"Do I even need to mention which segments of our population rely on student loans the most, and thus are getting screwed the most by the student loan crisis? Hint: It's not the happy white suburban family of 4."
Actually, according to the Wall Street Journal (http://online.wsj.com/article/SB1000087239639044424690457757...), the upper-middle class has seen the sharpest jump in student debt since 2007. Households with less income have an easier time finding student aid and those in the upper class can more readily afford the rising costs. This puts the upper-middle class in a kind of purgatory for financial aid.
+1 I made it through college with hardly any debt because my family's income wasn't high enough to warrant loans (instead of straight up aid) until I was a senior. However, I have a friend whose family makes more money than mine, but also has a sibling in school so they have a lot more debt.
If a private college wants to give financial aid to a student who is poor, that is its business and it gets to define what 'poor' means for its purposes.
Kids from households making $200,000/yr may not be Maybach rich, but they don't need Pell Grants. and I certainly wouldn't describe their state as "purgatory" just because they aren't getting handouts.
The basis for giving this kind of handout (which I understand along with the general opposition to any handouts) is to improve class mobility and give poor kids a chance (after all, they did not choose to be born to the 'wrong' family). What reason is there for people with plenty of money to get that sort of handout? This I don't understand.
If a private college wants to give financial aid to a student who is poor
just because they aren't getting handouts.
Why is it when the kid is poor, its financial aid, if the kid is middle class, its a handout? The language seems twisted to articulate your point, rather than the point speaking on its own.
Also, let's take my situation. My mother made $102,000 last year. We're well off, by any metric. Making 100% over the median income makes you upper middle class.
My in-state total costs for my public university are $10,099 a semester. I didn't choose the crazy private school, I didn't go out of state, I'm at literally the cheapest school I can be at.
It still cost 27% of her net income per year. That's a reasonable amount of money? I don't think it is.
Now, you can say you're supposed to save beforehand, except back then we were poor as dirt and couldn't afford to. Does that get factored in into any kind of federal aid? Nope. Last years tax return, only.
I have enough merit based scholarships that she can afford to send me there, but I think it's ridiculous to ignore that there is a larger problem in academic costs.
EDIT: The argument could also be made that students should be working through school to offset the costs. I personally find that rather backward, (Why is college the only education not funded by taxes?) but it's the most practical solution currently available.
You are making up an intellectual dishonesty which isn't there. I'm happy to call it a handout in any case - I said that I understand handouts for the reason of social mobility and also a general opposition to handouts. Fundamentally it doesn't matter what you call it. I am not guilty of some kind of diabolical framing here, that is nothing but a distraction.
$10,099/semester is a reasonable amount of money for a college education, at current market prices. You could have gotten cheaper but presumably you did not want to - your choice. At $102,000 it is completely affordable. When one has kids, and wishes them to college, one is normally and reasonably expected to save up for that purpose.
So your argument seems to reduce to 'my mother shouldn't pay this money.' That implies someone else should pay it. Why? What makes it so much not reasonable?
After your total costs are paid, your mother is still making $81,802/yr. She can't live on $81,802/yr? She should be getting money from people who don't even make $81,802/yr because you are going to college and you think that the cost of tuition is not 'reasonable'? You should be getting that money ahead of people who are poorer and not getting any aid?
You are making up an intellectual dishonesty which isn't there. I'm happy to call it a handout in any case - I said that I understand handouts for the reason of social mobility and also a general opposition to handouts. Fundamentally it doesn't matter what you call it. I am not guilty of some kind of diabolical framing here, that is nothing but a distraction.
Commentary on your word choice isn't a distraction, but your brazen attempt to dismiss it is rather amusing.
$10,099/semester is a reasonable amount of money for a college education, at current market prices.
That caveat there is the only way you can possibly say that. For current market prices, it's not bad. What I'm saying is that the market is charging too much for college education.
You could have gotten cheaper but presumably you did not want to - your choice.
And still go to a university? You're incorrect.
When one has kids, and wishes them to college, one is normally and reasonably expected to save up for that purpose.
Are we just going to completely ignore my comments there? I addressed this in my earlier statements. Federal funding does not consider past income, yet there is an expectation that college should be saved for then. That's dissonant.
So your argument seems to reduce to 'my mother shouldn't pay this money.'
And your argument seems to reduce to "your mother should pay this money". When you reduce things to their simplest terms, everything sounds stupid. It's a logical fallacy.
That implies someone else should pay it. Why? What makes it so much not reasonable?
It should be a distributed burden across the populace via tax, for the exact same reasons that all other education spending is done that way. Education should be a public service, as it's the cornerstone of a modern economy.
After your total costs are paid, your mother is still making $81,802/yr. She can't live on $81,802/yr?
This is a foolish argument. First, since it's a post tax expense, the more relevant number is net pay, which works out to be roughly $55,000/year. Which she can live on, but that's not the point.
Education is completely inelastic. It is a requirement for any kind of middle class job in this country. If it costs $10,000 a year, or $50,000 a year, I have to pay it, if I don't want to be a second class citizen in a post-industrial economy.
This is why it needs federal regulation (Or more ideally, provided for via a tax), for the same reasons that utilities and the rest of the education system are.
She should be getting money from people who don't even make $81,802/yr because you are going to college and you think that the cost of tuition is not 'reasonable'?
...That's not how it works. Do you receive money because everyone helped pay for the road you use to drive to work? Without it, you would have no job and no income. But you aren't arguing that you should pay for your own road.
Why is it when the kid is poor, its financial aid, if the kid is middle class, its a handout?
Neither name is appropriate. It's plain old price discrimination. The school wants to charge more money to people who have more money.
Every business loves to do this. The only thing unusual about college is that if they crank the price up to $150,000 and then discount it to $80,000, some people think the school has "given" you $70,000.
Yeah, I agree. As a for profit company it seems like a really immature thing to write.
I think it's pretty clear there is a problem in education finance. That problem affects a lot of people of different racial backgrounds. Comments like that create discord among the very people you are claiming to want to help.
I don't think you can have a discussion about education without bringing up issues of race and class. I admit, that was a pretty untactful way to bring it up.
It's an uncomfortable subject. I'll handle it more sensitively next time.
You're right: race and class are big issues that affect education, but outside of that sentence, you only talk about financial (and therefore class) issues. There are plenty of facts in what you wrote, but none of them are about race.
I take no issue with the way you worded it (though I'm sure some people would, so I wouldn't use that phrasing on my company's blog). I take issue with the lack of evidence on that particular point. It happens. The rest of it was good, and your cause is admirable.
There are serious problems with the for-profit university model (like the University Of Phoenix) as outlined in this article.
I think it's worth pointing out that these businesses are aware that they may have a problem, and have stepped up their political giving massively to protect their interests. Mostly, to Republican candidates, and especially to Mitt Romney. [1]
Also, purely coincidentally, non-profits are exempt from the "gainful employment" rule and all the other new rules being levied against competitors to the non-profit education sector.
Weird. It's almost as if the politicians don't care much when their cronies rip students off, only when other guys do it.
The chart you linked to doesn't refer to giving from educational institutions themselves. The chart is tracking contributions from individual employees[1] of those institutions. Seems to me that simply represents the fact that professors tend to be Democrats.
On the other hand, with for profit colleges, institutions themselves [2] are contributing directly to superpacs and other political groups. It's a totally different metric.
[1] from your link: "Since school districts, colleges and universities are generally prohibited from forming political action committees, political contributions from the education industry generally come from the individuals associated with the field."
[2] The Apollo Group, which owns the University of Phoenix, contributed $75,000 last month to Restore Our Future, a super PAC run by former Romney aides. The pro-Romney super PAC is one of the biggest players in the GOP's long-running nomination fight, pumping more than $38 million into commercials, direct mail and automated phone calls that promote Romney and attack his GOP rivals.http://www.usatoday.com/news/politics/story/2012-03-26/romne...
One chart measures which party gains if more money flows to the non-profit sector. The other chart measures which party gains if more money flows to the for-profit sector.
You can nitpick the details of exactly what entities the money flows through, but the politicians aren't.
It is a valid difference, and politicians are aware of it.
Organic giving from individuals who work in the educational sector doesn't come hand in hand with organized, well financed political pressure in the same way that a lobbying effort/targeted giving coming directly from a specific industry does.
Yes, clearly the non-profit sector is far less influential than the for-profit one, in spite of donating vastly more money. Education as a whole donated $6.3M to Obama, the for-profit sector donated $145k to John Kline and $107k to Romney [1].
Clearly the for-profit sector is vastly more influential.
This influence is proven by the fact that the politicians are making special rules for the non-profit sector and explicitly exempting the for-profits from them.
Oh wait, my mistake - I live in the real world, where $6.3M > $145k, and politicians target for-profits for special rules and throw more money at non-profits.
[1] Unfortunately OpenSecrets doesn't explicitly break the non-profit sector out of education as a whole.
Yes, clearly the non-profit sector is far less influential than the for-profit one, in spite of donating vastly more money. Education as a whole donated $6.3M to Obama, the for-profit sector donated $145k to John Kline and $107k to Romney [1].
