everyone. But since it isn't, I'm not willing to make excuses for those who attend without weighing the costs and benefits. It's one of the easiest things in the world to do.
Then colleges are concerned when they see enrollment at many majors keep shrinking, while the demand for computer science grows, even when the college doesn't even have a proper CompSci department, but they depend on the Math school.
Then the students wonder why it's a 4 year degree with a full year wroth of non-major classes that seem unrelated, but tack on tens of thousands to the cost of the degree, plus whatever on-campus housing and meal plan, mandatory for freshmen, might cost.
There are only two options with debt: bad debt are written off, lender takes a hit and the lender must be careful who they lend money to.
Or bad debt lingers forever and accrues lucrative interest, in which case giving out bad debt is the whole point for the lender’s operation. The only risk is that the debtor might die. If the debt also passes to the next of kin, you have full-on, real slavery.
> The people agreeing to these debts, by definition, do not have an education in complex debt instruments that cannot be discharged.
I mean it's a pretty simple concept that you borrow money and you must pay it back.
However we agree that the failure is that we do not educate them enough already in the first 12 years we force upon them. For that I blame a lack of options, government "standards" which become ceilings instead of floors, and the unions that protect bad teachers, also I'll note as a foreigner in the US. The US Schools i've seen (and i'm extrapolating here to most public schools) are ran like social clubs and have far too much time devoted to bs that does not help the kids. I'm talking about extracurriculars that impede with a quality education. Football is not a subject we should be prioritizing as a nation... Formals, homecoming, spirit days etc are such a distraction from what highschool kids should be focused on -- Growing up and making a viable future for themselves.
People note that Highschool rankings in Canada are excellent, well guess what? None of that happens in Canadian highschools (that I'm aware of), there might be a school dance or two, and "Prom" is very low key, relatively. High school football is small time...
I am disinclined to agree with you. Homecoming, football, having fun in sports, are exactly what kids should be focused on. They should be enjoying life, not hunched over materials studying late into the night.
Of course, focus on footballs, elaborate dance, and other sports can be excessive. I merely object to the excessive focus on academics, the rat race, and pressure cooker environment to get education at top ranked colleges.
On the contrary education should be meeting the needs of the 21st century, teaching skills to create functioning adults that can navigate life's challenge, such as avoiding scammers, how to judge quality information, how to diagnose and solve emotional challenges. There will still be classes taught on academics such as learning to read, simple arithmetic.
Only when they're adults that their focus will entirely be on academics. Academics are easy if you're well adjusted and know how to learn.
where are the parent's? They're meant to be the ones teaching these non-academic education to their children.
School does not replace parenting. School is for academic studies - stuff that a parent won't have had the qualifications to teach.
This is rigid thinking. We should be adapting schools to the need of the 21st century and challenges our current population faces, rather than have people sink or swim.
Leaving it to parenting alone is basically sink or swim. Some do great. Some do shit. Some are middling. Never mind the fact that a large part of children time are spent in school. Schools are basically daycare. They're also 'raising' children whether we want to admit it or not.
That's pretty much the hard part. There will still be some needs for some academics classes. However, once you teach them how to learn, learning academics is easy to do.
It's unclear to me which country you mean you'd rather live in.
But for me, I actually do prefer to live in the US. But it's a fallacy to think there aren't ways the best could be improved. IMO the US could stand to do a little bit of growing up, and get rid of this "life is a club/party, and partying is the meaning of life" mentality that I see is so the root of many different kinds of behaviors (that are not partying in and of themselves)
i agree, but the life is a club/party mentality isn’t what’s plaguing education, it’s the waste of time trying to get the bottom 10% of kids to perform at the median level. when i was in school, those kids got sent to alternative school so the rest of us could actually learn.
furthermore, i think not enough attention is being paid to the top 10% of students, most of whom are ignored as the teacher tries to wrangle a few shitheads poisoning the well of the classroom so to speak.
i think teachers should be paid roughly 5x their current median wage while simultaneously making it as difficult to become a teacher as a doctor , lawyer, or any other prestigious licensed position
> The people agreeing to these debts, by definition, do not have an education in complex debt instruments that cannot be discharged.
I guarantee you that law/med school students have an education in "complex debt instruments that cannot be discharged."
Because before the current law was passed, they were the ones abusing the old "complex debt instruments" to discharge debt they knew they'd be able to pay back once they started making bank. The law was passed because they were doing this in large numbers. For these serious med/law students, the old system was free money. The new system is a reasonable risk.
Did you know this? If so, why did you write "by definition?" And why go off on a tangent about English literature students?
“ guarantee you that law/med school students have an education in "complex debt instruments that cannot be discharged."”
All the people here claiming they know a good degree from a bad one as if they have divine providence of what will happen in 5 years
And I gave them a $100,000 and ask them you to buy and hold a single non-FAANG or meme stock for the duration of their degree you would probably loose money. Or to predict if you should hold shares vs bonds for 5 years, without adjusting their position, like you do with a degree.
You could start a degree as a VFC artist and in 5 years your job might disappear with AI.
You flew too close to the sun. You can’t argue with a bunch of people who are in debt and learned that playing the victim pays.
It’s funny. That everybody is mad at the banks and schools. But the politicians and do good laws passed are what caused all of this.
Banks did it want to give loans out for shitty degrees to people who would probably not pay them back. So laws were passed to force banks they had to give out loans.
Schools did not want to accept everybody, but only the top of class. But laws were passed forcing them to widen their acceptance criteria.
This creates the perfect storm we are in.
Before the system was self limiting. Banks only gave out loans for degrees and to people who had high probability to pay back. Schools accepted only the best students who had a high probability of succeeding.
The loans were low risk, high reward, and the schools were able to provide a higher level of overall education to those who did go.
No they did not. They threatened to simply stop offering loans for school. The only way to get them back on board was to make the loans they issue for school was to make it so such loans could survive bankruptcy.
Many banks were fine not offering loans if it meant they could not decline offering loans for specific degrees, schools or even based on the applicants grades.
I don't like this type of comment because it's makes it seem like that this was all planned like this on purpose (by some cabal of evil schemers, I suppose?), but without the need to provide any evidence that that's indeed how it went, because nothing of the kind of is explicitly claimed.
Things can go wrong without people scheming to do evil. It's not helpful to twist "these and these circumstances combined to produce a bad outcome" into a plan description unless you bring at least some evidence that it was, in fact, planned to go like that.
It would actually be worse if we accidentally built this machine to trap and drain a generation of their productive capacity?
And of course there is a cabal of evil schemers, they have hardly bothered to hide themselves, e.g.:
> Mudsill theory is the proposition that there must be, and always has been, a lower class or underclass for the upper classes and the rest of society to rest upon.
> The theory was first articulated by James H. Hammond, a Democratic United States senator from South Carolina and a wealthy Southern plantation owner, in a speech on March 4, 1858. Hammond argued that every society must find a class of people to do menial labor, whether called slaves or not ...
This is barely relevant to college debt. If anything, it contradicts the parent comment because it would be the white collar middle class resting on the "mudsill" of cheap global labor. The Internet also underestimates how hard labor jobs are on your body. It would have been even worse during the golden age of American manufacturing, when there were 10 times as many work related deaths.
When people imagine a world of we didn't outsource factory work, they assume it will be exactly like ours but where all unemployed English majors become unionized factory workers. In reality, any policy comes with trade offs. People like Steve Jobs would have entered blue collared work, like their parents. Consumer electronics would be significantly more expensive when made by domestic labor, and that means there would be less competition and innovation in this space.
Distinguishing between malice and ineptitude at the systemic level is nearly impossible.
If the OP's type of comment makes you uncomfortable, you might be leaning too far into putting blame on ineptitude by default, instead of a healthy at least 50/50 mix of blaming greedy malice. OP just listed the 20/20 hindsight of this all. If that makes it sound like it was all a scheme, well - who knows - but it's just as unhelpful to always suppose such circumstances could have just been incompetence with no clear evidence.
I see your point, but this is not really just about people / businesses being individually greedy malicious (where I agree fully with your argument, and you're not wrong that I may assume good intent a bit too often - I'm indeed that kind of positivo hippie).
Here, there's a kind of "big picture malicious", Sith-Lord-level piece of action being sketched, and that's in my opinion a categorically different thing. No group of conspirators got together in the 80s and secretly schemed for decades to make America's universities debt factories, at times against their own short-term interests, and are now sitting at the country club making evil laughter sounds. This vibe is the road to nihilist fatalism, it adds nothing, it helps nobody, it's just throwing your hands in the air and saying "I give up! The world is terrible!"
I mean, it might not be that - but it could still be a series of smaller decisions from people who could have known better deciding to choose greed and creating/reinforcing a marketplace where the competition likewise needs to choose greed to compete. It doesn't need to be orchestrated by a table of cloaked figures to still be an additive conspiracy where they all knew what they were doing yet did it anyway as incentives aligned. I'm not sure what in the OPs post makes it require some cartoonish villainy, when a decentralized herd of morally bankrupt people can serve just fine and be just as evil in the end!
I do get the reluctance there though to doubt collective conscious evil action. Which is fine - it's usually far more likely it was done in a "market incentives aligning" way, even when they're entirely conscious (still evil) moves. I think those dark board rooms do happen still, but they're subtle, or relegated to just approving preplanned media narrative directions and such. They do make long term concerted plans, and some of those plans can be downright dark - but they also just go with the flow a lot, or plain fuck up on executions with better intentions.
I think the takeaway should be that neither maliciousness nor incompetence is really required to make evil exist - it's an ever-present network effect potential of the [capitalist] system itself, which will trigger due to some mixture of the above regardless. You can't especially blame greedy people for capitalizing on it, nor incompetent people from dropping the ball with it. It's simply a complex system that's probably due for a better design - and/or it's something we need to try and live with (survive through). Though that could all just be my own personal bias as a systems engineer who considers those the start and end point of most discussions.
Glad my point made it across though, thanks for saying that!
Unless I missed it in the article, I don't think the author mentioned one of the biggest factors. The big lenders in America are effectively extensions of the US government, and the government guarantees over 90% of loans.
That means there is no risk (for the lender) to give out student loans. The taxpayers take on the risk
Which is bad too because if you turn your hobby into your career, you end up not having a hobby anymore. In order to have a happy life, you have to have a vocation and an avocation that are separate from each other.
> In order to have a happy life, you have to have a vocation and an avocation that are separate from each other.
This reads to me as your career shouldn't involve doing something you enjoy. I think this mostly happens in situations where people are doing exactly at work what they'd do at home, and they don't like their job for any vast number of reasons. Usually that's only a problem if you don't have the security to find another job.
My personal experience is that it really helps to be able to be passionate about your work. It's fulfilling. You will perform better at your job, because you will be multiplying your experience from work with your experience at home. Sometimes my hobbies and my work have been literally exactly the same, e.g. I've been able to open source projects from work (which I then work on as a hobby).
The advice I'd give people instead:
Like your job. Get a degree in a field that you both enjoy and that pays well. That sounds glib, but so many people don't think about this at all (part of the focus of the article). You probably won't be able to align your career and the exact activity you enjoy the most, but you should shoot for them being in the same ballpark. Where they don't align? Sure, that's opportunity for a hobby.
The problem is finding that intersection. If you are really suited to journalism you will have a hard time financially in 2024. And the experience of studying a thing and doing it for a living are different, and in 2024 its hard to try different careers out because most employers want credentials and experience. There are still jobs where you can walk into the office and talk someone into giving you an internship but many organizations force all hiring through online applications and the HR bureaucracy (and the 'talk yourself up' approach works better for extroverts from the hiring manger's culture).
To your specific example, there are a lot of jobs that involve content marketing and other types of writing that aren't exactly hitting the pavement journalism but probably pay a lot better, are more reliable employment, and may be close enough. As you say, it's about finding the intersection.
If I were looking for a writing job today--which I did a lot of over the past 10 years--I wouldn't be looking to the New York Times or certainly a small city paper, I'd find an opportunity with a company that would doubtless have some guardrails but would also have other opportunities.
Your example of having engineering degrees but spending much of your working life writing is a good example of how income and academic degree don't necessarily go together. If you get training rather than an education you have a clear path but if the job you trained for is not hiring when you need a job you can be SOL.
Basically no one has cared what degrees or certifications I have in decades.
(The one caveat is the fact that I went to the same school as the ultimate hiring manager probably didn't hurt. But the decision had probably already been made at a higher level.)
The problem for people starting in the world of work in the USA is that its very hard to get a job that pays real money without degrees, certifications, and contacts. Its also much easier for most people to do the 'looks good feels good' thing if you know you have been successful and well paid in job X, and job Y would be similar. So once you are established in an industry your experience and self-acquired skills matter more than your degree, but getting in to that industry is hard And the housing shortage in most rich countries makes it hard to spend 5 or 10 years trying different things until you establish yourself in an industry that works for you.
Sure. People who have no signals (including contacts and credentials) have trouble lining up jobs other than (and maybe including) fast food. People need signals for professional work which include degrees and various sorts of credentials. I'm not sure it's much different anywhere else in the world.
Interests change too. I had degrees in Mech E and material science and I drifted into computer hardware related product management in relatively early days. From there to being a tech industry analyst and from there to doing a fair bit of early-on cloud strategy and content marketing work. Back to doing sort of part-time analyst work.
I suspect a lot of people here have had more linear and well-defined paths as the industry has matured.
I don't consider any of it a waste and I've enjoyed a lot of it. I've had conversations with people I've known for decades about it and they're kind of meh. You've done fine whether or not your formal training was necessarily on target for what you ultimately did.
I'll also add that working on newspapers has been probably been more useful than a lot of the technical stuff I've done.
There are no guarantees in education. Lots of people have degrees in engineering, finance, software engineering, etc. but are not working in that field, either because they find they don't like the work or because that field is not hiring in the years after they graduate. Incomes of people with any academic bachelor's degree are similar in the country I live in, because if you are bright enough and diligent enough to get a degree in something reasonably rigorous, you generally eventually pick up the skills and connections to find a good niche. But 'get a degree in this, it pays well' is risky.
> So many young people think their hobby can become their career and pay for a nice life style. Unfortunately, it's not the case for many majors.
We (as a society) tell kids all the time that their hobby can't be a viable career. Kids are just headstrong and don't want to listen to their parents/other adults telling them unpleasant truths.
It's more than one generation. I remember hearing this "you can be anything you want to be" stuff when I was a kid 30 years ago, and they're still telling kids this today. It's a joke
In your 4 step process where do you blame the not for profit schools for raising tuition by completely absurd and unsustainable amounts?
If we are going to forgive student loans, tax payers should not be on the hook. The loan originators and most importantly the schools should pay since they are both the primary beneficiaries of this disastrous policy.
The cost of student loans is nothing compared to the value that those degree holders will provide. In my opinion, your first degree at a public university or community college should be paid for by the Federal government as long as you keep a certain grade average, and stick to a reasonable timeline.
If it matters to anyone, I paid off my loans entirely, but also received Pell grants.
If your opinion were correct the degrees would pay for themselves and we wouldn't be having these discussions. We have people paying $160k a year to study in fields that are increasingly having their fundamental research completely debunked and exposed as fraudulent (see Political Science and Pyschology).
There is also absolutely 0 reason these degrees should cost so much. If we want to keep a guaranteed student loan program it should be restricted in the amount that can be borrowed and it should only be usable at local community colleges that cost under $5k a year. Nothing about education necessitates spending more than that.
The degrees do pay for themselves on average. Bachelor's degreeholders have median earnings $525/week higher than high school graduates (https://www.bls.gov/careeroutlook/2022/data-on-display/educa...), which over the course of a career would cover even the most egregious student debt loads. That's precisely why it's a hard problem; we could just warn kids not to jump into the debt trap if it weren't genuinely worth the cost.
The median student that graduated from college starting in 2009 had more debt than what they started with after 12 years and it's only gotten worse.
So your belief that it will cover the most egregious is not true for the median student. Given that, I'm also interested in how those lifetime earnings increases are distributed across degrees.
This kind of "fact" always raises alarm bells for me. Did you hear it because it's true, or because it sounds compelling while being impractical to disprove?
