At any link in the chain, someone could have said "this is a bad idea" and stopped--but instead they do what's in their own (short-term) best interest, and everyone loses.
She's horrible at money, I have no pity. I will agree though that this form of debt should be dis-chargeable via bankruptcy.
Otherwise, why wouldn't someone just run up $300K, declare bankruptcy the day they graduate, suffer credit-wise for 7 years and celebrate their 30th birthday completely debt-free without ever paying a dime of the loans?
I noticed that with my school. I was in graduate and under-graduate school at the same university. I was there for 7 years. The tuition kept going up at an enormous pace and the school just stared building stadiums, shopping areas, recreation centers and other seemingly useless stuff. Incoming students and their parents had to take higher and higher loans.
I graduated without any loans and we payed my wife's loans in 2 years but that is definetly not the norm.
Producing graduates that are enslaved to paying back giant loans makes less able to competitively choose work places (they can't quit a job they don't like as easily because they have to keep paying another, rather large monthly bill).
Easy loans lead to higher tuition...
...higher tuition leads to more debt on graduation...
...more debt on graduation leads to a need for a higher salary...
...the need for a higher salary increases the prices companies charge for goods and services delivered by college educated...
A prime example everyone is familiar with is the rising cost of healthcare.
If this continues we're going to stratify the income in the US so far we'll end up with an aristocratic and peasant class of citizens and the only way the non-college educated peasants will be able to live is through indentured servitude to a "lord or lady".
- exacerbated income disparity, since only the elite are hired, which makes the job market extra-tough on all but the most capable new graduates, as well as
- higher professor salaries, since professors and potential professors in the field have attractive non-academic options, but also
- more willingness of students to take on more easy loans, since "everyone knows" that lawyers, etc. make so much money that it's okay to take on a lot of debt.
Just replace "lord or lady" with the name of a large multi-national corporation (Wal-Mart for example).
Increased availability is not always good. This is a clear case where getting the loans was a terrible financial decision, since she's only earning enough to pay off a tiny fraction of the principal. We should be decreasing availability to people who have no realistic possibility of paying off the loans, especially when they don't even have the option of bankruptcy.
The idea that making loans available to people with marginal prospects of paying them back is always helping them is bogus. It removes pressure on colleges to trim their costs to help poor students, as well as encouraging people who financially won't benefit from a degree to pursue one anyway.
I'm saying this as someone who got mired in debt going through college and spent years climbing out of that hole. Things worked out for me in the end, but the loans were so easily available that I didn't consider the alternatives. Now I'm so allergic to debt I don't even want a mortgage.
The interesting bit is that, at least in the U.S., one can go to decent schools relatively cheaply. In-state tuition at state schools is anywhere from 1:4 to 1:12 ratios with private and out-of-state schools (that is to say, a person could get an entire B.x. and M.x. at a public school for about the same cost as a semester or year at a private institute).
Whereas say a career as a programmer, there are plenty of back doors and ways to learn and move up without having to get the formal education. There's still the reason to get that education but I can honestly say if I don't end up making back the difference on what I spent on it during my working lifetime it won't worry me at all.
It wasn't a bad class (and nicely enough my CS teacher happened to teach it, also), but unfortunately I think it's worse off than math classes as far as getting people to care and thus really remember it for later.
Correct me if I'm wrong, it's just the perception I have seemed to get about some fields from things I have read.
So--what are your goals? And how do loans and a BS degree program get you to them?
I've tried to teach myself the math involved, but I've come to the conclusion that to really learn it I'll need courses in it. It's mainly the math, I think, that I'll have "trouble" (actually have to study) with - not the programming.
Without loans, I'd have to work full time to support myself. This would cause my performance at school to suffer, unless I took a barista/service type job. Which I'm not sure I could support myself with (to be honest, I don't know how the baristas here in NYC do support themselves with it). I've been out of the service industry since my first go-around at college, and have no desire to return whatsoever.
With loans, I'll be able to concentrate fully on the work involved, and perhaps have time left over to build a few cool things that I don't have time for now.
A BS degree program will get me the background in maths (Bayesian theory, calculus, linear algebra, statistics) and advanced computer science (ANNs, GAs, compiler design) that will get me to the place I really want to be: advanced/next-gen datamining and knowledge systems. I'd really like to be working on how to analyze how people connect and predict trends based upon it. (Yes, I understand that many privacy people, including myself, have issues with such a thing. It's something I'm fascinated with, but have moral qualms about implementing. Also, lack of experience/know-how.)
Have you considered finding a study partner for learning the math? Or a tutor--if you live near a university, you could probably find a math major that could use some spare cash.
I'd really like to be working on how to analyze how people connect and predict trends based upon it.
Working where? At an existing company? There's not too many options there, so you'd want to plan toward landing a relevant job (whatever that might take--and a degree alone isn't worth all that much; professional networking is). At a start-up? In that case, debt is probably the last thing you want.
Education for Home/EU students from disadvantaged backgrounds is free, of course.
Am I reading this incorrectly? $250,000 for 4 years? Thats insane.