This argument doesn't make any sense. He just spelled this out for you, but I'll try it again.
Individual donations from non-profit education employees are not lobbying on the part of an industry. They're citizens playing an active role in politics.
Corporations in the for-profit education business are lobbying in an attempt to further increase their profit margins despite providing a product that is comparatively worthless.
Oh wait, my mistake - I live in the real world, where $6.3M > $145k, and politicians target for-profits for special rules and throw more money at non-profits.
Just as they should. For profit schools are student farms, churning them out and providing predatory loans to their uneducated students.
Nobody gives a degree from a for-profit school any kind of respect, it carries no more prestige than a high school degree. That makes their product worthless. They're attempting to legislate around their failings, not improve their product to a competitive level with the non-profit education system.
Seeing as the non-profit schools are supposed to be public institutions created to better the country, it's appropriate for them to receive federal funding.
Just as they should. For profit schools are student farms, churning them out and providing predatory loans to their uneducated students.
I'm confused. The "gainful employment" rule seems to target low quality schools. If, as you assert, non-profits are of higher quality, why exempt them from the "gainful employment" rule? After all, the rule won't affect them (if you are right).
The answer is, of course, that if you are wrong and some non-profits are also low quality, the employees of those schools will have less money to donate to Democrats.
But I'm sure no politician anywhere cares about that.
First, let me point out rather amusingly that you did not respond to any of my points on the nature of campaign contributions. I'd ask again for you to do so.
As for your questions.
I'm confused. The "gainful employment" rule seems to target low quality schools.
Incorrect. Your false assertion here completely derails the remainder of your post, making it irrelevant. If you would like a correct explanation of the gainful employment rule, let me know.
> Individual donations from non-profit education employees are not lobbying on the part of an industry. They're citizens playing an active role in politics.
Yeah right.
Interestingly enough, no one makes that distinction when it comes to oil company executives.
> For profit schools are student farms, churning them out and providing predatory loans to their uneducated students.
You seem to think that everyone at a non-profit works for free. They don't. They benefit from the money that comes in.
The only difference between non-profits and for-profits is whether the investors get any direct dividends. There's no difference wrt the employees.
And, non-profits do figure out ways to indirectly compensate their donors.
For example, they arrange for and vigorously defend various tax breaks.
In fact, they lobby for high tax rates to make deductible donations more attractive. Gee thanks - I'm paying for your donation.
> Seeing as the non-profit schools are supposed to be public institutions created to better the country, it's appropriate for them to receive federal funding.
Shouldn't we ask whether they actually do better the country at some point? And, suppose that other institutions also "better the country", shouldn't they get money too?
> That makes their product worthless.
Really? Where do you think that your auto mechanic learned his trade? How about the plumber? And so on.
The for-profits tend to serve people that the non-profits have largely abandoned. Why don't those people count?
Please look up the lobbying organizations for Head Start and some of the higher education institutions which also have lobbying organizations for individual federal programs that benefit the public universities. My giving was rather less than organic.
I'm at Stanford, and if you think that Stanford doesn't use every bit of its institutional influence to promote liberal political power, you have rocks in your head. This university, like its peers, works tirelessly with media such as the NY Times to promote their candidates. They aren't allowed to donate institutional money directly to a candidate, which politicians need to buy media ads to get their message out. Instead, Stanford only employs those who support the institutional liberal political agenda (calling this policy "celebrating diversity"), then those people go to their partners in the media as "Stanford professor so-and-so" with "news" about what they've just "discovered" that has implications for how you should vote: "Stanford professor finds that [conservatives are mentally ill, people who vote for conservatives are bad, Republican claims are wrong, Obama is awesome, businesses need more regulation by liberals with elite degrees and no business experience...."]
Conservatives have to donate money to buy ads. Stanford gets to post its political campaign messages directly as "news."
Meanwhile back on campus, every effort is made to indoctrinate thousands of students and send them out as an army of "individuals" to do heroic things in the service of those who people at Stanford are expected to support. I had to break off my work a few weeks ago and go to another building when the second floor was taken over by a law professor who was leading a pep rally for Obamacare called a "discussion of the issues."
The notion that universities such as these just have some left-leaning individuals acting privately while the institution itself remains resolutely neutral politically "seems rather disingenuous to me."
Stanford might be culturally liberal, but genuine leftist sentiment would be stabbing itself in the gut. Who would go to Stanford if UC Berkeley were tuition-free again?
Yeah, I don't believe any of that is true...especially in the way you phrased it. Maybe there could be some bias, but systematically? Absolutely? No way. I don't buy it.
You don't believe that any of what I said is true because you know for a fact that American universities have no systematic liberal bias? "No way"? No possibility they do?
Okay, then, your credibility can be judged by other readers on that basis: no way there's any systematic liberal bias at a place like Stanford.
I claim that these universities are powerful, overwhelmingly liberal-leaning, highly-politicized internally, highly-influential externally, and that their internal politics heavily impacts the nature of their significant external political influence. The corporate comptroller at Harvard does not have to write a check to an individual politician for Harvard to exert its political influence. Harvard has plenty of ways to influence people that don't require paying for political ads. The politician may even be writing checks to Harvard, hoping to get his son admitted.
And readers can judge the credibility of that claim, too.
Wait: are you saying that non-profit education is ripping students off and making lots of money?
edit: with the help of connivance from the Democrats? Because that seems to be what you are implying...
Perhaps there are reasons for this that have nothing to do with money. Many for-profits have very shady marketing and admissions policies. Almost all of them have very low academic standards. Mostly their money revenue comes from student loans that have very little chance of ever being paid off. Public institutions aren't quite at this stage of immoral behavior. This is why, I presume, that the for-profits are being targeted. Teachers who fail students at for-profits tend to get fired. Their incentives to just pass anyone. Working at a community college I do get nudges to increase the pass rate but I know I'm not getting fired for failing students who don't know enough to pass.
Many for-profits have very shady marketing and admissions policies. Almost all of them have very low academic standards.
Some non-profits have similar problems. Why exempt them from the rules? If these are real problems, why not pass laws against them and let the chips fall where they may?
Allowing lenders (or providing greater incentive for them) to modulate rates on loans based on (a) the institution attended, (b) the major chosen, and (c) individual performance metrics, e.g. GPA, would be a solid step towards resolving education debt insolvency.
This could be achieved by switching government subsidies from loan guarantees to payment-share plans by which the government pays a portion of each payment but ceases to do so in case of default. These loans should be absolvable in bankruptcy - an immature decision made in one's adolescence shouldn't be a lifelong burden. Thus, the credit risk is retained by the lender while financial impact lessened on the student.
Unpopular as measures radically increasing costs on liberal arts majors may be, the present situation is a clear example of artificially locked markets producing inefficient outcomes.
I was just about to suggest the same thing. The degree seems like a very important piece of information to a creditor making a decision. If I know that 60% of students of a particular degree will default within 4 years, why would I continue to loan that money out? If it's impossible for them to get out of it, that'd be good enough a reason.
It seems that most of my engineering friends have a very existentialist perspective on it: the person is entirely responsible for the actions they take. If they got themselves into debt, then they should figure out how to get themselves out of debt.
That's valid. The student wasn't forced to go study art history, but they were lied to by a lot of people, including their parents and society, which are two difficult groups to ignore. I think it's good that we're airing out some of college's dirty laundry--it needs to be known that if you go study art history, there may be a greater than 50% chance that you will be jobless or working as a waiter or waitress. I had this debate with someone last weekend where I made the same argument, and she got very defensive. It's hard to get specific and criticize certain degrees without being offensive to somebody because people feel they need to defend their choices. I later found out she studied art history, she was a waitress, and she had just quit her job. To her credit, she probably didn't realize her job options were grim when she chose to do that. If this issue is spoken about publicly, it should at the very least make the decision easier for people. Every graduating senior in high school should hear both sides of the story and fully understand they can't arbitrarily pick any degree and expect the same results.
It's a greater likelihood, sure, but... people also need to learn to take control of their lives. Dude - the $80k Art History job ain't coming along - deal with it. Pivot. I have an undergrad degree in Philosophy, but have been working in software development for more than 15 years, earning a good living most of that time too.
This notion that "oh no, i have a liberal arts degree - my life is forever ruined and I'll be serving coffee part time until I die" is a tired meme. "There are no jobs!". Yes there are, in some fields. Hustle to get in to those fields, regardless of what your "major" was. Just do it.
Now... I realize not everyone can do this - life situations dictate that some people have more struggles than others. But I meet single, healthy unattached 20-somethings that complain about the state of things - this is the best time in your life to retool, readjust and get moving. And they generally don't.
I have an B.A. in Theater. I've been a software developer for a decade, no problem. My theater degree taught me context-dependent textual analysis (i.e. requirements gathering), social observation (i.e. UX testing) and modeling. It has done far more for my career than a CS degree would have.