This source strongly suggests that the original claim is not true. I don't understand exactly what the X axis is meant to be, but if we assume the 2012 number is meant to represent 2009 graduates, it seems incredibly unlikely that the median graduate has made no progress after 12 years if ~62% of them began making progress after 3 years.
(Can you come up with a story where the two numbers might be consistent? Probably, yeah. Thus the impracticality of disproving weird conditional statistics like this.)
I can't find the source for the stat I mentioned originally but the data I did find doesn't paint the rosy picture of a getting college degree with debt being an unambiguously +EV decision.
I feel like the key thing missing from this discussion are the employers who still demand these degrees. Let's say we reformed both higher education and student loans - does that have any meaningful impact on the demand side beyond pushing the salaries of degree holders up (thus increasing the value of a degree, thus making larger loan values easier to justify, thus...)
If we stopped subsidizing the degrees less people would have them, but employers would still need the same number of employees. They would be forced to drop necessary degree requirements or go understaffed.
Maybe they'd do their own educational curricula with requirements that would require minimum tenures with payback requirements. (Not sure of all the US laws in this regard. There used to at least be relocation payback requirements.)
But I suspect a lot of people here wouldn't like 1 year bootcamps for jobs that included an extended employment commitment.
I suspect they would like it better than paying for 4 years of education with no guarantee of employment at the end. But most likely it would be nothing of the sort. Most jobs that require degrees don't actually use any of the material in the degree (any job that doesn't care what your major was). Those jobs could just hire HS grads without any other changes.
In general they do, it might not be a guarantee, but a degree helps pass hr filters. The only way to bypass that is having years of experience in a big company or a recommendation, for junior positions a degree is very necessary.
5) Do nothing about the problem until the debt becomes too large, then attempt to blanket cancel the debt without expecting any fallout. All the while doing nothing to fix the underlying issues.
> Lenders keep issuing loans without regard for the borrower’s ability to repay, knowing the debt can’t be discharged. ... Meanwhile, lenders—both government and private—keep the money flowing. Why wouldn’t they? With loans that can’t be discharged in bankruptcy, they’re guaranteed a return, even if it takes decades to collect.
From the first chapter of David Graeber's "Debt: The First 5000 Years".
> “But,” she objected, as if this were self-evident, “they’d borrowed the money! Surely one has to pay one’s debts.” It was at this point that I realized this was going to be a very different sort of conversation than I had originally anticipated.
Sounds like the perfect way to create a system where the only way out is some kind of black swan bubble burst. I (genuinely) wonder who will be protected from the shockwave when it does: the number of people on the debt side is presumably enormous.
> cannot use discretion in deciding who he gets to forgive for loans
You present this as though it doesn't make sense, but as far as the federal government is concerned forgiving a debt is spending (which is why the IRS will tax you for forgiven debts, income is the other side of spending). And spending is explicitly under Congress's authority.
> Hold these debtors to standards that aren't applied to other types of debtors
That’s because these loans are made using standards that aren’t applied to other loans. The government basically does not consider credit risk or traditional underwriting standards when making student loans.
Sure just allow slavery, unlimited pollution and no safety requirements or liability then the US would have no problem competing. Otherwise you have to regulate to create a level playing field
5) Don't forget the massive rise in tuition. My brother went to college a few years before me, and by the time I got there (born before 1990), the price was double what it was his first year. It was only 2 years of increases.
6) Only allow help for families making under a certain amount, so those from abusive homes are shit out of luck.
>>> 1) move most careers...out of the country....to the benefit of shareholders.
You've hidden very carefully the causality in this sentence. Who moved them? Why? Its perhaps implied that since shareholders benefited, that they did it. Yet a careful examination reveals quickly the elephant in the room in that thesis: why did outsourcing now, and not before, if the benefit to shareholders has always been there? why did this happen mostly in the US, and not other countries?
Of course, the reality is far more complex and reveals that the road for manufacture hollowing in the US was a road paved with good intentions. History is there for anyone who wants to read it.
There is outsourcing in places like the EU but it looks different and takes place within it, because the wealth disparities between EU countries are so much greater and US GDP per capita is so high. The state with lowest GDP per capita, Mississippi, is on par with Belgium.
Well one of the reasons for outsourcing was the idea that becoming a service economy would improve our country and it's citizens... Unfortunately that turned out bust.
many citizens' lives were improved. The cheap material consumption and availability is an improvement. It's just that the benefit is so widely available that people stopped thinking of it as a benefit.
It used to be that owning a TV or radio was an expense you planned for and it had to last.
Of course there are those who were hurt from the move from blue collar manufacturing, but overall, the aggregated benefit is higher than the losses from those who were laid off. And it's not as if new industries did not spring up.
> It used to be that owning a TV or radio was an expense you planned for and it had to last.
Thereby replacing one problem with another. The hope was that quality would be minimally impacted and repairs would be affordable. Instead, businesses are incentivized to quick-to -obsolesce products.
Disastrous garbage problems that impact everyone, even the wealthiest, though they are blissfully unaware.
> Of course there are those who were hurt from the move from blue collar manufacturing, but overall, the aggregated benefit is higher than the losses from those who were laid off. And it's not as if new industries did not spring up.
Trump’s rise in 2016 shows that this narrative is woefully inadequate.
6) Intentionally train too few doctors for the explicit, stated, out-in-the-open purpose of pumping doctor wages. Continue this policy until it is too late to train enough doctors for the coming wave of Boomers.
I'm glad that everyone is calling out that it is in fact a very good thing that the President is prohibited from arbitrarily deciding who to gift free college to. Loan forgiveness should rarely if ever be used. Too much opportunity for abuse by politicians who would love to dangle it as a carrot during election season.
For number 2, how did you come up with the very narrow 15 year window of birth from 1980 to 1995? I was born in 1963 and for the entirety of my upbringing it was a forgone conclusion that the lack of post high school education had a dire and inescapable consequence in future earning and socioeconomic status.
I was born in the mid-70s, and nobody told me "Just go to college, any college, and major in anything." That was never the narrative.
It was "Go to a top-N college, major in one of these very carefully enumerated majors that tend to result in good career trajectory (business, engineering, medicine, and so on), and maintain a very good GPA throughout." The messaging was very clear, from parents, teachers, and guidance counselors: Don't go to film school or a Tier-2 university and major in history, if you want a career.
I'm not sure when the "Go to any school, and do whatever" messaging started but it was not happening in the 90s when I was in high school.
I grew up in the latter half of the 90's and the narrative I remember was that it was a time when even like entry-level secretary jobs started requiring degrees (a phenomenon which may or may not have been exaggerated), and the reasoning was "it doesn't matter what it's a degree in, they just want to see that you have the capability to see something through to the end and not drop out"
was still told this and i graduated college in 2024. it did work out for me, but for the vast majority of ppl in my graduating class, unless they double majored from B School or did a proper STEM degree, they’re unemployed
Because at that time an engineering degree still had some weight because not everyone can get it. This inflation 9f degrees caused the degrees to have way less value only for the next generation
> Hold these debtors to standards that aren't applied to other types of debtors. You cannot discharge them through bankruptcy
That's because other types of debts are backed up with collateral. 18 year olds have no collateral, and so can easily just declare bankruptcy - and what is the note holder gonna do about it?
That means the note holder needs some sort of guarantee to get paid back, otherwise they are simply not going to grant the loan.
SCOTUS ruled that the President exceeded the authority over this that was authorized by Congress. I.e. it's Congress' purview to do this, not the Executive. The Executive does not get to make up laws.
>SCOTUS has said that the chief executive of the note-holding institution (in this case, the President of the United States) cannot use discretion in deciding who he gets to forgive for loans.
Yes, because the power of the purse rests solely with the House of Representatives.
Despite terms like "the President's budget", the White House has next to no authority in regards to what budget they get and how it will be spent. The legislature (House of Representatives) legislates and the executive (White House) executes; the executor cannot legislate.
This is why the often mentioned PPP loan forgiveness was fine (it was codified by the House) but Biden unilaterally deciding that certain debts to the government are forgiven is not.
> SCOTUS has said that the chief executive of the note-holding institution (in this case, the President of the United States) cannot use discretion in deciding who he gets to forgive for loans
It's really amusing how the unitary executive oscillates in fashionability according to which political tribe is currently in power. Congress is responsible for appropriations. Full stop. Whenever this has been bypassed via some loophole, by Bush, by Trump, by Biden, etc, it has been at its core unconstitutional. And it is in our collective interest that it remains that way.
I mean for fucks sake we were pushing 18 year old teenagers into tens of thousands of dollars of debt! I dunno about most people but at 18 I had absolutely no clue about anything, especially the concept of money nor career. How the fuck does an 18 year old comprehend why taking $60,000 to get a degree in “Latin Dance” is not a good idea (and we all know many people who fall into this bucket too!). And yet parents, councilors, teachers, and “the whole system” pushed this onto every kid in high school.
And then society turns around and mocks them later on for being “stupid” and “lazy” or whatever… fuck that shit. Society strongly told kids that college, any college, was the only way to have a future.
Where were parents? Don't tell me they were absent in such a massive decision that absolutely defines rest of their kids lives.
Yes its horrible to force 17-18 year old to make such an important decisions and also schools should have known better and counsel heavily beforehand. But lets not forget that for the state you are 100% responsible for your actions at that point including any crime, state will happily draft you and send you to get killed if the need arises. Loan management pales in comparison with this.
Truth is harsh, society is harsh and unfair in many aspects. I don't see this improving unfortunately anytime soon.
Of course for many the parents were present! They were being told the same thing by the education system. They were told that unless their kid got a college education their kid would not be successful. And while I wasn’t parent then but am now, I’m positive their peer group was pressuring them into helping kiddo out by co-signing on crazy large loans for degrees that their kid might never really use. I’ve seen it happen.
I get that there is a lot of societal bias toward blaming the person who got the loan for being a pile of shit deadbeat who was stupid enough to get a $70,000 “art history” degree… but dude. These people are basically kids. Or at best adults with very, very little life experience being given strong thumbs up by “the elders” who are supposed to know better…
The student does take some responsibility but society at large should take most of it.
I mean for Christ sake you had 18 year olds getting into huge amounts of debt that you cannot discharge in bankruptcy. There are very few financial tools in life that are so “iron clad” as a student loan and we handed them out like candy to the least experienced adults out there. What a shit thing to hand to somebody who just started out in the real world. Feed them lies and convince them to saddle up with a lifetime of debt that has absolutely no undo button besides death. We let total deadbeats rack up tons of unsecured debt and let them discharge it but somehow an 18 year old is allowed to basically take on perma-debt. It’s complete bullshit that makes the rich richer and the poor worse off.
You are being downvoted but that was exactly my experience. It wasnt hyperbole. I was told my entire time in k-12 you need to get a college degree by everybody. Parents, teachers, counselors. Additionally they said, with no exaggeration, to get any degree, at any school, and take out as many loans as you need. So yes an entire generation of kids were told the $60,000 in debt for a latin dance degree at a no-name school was better than no degree at all.
I don't know when that narrative started, but it was not what I heard (high school in the 90s). I at one point thought out loud about majoring in Art in university, and everyone, parents, teachers, guidance counsellors said, "Buddy, not if you want an actual career! Major in engineering or something." Maybe the later generations got the bad "Major in anything" advice but I sure as heck didn't.
Someone should be in jail for this. And the boomers and older who enabled it should feel embarrassed about feeding their children into this debt machine.
> 2) Tell everyone born between 1980 and 1995 that they'll be unable to compete in the global marketplace if they don't get at least some post-high school education, and imply that the mere presence of a degree will help instead of having a specific type of degree
Yes but I'm conflicted on this for a couple reasons.
The second part, became less true for anyone graduating after 2004 or so.
Where I still get -vexed- are the people I know who, about to hit or are into their 30s, start in a program for (or, wind up finishing with) a non-marketable degree as their first degree.
And the best example I can think of, was a specific not-colleague that started in some sort of program because they wanted to get into prostetics (I warned them about 3d printing upsetting the industry, they yelled at me for raining on their parade,) the 3d printing paradigm shift, surprise surprise, caused an upset into the marketability of their program, and they shifted into, at least last I was on speaking terms with them, women's studies.
I think part of the reason for the second half however, is an odd balance of 'younger people can be naive' and it's better to have them think that and finish than drop out a year or two because their major isn't panning out, i.e. switch to something else.
I say -that-, mostly because I know a lot of folks in my school would wash out from Engineering into Business or something else and while it's possibly not 'ideal', finishing some semi-useful degree is better than dropping out with some percentage of the full debt and nothing to show for it. I will note that almost everyone I saw 'leave' an engineering/CS/STEM type major flipped to something that was still, on some level, marketable.
> 3) Have next-to-zero standards for public funds used in grant and loan programs for college education, meaning people can take out loans for any sort of degree program at almost any sort of institution
This is a large blowback effect of various laws to prevent discrimination/etc against historically ethnic universities and programs. Unfortunately it's led to the 'Underwater Basket Weaving' meme.
> 4) Hold these debtors to standards that aren't applied to other types of debtors. You cannot discharge them through bankruptcy, it's very difficult to renegotiate, and SCOTUS has said that the chief executive of the note-holding institution (in this case, the President of the United States) cannot use discretion in deciding who he gets to forgive for loans.
Well, there's the 'flip' side, which ironically, due to all the other arms of the Kraken, contributes to the problem.
They are difficult to negotiate but have various outlying circumstances, i.e. IBR and time periods associated with that, certain discharge conditions (I have a colleague who's student loans were completely forgiven because she had ADA paperwork and they neither offered her a reasonable accommodation nor warned her when she started said program, at least -that- part of the system worked,) and the lovely 'indentured servitude with extra steps' Nonprofit forgiveness program, where if you work for a nonprofit long enough, you can get a discharge.
But then, you do get all these folks that 'wash out' into non-marketable degrees, they keep working at Starbucks or low paying jobs so they get the IBR, what does that do to the rest of the system though? it puts a fuckton of stress on it that we see in the rates.
All of that said, I feel like there's a 'number' where the loan should just be treated like any other debt. e.x. oh you've got $4000 in student loan debt and $50,000 in other debt? Fine wash it too. Or 'hold' the degree till it gets paid back, IDK.
We should be way more willing to straight up kill multi-billion dollar industries. Without that willingness, most modern problems are impossible for governments to solve, and such industries and even their potential competitors are incentivised mostly to exacerbate the problem. I love a good market as much as anyone but there really are problems
markets will never solve
But…the whole point is that it is NOT a market. If student debt is dischargeable and the government guarantee is removed or dramatically reduced, pretty much all problems are “solved”.
Universities will have to start focusing on ROI. Universities that provide a poor ROI will shut down. Universities will need to reduce costs for traditional coursework, cut courses with poor returns, add courses with higher returns.
The inflation in higher education that has run rampant due to subsidized demand being removed.
> Universities will have to start focusing on ROI.
In Europe, they have a simpler system. Education is paid for from taxes. If a student does well, they pay for it via taxes. If they don't, then they aren't crippled by debt.
The problem with the ROI approach is it still places too much burden on the student, and, well, life happens. Say you major in comp sci (or some other high-paying field) but shortly after graduation something happens which prevents you from working in the field. Sucks to be you.
And likewise it sets up universities to, as you say, "cut courses with poor returns." Like for example "teaching", because school teacher pay is crap, so it has a poor ROI.
I would imagine in Europe they select more carefully the students whom will go to College. Here in the US we've told students that everyone must go to College. We now have too many people in College and many of them aren't going to be successful once they are in. It's not sustainable. In many of our public universities, the graduation rate is well below 50%
> I would imagine in Europe they select more carefully the students whom will go to College. Here in the US we've told students that everyone must go to College
You imagine wrong. Pretty much everyone goes to university in most and European countries. Even in wildly tourist dependent places, a degree in tourism is a normal thing for a young person to pursue before going to work at hotels/restaurants.
If those students/graduates move to other European countries (which they mostly do), they'll be counted in their destination country, evening things out.
Where did you get the idea most Europeans get a degree?