The problem is that people have started seeing college as vocational training, because that is how it is portrayed. "If you spend this money, you will get a job." That shouldn't be why you go to college: you should go to college to learn how to think and learn. A career is what you do afterwards.
However, both employers and graduates need to believe that for it to work. If no one is willing to hire people without prior experience eventually employers can't hire anyone unless there is a vocational education program in place. And then we get to where we are today, where people rush to whatever vocational program is at hand until the field is flooded with applicants, just because it seems like almost-maybe-a-sure-thing.
See, I still disagree with you here. Forget 'graduate-level' anything - you're still thinking in terms of formal education and degrees. Compete on hustle, moxie, other initiative - create your own life/job/work/etc - people will find you. Make a name for yourself doing something.
I know, this all sounds airy-fairy pie-in-the-sky, but it's largely true. Many employers are still going to be impressed more with hustle than with degrees on paper. The ones that aren't - perhaps you don't want to work there anyway.
The world is very much who-you-know vs what-you-know, and getting out there networking with people is going to get you a better chance of work than fighting with 9 other degree-holding applicants filling out forms on monster.com.
And I still disagree with you here. It's not about me and my personal employment situation; specifically, because my situation can always be improved via a purely relative advancement that would have no net benefit if everyone did it (see: "Darwin the Market Whiz"). Also, generally, because I personally am doing decently right now: I damn well wanted to go back to academia and get a research degree, and I've lucked out to get into a damn fine research institution. I've had to turn down 1 offer to convert a a good contract gig to full-time and turn away four recruiters pursue that (not to mention previous interviews where I was told I was turned down because they saw that I truly fit in grad-school more than I fit in their team right this month). I'm also continuing my open-source/research project and working on a side-business idea in the meanwhile. But just because I'm ok doesn't mean everyone else is ok, once we dispose of the false assumption that I'm average.
The real problem here is that you have half a generation 18-22 year-olds coming of age, trying to leave their parents' care, and finding that there's basically no demand for their labor.
Millions of people can't all have more hustle, moxie, initiative, mojo, or whatever other nigh-meaningless abstract term we've chosen to convey "the capitalistic equivalent of sex-appeal", than each other. There has to be actual demand for labor to hire these people.
Conversely, even though I'm not average, an overall bad labor market affects me. The tech sector is "recession-proof", but nothing is Great Depression proof. An ultra-capitalist economy geared towards maximizing debts and rents for bankers, lobbyists and lawyers does, in fact, ripple out to the tech sector and affect hiring. For instance, it means that there are very few R&D labs in computing right now (though a friend of mine has been interviewing with R&D teams at Oracle and I'll be happy to have the connection!), lots of VC-funded start-ups, and much of the world's top technical and scientific talent ends up writing financial algorithms. Someone who wants to actually do hard-core technology like me finds himself really curiously starved for places to work, given how well the tech-sector is supposedly doing. Oh, and everyone is wondering when this latest start-up bubble will pop, especially after GroupOn, Facebook, and Zynga IPOs.
So maybe you, rich old white man, should avoid contributing irrelevant noise to this discussion?
The problem is statistical. There just aren't enough jobs, an irreconcilable jobs gap. While it's nice that you had the incredible luck to pivot into a completely different field, that just doesn't matter here. You can't base an economy on every worker flipping heads ten times in a row.
so we should only take advice/input from people who haven't done something that would be suggested or advised? That certainly makes sense. Perhaps we need a few more layers of federal and state government programs on top of the ones we have to fix things for everyone without them needing to do anything more than tick a box?
Wow... why don't we see the same vitriol against multimillionaire 'founders' who build a company, flip it, then advise others to do the same, all the while claiming it was 'hard work'? Perhaps because the majority here want to buy in to that myth?
Of course luck was involved in my situation - I've had good luck and bad luck. I've made some pretty stupid mistakes on my own, involving more zeros than I care to count. But it's not down solely to luck - much of your success or failure is down to how you react, and how you learn from your mistakes. A big part of the problem - and I had this 20 years ago as well - is that young people haven't had enough life experience to be able to make good decisions - you don't get those until you're old/older. And very few younger people listen to older people re: advice - I know I certainly didn't, nor did many people I know, and it hurt us all in different ways.
Yes, it's all relative, and I'm not 23 in today's job market. But I have been both variously fired and laid off, deep in debt, and with nothing but a philosophy degree and minor retail and general work experience. It certainly ain't fun.
Even getting a degree - took 6 years, and I worked part- or full-time the whole time - usually multiple jobs (retail, delivery, food service, etc). I don't typically have a lot of sympathy for students who hit school full time, take out loans for the whole thing, and do not do one lick of 'work' (yes, school is work too, I know) while at school.
Unemployement was ~8% during the early 90s recession - we've certainly had higher this time around, so yes, there's some statistical differences, and the numbers are different. But complaining about broad social/political/economic forces isn't going to do much good for individual people. This reminds me of the food industry criticism - "everyone's getting fat! look at all the stuff they put in the food - we need regulations, etc". Yes, regulating food labelling, food ingredients, etc will probably help the aggregate over time, but it won't help me lose weight. I need to stop overeating, eat better foods, exercise sensibly, etc. Will that advise help everyone? No, because most people won't follow it, but it will make a difference to most individuals who put it to use.
EDIT: Should I even have taken this as personally as I did? Probably not, but didn't want to delete it now. :/
Maybe everyone should become an engineer, so everyone can be happily living in a technocracy were we make everything remotely tangible into money.
Maybe we should tell people to stop doing psychology, art history, history, political sciences, theology, literature etc. I mean, it's on Wikipedia, right? You can just go there and read about it, you know, as a hobby, so, why bother studying it?
Maybe we can all become engineers and convert everything into profit. What do you mean I probably shouldn't track someone's every movement? Why? It's the logical solution, it's possible, it's doable, it gives the greatest monetary return. And it's the best developmental solution! It's perfect!
That's a false dichotomy. Nobody is suggesting that nobody should choose a liberal arts degree. What's being suggested is that less people should be doing it because there's more supply for those professions than there is demand. There's very high demand for technology degrees and trade skills (welders are in desperate demand, for instance). These truths aren't being communicated to college freshmen as well as they should be, and that's causing a major crisis for a lot of liberal arts college grads who enter a job market that simply doesn't need them.
Why is it a false dichotomy? Do you honestly believe that people will all of a sudden flog to STEM subjects just because somebody tells them they will forever be unemployed otherwise?
We might just have this arguement because this is, after all, HN, but it still astounds me how hard it seems to grasp for many here that not everyone is actually even remotely interested in programming or "building a product".
I am absolutely convinced that ultimately a society as a whole can only benefit from a workforce (how I hate that word) that is educated beyond the requirements of their day jobs. The more you are interested in outside of your actual occupation, the more these interests will also play into your work and thus influence its outcome.
We have a constant stream of articles here that tell us how people became programmers without studying CS etc. Why however do people always assume everyone else is incapable of learning something else after studying something in the humanities? I know only very few people who expect to work directly with their field of study. In fact, most of the people who do are the ones who will at least try to go on and go into academia. Most other people I have ever met were very aware of the fact that there might be quite a disjunction between their area of study and their future job.
When I think about innovative companies in software and computer engineering, Apple is one of several companies that comes to mind.
It's worth noting that Steve Jobs turned innovative artistic design, not just innovative engineering, into economic value. One of Job's criticisms of Microsoft and Google was their lack of appreciation for "the humanities and liberal arts" ( http://www.vanityfair.com/business/2012/08/microsoft-lost-mo...). He saw Social Science as a component to making great products.
I'm a Computer Science Major. If I was recommending a Freshman what to Major in, I would recommend looking into something within Science, Engineering, or Business. They're unlikely to get an upper middle class salary majoring outside of those three fields.
However, just because a field doesn't produce dividends doesn't mean that it does not have educational value. A political science degree doesn't make money, but we can't have functioning governments without an understanding of politics and government.
Instead, we ought to consider the fact that college spending is only 3.3% of U.S. GDP. Re-prioritization of spending, and optimization of spending can carry American education forward. That's not a huge chunk of the American economy's wealth. People are falling into debt because the burden of college spending has been placed on individuals, rather than on federal and state funding. Over the last 30 years Federal and State expenditures to college education have dropped. In result, Colleges increase their tuition rates, and students and their families have a tougher time paying for college.
There's no reason for Liberal Arts majors to be paying obscene amounts of tuition, and especially shouldn't be going into debt, for a degree that isn't going to get them hired.
It's just a fact of the broken system. Tuition is justified by the job you get after it. But if you can't get a job in it, the high tuition is completely unjustified.
There have got to be better alternatives to getting a liberal education. Got any ideas?
The core problem is that state and federal funding of colleges has consistently been going down over the last 30 years, and continues to go down. When colleges get less money from government spending colleges either have to cut spending (and in result provide less to students) or increase tuition.
The high tuition causes student debt, so the only way to cut student debt is to decrease tuition.
Their are only three ways to get tuition to decrease.