> If those students/graduates move to other European countries (which they mostly do), they'll be counted in their destination country, evening things out
If they move to the Netherlands, the NL will only count what % of its citizens have degrees, not everyone else (because many may go back or move elsewhere after finishing their studies, you can't count them easily alongside the rest of your population; students are usually counted as some sort of temporary resident, if counted at all). And then there's also the UK which is a top study destination for Eastern Europeans.
> Where did you get the idea most Europeans get a degree
I come from one EU country, live in another, have friends from all over the EU, have visited as a student and now working adult. Most young people pursue degrees, even in forestry or tourism or whatever topic. Of course some will fail getting them, but 30% of under 30s is absurdly low for stats to be reliable.
It‘s a pretty efficient (and quite unique) system. People learn to do their job at a normal company and attend school for usually two days a week. And they can still switch to the university track later without starting from the beginning.
> Say you major in comp sci (or some other high-paying field) but shortly after graduation something happens which prevents you from working in the field. Sucks to be you.
That's why the article's saying you should be able to declare bankruptcy.
> And likewise it sets up universities to, as you say, "cut courses with poor returns." Like for example "teaching", because school teacher pay is crap, so it has a poor ROI.
Teaching is relatively well paid and there are huge numbers of jobs. It's highly likely that a teacher could repay loans. There are plenty of degrees far less capable of providing employment than teaching.
I think most people would agree with me in saying the European model sounds pretty swell compared to forcing people into declaring bankruptcy because of economic/personal factors potentially out of their control, while also inserting an incredible amount of volatility into the entire university system that would make long term institutional planning much less possible.
Be careful what you wish for. The majority of my fellow engineering graduates would not have gotten an engineering degree in Germany.
They would have flunked the first year - a weed out year - and then been forced into a technical diploma program and not be allowed to call themselves engineers.
My friend who went to the German school said they have a target of flunking half the students that first year. Funds are limited and shape how many can graduate.
And in the US, bankruptcy doesn't help with the student debt, so if the majority of your debt is student loans, there's really nothing that can be done other than die to get rid of them. And I'm 100% certain that if the student loan - industrial complex could saddle relatives and kids with that debt after death, they'd sure go after that too.
Many will agree, but that's part of the reason why the US has a 50% higher GDP with 30% lower population. Focusing on well-beeing, fun and experience comes at a price.
The U.S. GDP per capita is behind Norway, Ireland, Switzerland, and these countries are known for low cost and excellent education.
What do you mean about 30% lower population? How is that relevant? You’re quoting a per-capita stat, the population was already factored out. And you’re comparing a single country to 27 countries. Makes zero sense.
Not to be argumentative (really ), but that's borderline nonsensical; you're comparing a profession to a broad category of educational attainment. Teachers typically have a degree in the humanities. What other profession is so commonly viewed as underpaid?
Sure -- though that's almost just two ways of describing the same thing. If teachers were paid $500k, few would describe them as overworked, and if they only had to work 4-hour days (with current salaries and benefits), they might be fairly compensated.
In the USA, the government also pays for education. That’s part of the problem, in fact. Since the loan to the college is always paid for by the government, the college is effectively handed a blank check. Said check, now filled in with an arbitrarily high amount, is handed to the student as a bill to pay back to the government. The same is done in your system, in fact, except that the entire country suffers that burden, regardless of if that degree actually amounts to any meaningful contribution.
>In Europe, they have a simpler system. Education is paid for from taxes. If a student does well, they pay for it via taxes. If they don't, then they aren't crippled by debt.
That's all well and good for the student, but what about for taxpayers/governments who's funding that education?
>And likewise it sets up universities to, as you say, "cut courses with poor returns." Like for example "teaching", because school teacher pay is crap, so it has a poor ROI.
Sounds like the solution is to raise teacher pay, which would also have the added benefit of retaining teachers after they graduate. Giving teachers cheap training but paying them poorly seems worse than the status quo because you end up shoveling money into training teachers that'd end up dropping out anyways.
> That's all well and good for the student, but what about for taxpayers/governments who's funding that education?
We can say the same thing about K-12 education -- it's just something we choose to fund collectively, because that's the kind of society we want to be.
But also, progressive taxation means that the rich fund it more than the poor. So the general idea is that if law school and medical school are expensive to provide but result in vastly higher salaries, then it gets paid for in the end out of those lawyers' and doctors' taxes. Not the taxes from average Americans.
>We can say the same thing about K-12 education -- it's just something we choose to fund collectively, because that's the kind of society we want to be.
But in K-12 education, the taxpayer/state has strong control over what's taught. In the last few years there's some latitude by the students, but nothing close the panoply of programs offered by universities. If education is state funded, but only for programs with proven ROI (eg. STEM), I'd be fine with that.
When the state pays, what matters is the ROI to the state. There is a need for teachers, social workers, and people familiar with various cultures, but the market will never pay them well.
Public funding models often have incentives for delivering the degrees the state wants. For example, there could be field-specific quotas for degrees. The university gets paid for each degree up to the quota, but not for exceeding the quota. That can have interesting effects in fields that are popular but in low demand. For example, the acceptance rate to psychology can be as low as 2-3%.
Progressive taxation isn’t even necessary. If someone makes $10,000 and is taxed 10%, they give up $1,000. And if someone makes $10,000,000 then they give up $1,000,000.
It isn’t necessary, no, and in fact a flat super simple tax code would probably result in more tax revenue. However, since politicians like the power of the tax code, and because the wealthy like a complex tax code for all the loopholes, and since ordinary people like the idea of those wealthier than them paying more tax as a percentage of their income, then we’re never going to get a simple tax code.
And absolutely the same logic can and should apply for universities - there can be private exclusive institutions, but the majority should be affordable and mostly paid for by taxes.
This already is the case. 75% of student debt is private universities and colleges.
If you get into Stanford but can't afford it, a loan seems like a good idea, but in reality the loan eligibility should consider the degree and future earning potential (along the same lines of how banks qualify other types of loans).
If we simply cancel student debt or remove private colleges' ability to charge a market rate the result will be no more private colleges (similar to other countries with fully publicly funded education). In these countries you typically have a national exam that determines where you go, or you have to lottery in to a school if it isn't in your district.
A country's which population is educated, usually bodes well, unless it's an authoritative govt one, in which case dumbing down the population is the way (from the govt POV, at least)
Say you major in comp sci (or some other high-paying field) but shortly after graduation something happens which prevents you from working in the field. Sucks to be you.
And if you’re a nurse or a police officer or a teacher or a lawyer and you lose your license under specious circumstances, it really sucks to be you.
Simpler isn’t always preferable: note that the key feature from the consumer perspective in that system is
> you pay no matter what
Meaning if it’s assumed “despite learning little, you still will be able to pay for it”, there’s no longer any motive force towards quality, as your payment is assured. Incentives on taxpayers thereafter who want to minimize their tax burden would therefore be optimizing primarily toward cheapness of the educational process, rather than efficacy and quality of the education which outbound students received.
A vigorous market for education, would suggest you would likely get a variety of nodes along a “costliness to quality” options frontier.
> there’s no longer any motive force towards quality, as your payment is assured
There are many excellent European universities, including ones which have been around for centuries, telling me there are ways to handle your concerns.
> A vigorous market for education
How's that Corinthian Colleges degree working out? Costly and no quality. And exactly the life-crippling outcome we should expect in a 'vigorous market'.
This is non-responsive to my point. Pointing out that paid universities like Corinthian in a grossly distorted market predictably are not very competitive offerings, or that good offerings can nevertheless still exist in heavily distorted markets, both fail to address that
> Current educational incentives caused by how payment is handled in these all-pay systems mean there is very little or no pressure exerted towards promoting an educational arms race towards quality, rather than minimizing cost to service that education.
In a more competitive market, yes, I believe you'd both likely see better European offerings, as well as substantially more compelling American paid offerings than the current batch of cash grab for-profit universities. They exist in their current form almost exclusively because financial lenders in the US have no incentive not to issue loans to students - even if the program is bogus, they are guaranteed re-payment.
This is a commonality shared between both current European offerings (via taxation guaranteeing repayment), and American alternatives (via guaranteed load repayment).
'In a more competitive market' sounds like an article of faith, akin to the No True Scotsman, where there's no definition of what is competitive enough until it meets the proponents' sniff test.
What would a sufficiently competitive market entail? Has it ever existed?
Would it look like modern US K-12 systems where commercial schools prioritize the most profitable students and leave the others to the public schools? Where good marketing beats good education?
How would it not be "heavily distorted" by impositions like Title 9 and other civil rights requirements? By government requirements on the school in order to receive state and federal money? By accreditation requirements?
This question being written as singular suggests to me you’re conflating some combination of education as a concept, education in America, and education in Europe. I see this as muddled thinking, they each have their own issues and their own timetables over which issues can and do exist.
Education history in Europe is actually decently hyperlocal and pretty path dependent for each country during the 19th and 20th century. Talking about it as a monolith is challenging, but there’s a pretty consistent pattern in societies with all-pay taxation-paid schooling that it has clear incentive structures that a school, having been “paid up front“, is not incentivized to put in the work to provide a high quality education, and as the financier of that education is the taxpayer, the pressure is primarily to keep costs low.
As for America, you don’t need much faith to believe that in the US instituting dischargeability would dramatically improve competition and quality in these spaces and the market for education - so yes, this market used to be substantially more competitive and used to exist. Since the 1970s when these laws were passed, student debt and tuition costs have skyrocketed, low quality for-profit university creation skyrocketed, and people have been hobbled with debt for degrees many are never going to pay back. Dischargeability reduces this greatly - it causes financiers to create motive pressure on education to not be a fiscal vampire preying on its students and equip them with meaningful trades and socially useful knowledge.
As for standards and regulations on schools, assuming the public sees fit to fund higher education through government spending, having requirements for a school to receive that government funding seems reasonable, so long as they reflect the desires of the local populace.
Ultimately, all this is a discussion of tradeoffs - I think someone can happily prefer
> everyone gets a free tertiary education paid for by their taxes
I think that it being free and paid-by-all means it’ll have low motive pressure towards quality and therefore be comparably mediocre to free elementary and secondary compulsory education, which even based on your own reckoning seems to be a two-tier system where the public institutions get short shrift - but you seem to care about it being free or less focused on fiscal student outcomes as its own value. It’s a tradeoff.
I care about having actual definitions of what "more competitive market" and "vigorous market for education" means, and gave examples of markets with significant market failures.
Is it even possible to have a vigorous market without strong government oversight?
> define more competitive markets - Is it even possible?
Yes it is, and I am using it in the traditional sense of "Sellers vying to make their offerings more compelling so consumers prefer them to alternatives". A more competitive market has more of the above fighting happening, which can be incentivized in several ways.
Specifically for the US, I already gave a massive truck-sized example of how you can make offerings more competitive: repeal recent 1970s policy changes that make college debt work different than essentially all other debt in being non-dischargeable, and lenders will put pressure by refusing to lend for failschools. This will slash their demand, and survivors will be expected to provide more compelling “when examined actuarially” lifetime student economic outcomes: from the lender’s perspective, the education needs to be expected to at least pay for itself. Schools in a world with dischargeability will therefore make efforts to compete on being able to compellingly show “we are imparting an effective education which equips you to repay what you spent”, and in general will be less able to get away with “we have a strong brand and you’re young and naïve, come study here!”. You can fool an 18 year old, you won’t fool the underwriter.
Specifically for the EU, there’s three approaches I’d like to see considered, the first and last more experimental than the others. It’s a widely agreed upon problem that faculty aren’t incentivized or often even that good at actually teaching, and to a lesser extent they’re also bad at training graduate students, because professorial incentives are to be good at research and grant writing, the thing for which universities pay their salary.
Historically, many universities used a different mode where they kept permanent salaried faculty positions very limited, and rather than charge a tuition, most schools and professors were expected to charge a fee or honorarium they would collect from their individual pupils as the bulk or totality of a professor’s compensation.
We moved away from this because historically teacher compensation was abysmal and we wanted to better support educators in studying - the pendulum swung way too far the other way though, and professors are essentially totally insulated from needing to seriously engage with their student body - they make a salary no matter what and it shows when they teach like it. Returning to a market where teachers’ financial outcomes are at least partially linked to their students explicitly choosing and paying professors chosen fees rather than a tuition which everyone in society pays stochastically, professors are incentivized to competitively vie for being better at training and teaching, because their prosperity and success would be linked to it.
Second, as much criticism as the US model gets for its prices, much of that appears to be driven by administrative bloat and nondischargeability, payment itself is actually really great when dischargeable because it seems prices stay low and this bloat doesn’t happen when it is. It also means a significant fraction of students do try to get into the best school they can and the schools have some incentive to fight to be seen as better - they make their money when students go. The results speak for themselves: something like half to two-thirds of the world’s top 100 universities are all in America.
Last, I’d like to see both European and US models collaborate harder on job and work placement as part of ensuring student success. Colleges being a source of a liberal education without concern for fiscal outcomes can be great, but the pendulum swung too far and these students are essentially thrown out into the world without any expectation of success, because the school no longer has any investment in them. I’d like to see some portion of the fee of education be moved to explicitly garnished wages from placed-into-their-trained field employees - you succeeding would therefore be the university’s success.
I’d therefore like to see taxes slashed on education with moves to paid models comparable to how they existed in the US prior to the 70s, reductions in permanent salaried academic positions with in-kind movements of price of tuition from the school at large to being in baked into professorial fees instead, and moving the funding of education from societal fees to a fixed percentage of post-graduation salaries for some fixed time, to incentivize effective job placement.
The common bailiwick that needs to die is that Europeans don’t pay for college - they do, it’s just compulsory, lifelong, and in a way that is not incentivized to produce quality.
I agree that non-dischargeable debt for education was a horrible change, given the predatory response of the colleges and collusion between the increasing power of the administrative class over the university and the capitalists providing debt funding.
US schools are increasingly extractive because if higher education is indeed necessary then it is economically beneficial for someone to go to college - so long as the result is more profitable than not going to college. If the college charges less than that (or rather, the college + debt industry), then they leave money on the table.
There is little interest in providing quality low-cost education because it is capital intensive, and capitalists want to maximize their profits. As the recent news about rent collusion shows, capital owners will collude to extract more profits.
> the pendulum swung too far
This has been a trope since the 1960s when the right started their culture war against college education as the post-GI bill era meant college was no longer a place primarily for the children of the privileged classes.
That is, be specific - when was the pendulum enough in the other direction that you wouldn't have complained thusly? It seems you like the 1960s, when the right complained about ivory tower academics filling student brains with anti-American nonsense.
> reductions in permanent salaried academic positions
We have that. These are called adjunct professors. "Editorial: U.S. colleges are overusing — and underpaying — adjunct professors" / "The American Assn. of University Professors reports that 70% of faculty are adjunct, most of them without benefits, job security or union representation; they teach more than half of all college courses in the U.S."
They are also poorly paid, exactly as you would expect from an extractive industry.
How low should it be? 20% 10%? But in the 1960s in the era you praise, those numbers were much higher, back when academic positions included significant administrative responsibilities.
If you really want to remove "administrative bloat", remove administrators.
> garnished wages from placed-into-their-trained field employees
Ahh, so you follow the meat widget model of college education. Got a degree in physics but decide to open a chocolate boutique? Sorry, you'll need to pay back your education first.
It costs a lot to go to med school, so those who go often end up in debt, which means they need to get jobs which pay enough to pay back that debt, which means they can't afford to provide medical care to poor communities.
It costs a lot to become a lawyer, which is one of the factors for public defenders are 1) needed, and 2) so overworked.
Besides, we've had similar policies for a long time. I had teachers back in the 1980s whose agreed to debt relief for their teacher education which contingent on being a teacher for enough years.
I've also heard stories about the consequent problems in such a bureaucratized system.
> see both European and US models collaborate harder on job and work placement as part of ensuring student success
In Germany: "After passing through any of the above schools, pupils can start a career with an apprenticeship in a Berufsschule ( vocational school). Berufsschule is normally attended twice a week during a two, three, or three-and-a-half-year apprenticeship; the other days are spent working at a company. This is intended to provide a knowledge of theory and practice. The company is obliged to accept the apprentice on its apprenticeship scheme." - https://en.wikipedia.org/wiki/Education_in_Germany
How is that not exactly what you are asking about?
> The common bailiwick that needs to die is that Europeans don’t pay for college
I'm really tired of people doing the "I'm so clever" comment that "you know that 'free health care' isn't free, right"? That extends to people pointing out that "free college education", and "free K-12 education" and "free school lunches" and "free tampons" and "free condoms" aren't actually free.
Like, duh. It's just name-calling implying I'm ignorant, and therefore you don't need to take me seriously.
Did you know that freeways aren't actually free, but depend on tax funding?
They already focus on ROI, the problem is it's ROI for them not the student. In most states the biggest or second biggest company is a university because they run for profit sports programs with no pay to players, make money off commercial research grants and classes using pHd students making 34k/year, use the students as both low wage workers for campus jobs in high value retail space leased to franchises and as a captive populace to price gouge with required meal plans using the student loans, capitalize again off the real estate that is often land granted to them by the state by offering overpriced student housing that is often mandatory for freshmen. You basically have to accept getting scammed to get a degree.
Trade schools should definitely focus on ROI, and a lot more people should attend them. The idea of the public university is to bring a traditionally aristocratic practice - the devotion of several years of one’s young life to not-necessarily-practical intellectual pursuits - to the middle class. I think our civilization would lose something worthwhile by returning this practice to the exclusive domain of rich families. Much the same as if we sold off all our public parks for development.
The issue is that we have democratized not only the class background part but also the “intellectual pursuits” part. College should be a lot more selective and a lot more rigorous; only a small minority of students have any business attending. The rest can get their credentialing and coming-of-age ceremony in an ROI focused trade school.
See also the excellent book "Shop Class as Soulcraft" for a thorough examination of skilled trades as an under-appreciated and vital aspect of our economy and culture.
> The idea of the public university is to bring a traditionally aristocratic practice - the devotion of several years of one’s young life to not-necessarily-practical intellectual pursuits - to the middle class
The entire idea that spending 4 years learning useless knowledge is somehow valuable is completely mistaken bullshit.
Aristocrats could get away with it because they were rich but there is 0 evidence this practice brought fundamental value to them or society other than serving as an expensive status signal.
which would make lenders more cautious which would make it harder to get a loan which would make less money available so tuitions would be competing for less and prices would come down this is how it's supposed to work yes
Yes, but this is also the preferred solution of the people who caused the current crisis with university cost inflation.
Universities used to be expensive schools for rich people's failsons to "find themselves". That's why there's a lot of focus on "well-rounded" educations even today. Then western governments started offering taxpayer-funded tuition, which resulted in a new wave of educated kids who refused to believe government narratives regarding wars and refused to comply with conscription and drafts. This came to a head during the Vietnam War, where the US found that it's usual ability to start wars against labor in other countries had been stymied by them educating the enemy (their own workers).
While the draft has been relegated to a vestigial function in the US today, the people in power were able to shut the people down. Saudi Arabia, a theocratic dictatorship that belongs in the 10th century, not the 20th, did the American ruling class a solid by embargoing the US and shutting down our economy for a decade. This gave cover for the complete overturning of Progressive Era policies. Most importantly for this subject, public state universities were stripped of their government funding. Instead, they would charge ever-increasing tuition which students would pay for with loans. This ensured that the poor could not access education and that the educated middle class would be in permanent debt slavery.
Public universities went along with this because they were promised more money than they could get from public funding. This is why you see massive amounts of money being wasted by universities on bullshit. The ruling class gave universities a seat at the table of lavish excess in exchange for, y'know, letting the cops shoot their students with rubber bullets any time they get antsy. Your student debt is a bribe from the military-industrial complex to the university system that you pay for.
However, this gambit did not fully succeed. For one, students are still protesting, despite the debt noose around their necks, and university officials' best efforts to rubber-bullet their students into compliance. So there's a lot of politicians who want to get rid of university education altogether and replace it with trade schools. I may have harshed the concept of a "well-rounded" education before, but it does mean universities still have to teach things like history and economics, which is the sort of thing that makes the lower classes resist their social programming.
So a lot of people in power want to get rid of universities and replace them with trade schools. Now, I actually don't have a problem with trade schools; a lot of good paying jobs are going undone because they don't confer the kinds of status middle-class families want. But there's a lot of right-wingers who want kids in trade schools solely because trade schools generally do not teach all the problematic subjects and forbidden knowledge (aka "traditional coursework") that makes tools of society start asking questions.
If you want an actual way to fix universities (without just turning them into trade schools):
- Have a ONE TIME student debt forgiveness event, contingent on shutting down the student loan system, so this shit doesn't happen twice.
- Restore public university funding sufficient to allow tuition-free education for all poor and middle class students.
- Purge the university administrative class, they've grown overbloated and turned universities into their own personal hedge funds.
Once this is done, then we can start talking about what classes and degrees actually have good ROI on the public money the universities will be getting again. The thing is, though, the existing "low ROI" degrees mainly existed so the university administrative class could pump up admissions numbers. Remember, that was part of the deal they made with the devil. Taking away the student loan system means there's less incentive to admit students to prop up numbers, but if that becomes an issue again, we can further require minimum standards for students or courses through the university funding mechanism.
> Universities used to be expensive schools for rich people's failsons to "find themselves". That's why there's a lot of focus on "well-rounded" educations even today. Then western governments started offering taxpayer-funded tuition
Replace western by "US" for "well-rounded". AFAIK, all European university degrees are focused on a single topic, and its requirement (so, lots of math if you're studying physics). No literature classes required (or even available in some cases) if you're, e.g., getting a computer science degree.
> If student debt is dischargeable and the government guarantee is removed or dramatically reduced, pretty much all problems are “solved”.
Chesterton's fence definitely applies here.
If you don't understand what that law attempted to prevent in the first place, you're just going to get your pocket picked by a different group of people.
Yep, exactly. Current situation is clearly bad, but most of the solutions seem to focus around the idea that dismissing trillions of dollars in debt through bankruptcy is a great idea (it isn't)
1. Provide a counterbalance to private industries by having the government player to be a significant player in that market. That means a free or near-free high-quality state higher education system like the California system used to be until it was made an explicit political goal to avoid an "educated proletariat" [1]. It also goes for housing, hospitals, banks, ISPs and so on;
2. Nationalize failing industries rather than providing them loans for no reason. Banks fail in 2008? Well, you belong to the state now. Just like the FDIC does with failing banks.
3. Federal dollars for pharma research should come with an equity stake in the private corporations that monetize it. Most drugs are developed with Federal grants.
> I love a good market as much as anyone
Just curious: where do you see markets actually working?
> 2. Nationalize failing industries rather than providing them loans for no reason. Banks fail in 2008? Well, you belong to the state now. Just like the FDIC does with failing banks.
I kind of agree with this, but as a taxpayer, I don't necessarily want the government to have an equity stake in a failing or horribly-run business.
We need the government to grow a backbone and allow large businesses and even entire sectors of the economy to FAIL when they suck. I hate the narrative "We have to keep ShittyCo alive because it provides 10,000 jobs!!" as if those jobs would just disappear if ShittyCo got flushed down the toilet like it should be.
Taxpayers should not bail out GM and Chrysler and AIG and US Airways and these shit companies. We should have let them fail, let their careless shareholders eat it, and created a regulatory environment that allowed better-run competitors to spring up.
> I love a good market as much as anyone but there really are problems markets will never solve
The problem with student loans is that they are not driven by markets. If they were, absolutely nobody would give a loan to an 18 yo to spend 4 years and $160k to study psychology.
Multi-billion dollar industries represent jobs, stocks, and campaign contributions. The US government is not designed to beat those forces. It's the same reason we'll never see universal healthcare unfortunately.
You seem to imply that a general willingness is what would allow this to happen when the article spells it out pretty clearly: it's powerful organizations clinging to power. Your sentiment amounts to nothing more than wishful thinking.
It's tempting to just agree with your sentiment, but I think that day dreaming about an unrealistic solution sucks energy away from more effective actions. The main challenge of solving a difficult puzzle is to avoid dead ends and red herrings.
A more promising plan involves explicitly strategizing against the agents who have the opposite agenda.
Can you imagine if we could kill MLMs, pay day loan sharks, bail-bondsmen (My state fully banned this lunacy), Psudoscientific medicine (chiropractors), Scientology and other useless trash from society?
God going after just one is liable to get you a fate worse than Daphne Caruana Galizia
We shouldn't see the government as solution to too many problems. If we overdo on it, we get socialism. And we know how it always ends.
Let the market forces decide. Eventually people will realise college doesn't work and will stop going there. Seriously problem is that too many people think they are smart and can benefit from a degree, when most can't. If 10% top graders go to college from school as it was in the boomers' era, ROI of higher education will be enormous (as there won't be an oversupply of useless graduates), and costs will be low (as low demand always reduces prices).
We shouldn't punish people who take the money because people are willing to pay it. Who's fault it is that they are dumb? Do we see much say, annoying advertisement to the tune of "go study X with us, you'll be rich and women will love you"? No. People are doing it because they are dumb. If we try to build a system that prevents smart people from taking money put on the table by dumb people, we will make the whole system dumber by incentivising dumbness.
In this case, government intervention is what caused the problem, and removing that intervention is what would disrupt the multi-million dollar industry.
Specifically, the government made it so college loans can't be discharged in bankruptcy, and backs many student loans.
The solution is to remove the exception for student debt in bankruptcy, and either have the government stop backing student loans, or make stricter requirements for colleges to quailify for its students qualifying for federal loans. Like say, require that a certain percentage of students graduate, and get jobs within a year of graduating, having reasonable tuition, etc.
Agree, but the result will be that far fewer kids get to go to college, or get to go to the best college that they can get into.
Loans will only be granted to students who have a track record of high achievement, parents willing to co-sign, and going into majors that make economic sense.
Enrollment will drop, universities will stop offering passion majors, mass layoffs in library science, academia, and college administrations (likely to the tune of 1M+ people).
In the end, students will be told by federal examination which school and major they get to pursue, or whether they get to go to college at all.
That's assuming the government is both effective and efficient in this process.
This is essentially how most consumer economics work.
But isn't it the goal? To make sure only the kids who have the brains and the right class to make value out of a degree (or don't care about value because their parents have cash), will go to study, not "just about everyone" as now. Working class kids without outstanding abilities should go to trade schools/apprenticeships and do blue collar labor. It pays decent bucks, and brings value to society too.
I think therec would also need to be a cultural shift to make trade schools and apprenticeships more acceptable, and make financial assistance for them more accessible.
And for that matter, I think it could make since to have trade schools for white colllar jobs too. In some sense that is what coding camps are, although I'd like to see them be a little more rigorous and include things like security, software design, algorithms, etc.
As for passion subjects and arts, maybe have more, and higher quality community classes available that people can go to when they already have a decent job and can pay for them outright instead of accruing massive debt.
> If we overdo on it, we get socialism. And we know how it always ends.
First, no, we have some high-visibility examples of dictators claiming to be socialists, several of whom had purges of other internal opponents who said socialism was a different thing to what they were doing.
We don't point to the "Democratic People's Republic of Korea"* or "The Democratic Republic of Congo" then say of Democracy (or of republics) "And we know how it always ends".
Second, there's a huge gap between what the USA considers "dangerously lefty" and what is seen in northern Europe today, let alone states today which are or were explicitly socialist such as the USSR.
There have been a lot of socialist countries that were proper and strong democracies, notably India. The result? Hundreds of millions in abject poverty in India until socialism was given up in the 90s, and is slowly recovering.
Funny you say that, Karnataka is an outlier beating its peers in all quality of life metrics and has been run by communist for decades.
Also, modern day India has a very strong government intervention bias, especially regarding lifting people out of poverty. Be it investments in infrastructure (such as running water), or downright giving food to people. Good luck explaining how that isn't "socialism" to an American.
> Funny you say that, Karnataka is an outlier beating its peers in all quality of life metrics and has been run by communist for decades.
You mean Kerala, not Karnataka.
And conversely, West Bengal was ruled by the Communists since the 1970s to the early 2010s, yet it's developmental indicators have regressed to those comparable to some of the poorest states of India.
Conversely, right leaning and nativist Himachal Pradesh (if you ain't Pahadi or Pahadi-adjacent we will give you the cold shoulder, and both the state chapters of the HP INC and BJP trace their origins to the RSS and Arya Samaj) has developmental indicators that can match Kerala and other traditionally richer states in India.
At the end of the day, all that matters is administrative capacity, not ideology.
If local government is held accountable, it will work hard to deliver.
No, i mean EU socialist countries. To the tune of Sweden, Netherlands, etc. That are little but sleepy retirement community with no ways to make money. Why would anyone with any ambition want to live there? So they don't. They go to America in spite of all it's horrors and sins. Live there once they made they money? Also no, because taxes, they go to the likes of Cyprus or Malta, or since recently, Spain [1]. These countries are good only if you are a taker, or a tourist.
I moved from the UK to Germany, I actively decided against the USA. Why? Consider what was going on politically in the US right after the UK voted for Brexit.
Σκεφτόμουν την Κύπρο, αλλά οι Άγγλοι λένε όταν κάτι είναι δύσκολο να διαβαστεί: "It's all greek to me"
European social democracies may not be the best if you want to get rich, but for average Joe they offer superior quality of life compared to the US. IMO too much capitalism and socialism both suck, and certain EU countries have the best balance between them.
What is the total cap of those startups? How does it compare with what IPOs in the Valley in a single year? We are probably talking about same "startups" as in Spain that people only open to get startup visas. There are multiple business plans mills there who specialise in writing plausible "sitcom startup" BPs for that purpose.
That, probably can and should be fixed. Set a minimum age for someone to take a college loan to say 21. Otherwise, a parent takes it and it's subtracted from a parents' social security check before it does from kid's. Then people will think twice. Maybe that's fair.
Good idea. I think kids in high school should also be shown some real stats about monetary outcomes from different degrees. Not BS marketing material from educational institutions, but actual statistics. The whole society would benefit if number of students in different fields would roughly match labor market demand.
how many people do you think even understand “actual statistics”? i was reading a study done by actuaries working at one of the largest reinsurers in the world, and they made conclusions based on confidence level values overlapping, which is a nontrivial mistake i identified within seconds. and these are actuaries, people who by and large, so understand statistics. how do you expect the average person to interpret any of it when they struggle to understand what a rate of change (inflation) is?
Yep, and kids also smoke, vape, do drugs, gamble, assault people, play too many video games, etc.
The answers lie in educating them to make good decisions, and be there to help when good decisions happen to turn out poorly. The current dilemma is largely due to provably bad decisions (by students, banks, universities, government).
Are student loans the most pressing "bad decision" we have as a society? Definitely not. Is it a very electable topic? Yep
I question utility of that reduction. When you reduce complex situations to simple words like 'socialism' you lose nuance and predictive power. It's not binary. It's more or less. Canada is more socialist than USA. Norway is more socialist than Canada.
Reducing to "is" or "isn't" doesn't help understand the problem or come up with viable solutions.
If we go along the route of "asking the government to ban every line of business where people waste money getting no value for it or even getting harmed, being driven by systematic delusion", as it is with the higher education - we will shoot ourselves in the foot in a massive massive way as this will kill almost all web startups as this is what they are - use manipulative tactics, knowingly false expectation and social effects to force people to spend money on... well nothing really. And the lower your chance of getting something in return, the more you pay (classic example are dating apps). I go to startup events frequently. Took me a few years to accept the truth that speaking about any industry (their slang for it is "vertical") - well, any except porn - like dating, pharma, so-called "nutra", etc. they actually mean "scam in the field of X", and the main idea of every successful one is "a genius way to obscure it is a scam".
For God's sake, it will even kill custom software development which most people sitting here, do for a living - because it is the same exact thing - vast majority of clients never get what they want and even if they did they won't be able to make the money on the useless "products" they invented, because this is nothing but a systematic delusion that's moving them. Almost all of them see themselves as genius inventors of the next world-changing thing but they are in fact random nobodies who raised cash from other random nobodies, to waste it on something that makes their contractors laugh so badly they even refrain from doing video calls. It's even worse than higher education. I seen multiple software dev companies throwing lavish parties on the April Fool's day as "professional holiday of our clients".