1. Increase Federal and State funding of colleges. As I mentioned in an earlier response, this is doable. College spending is 3.3% of GDP in the USA. Looking at the economy and country as a whole, that's not huge. Re-arrangement of spending, increased federal and state investment, and optimization of spending could reduce student debt a lot.
2. Get rid of much of Universities. Turn Universities into Trade schools and get rid of many University programs. This is not really the approach I want to see, as I think universities have a lot to offer the world in their current complexity.
3. Find Technological solutions and applications that reduce the cost of education without reducing its quality. This is the Entrepreneur's job.
I don't think engineers are all about making things into money. I think they're more interested in doing things efficiently. Think about a barber shop: would an engineer repeat the same task every day, or would they automate it? I think most would try to automate it. The tradeoff would be efficiency for personality, and I think some people value it enough to keep it, while others wouldn't. That's probably a separate debate: would life be happier if everyone were an engineer?
I'm also not saying everyone should be an engineer on this thread. I'm saying it's an interesting thought to change the way lending the money out works. What I'm getting at is this: is the non-absolvable nature of student debt a conflict of interest with the creditors, and are they giving it out indiscriminately?
No, but companies are all about making things into money. That's why they choose a number of subjects (and degrees) that they deem useful and disregard everything else.
What people fail to understand is that a degree in the humanities also provides qualifications other than "let me tell you about the depiction of French rats in late medieval English clay paintings." However, these skills are not seen as being easily converted into revenue and thus ignored.
Such skills include independent problem solving, a high degree of organisation, formulation and proof of theories, descriptive and abstract work etc.
However, if you have an engineer who builds you parts for a car or a website or a backend or what not, you can immidiately slap a price tag on it and give more money to your shareholders.
Perhaps we should stop telling kids they can be whatever they want when they grow up.
That's a rather depressing idea, but it's the truth. Unless you're independently wealthy or one in a hundred million, you will not be able to sustain yourself in certain pursuits.
They're great to have as a hobby, but sometimes you just need to pay the bills. The land of opportunity is closed for our generation, but nobody told us until we had already packed our bags and boarded the plane.
Used to be poets earned very little but had very simple lifestyles. It was their choice so everyone was happy.
Now if you want to be a poet, you still can. But the problem is that there are upper-class kids who want to be poets but not live like one, and they are going to bid up the cost of the poet lifestyle.
A similar thing happened in journalism. Kids of rich families wanted to "change the world" and bid the wages of working journalists down to nil.
I would probably ask them to read What You'll Wish You'd Known (http://www.paulgraham.com/hs.html). I like the analogy of staying upwind because it provides you more options when the time comes that you find out what you want to do.
No, telling kids they can be whatever they want can never change (as long as it isn't unethical). The idea is to teach them to be responsible and logical. If tuition for say an art major cost $15k a yr, they have to understand or be told that unless the parents support them, they will either need to work part time or other means to come up with the tuition, or if getting a loan, working more than fulltime outside the major field may be necessary.
I see that ending really badly. We have seen that schools have no price pressure, so the standard price for school will end up being "50% or more of your future earnings."
You must have price pressure on schools. Even more money at even more onerous terms to the students will just exacerbate the problem.
We know that students and parents value degrees irrationally. We also know lenders have a lesser propensity to make the same mistake.
By introducing market forces on the lender's side we are side-stepping educating high school students and their parents about the returns on education and instead making the lenders be the bad cop who says "no, you're not walking out with $200k debt and an art history degree".
This should, in theory, reduce demand for university degrees in preference of community college or trade school certification, a system that has shown its merits in Deutschland.
It may also be useful for schools to own a portion of the credit risk of its students. The stick approach to this would be having schools buy a tranche of the loans each semester. The carrot would be the lender offering the school a small payment each year after graduation that the loan is paid on time, or alternatively, a larger payment if the loan hasn't defaulted in 6 and 10 years.
Schools will happily agree to 20% of an engineer's future output, guaranteed enforcement by the government under threat of imprisonment.
You know what would be better? Go back a few decades and make student loans dischargeable in bankruptcy. No one will lend students $150,000 that they can discharge immediately after graduation. The school will realize that crazy debt levels will backfire on them.
The price pressure used to be state-subsidized public universities with tuitions deliberately kept very low. As in, $600/semester low, or even zero-tuition low.
A default rate of 5.9 vs. 3.8 is significant. That means that if two groups of 1000 students take out loans, the group made up of liberal arts majors will have 55% more defaults than the engineering group. Given that loan interest rates are on the order of 5%, I fail to see how a 2.1% difference in default rate would ever not be significant.
If an engineer is allowed to borrow $30,000 and the liberal arts major is allowed to borrow $10,000, then the school will just charge the engineer $20,000 more. (They'll probably frame it in a much better way that looks like a discount to the liberal arts major, but it's important to not be fooled by that.)
If the school charges $20,000 more for an engineering degree, that will be a clear signal that that degree is more valuable. Which can definitely change things.
Is it fairer to over-allocate to the major where the graduate has a 2.1 percentage point higher chance of defaulting on a loan they will never be able to escape? The cost of an artificially levelled playing field is the present malaise.
The current bankruptcy rules wrt student loans came out of some experience with different rules. (For example, speciality MDs had some cute hacks to dump their undergrad loans, which were very old by the time they had money.)
How does your knowledge of those rules and that experience inform your proposed policy?
In the present environment it is people who got a worthless degree from a third-rate technical school, like Devry, Kaplan or the University of Phoenix that are saddled with student loans they cannot ever hope to repay.
The legal environment has changed, as have those who take advantage of it.
> In the present environment it is people who got a worthless degree from a third-rate technical school, like Devry, Kaplan or the University of Phoenix that are saddled with student loans they cannot ever hope to repay.
I know personally folks who have degrees from two of those three that were extremely valuable to them, degrees and education that made it possible for them to make a very good living.
Of course, my anecdotes aren't data, but I'm pretty sure that you're just bloviating from an even less sound basis.
That's not counting the tradesfolk (mechanics, plumbers, etc) for whom such schools are the only source of education. They were abandoned by the non-profits long ago.
I note that you ducked my question, so I'll repeat it
How does your knowledge of the bankruptcy rules and experience with past rules inform your proposed policy?
Kaplan's default rate is 17 %, Phoenix' is 13 %. If that is any guide, spending any money on that kind of school is a bad investment. For comparison, the default rate at public universities is 6 % and at private ones it's 4 %. (There are reputable for-profit colleges with default rates less than 5 %, so this isn't painting with a broad brush.)
Student loans need to be dischargeable in bankruptcy, because the only reason a bank lends to students at those places is that the creditor is backed by the law as it is currently written. If it were different the students would go elsewhere, the banks would have to find someone more profitable to lend to, and Kaplan-Phoenix-Devry would go out of business as it ought to. Society in general would be served better.
Training in the trades is a different issue. In other countries (Germany comes to mind) this is done by the employer, and it works well for them.
> Kaplan's default rate is 17 %, Phoenix' is 13 %. If that is any guide
There are lots of public schools with much higher drop-out rates. Maybe those folks don't go into default, but they're still paying for an education that they didn't get.
> Training in the trades is a different issue.
Nice duck, but until there's another mechanism for training tradesfolk exists, it is insane to destroy the one that we have.
And, I'll bet that German employers rely on outsiders to do the training. Either that, or the training is useless outside the employer. While employers may like the latter, it's a bad idea.
If German employers use outsiders, we're just quibbling about who signs the checks, not who actually pays.
> There are lots of public schools with much higher drop-out rates.
We were discussing what is appropiate policy wrt student loans in bankruptcy, not who else is a bad actor.
> And, I'll bet that German employers rely on outsiders to do the training. Either that, or the training is useless outside the employer.
Examinations are organized by the trade organizations ("Handwerkskammern"), who also set the curriculum. This is how training becomes portable between employers. Training itself is done in-house.
It's not a financial problem (well it is), it's a cultural problem. American culture just doesn't value education and learning in general.
Isaac Asimov articulated this very well:
Anti-intellectualism has been a constant thread winding its way through our political and cultural life, nurtured by the false notion that democracy means that 'my ignorance is just as good as your knowledge'.
I don't buy it. We have a culture that rewards everyone going to college, even if they'd be better off not going to college. And your explanation for this is that we don't value education? I'd argue the exact opposite. We value education too much.
That's inaccurate. We have corporate cultures which value the possession of a certificate of achievement, not a culture which values education.
Depending on the survey you have up to 50% of the US denying evolution. A process that is clearly evident without any leaps of faith. That's not indicative of a culture that values education. There are many other aspects of math, science and technology that large swaths don't understand or misunderstand that would not occur if education were truly valued.
I won't disagree with that as there are many aspects to education beyond the technical (literature, art, philosophy, etc). I used evolution as an example because the statistics were easy to find. I also find it strange that the Roman Catholic church can express an acceptance of it, but so many people in the US still deny it.
It's not the only scientific or technical concept that's grossly misunderstood in this country (or the world in general).
How about the false connection between autism and MMR?
I've removed other examples that tended to fall back on showing religious groups as particularly in conflict with science.
Here's a still controversial but areligious one: WTC collapse. A 'model' using chicken wire and gasoline was used to persuade a non-negligible percent of the population that planes filled with fuel crashing into the upper half of 110 story buildings would be unable to cause the collapse of said buildings. A fundamental failure in education has occurred when you get engineers accepting things like this.
People with a college education are definitely rewarded.
The cultural problem is not that education is not valued, it is more on the lines of that education is often (most of the times) equated to "formal education."
> Why administration had to grow 4x the pace of enrollment is beyond me.
While I won't claim that every single administrative dollar has been well spent, between 1993 and 2007, this would cover things like on campus tech support and IT staff and equipment (email, online registration, transcripts, etc), more broadly available and diverse student support (counseling, LGBT support organizations, ombudsmen, etc), and presumably tutoring services that help the growing fraction of the population in college thrive, rather than simply prep-school graduates. Again, I'm not going to claim that 4x increase relative to enrollment is the right amount, but compared to universities 20 years ago, they are providing more services.
One thing that really bothers me is how much universities are allowed to raise their tuition on existing students. I started college paying about $6k a year in tuition my freshmen year. My senior year cost me $11k. The difference in tuition raises overall probably increased my total loan amount by ~$10k by the time I graduated. This is huge and there is no way students can take this into account when applying for college. I don't know why there are no laws protecting students by requiring fixed tuition rates for students? Universities are notoriously bad for raising rates by thousands a year, which students must take into debt or leave.
*Edit - Ok, the tuition when I first went to college was $20k a year. I had a $14k scholarship, so it was a manageable $6k a year. Now the tuition, 5 years later, is over $27k. That is a 35% increase at about 7% a year. Pretty ridiculous if you ask me, especially for a state school which should be affordable.
The federal government's Medicaid mandate is destroying state education budgets-- Medicaid is literally crowding out state public university education spending.
I'm talking about out-of-state tuition though, which from my understanding was not subsidized by the state government at all. The funny thing is, the university I went to was still cheaper and better than my in-state alternatives.
It's all the same pie, from the point-of-view of state government. They need to make their budget balance, and the school is a target-rich environment for them.
This report's theory is that if the government stopped pumping so much money into the system, tuitions would cease to rise. It's tricky to answer. There's definitely good reasons for public money in education. But it seems to be hurting for the most part, not helping.
It's not that they're pumping money in that's the problem, it's the place they decided to pump that causes the issue. Financial aid and guaranteed loans are on the side that increases many student's ability to pay. The alternative is to give money directly to schools (perhaps based on enrollment numbers to mimic the "market based" approach of tuition aid). This brings student's ability to pay back down and would force schools to lower, or at least freeze tuition,.
Private financial institutions would no longer loan nearly as much money to students to pay for college, so less money would go through the chain of (student after graduation)->lender->(student when they were in school)->school. This means that overall, less money would be moving from students/graduates to schools.
Schools would have to find a way to manage with smaller budgets or get more government support.
"This is huge and there is no way students can take this into account when applying for college."
"Universities are notoriously bad for raising rates by thousands a year"
These statements conflict. Tuition increases should be taken into account when planning a college education. Some schools have a policy of constant tuition over four years. Students who aren't okay with tuition increases should choose those schools.
It is one of those things that is obvious in hindsight. No one informed me that tuition increased at that level when I was looking at colleges (certainly not the schools). The only way I could even find past tuition levels for my university was by looking at my financials for the loans, there was no where on their website or easily googled where I could find past tuition costs. The outrage over college costs and debt was nowhere as publicized five years ago as it is now. OWS, trillion dollar college debt stories, many of the new education startups didn't exist yet. I am certainly not the only student who felt screwed by a ~30% higher tuition rate their senior year. Universities are also notoriously good at selling a college education and tacking on the hidden cost.
Maybe you as an 18 year old would have been smart enough to figure it out, but I doubt most do. I actually planned out my college finances based on the freshmen tuition rates before even going and had a plan for what I was going to do.
Constant tuition is a very rare thing, I can't even name a school I know that does that.
I was excited to read this article, because I want to see more attempts to improve education. But then I saw that this is a for-profit education company.
I know there is a place for private educational endeavors in our society. But if you really want to fix education for everyone, you've got to focus on public education. Yes, it's a big ugly political seemingly unchangeable mess. But it's the only system that reaches everyone.
Every generation has a revolution waiting to happen. Improving public education might be the next significant social revolution in the US, but it won't be led by for-profit education companies.
How much failure would it take from the not-for-profit public education system before you'd consider the possibility that it is the very incentive system created by their non-profit status that has a huge hand in the failure?
We've created a system in which the reward for being an excellent teacher is... what, exactly? More paperwork? More friction from the ever-larger administration for not doing the same as everybody else? More frustration with not being allowed to be the good teacher because they have to teach ever harder to the test?
Until you fix the incentive system you're not going to get better teaching, and yeah, that's probably going to involve someone making some money, because it's beyond me how to fix the incentive system in the presence of an open-ended promise to keep the money hose opened and pointed at them no matter how much they fail. I suppose we could always try giving the same people even more money if they just promise to try really, really hard to do something else a couple of times until they give up.
And I am also pretty sure that true 21st century education isn't going to just a tweaked 20th century education. It's going to be something totally different, and the non-profit system simply won't get us there. Why would they? They don't get defunded for using decades-old totally outdated education systems. (In contrast to the decades-old non-outdated parts, which do exist, but are not 100% of the curriculum by any means.) We know that, because that's already the current situation. They've got no reason to move.
How much failure would it take from the not-for-profit public education system before you'd consider the possibility that it is the very incentive system created by their non-profit status that has a huge hand in the failure?
That is part of the failure, and I am deeply affected by it right now. I am a pretty good teacher, and I watch terrible teachers get paid more than me because they've been at it longer. I can't pay off my family's student loans, and I can't afford anything more than a small condo.
But I still don't think privatizing education is the answer. There is always the possibility of taking education back from the politicians, and setting up a system that does incentivize good teaching. It's not as simple as paying teachers more if their students pass tests.
One fix that would go a long way is restructuring our approach to tuition in service sectors. If you take away my student loans, I would be a happy, hard working teacher the rest of my life. I will get some portion of my loans forgiven for teaching in a high-need area, but that won't go a long way. The same goes for other service sectors, where a reasonable job will leave you paying off student loans until you are past retirement age.
There are bureaucratic fixes. You can give more professional freedoms to highly-effective teachers. Measuring effective teaching is difficult, but not impossible.
As soon as you give up on public education and only see privatization as the answer, you give up on addressing the education gap between different socioeconomic groups.
"It's not as simple as paying teachers more if their students pass tests."
That's not the interesting thing that privatization allows. What it allows is the doing of something fundamentally different.
I don't see privatization as "the current school system, just private". Yes, that is what it is now, mostly, unless you poke around what are currently very fringe bits. What I see is a world in which (in a nutshell) self-serve homeschooling becomes easier and easier and more effective until it eats the current system from the inside. Give it about 20 years. Public schooling will survive, but as part of a large ecosystem, instead of the whole.
"As soon as you give up on public education and only see privatization as the answer, you give up on addressing the education gap between different socioeconomic groups."
No we don't. Vouchers may not be 100% "free market", but it's not going to keep me up at night.
We've tried the "keep giving the system more money in the hope we get better teachers". We've been trying that for my entire life. If you want to pay teachers like SV engineers, you're only going to be able to do that in the general framework of a for-profit company.
If you imagine a really competent teacher sitting next to an engineer with the Khan Academy and intensely working with them and the statistics to produce a high-quality course, that's definitely the sort of thing that will command an SV engineer salary. There will be fewer such positions, but the immense societal gain of having these high-quality curricula propagated far and wide for cheap will far outweigh the fact there are fewer teaching jobs.
Given that neither system is working but both have evidence of having worked historically or in other countries, it would seem premature to assume sans evidence that education must be in the public sector.
Note that non-profit private institutions are not public schools and are highly effective research institutions.
When things aren't working it's a good idea to rethink the base assumptions we are making on faith alone.
I'm not sure that education is the big problem, but it's definitely up there. I think probably the financial climate leading to unemployment/underemployment is a bigger one, but significantly more difficult to fix.
Imagine a world where you can retrain yourself on the order of months, not years, and take on little or no debt to do it. How would that impact unemployment or underemployment?
When Obama stands in front of a bankrupt auto factory in Detroit and says, "We'll retool these factories and retrain these workers to produce wind turbines, solar panels, and electric cars!", how do we do it?
People are desperate to answer that question and services like bloc.io, Udacity, Coursera, Khan Academy, University Now, etc. are just our best first answers.
Education is more than a big problem: it's the root problem.
Caveat lector: I help run http://devbootcamp.com and the bloc.io guys work out of our offices 2-3 days per week.
>Imagine a world where you can retrain yourself on the order of months, not years, and take on little or no debt to do it. How would that impact unemployment or underemployment?
It would have very little effect on un- or underemployment, since un- and underemployment are driven by demand, not supply.