Should we first look at ourselves in the mirror before blaming the college cabal for doing the same as we do ourselves, just more successfully?
I said is I don't see the utility in reducing the concept from a continuum to a binary "is/isn't"
You seem to have doubled down on the is/isn't perspective and demonstrated what I was referring to. The more you reduce the less useful your reasoning becomes.
No, with high student loans, you are not supporting high talents; you are supporting the rich only. You are obstructing a lot of potential that poor students might have realized if they could have afforded it. It's not about banning universities; it's about broadening accessibility. Schools are state-funded for the same reason.
Socialism is a term too broad to mean anything. When we say socialism, do we include states that provide healthcare systems as infrastructure, as is common across the world? Do we include the vast amounts of market interference represented by decisions about what crimes can be hidden behind a corporate veil, what companies win lucrative government contracts to have decades of non-competitive profits?
The attitude that the government shouldn't intervene against companies on the behalf of human rights has been tried for fifty years, and it is an unprecedented failure even in financial terms for at least roughly 80% of the population of one of the largest and wealthiest countries in the world in terms of real purchasing power. Even for many of us in higher income brackets, the resulting crumbling infrastructure and drastic wealth disparities leave much to be desired as a society to live in. Many of these problems have solutions, and calling them "socialism" is meaningless as an argument against them
That's too disruptive, and there's too high a chance of unintended consequences. Instead of that what you'll see is a 'we'll kill this multi-billion dollar industry over the course of the next 30 years'
With all due respect, fuck that. We do disruptive stuff with unintended consequences for millions of people as a matter of policy all the time, and the idea that it'll disrupt some finance goons' ponzi scheme does not bother me
This is the problem with a ton of policy thinking. The idea that we can solve a problem of this magnitude with disruption, and somehow prevent market forces from reacting, is incredibly short sighted.
It's incredibly expensive to run a university, and many people feel entitled to attend any university they can get into (not a bad thing, btw), but you can't suddenly erase the bill without drastically cutting costs, changing supply/demand, or otherwise altering the economics first.
The college level education system in the US employs almost 3.8 million people. Decisions here absolutely affect their employment, tax rates, employment rates, bank loans, financial industry solvency, etc.
This problem is incredibly far away from the space of YOLO tactics.
If you mean banks, there’s the problem that “let it die” often translates to “shift the obligation”, which typically gets shifted to the tax payers, either in plain sight after a bailout, or under the table by devaluing the currency (basically taxation without having to say it).
They stopped the one child policy nine years ago; they had it in the first place because demographic projections had them severely overpopulated if they didn't.
During the period in which it was active, their GDP increased by a factor of about 62. Not percentage, multiple.
They reversed the policy too late. Their rapid growth was them seizing the low hanging fruit upgrading from a country of almost entirely peasants to slightly fewer peasants, all funded by Western greed. Those gains will never happen again.
Entrenched and connected types tend to exit industries before the gavel hits, and enforcement from the CCDI isn't impartial, with plenty of bribery to remain off their radar.
Truly Schumpterian creative destruction is good in a vacuum, but reality isn't a vacuum.
I don't know if this is some kind of heresy, but here we go.
I don't think universities provide much value at all to the common student who is not going to be a PhD.
I went to a very well-known institution known for putting the students in a room with the professors, maybe two or three students, to one professor. My economics professor taught me one on one.
I still think, in the end, the work is mostly done alone, in a pile of books, on your own time.
Not with other students, and not in lectures, and not in tutorials.
This is a bit different from school where you can actually learn the material in class because, let's face it, school doesn't have a very deep curriculum.
So at university my impression is that they mainly tell you what to go and read about, and then you read about it yourself. The tutor is there to course correct you a bit, but they aren't going to do much other than save you a bit of time learning the orthodoxy of your subject. The lectures are a table of contents. At most, it's really just a guy telling you that you should know what an eigenvalue is, or you should have read about the ISLM model, and so on. For you to actually understand something, well, you have to have spent a lot of time in the books rearranging your mind.
Given that this is what you actually do at university, why have it this way?
Make an examination authority. "Here is the national linear algebra test. Anyone who wants to try it, sign up, and come to this hall on this date." Everyone who passes, whether they studied at home or went to fancy U, gets a paper that says they passed it. Do it as a 12 year old prodigy or a 75 year old grandma, you get a diploma.
Now, maybe there is already an authority that does this, I don't know. But it isn't very well known or authoritative.
The current incumbents are gatekeepers. Everybody thinks that smart kids go to the most prestigious universities, and that includes employers. It's a Schelling point that doesn't need to be there, and it allows the universities to extract a great deal of value from the kids.
If you made this authority of examinations, many people could learn the material and show their competence without incurring huge costs.
People could start working earlier. You could separate the coming-of-age experience from academic learning. Poor people could participate more.
I don't think this is heresy at all. I read this and just think you have a giant blind spot because you seem to be assuming that the way you learn is universally applicable.
I went to an unremarkable state school where I had classes with a hundred other students. Even my senior level courses were about a dozen to one teacher ratio. I still remember my professors and specific moments during their lectures when I was able to ask a follow up question which triggered that Eureka moment we're all looking for.
I wish I was able to just sit down with a textbook and learn a meaty subject but that doesn't work for me. I, and many others, need (or at least it helps a lot) the academic structure to learn effectively. The academic calendar, lectures, textbooks, homework, and other students you can study with all work in concert. The way you're dismissing all of that strikes me as really myopic.
There are many examination authorities but employers basically ignore all of them and have gone all in on college degrees as the signal for employment. In that way colleges are gatekeepers to higher level jobs, but they're hardly the only actor here.
Not a heresy at all. I went to two of the top 5 CS schools in the US and I barely recall anything I learned in there, almost everything I know ended up being self-taught later in a much more efficient manner than being student n.200 in a class taught by a researcher who barely speaks English and doesn't want to be teaching. The main upside was associating myself with those two brand names which later got me jobs and cofounders, but that's about it.
When I went to a public university in Europe, I realized after a month or two that lectures are a waste of time, and I stopped attending most of them. But the structure and guidance provided by the university allowed me to study things more efficiently than I could have done on my own.
I think the key is that universities are not schools. They are places of learning, not teaching. If you go to a university and expect to be taught, you are probably wasting your time.
And that vision is not really compatible with tuition fees, because they can easily turn you from a student to a paying customer.
You are correct, but universities did use to actually teach. SICP is still relevant 40 years later, and it was because the professors who created the class and textbook actually gave a fuck, knew what they were doing, and were still allowed to do their jobs. I really do think this is a recent phenomenon, but I have no idea how to get back what we once had from the parasite class.
University is too rushed. That's why you feel like the work is done on your own. Cause of course you have to acquaint yourself with the subject at your own pace. Once you become acquainted, that's when it becomes useful to have access to a leader in the field. But by that time you are writing your finals and preparing for the next semester.
Except for medical students, who require a teaching hospital and all its equipment.for their education
Except for EE and other engineering students, who require lab and other equipment for their education
Except for chemistry, biology, and other science students, who require chemistry equipment, etc. for their education. You get the idea.
Even for fields that require no specialized facilities, frankly, I don't see any Fields Medal or Turing Award winners that are self-taught nor do I have any reason to expect to see any in my lifetime.
Most received the Fields Medal or Turing Award are not "the common student who is not going to be a PhD" so you and GP agree on the importance of universities in that regard. In general I read what they say as solely relating to what I'd categorize as "undergrad or non-specialized track students".
I agree with you there is a lot universities have to offer students though. Your examples of equipment are a great highlight. On the other hand I think when you weight the ever growing cost of attendance with the amount of unique values provided it has been shrinking quite a bit, in favor of the "not providing much value" side. This is especially true for the relative lack of unique values brought for the vast majority of students during the first ~2 years of general education. It's difficult or impossible to get many of these organizations to let you just jump in at that point though.
Overall I think, for many at least, the biggest value is an environment which helps guide them to doing the self learning. Many (most?) can't just sit down to write and then follow their own multi year study plan and end up with something comparable to what they'd get out of going to a university, even if they end up spending the majority of their time there self learning. GP may well not be part of that group but I'm not sure their conclusions apply to those who are.
> Except for medical students, who require a teaching hospital and all its equipment.for their education
They're not really students in the normal sense, they fit more into the PhD category that I mentioned, since they need actual personal help.
> Except for EE and other engineering students, who require lab and other equipment for their education
I have an engineering master's from a world famous university where the lab work was pretty pointless. It didn't count for much if at all, and was more or less just entertainment.
If you were doing a PhD, you would do experiments where the outcomes were not a foregone conclusion. In undergrad, it's not any different from baking a cake, it ain't gonna go any differently than expected.
I suspect you'll learn more watching a video of someone doing the experiment, that way you are not concerned with trivialities like converting units and wearing safety goggles. Something like what NileRed does for chemistry.
> Even for fields that require no specialized facilities, frankly, I don't see any Fields Medal or Turing Award winners that are self-taught nor do I have any reason to expect to see any in my lifetime.
Well, that level of work requires a personal contact, like a PhD advisor. I am addressing undergrad work, which is fairly ordinary material that has already been well digested.
> I have an engineering master's from a world famous university where the lab work was pretty pointless. It didn't count for much if at all, and was more or less just entertainment.
For me personally, having a maker space and access to expensive equipment was how I learned to do useful things as an electrical engineer. Was it entertaining? Absolutely, but that doesn’t mean it’s not valuable. In fact, the things I’ve had the easiest time learning were things I’ve done because they were inherently enjoyable.
> Make an examination authority. "Here is the national linear algebra test. Anyone who wants to try it, sign up, and come to this hall on this date." Everyone who passes, whether they studied at home or went to fancy U, gets a paper that says they passed it. Do it as a 12 year old prodigy or a 75 year old grandma, you get a diploma.
> Now, maybe there is already an authority that does this, I don't know. But it isn't very well known or authoritative.
Western Governors University operates this way. You can get a full, recognized degree that way (in a limited set of topics).
> I still think, in the end, the work is mostly done alone, in a pile of books, on your own time.
I feel compelled to link the quote from Good Will Hunting here, I will refrain. However I agree completely. I also went to a “great” school, and I learned everything from overpriced books on my own time. In fact, in my entire tenure of undergrad I never attended a full week of class, not even the first week.
Absolutely worth it because of the environment that it put around me for four years and the peers who inspired and pushed me to do better (and also helped me grow socially, become more independent, etc).
There is nothing in adult life that's even close to that kind of environment and the growth that it fosters.
Although you have to go to a good school with great peers to experience these benefits.
Academia is not a monoculture, but people who take the path suggested by the administrative faction are the ones ending up in debt. The marketing is like that for dodgy credit cards or subprime home loans. (The Ivy League strata is more about getting to network and socialize with clubs of the wealthy and powerful, possibly getting a lucrative position as in the British Empire's public school system, so set them aside as a special case.)
Otherwise, for people who want to learn arcane technological skills and curious knowledge for the science and engineering world, community colleges and research universities are the way to go. Two years in a community college at low cost, ideally some kind of grant/scholarship for 2-3 years more at a research university, preferably in collaborative/teamwork situations with actual professionals in their fields. You also have access to tools and equipment that you'd never get to use otherwise, and experience with such setups can lead right into a good R & D job.
It's not worth being weighed down with debt at the end, though, since the loan payments will eat up revenue that could have gone to savings for a home, founding a startup, etc.
Students should thus view the academic finance system as a hostile adversary that's always trying to force them to take on as much debt as possible. Student loans are traded like subprime mortgages were in 2008, I imagine tranched into pyramid schemes, and the industry always needs fresh meat.
I mean, a lot of trades do have standardized tests. The LSAT for law school, the MCAT for medical school, and the CPA exams for accounting come to mind. I don't know why computer science hasn't organized in this manner, maybe because it's a younger field or maybe because there are simply too many people and employers don't care enough about having certified employees.
CS does have a lot of certifications, which are generally regarded as crap by most university-educated CS people. Part of the reason is that a lot of certifications test you knowledge with specific tooling, and that tooling may become obsolete rather quickly in the field.
It's also worth noting that a lot of the tests you talk about aren't valued particularly higher by their own fields. Most lawyers I know have commented that the bar exam [1] primarily tests material that is largely irrelevant to the actual practice of law, to a degree that scoring too highly on the exam tends to be seen as "you wasted too much time preparing for the exam."
[1] The LSAT isn't a test of whether or not you've mastered law school material, it's a test of whether or not you are allowed to be admitted to law school in the first place. The bar exam is the actual necessary certification to be a lawyer.
It's a younger field. A lot of self-taught people think they will be excluded (they wouldnt be). There is a deliberate effort by execs to lower the salaries of software developers by ensuring there are no barriers to entry and flooding the market which the vast majority of the workforce has been tricked into going along with.
I also attended a well-known institution and this was precisely my experience of university. I stayed home and read the textbook, supplementing with materials online, hardly attending lectures at all.
I had paid for university almost entirely out-of-pocket with earnings from co-operative internships in software; when "real-life" problems started to rear their ugly head, the choice came down to incurring debt or working in a (still to this day) lucrative industry.
What was the point? Why join the rat race of my peers who would rush through the material, only for it to be forgotten amidst the torrent of next semester's information? Does this style of studying actually produce a level of erudition equal to or greater than one who obsessively pores over the literature at their own pace, taking their time to slowly digest and process and crystallize the information in their mind? Or have they just found the most expedient route past the gatekeepers of higher education and diplomas?
I would much rather do exactly what I did in university - read through the material on my own terms and take time to digest it at my own pace, but without the crippling debt. That said, I still very much view education as a privilege, open to those of financial means, who have the opportunity to put aside several years' worth of earnings and time to pursue academic studies, irrespective of practical application. I am reminded of a second-year philosophy professor who took half a lecture to explain how the purpose of higher education is not as a vocational school to bring one wealth and employment (taking shots perhaps at the career focus of the institution's co-operative program), but rather to give one a more fulsome perspective of the world and enrich their intellectual life - not in hopes of some mundane, worldly reward, but for its own sake.
Had I the wealth, I would love to go back to complete a degree, not for practical employment prospects or even prestige, but to (at least attempt to) feel intellectually whole. A merit based system of standardized testing that awards degrees based on examination performance would be right up my alley, for I could prepare myself to meet its demands at my own pace and according to my terms; I consider the hacker spirit of measuring the quality of a software solution not according to the attributes of its author (wealth, status, degree, or otherwise), but on whether or not the code works correctly and efficiently adjacent to this sentiment. For everyone else, there's debt - and I can't justify making that decision.
I wasn't an engineering major, I was a computer science major, but I still asked and was allowed to work evenings in the facility.
I got on the job training from experienced experts on orbital mechanics, the practical operation of spacecraft, and the infrastructure behind space flight activities. I also got to write some software that is used in the command and control of spacecraft.
Going to school gave me access to supercomputers and mainframes, practical hands-on experience that cannot be learned from a book.
Also, my university is somewhat unique in that it has an extremely rigorous writing requirements for all graduates, including creative and business writing. A comment I received multiple times at the beginning of my career is that my writing skills were extremely advanced compared to my peers. This is a double-edged sword because now, decades later, coworkers send me paragraphs to edit before being sent out.
I also minored in studio art, because as a young freshman I figured it was an easy A. Little did I realize that free and easy access to studios, models, screen printing equipment, and photography labs would lead to several lifelong hobbies.
My school also had telescopes I got to use as a member of the astronomy club, and amateur radio equipment far beyond my ability to afford as a member of the ham radio club. There is an exact and precise 0.0% chance that I would have ever gotten to even touch a 20" reflector, high quality CCD cameras, or sophisticated mounts and star trackers without going to school. Ditto for 1.5kW amplifiers and vast fields of specialized antennas for radio communications.
After I realized that staring at an IDE window all day was actual, literal, hell to me I transitioned to being an aerospace engineer. No degree, I just explained to people what I knew and did in school, what programs I had worked on, and they said "good enough, here's a board assembly drawing start spec'ing out space-rated micro- and nano-d connectors for it" and decades later I'm a senior principal engineer designing satellites.
Hell, just understanding what SWR is, what multiplexers and other RF terms meant, and knowing about polarization, propagation, and effective radiated power from my university ham radio club days went a long way to getting me to where I am today.