There is zero evidence that unemployment in the United States today is driven by a mismatch between skills-employers-want and skills-workers-have, for instance.
Paul Krugman discusses this in a few of his columns.
The Keynesians haven't been proven wrong on their claims that increased demand -> increased production. It's the part where increased production -> increased employment that they have been shown conclusively to be incorrect.
I feared that mentioning Krugman would bring out the Krugman-haters with their nonsense. Sadly, I was right to fear.
You know that the Fed statistics that you cite show that, for example, durable goods production is down 6% since 2007? Even though population has increased in that time. That is to say, the graphs support what I said and what Paul Krugman says, not the nonsense that you think you've learned from Fox News.
You are completely ignoring the point - if demand increases but producers don't need to hire people to produce more, employment does not increase. I.e., demand may be correlated with production, but production need not be correlated with employment.
If you looked at the fed stats I cited, they show precisely a lack of correlation between production and employment.
Nothing you have cited disputes this fundamental point. Krugman doesn't even try, he just declares victory and insults those who disagree.
Nonsense. Should I post the graphs again? The graphs clearly demonstrate increased production without a corresponding increase in employment. This is the "jobless recovery" that many columnists lament. Some graphs again:
According to Keynesians (e.g. Krugman), recessions are caused by labor not becoming cheap in response to exogenous shocks (due to sticky nominal wages). Do you disagree with this theory?
This is a kind of null hypothesis: that US companies, across all sectors, are permanently not hiring above the rate of replacing their current employees. All dynamic changes are because of fluctuation in supply; the only way companies will hire more in any sector is if increased supply drops wages enough that they can pick up more employees for the same money.
That is a pretty extreme claim which seems pretty easily testable; where has it been tested?
You seem confused. Perhaps I was not clear enough. Let me reiterate.
Companies hire people to make things or provide services if the company believes it can sell those products or services. If, for example, a company is making 100 widgets a day and selling only 50 widgets a day, the company will not hire new employees at any salary, even a low one, because it already has more widgets than it can sell. If a window-washing company has 6 window washers, and enough work to keep only 3 of them busy, it will not hire a 7th window washer, even at a low salary, because he'll just join the other 3 guys that are already sitting around the office doing nothing. In fact, if that state of affairs is projected to last for a while and laws don't prevent it, he'll fire 3 of the window-washers he already has. As soon as people start wanting window-washing and there is too much work for 6 window-washers, a 7th will be hired.
Unemployment is thus driven by demand for goods and services. The supply of workers is immaterial. Companies don't hire extra workers just because they're cheap.
The U.S. has high unemployment across all sectors. There are no sectors that are booming. Thus, retraining yourself doesn't have any immediately useful benefits during the current recession. ALL fields are slumping.
Your condescension is unwarranted and inappropriate.
You stated that unemployment is driven by demand. You also stated that there's no evidence unemployment is driven by a mismatch between the pattern of demanded skills vs. the pattern of present skills.
I am not arguing with you about these claims. I am just going on what you say to me. The combination of those claims LOGICALLY ENTAILS that unemployment, being driven by weak demand in every sector, and NOT just by weak demand for certain skills in specific sectors, MUST be driven by weak demand for labor overall, across sectors; in other words, every single sector does not need any more labor of any kind.
This is what you actually said. If you didn't mean it, then you should have said something else.
What I said... which is true... is that this is an extreme claim, and eminently testable. And you still haven't provided any test of it. Although you seem to expect me to believe it. So rather than linking to Krugman again... why don't you provide evidence for the extreme claims you are making?
By the way... I am a regular reader of Krugman's because I like a lot of what he says, so if you cannot be "clear enough" and cannot defend your extreme claims to a Krugman fan, then the problem isn't that you are being discriminated against on the basis of ideology. It is that you are making bold claims which have certain entailments, you are refusing to recognize these entailments and you are refusing to provide evidence to support the claims at the same time as you refuse to withdraw them.
>I am not arguing with you about these claims. I am just going on what you say to me. The combination of those claims LOGICALLY ENTAILS that unemployment, being driven by weak demand in every sector, and NOT just by weak demand for certain skills in specific sectors, MUST be driven by weak demand for labor overall, across sectors;
Does not entail this:
>in other words, every single sector does not need any more labor of any kind.
If there is weak demand for labor overall, then there will be a weak demand for labor, not zero demand. Additionally, labor does not follow normal supply and demand models, and if you're not aware of the evidence for this I'd suggest you read an economics textbook.
Your argument is similar to that of people saying that because North Dakota has low unemployment due to its energy boom, a massive energy boom would cure unemployment. But North Dakota's energy boom only has such a visible effect because of the state's small population; Pennsylvania has added a similar number of jobs and it has barely changed the unemployment rates, as the the state has a much larger overall population.
Likewise lack of skilled employees in, e.g. the technology sector does not necessarily indicate unemployment is caused by structural shifts in unemployment, unless the tech industry is looking for millions of new employees and can't find them.
Between December 2007 and October 2008 the unemployment rate doubled. It seems far more likely that the United States hasn't yet recovered from the financial crash rather than experiencing an unprecedented shift in its economy at exactly the same time.
Unemployment didn't slowly rise during the boom times, it spiked because of a financial crash and has been slowly declining since. Any claims of a structural shift require extraordinary evidence, and all you've provided are non-sequiturs.
Rather than mindlessly quoting Krugman's newspaper column, you should go learn the basics of Keynesian economics. Keynesian economics claims that companies don't hire workers because their real wages are too high (due to sticky nominal wages and insufficient inflation).
Since you seem to have an aversion to reading anyone besides Krugman, why not go read his textbook?
The US government can't sustainably provide a safety net that provides basic needs (whether this is because of finances or because of ideology is a debate I'm not getting into).
And getting rid of the free market is not an option for us either.
So if we are not going to let people starve in the snow every time the raw forces of economics kill a market or shift all production somewhere else, they should have some help to find new footing.
Education itself is not the problem. Education is good. Problem is in the fact that to prove education, we need degrees which means we need to come up with outrageous amount of tuition fee to pay. Why do we have an ever rising tuition fee ? Probably because colleges know they can get away with it due to funding/subsidies. Colleges also know that a degree is a major rquirement to even try and get a decent job these days that pays more than minimum wage (outliers are there of course). So it does not matter if they charge 100K for a degree.
but I think that lack of relevant education is the largest contributing factor to unemployment. for example, american manufacturing is actually doing great right now, the problem is that it's become more efficient and can do without labor workers so while the businesses flourish there are less people to employ.
In regards to relevant education, I think Amazon's career choice program is a good example of targeting the right industries.
From Jeff Bezos letter:
"We’re offering to pre-pay 95% of the cost of courses such as aircraft mechanics, computer-aided design, machine tool technologies, medical lab technologies, nursing, and many other fields.
The program is unusual. Unlike traditional tuition reimbursement programs, we exclusively fund education only in areas that are well-paying and in high demand according to sources like the U.S. Bureau of Labor Statistics, and we fund those areas regardless of whether those skills are relevant to a career at Amazon."
> I think that lack of relevant education is the largest contributing factor to unemployment.
I hear this often, but I am always left wondering what jobs will rise out of the woodwork if the condition became true?
It is easy to say lack of education is the problem because it is the common filter used when hiring, so it is highly visible, but one only needs to look to the software industry to see perfectly capable programmers struggling to find work in what is supposed to be a hot market with companies crying for help.
I believe it is far more complex, and may not relate to education at all.
I agree education (and even more particularly, the method and quality of teaching) is a problem, but it's not the same problem as student debt.
As far as I can tell, much of the (debt) problem is caused by bad decision making by clueless parents and teenagers who think they need to send their kid to an Ivy League or think that their child somehow needs to spend 40k a year to go to an in-state school.
Let's be honest. The cost of education is going up, yes. But getting into debt is also bad and a poor choice. Yet nobody is responsible enough to consider it when making college choices, just to whine about it after the fact.
Students do not need to own a television or get cable or even have a video game console. Students probably don't even need a car, definitely don't need smartphones, and at least where I went to school, could probably do just fine without owning a computer, too. Likewise, instead of getting into debt they could go to cheaper community colleges or a whole slew of things.
Instead many college students, regardless of economic background, seem to have smartphones, Macs, and 42" TVs.
When I see someone complaining about college debt, I see somebody who went to an overly expensive school, without a plan, and did whatever they felt like without ever stopping to consider first if they could make a living when they were done. I see a child.
As someone who looked at the big picture when making college decisions and now has no college debt two years out of school, I have no sympathy.
I turned down the University of Chicago (among others) so that I wouldn't be in debt and to hear all the whining about it from entitled feeling kids who didn't make smart decisions makes me angry.
Now I'll agree that you may need to take on some debt to complete college. But if you're taking on more than the cost of a new car, you're doing it wrong.
Don't get me wrong, either. I concur that colleges waste lots of money.
While I agree with many of your points in principle, I think your rhetoric is a bit off. For one thing, I think it's ridiculous to even bring up Ivy League when discussing overall student debt. Ivy League's total enrollment is something like 100,000. Assuming every single freshman took a full debt load, thats 'only' 5 billion or so. The government report linked in the article states that in 2010-2011, $117B of student debt was generated. Ivy League doesn't even matter.
Furthermore, while its easy to criticize the students themselves - obviously many of them are not paragons of responsible spending, but it also kind of misses the point. For one thing it's easy to wave away and say 'many' students have shit they 'don't need', but how many really do? And how much is that really contributing. Without data, its just a gut feeling. Maybe it's true, maybe it's not. Because I can tell you that where I live, very few students have 42" TVs. Yes, we have smartphone and Macs, and some of us have video game consoles, but how much does this really add to our debt load? Certainly not trivial, but when you consider the average student debt is like 25k, you certainly can't say that the extra 4-6k on random gadgets is what is driving the problem. After all, if you can pay a 20k loan and avoid defaulting, you probably can also pay for a 25k load and avoid defaulting.
And finally, how does one even approach solving a systemic problem (it obviously is systemic) like this if all you do is place the blame on the actors. Clearly the problem is large enough for blame to be ladled on everyone.
I think a big aspect of the problem is that people literally are children (or less than a year into adulthood) when social proof from their high school classmates dictates that they choose a college. As PG said in "Why Nerds are Unpopular," if he could go back and give his thirteen year old self advice, he'd tell him to realize the world around him was fake. Most students coming out of high school simply don't have the perspective to know "the big picture" like you did, nor do they know that they should be seeking that perspective. By the time they might realize this, they may already be half-way (or fully) invested in a bad decision that has significant barriers to fix.
(edit: "Nerds are Unpopular" => "Why Nerds are Unpopular")
I attended the University of Chicago, paid for it myself, and took on 100% of the debt.
I'm still paying it off, but it was worth it! My life is without question 100x better for it.
Your point is fair, though: with few exceptions student's expectations of how transformative their college education to be absolutely eclipses the reality.
I think the OP's characterization of the decisionmaking process that leads to crippling educational debt is somewhat unfair. It's definitely driven by the parents and children who he condemns as "clueless." But I think it's important to consider that many of these "clueless" have been told their entire lives that "education is a great investment" and "graduates of prestigious universities all become successful and rich," and have never really been confronted with any reason to question these pronouncements, which have appeared consistent with their own observations and experiences. Colleges and universities don't hesitate to trot out these tropes in their recruitment literature, though I suppose it's a mark of the "clueless" that they hold educational institutions to a different standard of credibility than used car salesmen or carnival barkers.
I see a parallel to the recent mortgage crisis. Sure, fundamentally, the crisis was just huge numbers of people defaulting en-masse on their mortgages. They all made "clueless" decisions by taking on more mortgage debt than they could handle. Maybe they deserve what they get, and maybe the appropriate response is to be angry at these entitled whiners who made worse decisions than the OP. But these decisions were facilitated by lenders and securities brokers who were acting in less than good faith.
I'm inclined to view both the homeowners in the mortgage crisis and the students and families struggling with education debt right now more as victims of poor information availability and outmoded decision heuristics that fell behind the times, and less as entitled whiners.
I guess I should note that I also went to the University of Chicago (hi Jesse) and it's fairly clear by now that it was a terrible choice for me. So maybe I'm just grasping for rationalizations while desperately fleeing from the crushing psychological weight of the responsibility for that choice and the long and uninterrupted sequence of related bad choices that have more or less ruined my life.
Can't really tell if the last line is sarcasm for sure (I think it is?).
I can't stand when people are taught to listen instead of think, and that predilection of mine is why I can't see the sub-prime mortgage crisis as being at all similar to college debt.
Someone who is going to college is supposed to be bright, intelligent, and motivated. A budding critical thinker who can deal with new and complex ideas. Hence I don't think someone who makes decisions based on what they're told is a good candidate for college. Likewise I don't think someone who is focused on the past success of others is exactly an ideal college candidate, either. Both of these things are ostensibly why there are large essay sections as part of the college application process.
In any case, I think it's kind of disingenuous and silly to have the same expectations of someone without a high school degree and three kids working 60 hours a week getting pitched on a bad loan and a top end of the spectrum student getting pitched on colleges. You can't have the same expectations.
That said, I think you hit the nail on the head when comparing modern college recruitment practices to used car salesmen. In fact, visiting MIT (academic activity related) remains one of the most disillusioning experiences of my life. Sure, science goes on there, but I felt like I was inside of an infomercial.
If anything perhaps both are a sign that K-12 needs to have more coverage of financial- and media- literacy.
But I guess I've regarded the success of graduates of Ivy Leagues and other prestigious schools as having more to do with being part of the good old boys club and networking with the wealthy than actually having anything to do with having good teachers.
No sarcasm; just a lot of regret and self-loathing.
It seems like the root of our disagreement is our differeing expectations for the cognitive and decisionmaking abilities of teenagers. As other posters have mentioned, there are lots of social factors at play in the college decision, and I think those factors can be far more powerful than what's necessary to lead a straight-A high school student astray.
If we pared away all of the people who were susceptible to making bad decisions based on what they're told or who are focused on the past successes of others, only the tiniest sliver of the population would remain as viable candidates for college. Maybe this is the point you're making - maybe you think we should shut down almost every university and tell everyone outside the enlightened sliver to go figure out something else to do. (Might actually not be that bad of an idea.) Or maybe you have a different view of people's cognitive abilities at age 17.
The approach that you personally took toward your college decision is, I think, pretty exceptional, and puts you toward the top of the top 1% of rational 17-year-old decisionmakers. I hesitate to condemn people as clueless and undeserving of our sympathy because they fall short of that lofty standard.
I agree there are large structural flaws with college (well, pretty much the whole educational system). Good teachers and good researchers aren't the same thing for sure. Likewise, many amenities at college today are not really necessary, but also likely don't have a anywhere near an order of magnitude impact on costs. At some schools healthy food is often replaced by junk food provided through restaurant contractors, which is not so great, but maybe is a little cheaper. I agree that something needs to change with how college works, and that the costs are getting a bit silly when they're almost at the point that you could get together with a class of friends and hire expert personal tutors instead.
Likewise, I definitely think that many people who feel they need to go to college are people who shouldn't go to college, or who at least aren't ready for it. Witness the huge numbers of remedial courses at many public institutions, as well as decreasing standards in many courses. I sometimes take classes at the local community college for fun and I'll have classmates who can barely read and write using student loans to fail their courses. Sadly enough, I've seen some of the same at 4 year schools. It's just depressing and I often wonder how they even got through High School. (And I'm not talking about non-English speakers or anything, either. Upper or upper-middle class Caucasians who have maybe 5th or 6th grade level language skills.)
Of course some people just eat McDonald's and play WoW instead of going to class while living off loans. I had a room mate one year in the dorms who did that.
I'm sure you're right that social pressure is a lot of it. Dad goes to college, assumes the kids will too, then doesn't much pay attention while they do rather mediocre in school, aren't ready for college, but absolutely feel like they've got to. So on and so forth.
I can't accept the notion that social pressure is really a valid excuse, though, even if it's behind the reality for some of the problems.
But I'm the kind of cruel bastard who hates it when people worry about what everyone else thinks and who if ever has kids will move several times on purpose and keep them from watching TV and hopefully raise them so that they can trust themselves instead of their peers with lots of comments like 'well, if Freddy jumped off a cliff would you?.'
I've also got to think another part of it is the notion that the credential is meaningful, but doesn't represent any skill or knowledge. So many people these days think of the paper first, the socialization second, and learning third.
I'm sure there's something, too, with the excessive helicopter parenting keeping even smart 17/18-year-olds from really thinking for themselves.
I guess I'm just not super sympathetic about things that irritate me, and my experiences have rarely exposed me to the sympathetic side.
One thing I just thought about is ROTC. Better than debt, I guess? The people I knew in it were definitely on the straight and narrow and all set to finish with decent grades and no debt.
I mostly have a problem with the people for whom it CLEARLY was a bad decision and they continually try to insist that it was a good one when it clearly did not work out at all for them. Such unwillingness to think rationally about poor decisions only makes it all the more easy for these ridiculous tuition hikes and loan schemes to continue.
The reasonable people (like you seem to be) who have their regrets along with their debts have my sympathy. I hope that things manage to improve for you someday. :(
Yeah, sometimes I think I might have had a better experience there, but then I think "I'd probably be more than 150k in debt" and the feeling passes. Plus I'm doing fine without having gone there. It's definitely a great school.
I can't imagine what it's like to have that debt hanging over your head. It seems like it'd only be worth it if you get hired out of school for something really amazing or with a ridiculously high starting salary.
Mostly, I see student debt as a glaring indicator that the system as a whole has some serious problems. I don't like to place blame on who is responsible.
But, it can't be denied that student and family responsibility is a factor in the massive student debt problem.
But keep in mind there are external pressures on families and students as well. Schools will sell students very hard. Peers. Our entire culture. When your president gets on air and says "We are dedicated to sending every kid to college", that's a very strong cultural message.