All of this is possible to learn autodidactically.
It would require a level of income (to gain access to the tools), foresight (to focus on specific subjects relevant to your goals), and drive (to have realistic goals laid out and to actually do it) not typically found in young adults, or old adults.
I assert it is easier, and outcomes are more favorable, if you pay someone to do all of this for you.
My perspective may be warped. I used the GI Bill and paid $0.00 for all of this. But if I had to pay the $54k it cost it would have been worth it 100 times over (I make a lot of money now).
If you can drop 90% of administrators and real estate by moving online, student loans become a thing of the past. College becomes a halfway house commune for young people to
who want to leave their parents nest.
So the way you fix a broken system is to replace it with something cheaper and better. The issue of course is that 99% of people who start online courses don't finish them. Universities provide motivation for learning, which is required for many learners.
I’ve said it before on HN and I’ll say it again: I don’t support any reform with respect to student loans that doesn’t see the academic institutions participate in the pain. I’d like to see a large number of universities get bankrupted by assuming some portion of the student loan liabilities of their alums, then allow the alums to file bankruptcy if they can’t pay off any remaining balances.
Did you know that federal student loans cannot be discharged via bankruptcy AND if you carry federal student loans into retirement, your social security income can be garnished?
1) I do not agree with applying this retroactively. You shouldn’t change the rules in the middle of the game.
2) it would be unfair to make universities participate in the downside but not the upside. Perhaps the federal government should also turn the interest earned over to universities. This could actually go some way towards lessening resistance.
1) The game has been rigged since the beginning and the unis have been the biggest beneficiaries and the most malignant actors. You don't think they knew damn well what they were doing by charging $100k+ in tuition for an English degree to an 18 year with no hope of paying back the loans used to pay the tuition?
2) The universities have already gorged themselves at the greed-pig trough. How is it you think they can afford to pay all those $100k+ salaries to liberal arts profs, have a 1:1 ratio of admins to students, and pay their chancellors and presidents $500k+? All of it is funded by indebting students to the tune of $10s or $100s of thousands while granting useless degrees.
Let them suffocate under the weight of their sins. They are the worst actors in the entire ecosystem. Worse than the naive student borrows. Worse than the predatory lenders. Worse than the traitorous legislators. Why? Because they know they're in a position of trust. They wrap themselves in the clothing of the teacher and the philosopher while picking the pockets of naive teenagers who were told they're following the path to prosperity.
fuck the Uni’s, they’ve spent decades profiteering off of us. my degree was an absolute waste of time (mathematics, cs+ stats minor) other than telling employers that i’m not a dumbass. i barely attended 30% of classes and graduated with a 3.5. uni is too easy, admits too many people, and serve as just a bottleneck in the system to actually living my life (profitably). the only reason i, and im assuming most others, went and did a hard degree was to signal to employers that im intelligent (and deserved to earn a proper living wage) , not bc i genuinely gave a shit about learning more lol
Seems like a good overview, but I do find this bit unclear:
"But why don’t market forces correct these issues?
The answer lies in the unique shield that non-dischargeable student loans provide to educational institutions and lenders.
In a normal market, if a product consistently fails to deliver value, consumers stop buying it. Producers either improve or go out of business. But in the world of higher education, this feedback loop is broken.
Colleges and universities, shielded by the guarantee of student loan money, have no real incentive to improve their product or direct students to majors that have an ability to pay back their loans.
They can raise tuition year after year, even as the value of their degrees stagnates or declines. "
Sure, colleges can charge a lot due to loans, but they are still competing with each other and differences in tuition could make a big difference. I went to Georgia Tech over other universities because it was in-state and Georgia has generous scholarships for students with good grades. So why does competition among schools not lower costs?
> But why don’t market forces correct these issues?
Another theory: The value creation is not linked to the value capture. So market forces make a bad feedback loop.
Look, I'm totally pro business, but business is only "good" at allocating capital when value capture and creation are linked. Education isn't like that. The closest we have are the bootcamp schools, where they take a cut out of your first 2 year's salary if you find a job or nothing if you don't.
When capture/creation are not linked, you need a different social organization method. "Government" or "Religion/non-profit" come to mind. Perhaps others have additional suggestions.
The fundamental problem in job education is that it needs to be linked to the needs of future employers, but those employers do not have an incentive to hire workers and train them, thereby aligning the education program with the needs of the employers. Employers do not want to pay for training, because employees can leave at any point, so they decided to let employees go to university and pay for their own education. This then leads to a misalignment between what people elect to receive an education in and what employers want, because people aren't mind readers and know exactly what will make their boss five years into the future happy. So what happens instead is that higher education becomes purely about standardising worker skills, so that each worker is a replaceable cog according to their degree. This means you can just hire X amount of Y degree holders instead of caring about their individual skills.
I ran a coding bootcamp school that had both your typical pay-upfront and later added an option like you outline. I can't speak for all programs, but schools use an affiliate third party lender for those "free" loan programs.
It was relatively new for us when I left, so I never saw the aftermath. I know it worked out well for some students, but my biggest concern was ensuring payments only kicked in if the job was "in-industry or field". My logic was the value isn't there if you go to a coding bootcamp only to not use the skills.
I was still worried they'd basically ask "do you use a computer?" and consider it in-field.
Another issue here is we had folks just looking to up-skill and the value return was harder to gauge if they were returning or continuing to work their job. This was mostly limited to our part-time program so we didn't offer the delayed-loan for it.
Apparently yeah at least arguably the most prominent boot camp takes a verry broad stance on 'related' occupations for income sharing: https://www.sandofsky.com/lambda-school/
I don't know about nationally but my local universities are having year over year enrollment decreases. I think there are some market forces in play, but they aren't reducing tuition, just making the universities ask for more state or local tax money.
> I went to Georgia Tech over other universities because it was in-state and Georgia has generous scholarships for students with good grades. So why does competition among schools not lower costs?
All the schools have access to loans that are guaranteed to be repaid. We still have the mindset that degrees are required for employment (I'm not commenting on whether that's good or bad; that's just the current cultural mindset). Because of this, schools have no incentives to control costs. The students will go regardless because they have access to money that will pay for the tuition, no matter how much it costs. There's no penalty for the universities to raise costs because they will get students anyways.
Also people get their first loan when they’ve just been legally considered adults. Nobody knows for sure they’ll be able to start paying these back in five years.
You buy a car so you can work and eat. These are very straightforward causes and effects. No car no job. Buy car that costs << than job. Done. Buy an education and you get more bills, not more income, for years. You might not even finish.
I think it's really sad that we so reflexively consider universities vocational training that criticism of universities so often includes "offering degrees that won't get you a job"
Actually academia predates the push to gate jobs behind undergraduate degrees, and trying to repurpose these institutions that mainly exist to train and employ researchers to be fully general vocational schools has been a disaster in every respect for everyone but the parasitic class of administrators it's spawned
If you would like to study something economically useless I have no problem with that. If you ask me to pay for it, I do. It isn't the business of society at large to fund anyone who wants to study whatever they want.
Academia does predate its role as employment gatekeeper, but it was privately funded then.
Yea, and jobs that selected by university degree wanted to implicitly select for class
Making the path to go to a university more accessible is admirable. Entrenching this hiring practice with policy designed to enforce its implications on universities was always ill-conceived and the consequences have mostly been negative, creating a class of permanent debtors, turning universities into dysfunctional and corrupt quasi-businesses, and not really causing a significant de-stratification of job opportunities on balance at all
And some jobs do. As I've noted elsewhere if you want to go into Big Law, you go to a relative handful of law schools, which are heavily fed by undergrad Ivies, and clerk at a high federal level.
Yes, like I said before, this hasn't de-stratified the job market. Jobs that want to select applicants by class can find plenty of ways to do so easily
E.G.: More expensive vocational programs that haven't been subsidized, selecting among universities for especially "prestigious" (read "class-signaling") ones, baking cultural assumptions of the upper classes into the expectations surrounding "professionalism" in the interview process, etc
I think that's effectively what a lot of people here are arguing they should be. You're not going to have cheap and quality research institutions (except via financial aid/loans). You can imagine different systems--and they exist to some degree in Europe. It's presumably not a terrible system but it probably does tend to be more exclusive.
And then on other side universities started as vocational schools for clergy. Who then also had time on the side to do at least some research or muse about things.
I agree with the article's diagnosis: the system is out of control, with no market forces are in place to keep costs in check. It's unsustainable for students to take on this level of debt.
I'm not sure I agree with the solutions though. Making student loan debt dischargeable doesn't make a lot of economic sense. We're talking about 17-year-olds with no income and no collateral. Why would any lender want to be in this business? Who will lend to students if the debt is dischargeable?
The article's solution is to essentially make the school the co-guarantor of the loan, such that the school absorbs part of the financial impact of student default. Ok, but now the school has a direct financial stake in the student's overall finances. Do you really want to have that kind of relationship with your school? Do you want an admissions process that is partially trying to decide if you're financially responsible? Do you want your school pressuring you to choose a more lucrative major? Do you want communications from your school reminding you that it's important to be making good financial decisions? If your school is co-guarantor of your loan, it's their business to make sure you're going to repay on time.
There has to be an element of responsibility that falls to the borrowers themselves. It's true that a 17-year-old does not have the experience to know for themselves how much debt is reasonable, especially when they cannot necessarily predict their future earnings. But there has to be some incentive to borrow less. I don't think it's healthy if student can borrow with abandon, safe in knowing that they can just discharge the debt in a few years if it doesn't work out.
Ideally students would be voting with their feet, and would make it clear to colleges that the cost of tuition is a significant factor in their decision. But I guess prestige and tradition are so powerful that people will want to go to name-brand colleges no matter the cost.
> Do you really want to have that kind of relationship with your school? Do you want an admissions process that is partially trying to decide if you're financially responsible? Do you want your school pressuring you to choose a more lucrative major?
Yes. These schools need to eliminate or drastically reduce the economically useless degrees that they have produced in such grotesque surplus for the past 40 years. They should absolutely have an incentive to produce an education that is useful to society. They’ve miseducated Americans for generations on the lie that all education is inherently good.
> Do you want an admissions process that is partially trying to decide if you're financially responsible? Do you want your school pressuring you to choose a more lucrative major? Do you want communications from your school reminding you that it's important to be making good financial decisions? If your school is co-guarantor of your loan, it's their business to make sure you're going to repay on time.
I wouldn't particularly enjoy this... but at the same time, the alternative seems to be students that "don't know what they're doing" taking out loans over $100k to get degrees that are not in demand. These people will then claim they were ignorant of the true cost, job prospects, potential salary, etc.
The elephant in the room is that many degrees simply don't leave students with a lot of earning potential. I never understand why the discussion seems to trend (not implying your comment did this) towards how we can pay for these degrees or make them affordable. It sounds harsh but I don't know how to see it any other way.
FWIW, most of my friends in undergrad would openly flaunt the way they were spending their student loan money (weed, video games, new spoiler for their car, etc.). This was not the exception, as far as I could tell.
So the age thing goes both ways - 17 year olds are too young to make smart financial decisions, both about whether to get a loan, and how to spend it.
Many states do operate tuition-free programs for residents at their public colleges. But students with good grades often prefer to take a large amount of debt rather than go to the local state school, and it's not clear how you would go about changing that.
The competition then switches from spending direct financial resources to the university to spending financial resources to out compete other students vying for the same university. In China there's usually 1 seat per 50 candidates for good university spots, and the only thing that matters is your ranking in the entrance exams. It's not exactly uncommon for high school students to be spending 14 to 19 hours a day 7 days a week for 3 to 4 years preparing academically to win a spot.
But on the other hand it would encourage other universities to build better programs. Who cares if it’s difficult to get into a good university. That’s already true without free tuition. Post-high school education already has marginal gains. Networking is a completely different story but one that isn’t affected by the cost of tuition.
It may be better to start with understanding why on earth the it’s so expensive to get educated in the USA, while in other countries it’s much cheaper, even when unsubsidized
Any mention of reducing (or eliminating) profit in America is STRICTLY taboo.
You’re just not allowed.
Profit is the foundation of the American culture and society.
I think in part because on the "buyer" side, there's often a problem of how to sort through 100 resumes for a position. Given that in any given pile of resumes, probably 70% are unqualified, filtering for "degree" is an easy way (though naturally not great, though how not great it is is hard to measure, which of course means we do it) to cut the work required in half or more.
Yeah I don't get why this isn't talked about more. It feels like one of those things in the 80s/90s during the free market fad where people decided that private loans would fix education and it ended up just disastrous.
You don't have "an industry" that hikes prices, and there is a central authority without ulterior motive that has an influence over what is funded. Not to mention that you don't put young people into debt from get go.
My understanding of a free education is one that is 100% paid for by the government, since someone still has to pay the professor's salary. In that case, you still have an issue of an industry that can demand increased prices (from the government, of course) if university enrollment suddenly increases (and I think it would if students didnt have to pay tuition). So I think you still have to figure out how to handle the market forces, but you're right that shifting the burden from the students to the government lets people start off their lives with less debt, which is a benefit of its own.
Meanwhile, I know of German and Dutch peers of mine who upon completing their masters in Europe, enrolled in California to do a second Masters ( at the time I believe they paid in the range of $100k) for the VISA and internship opportunities. And IIRC, the bet paid off because they all found employment in California, with salaries 3x to 4x what they could get here.
Their parents paid taxes like everyone else. If anything I would say it is unfair, that they are forced to move to the US, because the imbeciles in power mismanaged the economy so much that there are few adequate jobs for them, and the local Germany/Dutch economy is not competitive on the world stage.
I've been saying this to anyone who would listen for years. All the problems with higher education in the US are the direct result of student loans being unable to be discharged in bankruptcy. Usually complex problems have complex causes, usually if someone says "simple, just do this" it means they probably don't understand the problem. Not this one. This is one of those rare problems with a singular cause and a "simple" solution: allow student debt to be discharged in bankruptcy. I put quotes on simple because, while the solution is simple, it's easier said than done as the author points out, the regulation of the industry is captured and making it actually happen is very difficult due to incumbent institutions benefitting from the status quo. But we have to set the bone, it's going to hurt but there's no way around it. We are very fortunate that the solution is so simple.
and if nobody is willing to lend to these students any longer because their field of study won't yield enough income to pay back a loan... well, mission accomplished
Getting a BA in Underwater Basketweaving from your local commuter state university is much less financially damaging than at Duke or UChicago.
I'm not a fan of the idea of "useful" and "useless" degrees (ime, the best predictor for success is critical thinking skills, not major), but I do find private universities don't make as much financial sense, especially given that well paying industries like Engineering, Accounting, etc don't place much weight on your initial Alma mater beyond your first job.
Anecdotally, I had an alumni interview with a successful tech IB/PE/HF alum from CS@CMU years ago while I was applying to colleges, and he was very insistent about how he felt the RoI at SJSU or CalPoly is superior to CS@CMU. I didn't end up attended CMU (I was lured to a more "prestigious" LAC) but he was absolutely right.
That's the twist though. If your first job is better, the second job is likely better too. It took me a decade before I made it to a first class job, sitting next to people who worked there straight out of college.
That's why Baruch has Ivy level representation in IB and High Finance, and SJSU plus CalPoly SLO has Stanford level representation in the tech industry at large.
Just looking at the Linkedins of the most successful EMs, PMs, and SEs in my network, most attended a normal state flagship and worked at an "OK" company like Oracle or Splunk.
This whole "FAANG"-or-bust or "Ivy"-or-bust mentality is legitimately divorced from reality, especially now that the market is legitimately horrid for new college grads.
> It took me a decade before I made it to a first class job
What do you define as a "first class job"? Where was your first job located? Were you open to moving to a major tech employment hub (eg. Bay Area, Seattle, Austin, NYC)? Did you start your career during a tech slowdown (eg. 01-04, 08-12, 20-21, 23-present)?
"Meh" companies like Oracle or Cisco pay early-to-mid career employees roughly the same as similarly leveled employees at Google or Amazon.
The main thing is, these employees need to be based in the Bay Area, Seattle, or Austin to justify those salaries.