I commend you for making wise decisions when you went to school, though.
I just graduated with my CS degree this May, and I only took on a total of 20k debt and lived on campus, and that 20k was just the stafford loans that 3 of my scholarships mandated I take in order to qualify. Note, now that I graduated, I already paid off over half that on just reserve funds from summer jobs that I have had dating back to High School.
While I was there, only about 1 in 5 students actually had a full financial aid package. Most of them didn't fill out FAFSAs, or didn't even use subsidized stafford loans - they had direct bank loans from their parents for upwards of $60k a year.
In my opinion, the people of the 22ed century will look back and think we were hilariously dumb. We have instantanous communication of ideas and knowledge via the internet, and our internet speeds are only getting better. If you want to learn something, it is easier than ever to find a community of fellow learners for a subject, find tons of free learning materials on that subject, and buckle down without the financial obligations and classroom environment (which doesn't work for everyone, and you inherently have less engagement there because one teacher can not effectively engage with even just 10 people all the time).
Like the article said, the degree is the problem. But I don't think thats the real problem - moreso the problem than that is the inability for individuals to have ideas and persue them in business ventures, because upstart small business will demand much less degree knowledge from employees (even if they are very skilled) since they draw from a local pool.
You get the degree because you will be applying to massive companies with huge HR that don't want to try to interpret you as a person but want to get a quick diagnostic of if you are capable or not from a one word answer to a 3 word question: Got a degree? If hiring was more based on individual accomplishment and demonstratable knowledge rather than paper, we would all be better off for it by getting off the degree treadmill.
I think the biggest problem with higher education today is the fact that colleges aren't the one issuing the student loans. If a student enters the workforce and can't find a job to pay back their loan, the colleges aren't the ones on the hook; the students are, and eventually, the taxpayers. I understand that government-backed loans are a way to try to make higher education available to more people but all this easy money has resulted in a huge cash grab by for profit institutions who frankly could care less whether or not their graduates actually pay the loans back. Couple that with the almost religious belief that a college education is the only way to achieve the American dream and you have a recipe for the exact disaster we're flying head first into today.
I don't think there's a private solution to this problem. If we look to functional educational systems (example: germany), we see that other countries are often much better at matching people up with careers that match their talents (or lack thereof). Instead, we have colleges that will take whoever can pay over whoever might be the brightest academically. The people who can pay aren't necessarily the sharpest crayon in the box, and the people who can't might be the next cure for [insert x here].
State universities at the very least should be tuition free so as to not completely fuck over students from dysfunctional families who won't help/families that can't afford it. Of course, it would also be wiser to raise entrance standards and somehow figure out how to stop the ridiculous GPA inflation that goes on in the liberal arts fields. STEM still pays relatively well, but that's because our standards haven't dropped; unfortunately, many requirements for maintaining a scholarship fail to take choice of major into account when setting a minimum GPA.
Anyone can get a liberal arts degree if they have enough (or can borrow enough) money, which is why it means shit nowadays as a measure of IQ.
I am at a state university, and there's a couple of issues that people here aren't really aware of.
University funding comes from three sources: tuition, state funds and research grants (federal or industrial). The last two have been steadily declining, so that leaves tuition as an ever more important source of funds. The university is building new dormitories to get new paying bodies. It doesn't matter just how damn incapable the students are, what counts is that they pay. You can't encourage anyone to drop their chosen degree, if you do you might have to apologize to the chair and the parents.
Again, funds are scarce, and the administration tries to hive off teaching of introductory courses to adjuncts. It takes anyone a year or two to learn the ropes, then people leave because working conditions here are poor, the classes are too large and the workload too heavy. No one is concerned about the revolving door for introductory courses. Besides, you have to have an excellent command of the subject matter to be able to teach a beginners' class, you just cannot put a bottom-of-the-barrel type in front of an introductory course and expect the students to do well.
Again, it's the undergraduates that pay, and they money goes primarily into teaching facilities. Meanwhile the research space is neglected. There is no money to replace the fifty year old rotting tiles in my office, everything goes to provide a nice environment to the dear undergrad kids.
Someone might notice that mathematics and computing are peculiar in that there is not much capital equipment or education needed to be productive. One can be a decent programmer with a bachelor's degree and grow into software engineering. But consider the physical sciences, biology, chemistry physics. To produce any results one needs capital equipment and a PhD. No one goes anywhere far in biology even with a Masters.
Startup mania. I'd love to join a startup in my field. Try that with a sick wife. Can't afford it.
I feel like this is just swapping degrees for certifications. In this case the certification is just saying you completed training with so and so (so and so being bloc.io). Either way, everybody's just chasing paper and maybe learning something in the process.
EDIT: What I meant by certification was more abstract. On a resume, saying you completed tutelage with an individual or a group (and have achievements to go along with them) is pretty similar to completing certification that implies knowledge attained prior to completing the certification...the disfunctional nature of certifications, degrees, and mentor-based systems notwithstanding. People market themselves with this stuff, no matter what precisely it is, or where they got it from.
I like that policy! I'm just curious how it ultimately boils down to a difference in the mindset of people looking to market themselves with skills. I personally find this model to be really cool and wish you all the best in expanding into your other areas of teaching!
Maybe we need to start outsourcing our education to China and India. We can send our kids to India for their undergraduate degrees and then they can come back here to get their post-graduate degrees.
Move towards knowledge certification instead of a degree that states you completed your degree. Bar Exam, MCSE, Board Certifications, etc. If you have the drive and capacity to learn without attending college then you should be rewarded only having to take a certification exam.
Once enough schools go belly up people can just start listing those institutions on their resumes. Since the school is close there won't be an easy way to verify. (Just kidding of course)
The adverse effects of a warming atmosphere is a more existential problem, and I would argue that it is for this reason that it is a more fundamental one. Education is irreelevant if food supplies are increasingly scarce.
While I strongly support educational reform, I should point out that it is not just higher education, it's also high school, middle school, elementary school, kindergarten, and daycare. Every single aspect of the entire educational system down to the time spent on kids when they're too young to speak properly is broken. Consequently, fixing this is not as simple as having an online university, but I agree that the solution is very likely to be some sort of private, for-profit company, simply because that's the only feasible catalyst.
I'm somewhat curious to know how big of a problem (and what forms it takes) this is around the world—if people could share what this looks like from where they are, I'd be tremendously interested.
> Once you default on a student loan, you'll be hounded for life: student loan debt is the absolute worst kind of debt you can have, as it is not absolvable by bankruptcy.
I've always wondered two things about this.
1. How is that even legal? I thought the whole point of bankruptcy was to raise a big flag that says "I can no longer pay my debts", and they go away. Why is student loan debt different?
2. Why do American students tolerate it? Look what happened in Quebec when they tried to raise tuition even a little.
2. Why do American students tolerate it? Look what happened in Quebec when they tried to raise tuition even a little.
Just look at this thread: Americans are so incredibly enamored to market fundamentalism that they often can't see public policy when it's punching them in the nose.
1) Congress passed a law after a lot of lobbying. The reasoning was that when a student graduates they have substantial debt and no assets, so every student would just declare bankruptcy the day after graduating and wouldn't have to pay back the providers.
Yes, education is our generation's (18-30) problem.
Schools are lousy and degrade basic skills, as well as degrading deep cultural literacy and history. Idiots are held as heros. College costs are skyrocketing and dysfunctional buildings are being built by the colleges. The list of problems could go on... reams of paper have been spent documenting them.
Yes, there's a problem. I argue the essence of the problem is the deification of money.
There's another fix: Hire these graduates into the public sector or a random non-profit, let them make income-based payments, and then forgive their loans after 10 years, regardless of how much they've paid back. The taxpayers pick up the rest.
Maybe the problem is that there's less and less need for most types of workers.
We have a global population steadily lurching toward 8 billion. And, the richest of us seem to need less and less. And, that's coupled with aggressively commoditized global services industry that is providing more and more value for less and less cost.
Seems like major equilibrium shift waiting to happen.
Obviously, matters relating to shortfalls in our education system are important, but the real problem is campaign finance. With election candidates raising the vast majority of their funds from special interests, there is little incentive to fix problems that are profitable for said special interests.
Re-introduce cheap, accessible, well-funded public universities that people can study out, without subsidizing for-profit or even private universities. Public options allow the market to work while overcoming the underprovided nature of education.
The approaches to education in the past five decades or so have produced mediocre results in producing a more civic individual.
I wonder if the fundamentals of logic are imparted in any elementary school curriculum.
Our electorate is already pitifully informed.
However what's really woeful is that a large portion of the vote bank cannot dissect a simple election campaign claim or promise.
Actually, according to the Wall Street Journal (http://online.wsj.com/article/SB1000087239639044424690457757...), the upper-middle class has seen the sharpest jump in student debt since 2007. Households with less income have an easier time finding student aid and those in the upper class can more readily afford the rising costs. This puts the upper-middle class in a kind of purgatory for financial aid.