And if you start your career during a hiring slowdown, it doesn't matter if you went to Stanford or SJSU - you're screwed. I'm already seeing the desperation right now at on-campus recruiting events at Harvard/MIT as well as at regional publics.
Well from the sounds of it you've gotten on track! And that's something us Techies take for granted.
If you don't get on the career train for law or finance on time, you're de facto unemployable.
And this is why I love being in tech - we can grind and still find a strong path to upward mobility.
Hard skills like engineering, accounting, actuary, and medicine/dentistry/nursing are always employable. Sure you may earn less in some downturns, but at least we can get jobs.
And, unlike high finance, so long as you keep kinda up to date on technology and architecture, you can negotiate your way into IB level salaries (IB, VC, and High Finance pays fairly bad for the hours spent working, and I myself imagine returning to being a SWE).
I agree, and another way out is educating people who are about to enter university properly so they make an informed decision about the major they wanna choose more than their feelings and more on facts to see the outcome.
That's not a one-size-fits-all solution. Many 18 year olds will not be willing or capable of making a good financial long term decision regardless of education.
Mortgaging yourself into decades of indentured servitude shouldn't be an option that's available to young adults.
I actually beg to differ, most people who go into STEM for example have a pretty good understanding of their path and they are very smart 18 year olds who make really good decisions, but I agree that mortgages shouldn’t be like candies giving them to any kid. I agree that If banks were worried of not getting payed back, then maybe they would screen better, but still the issue of universities with bad incentives still remains there.
It is genuinely insane that US Colleges are basically holdings companies at this point. They priority is investments. It seems hostile to the goal of students
Human capital contracts are another partial solution that flips the incentives: instead of using loans to pay tuition up front, institutions are paid a % of your income for a fixed period of time, after which any remaining amount is forgiven. Typically this only applies to income over a base amount (such as 10% of income above a 40,000 base). Naturally this works great in fields with strong employment outcomes and terribly everywhere else.
The return window should be time limited so that the uni shoulders some of the risk - that their degree has market value. Masters programs can be particularly egregious, they are profit centers where only a small fraction of those getting the degree advance to a PhD program or some position where the degree matters. If the time is limited and one only need to pay a % over a threshold pay, the uni has some skin in the game and can lose on the gamble. In this market design they may be more careful about the promises they make and better guide our population towards programs that have better market value (and less personal debt).
> So, what’s the solution? It’s simple, but not easy:
"Make student loans dischargeable in bankruptcy again.
Tie lending terms to the value of the degree.
Impose risk-sharing requirements on educational institutions – Schools would face financial penalties or need to contribute to a risk-sharing pool if their graduates default at high rates."
=================
Sounds reasonable. Making people who were either faithful repayers or non-borrowers in the first place, pay for the bad or unlucky choices of a few is obvious bad and unfair policy.
There are always situations where people who make mistakes have them forgiven but pay a price. I think the public would accept something like that, but not a program where the debts are forgiven outright.
Schools need to take a haircut and repay some of the bad debt themselves, just like a bond default does not result in the bondholders receiving 100% of what's owed them.
This is an important topic, but I wouldn't recommend reading this post to learn about it. There are numerous flaws and jumps in the logic.
However, without getting into all that (time is too valuable to comment on the 50,000th iteration of the same points) I will just point out that the solution is much simpler than the author's. Make the maximum repayment of student loans a percentage of income over a period of time. For example, you have to repay a maximum of 7% of your income per year for 15 years. No need to get into complicated issues of bankruptcy law. If you want universities to align their incentives more than they already are, make them cover some or all of the unpaid loan balances after the repayment period ends.
There's a certain point in time for any industry where it has a chance to capture both the user and the legislator. Once that happens, prices for consumers start to grow faster than wages because the industry has more money for lobbying, it's a positive feedback loop.
Political solution to this is very unlikely unless there's a major stress in the system that, at least temporarily, takes out the one piece of the price growth puzzle.
Many years ago I went to university in the uk. Entry required good grades but tuition was free and there was a reasonable grant to live on.
Twenty or so years ago the grant became a loan and, more recently, tuition fees were introduced.
Nowadays way more people go to uni but come out saddled with debt.
Presumably the incentives are the same as described in the article for the US: the uni wants as many students as possible because they get tuition fees and short term the administrators don’t care about graduation rate or job outcomes because it will be on some future administrators watch when the feedback loop stops new undergrads joining?
It's somewhat besides the point of the piece and might be unfair, but I can't help to feel an immediate sense of distrust for any piece of writing that uses AI images.
Anyways, tying lending terms to the value of the degree sounds like a horrible idea, because how do you even determine that?
Seems to me the big issue is A) that the loans are managed b private companies with ridiculous terms and that even public state universities can basically behave like private companies by increasing prices this much.
Why can't the government not just radioactive prices for their own universities
> It's somewhat besides the point of the piece and might be unfair, but I can't help to feel an immediate sense of distrust for any piece of writing that uses AI images.
Im guessing that you’re probably not representative of the target audience, or the author doesn’t know his audience well.
The image is thematically appropriate. I don’t think the author is trying to bamboozle anyone with that image.
My problem is that it’s extremely poorly-done. The chain seems to sprout from the first student’s hair. If the author couldn’t be bothered to pay attention to the first thing people see when they click on the webpage, how much thought is put into the rest of the article?
Same here about distrusting pieces that use AI art. It’s like… a signifier of something hard to describe — values, qualities — that makes me want to listen to someone’s point of view less.
It's a sign of low effort, maybe? If they're not putting much effort into the art, maybe they're not putting much into the writing, either. Maybe not even into the thinking.
A big thing that he didn't mention: Income-based repayment programs (particularly the new SAVE plan) and Public Service Loan Forgiveness (PSLF), while certainly well-intended, make the cost of college essentially irrelevant for people who can reasonably expect to benefit from those programs. And so the colleges up the bill. His 3 proposed solutions don't really deal with this. Obviously people on IDR or PSLF don't need to declare bankruptcy just because of the loans. And if the colleges had to carry the risk, the risk would be far less than imagined if these programs still exist in the same way as today: the federal government guarantees it will write off the loan of anyone who works in non-profits (which are about 10% of all jobs) for 10 years, or anyone who makes a small minimum payment for 20-25 years with SAVE.
The SAVE income-driven repayment plan is a big deal that will make the cost of college far worse. What you have to pay is 5% of income above 225% of the poverty line. A family of 3 making $80k pays $104 a month - it doesn't matter if they had $10,000, $100,000 or $1,000,000 in loans. If you are not planning to be in a very high-earning field, why wouldn't you borrow the maximum? Why wouldn't the colleges charge the maximum? This amounts to a giant subsidy.
IMO, the US govt should stop all student loans and make the universities fund the loans. Then the universities would have an incentive to make sure students graduate with degrees & skills that will allow them to pay back the loan.
THey'd also have an incentive to make their own operation run efficiently, ie, fewer high-paid administrators who do nothing and higher pay (and tenure) for professors who do all the work.
> The solutions are surprisingly straightforward – make loans dischargeable, tie lending to degree value, hold institutions accountable
This really over complicates it in my opinion.
Student loans should be treated like any other debt. Yes, it should be able to be discharged as part of bankruptcy. From there we just need the government getting out of the way, save for a (hopefully) rare case of predatory lending or collusion.
Lenders will decide what value a degree is worth because lenders themselves should own the loans rather than governments. Banks and financial institutions have very skilled actuaries who would make pretty easy work of calculating the acceptable cost for a given degree from a given school, factoring in the lender's acceptable level of defaults.
Institutions can be very directly accountable when students can't get loans to go there. If a school charges too much, or the education they provide doesn't lead to careers that can pay back the loans, the schools lose.
I agree entirely, made my college decision based on these factors at 18. However, these analyses miss the mark by stressing the map, instead of the territory.
Ex. The graph about graduates being underemployed goes back to 1990, and there's no meaningful difference in the difference in the rate between then, and now.
Ex. 41% graduating after 4 years doesn't mean it is necessary colleges need to Find A Better Way: that would affect ex. the complain around graduates being not prepared with no discernible skills
> The graph about graduates being underemployed goes back to 1990, and there's no meaningful difference in the difference in the rate between then, and now.
this probably mattered less when the debt load was much lower
As an European this sounds lunatic. I pay +-600€ a year for my masters (bachelor coasts the same) and this 600€ also include a train ticket for all local trains in Germany.
Idk why there are so few US people coming here. Honestly our universities have their weaknesses as well but I think they can definitely compete with the average US university.
You have to account for something like 1k living cost per month if you are a bit lucky and don’t eat in restaurants every day. By working part time u can easily live of your salary.
I think the us is famous for its student loan system and it’s a way of separating poor people from people with better situated parents. We do this in Europe too but here we do it a bit more “hidden” and mostly in Highschool.
I think Americans need to start very seriously considering working in another country after college. Student loans can't be discharged in bankruptcy, but it is extremely unlikely they will be legally enforced overseas.
For that matter, some serious thought should be given to going to college overseas. I don't care that "American universities are always more prestigious," there are some countries that are handing out full ride scholarships to internationals and some where the full sticker cost is as little or less than a US in-state public school. Most high school counselors know nothing about this and most students don't even consider it.
Ironically, many American study abroad programs probably cost more than just enrolling in the foreign institution directly for a semester (whereas the same is never true in reverse).
A friend of mine did exactly that. Entered U of Waterloo on math scholarship. Lost the scholarship in the first year because of bad grades. Second year transferred from Honirs Math t9 General Math. Third year transferred from Math to film studies. Fourth year transferred from film studies to Independent studies. Fifth year a lot of drinking and soccer - Independent studies did not require any classes just some sort of progress towards some type of essay. I think in sixth year Ontario government cut his student loans. He was on the hook for something like 50,000 CAD. Left to teach English in Seoul. Been there since 2000
While the US system is particularly messed up, it's not that great in Europe either.
In my country universities get paid by the government based on number of graduates. Things like quality of education and employability matter very little. So, the end result is a system where many young people spend 5 years of their life on a masters degree that doesn't give them any monetary benefit. The university gets their money, the government gets fancy stats about level of education, but many students end up just misled and wasting their time.
Obviously this is better than graduating with massive debt, but it's still a major financial loss compared to working full time, or studying something employable. In my opinion, what we need is a change in mentality. People shouldn't tell their kids that it's okay to study just whatever you enjoy, at least not until you have some other means of earning a living you're happy with.
I believe a decade from now we'll see the "unbundling" of the three types of value universities provide: /1/ employability signal, /2/ knowledge, /3/ social. I don't know what will replace /1/ and /3/, but I look forward the future where /2/ can be made more widely accessible (without the debt).
Imagine a future where everyone knows 101-level concepts in chemistry, biology, physics, etc. and able to function in society informed by all this knowledge, rather than defer to "experts."
It's bizarre to me how accepting we are of the idea that higher education should cost anything let alone be mind-bogglingly expensive. This is wildly successful propaganda. Student loan debt was an explicit political goal [1]:
> "We are in danger of producing an educated proletariat," announced Reagan advisor Roger A. Freeman during a press conference on Oct. 29, 1970. Freeman, an economics professor at Stanford, was also an advisor to President Richard Nixon.
> "We have to be selective on who we allow to go through [higher education]," Freeman added.
Poverty is intentional and a necessary condition for capitalism. It creates a malleable and compliant labor force. Student debt, medical debt, housing debt. All of it only exists to make a handful of extremely wealthy people slightly more wealthy.
Modern universities aren't really about education at all. They're simply hedge funds in a trenchcoat.
Harvard, for example, makes what? Half a billion in tuition per year? But they have upwards of $50 billion in their endowment. The interest alone could fund the entire university.
In-state University of California, Riverside tuition is roughly $13k/year. This isn't mind-bogglingly expensive IMO. Less than 25% of student debt is from public colleges, with the majority due to expensive private schools. Most of my friends also worked part-time during undergrad, to further lower their loan burden.
You aren't making this point directly, but I think it's worth pointing out: not everyone is entitled to attend Harvard, Princeton, (etc.) any more than they are entitled to a Maserati.
There are, and should always be, affordable public options, so that anyone who wants a college degree can get one. We need to stop romanticizing elite universities, and acknowledge that you can get a great education, with hard work, at almost any university.
Harvard's endowment is $50 billion, and its expenses in 2023 were $6.25 billion [1]. To fund that, the endowment will need 12.5% annual interest, which is impossible. Tuition revenue is not remotely suitable enough for Harvard's operational expenses.
Again, people don't understand how endowments work. When endows a specific program at Harvard, their money must be used for that program alone. The funds can't be sent to the general pool for the entire university.
There are many ways to criticize wealthy educational institutions, but calling them "hedge funds" makes no sense. Which hedge fund subsidizes their clients' expenses with donations?
I'm not convinced American universities are unusually expensive. Its an costly business. Does anyone have good figures for what the cost/student is globally?
Here in Sweden university education costs less per head than highschool education (we of course pay for research separately). In Russia there's even one university, the Independent University of Moscow, which is just a bunch of mathematicians who give courses.
University education can be made into something really hardcore but simultaneously incredibly cheap.
For example, I think the IUM has exactly zero administrators.
I think most of the discourse is about fees students pay, so $$$ for US vs free for Europe. When you see $38k for US vs $32k for UK then its a different problem.
I was lucky enough to get a grant, 100% of cost, with two caveats, you have to finish, and once you finish you HAVE to work in the country for 2 years. Overall an amazing compromise for government.
The rise of Education Grants on Fed level and the decrease of state funds per student...classic economic game-ship gone wrong...
What might have worked better is higher Fed grants per student handed over to states as match grant where it matches state funds in the same student.
Anything else delves into false narratives around false facts....
And we do in fact have an example of said cure working...elementary education where no student has a debt...everyone forgets the 1-12th grade school system that works with no debt transferred to students....
Don't worry, if AI starts hitting the labor market like a wrecking ball, almost nobody's gonna be signing up for 4 years of busywork anymore. The only people joining will be the few people who actually WANT to learn subjects or join academia, and they'll get rock-bottom tuition prices.
What happens to all the existing student debt? Debt is just a number on a computer, I'm sure they'll figure something out...
How hard is it to just go to the public university in most states? Where I live, you can get your tuition completely covered if you keep a B average. Young people can get whatever degree they want without having to worry about debt as long as they have decent academic ability.
Why has nobody mentioned for-profit entities allowed to run roughshod over our country's students?
textbook publishers, for one, are guilty of this. professors get kickbacks to assign a new edition of a textbook each year or few years, so archived or older versions don't work. don't get me started on those books that come with a 1-time code that you have to use to do online work. its a racket.
Regulation should allow students to forgo their tuition payments if they can’t land a good job in their field of study.
That’d help align incentives.
Schools would compete on placement rates and quality. They’d need robust post-graduation placement services and would need strong partnerships with industry players to stay in alignment with required skills.
Think of high school, while most people do not pay fees directly while in high school your taxes pay for it. Most people for most occupations only require perhaps 5 years of staggered high school education. One can have an (extended) apprentice or higher degrees for others.
I like the system that some coding bootcamps employ where they take a percentage of the first years of working wages. This would be a way to discern the value of your degree quite accurately. It would align the universities' and students' interests.
Besides this, I also agree to the 200+ upvotes, system is broken y'all!
This is by far the most honest and accurate assessment of the current situation I have seen. And the solutions are spot on, and sadly his assessments for how likely they are to happen.
Excellent article, I think it goes too easy on the actual corrupt people who are the real culprits: the huge bloated administrations collecting big paychecks at the expense of poor kids who don't know any better.
Agreed with the overall consensus that we should let this market be guided by true market forces, but I also think people often assume the wrong outcome of this.
Universities give students a ton of control over their education. Where do you live, what classes do you take, when can you unenroll, etc.
Want higher graduation rates without lowering the grading bar? Simple, do not permit part time enrollment, even for one term. Sounds harsh.
Want better job prospects on graduation? Simple, kill off 90% of majors (dance, sociology, etc.)
The reality is that people generally think of college was a guarantee of success (it isn't). Many people would do better going to trade schools.
Attending an elite university will always be expensive (in HCOL cities, high demand for students and professors, etc.)
We need to stop treating college like a basic right, or a place for people to chase their dreams. Dream chasing is great, but if someone else has to pay for it, incentives will never align.
“We” decided that cheap college was too socialist and his people cooked up a scheme to make it more expensive and push the underclass and PoC into the GI bill. “You people” only get an education once you survive the military. But it made things worse for the middle class as well, as almost every5ing from Reaganomics has, and things have only snowballed from there.
It wasn’t even to push people to the military, but literally to ensure “the wrong people” had more difficulty getting a university education—Reagan’s people came up with it as a reaction to Vietnam War protests.
I’m not sure that the impact on the debtors is even the worse part. The removal of any apparent consequence for the cost of education also seemed to remove an incentive for the university to provide a quality product.
how do you get the system to change itself when it benefits so greatly from the status quo. massive protests? vote them out? those would require organisation and cooperation from people that can easily be turned against each other. no, the system stays as it is or gets worse. sorry to be a downer has there ever been a situation where massive self interest like this have been overcome?
The premise that 17 year olds cannot make this kind of decision seems widely accepted here. Yet, I remember clearly understanding that since I was paying for college with debt, I must study engineering.
Perhaps college has expanded to select too many people? I wonder if this could be solve by simply restricting college admissions to 20% of graduating seniors.
As with other industries, there is a steady increase in demand but not enough supply. Make it easier for accredited universities to be setup and let the free market forces drive the cost of an undergraduate degree down.
I actually think we should be decreasing demand rather than increasing supply. Not every job needs a college degree, and allowing more people to avoid college altogether would naturally drive prices down from the demand side. The hard part is that I don't know how to make employers accept non-degreed applicants, outside of having Peter Thiel shout at them to do so.
I agree. At least in my country degrees are commonly used to filter applicants for jobs that could easily be done by someone with way lower level of education. That's not a healthy system. A degree should teach you skills that you need and can actually utilize in the work you will do.
I think we are going to have an era of entrepreneurial maximalism coming soon. For a lot of young people, the employment deal is rather broken. Also, AI will benefit smaller companies far more than larger ones.
This was one of the worst articles on the topic I’ve ever read. Full of faulty assumptions, ill-defined terms, and just flat out misleading statistics. Numerators without denominator. The list goes on.
The problem starts at the point where people think the purpose of universities is to qualify people for jobs. I wonder what happens to the Humboldtian ideal.
The problem here is the time value of money. If the world is based on a production function of compound interest then in a world of finite resources what becomes cheaper over time are cell phones and what becomes more expensive are people's time, because the per unit cost of clean water and housing goes up and technology makes virtualizable goods cheaper.
This also has the added benefit of screwing with the Gini coefficient as returns to capital are always compounded where worker productivity at best goes up linearly.
So people mortgage their future in a bad Nash equilibrium in a competition to increase their productivity at a slightly faster linear rate than other workers, by taking money from financiers. The same financiers that see an exponential return and are incentivized to shrink labor costs to keep maximizing compound returns. So students are stuck in a system in which they're borrowing from their ideological competition.
It's not that universities are inherently evil or administrators are bad. It's a natural extension of how returns to investment work.
Now I'm not a Marxist, but that's the way the math works. The only solution I can see is a social system in which the wealthy form investment vehicles that run as cooperatives owned by the workers and flatten the Gini coefficient as much as possible. If students bought shares in a university that they then owned for life similar to bonds, then the university system itself would self correct.
Say you go to graduate school or had tenure - then you would have a higher share of bonds. You would no longer be paid in a linear way, but a compound one. If the returns didn't align with expected earnings the university would fail. Linear payments are essentially just an admittance of failure to believe that inflation won't destroy someone's earning potential unless they're able to become a shareholder faster than someone else. Which causes intergenerational disequilibria as we've seen where the old are incredibly wealthy and the young are too poor to start families.
Unless economics is willing to confront the social problem of compound interest in a finite world accelerationist capitalism will end up destroying society.
No, the solution is not to burn down academia. Ask the Cambodians how killing everyone with glasses worked out for them.
Silvio Gesell essentially makes the argument that the return on mere ownership of real capital is negative in the real world. Positive interest can only exist in a world where demand for capital exceeds supply. Since capital produces capital, we reach the excess capital "regime" eventually. The holding costs of excess capital are negatively therefore people destroy the excess capital. In the positive interest range there is a tendency for the interest rate to drop. In the negative interest rate range there is a tendency for the interest rate to rise. Both lead to the equilibrium real interest rate being exactly 0% in the long run.
But a 0% interest rate has some quite significant implications. The value of non-extracted rock in earth's crust and the mild steel it eventually becomes are equivalent, despite being separated in time. Capital requires energy to operate, which also comes from the earth's crust. In other words, everything that exists today is just a long winded transformation of one chunk of the universe into another. Nothing is ever "produced". All wealth is based on the direct or indirect ownership of land and its resources playing out over the ages. Mind you, in this framework, owning an expensive machine is equivalent to having the mining rights to dig out the materials and energy sources. It is not literal ownership of land that is important, but the access to its benefits.
My position is that global GDP is a compounding function on interest. So you if you take the sum total of the world's GDP you can take out (x - m). You can simplify the equation further to goods produced today and investment, which is similar to your argument.
So you have a total stock of raw resources, the current production function based on technological transformation, and computed interest in the future (which is a compound function). The resource stock is finite no matter its size (like all resources on earth), and the future expected return to transform those resources is expected to go up exponentially.
Competition doesn't matter under these circumstances. So long as investment has a compound function you run out of resources quite quickly or reach a point where whoever owns the most raw resources is the person that wins under the condition of a complicated game of musical chairs.
At 3.5 percent GDP growth rate at a compounded return you have to double the real return of goods in twenty years. Or you have inflation. In a generation the system collapses.
You have to massively redistribute wealth and flatten the gini coefficient almost immediately while assuming that GDP can no longer increase. Or you don't believe in math. There isn't a middle ground. Giving people bonds based on what they do that are nontradeable would be a start, although how you forbid resale is legally difficult. Forming investment vehicles that do what Benjamin Franklin did with the college in philedelphia might help. But the math doesn't work if you have a finite set of resources and a compound function of return. Technological transformation of raw resources into goods isn't a guaranteed exponential function.
Or we'll see more of what's come before. We can afford fancy computers but not homes because cell phones are cheap to produce and land is expensive to own.
This is why am not too excited about elections. Both side promise a lot but execution is lax. While credit is due to Biden admin for infrastructure and Chips bill, his handling on forgiving student loan was a mess.
It was a one time shoddy fix. May as well make all loans the Same - based on risk, be discardable and the punishment is credit score ding if it’s not paid.
Non-dischargeable loans are a drain on the economy.
The profit motive reliably exposes brokenness. What changed to make loans for useless activity profitable? Normally, a loan for useless activity wouldn’t be issued, because of the expectation that it wouldn’t be repaid.
The education-politician complex as we know it will face a dramatic reckoning in the next few years. Many mid-tier universities are likely to go under.
Perhaps, as a society, we will rethink how education is attained. In a world shaped by AI, maybe kids will take MOOCs just for fun.
One thing that really annoys me about universities is being forced to take random classes under the dubious banner of being well rounded. The incentives for the university are to make us spend more time and money on them. So of course, they want us to waste time in arbitrary forced requirements. My observation is that people are not actually well-rounded just because they went to a university. And I don’t think they’re even studying the fields that we need as a society. There are too many random fields that just seem like activism rather than something rigorous. Taxpayers should not be subsidizing those, and the government needs to be much smarter about managing the bad incentives for administration.
Not true... people were talking about this in the late 90's as being a bad idea because of misaligned incentives.
Loans are supposed to be inherently risky to the bank issuing the loan. Managing that risk is their business, and the reward for doing it right is the interest payments.
I remember people back then talking about "if the loans are non-dischargeable, then the bank is pretty much guaranteed it's money back, making it a no risk proposition to them. What's stopping them from becoming student loan mills? What's stopping colleges from asking for more and more money if the banks just lend it no risk?"
These ideas were out there, but get drowned out by the voices of the big pocket companies that are proposing the legislation. Tons of articles talking about the risk being overblown, the results are wonderful, etc. Think about the kids, good for 'murica, etc.
The big messages you hear over and over again in the media are being payed for by groups that aren't particularly interested in benefiting you. This is not a new problem, it's been this way for a long while.
And here we are 25 years later. Wondering how we got here. When anyone with a brain at the time knew this was coming.
The problem is only getting worse because of media consolidation and the vast reach of the internet into everyone's eyeballs. Be skeptical very of what you read.
Simple facts of life about education and (OP) student loans:
(1) Liberal Arts and Sciences. If you have the money/smarts, can go for a Bachelor's degree at an Ivy League university, maybe also join a fraternity, and, thus, get some more understanding of history, civilization, and people and meet some people likely good to know for a good career/marriage.
The Ivy professors are expected to publish a lot of research and, hopefully, get that research funded. The university may take 60% of the research funding for overhead.
I'm shocked, shocked to find
US National politics going on here. Here is your 60%, Sir.
The universities like getting the 60%, e.g., for the white table cloth restaurant or the the President's limo. US politicians like funding education.
Due to WWII with radar, sonar, the Bomb, the US government liked to fund research in the STEM fields and, soon, medicine, agriculture, etc. Due to the research, the profs stay bright, with brains active, but otherwise their research has not much to do with what is in the Bachelor's degree courses.
(2) State Colleges. Could get a Bachelor's degree and also a Teaching Certificate which would enable a career in K-12 teaching that could be good for wives and mothers. Low tuition.
(3) State Universities. Could continue and get a Ph.D. Could use that (A) as a union card for a career in college teaching that did not require research, (B) a career in research, maybe as an Assistant Professor trying to publish enough and build reputation enough to get promoted to tenure, (C) whatever else could use the work for. Can regard (C) as speculative with best results quite good for career, wealth, US national security.
One academic direction: Get a good background in math (probability, statistics), physics, and chemistry, and then do research in some other field, e.g., what is happening on the floor of the Gulf of Maine.
(4) Broadly, children need to grow up, and that can involve lots of inputs and experiences. Then they can go fourth into the great US society, lands, and economy and try to be successful. Some Bachelor's degrees might help.
Bachelor's, ..., Ph.D. as job training -- has not been very popular, respected, or successful in the US.
Broadly one effect for young people in the US economy is the economy might continue to grow and develop with new directions; so, ..., a young person can try to select a direction that is or promises growth, get a first job, and go ahead and grow.
E.g., my education concentrated on math and physics. Early career was in US national security which liked math and physics. Soon there was also a lot of interest in computing, so got into that -- right, quick sort, heap sort, AVL trees, numerical issues in matrix inversion and curve fitting, .... At one point, the US Navy was HIGHLY concerned about the US labor force in computing, especially for work in math and physics, and I got well paid to sit, learn about computing, and do some on some Navy sonar data, the FFT (fast Fourier transform), power spectral estimation, etc. As US computing grew rapidly, so did my career. Now, doing a startup in computing using some original math -- that is, combining what I'd gotten like the novel ingredients for a popular new pizza.
So, if job training, trade school, education with good "ROI" for good careers does not work well DIRECTLY, maybe (A) pick some of the best of what is in the libraries and (B) make what can with it -- yup, it's risky, speculative, etc.
My recommendations:
(A) If you can afford (1), fine. Otherwise, don't spend a lot of money on that Bachelor's ... Ph.D. education. I.e., for the OP here, don't take out student loans, and if go to state schools might not need the loans (might not apply to careers in law or medicine). By the way, for grad school, Master's and Ph.D., I never paid anything and did get paid for doing ugrad math teaching.
(B) For a Ph.D., at some schools, courses are optional, the main point is the dissertation, the definition is "an original contribution to knowledge worth of publication", the main criteria for publication is "new, correct, and significant", a cheap way to get the background for such research is independent study, and might do enough of that on evenings and weekends before going for a Ph.D. E.g., not a lot of need for "student loans".
(C) Get some basics, e.g., in the STEM fields, and then look for opportunities in the US economy.
(D) Meet people, especially the right people: It can be better who you know than what you know.
(E) If you are doing really good work as an employee, then maybe see if can do much the same work but for much more money as an owner.
That's exactly what political parties in a democracy should do.
You know who never says no to handouts from the government? Wealthy people. In fact, they don't just say no, they demand handouts. It's only when the government gives money to poor people that it suddenly becomes a moral hazard.
> debt forgiveness was a hot topic
... until a politicized Supreme Court killed it because it was giving money to poor people.
I think that a student debt could be replaced by dischargeable debt if you churned $100,000 of credit card cash advances in the same month, paid down your student debts, and then after the one year zero interest period expires, declare bankruptcy on your credit card debts that replaced your student loan debts. Can anyone confirm?
> Make student loans dischargeable in bankruptcy again.
I would like to see the author back this up with more considerations.
Bankruptcy disappears from all credit reports after seven years. The average age of first time home buyers is 35.
So if a new grad’s credit is trashed from the age of 23-30, it makes no difference to them - they are not planning on using credit for anything substantial anyways.
What is going to stop every single student from declaring bankruptcy immediately after graduation?
I feel like allowing bankruptcy in certain situations would make sense.
For example, I took out undergraduate and graduate loans to train for a career that, due to a freak health event (I got MS) in my last semester of grad school, I couldn't actually do. Currently, the disability discharge works in a way where if you can do any work at all you're on the hook for the full amount.
So someone who went to school to become an actuary/doctor/lawyer/etc, suffered a severe head injury and afterwards can only work a retail or fast food job is still on the hook for all their loans and has to pay them off on poverty wages.
Another case is people for whom the economic landscape changed so drastically so quickly that the decisions they made when entering school might not be relevant when they leave school. Think people who started undergrad in 2005/2006/2007 - they might have made perfectly reasonable decisions about what college to go to and how much debt to take out based on expected future return, and then that return tanked while they were in school + there were several years of scraping by during which interest accumulated due to no fault of their own.
Think of people who started a Computer Science degree in 2019 or 2020 (yes, individuals can maximize their chances of getting a software development job after university, but as a collective many of them will have to do something else for the foreseeable future).
Yeah, I'd consider the COVID kids to be in a similar boat to those of us who were in college for the GFC. The only reason interest rates were raised as suddenly and drastically as they were is because of COVID, which is a freak event. (Albeit one we should have been planning for as a country.)
There are ways to get student loans discharged in bankruptcy now, and one of the criteria that can be used is essentially that you were sold a bait and switch. (e.g. if the school majorly misrepresented what graduates from certain majors earned) I'd argue that there are cohorts who had that happen on essentially a societal scale, and we should modify the existing legal principle to include deception by the government/industry and not just by educational institutions.
I also think there might be societal stability benefits to this - one of the biggest black pills I've ever encountered was that in the GFC, people could lose their houses/go bankrupt and be allowed to start over even if they took out a NINJA mortgage, that the mortgage brokers/sellers individually saw no punishment, and almost all the high up people who caused/exacerbated the issues got off scot free or were eligible for new starts. If an adult in their 30s-50s makes a bad choice, we have to bail them out or help or not hold them accountable? But the kids who made bad decisions at 17 should be held to them for life? It was just a clear case of shitting on people without the power to push back that it made me revile a lot of American 'values'.
> What is going to stop every single student from declaring bankruptcy immediately after graduation?
The long and arduous process of going through bankruptcy proceedings. Have you or do you know someone who has gone through that? It's not fun nor is it a guaranteed ticket out of your debt.
This exists to an extent today. If you apply your profession to an area that the government deems a societal good (e.g. you work at a public university), it can be discharged after 10 years. This was status quo for decades.
2) Tell everyone born between 1980 and 1995 that they'll be unable to compete in the global marketplace if they don't get at least some post-high school education, and imply that the mere presence of a degree will help instead of having a specific type of degree
3) Have next-to-zero standards for public funds used in grant and loan programs for college education, meaning people can take out loans for any sort of degree program at almost any sort of institution
4) Hold these debtors to standards that aren't applied to other types of debtors. You cannot discharge them through bankruptcy, it's very difficult to renegotiate, and SCOTUS has said that the chief executive of the note-holding institution (in this case, the President of the United States) cannot use discretion in deciding who he gets to forgive for loans.
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