The next bubble bursting: could be student loans.

[Direckshun]

I think this piece will prove to be prescient.

http://www.washingtonpost.com/opinio...iOV_story.html

Subprime college educations
By George F. Will
Published: June 8

Many parents and the children they send to college are paying rapidly rising prices for something of declining quality. This is because “quality” is not synonymous with “value.”

Glenn Harlan Reynolds, a University of Tennessee law professor, believes that college has become, for many, merely a “status marker,” signaling membership in the educated caste, and a place to meet spouses of similar status — “associative mating.” Since 1961, the time students spend reading, writing and otherwise studying has fallen from 24 hours a week to about 15 — enough for a degree often desired only as an expensive signifier of rudimentary qualities (e.g., the ability to follow instructions). Employers value this signifier as an alternative to aptitude tests when evaluating potential employees because such tests can provoke lawsuits by having a “disparate impact” on this or that racial or ethnic group.

In his “The Higher Education Bubble,” Reynolds writes that this bubble exists for the same reasons the housing bubble did. The government decided that too few people owned homes/went to college, so government money was poured into subsidized and sometimes subprime mortgages/student loans, with the predictable result that housing prices/college tuitions soared and many borrowers went bust. Tuitions and fees have risen more than 440 percent in 30 years as schools happily raised prices — and lowered standards — to siphon up federal money. A recent Wall Street Journal headline: “Student Debt Rises by 8% as College Tuitions Climb.”

Richard Vedder, an Ohio University economist, writes in the Chronicle of Higher Education that as many people — perhaps more — have student loan debts as have college degrees. Have you seen those T-shirts that proclaim “College: The Best Seven Years of My Life”? Twenty-nine percent of borrowers never graduate, and many who do graduate take decades to repay their loans.

In 2010, the New York Times reported on Cortney Munna, then 26, a New York University graduate with almost $100,000 in debt. If her repayments were not then being deferred because she was enrolled in night school, she would have been paying $700 monthly from her $2,300 monthly after-tax income as a photographer’s assistant. She says she is toiling “to pay for an education I got for four years and would happily give back.” Her degree is in religious and women’s studies.

The budgets of California’s universities are being cut, so recently Cal State Northridge students conducted an almost-hunger strike (sustained by a blend of kale, apple and celery juices) to protest, as usual, tuition increases and, unusually and properly, administrators’ salaries. For example, in 2009 the base salary of UC Berkeley’s vice chancellor for equity and inclusion was $194,000, almost four times that of starting assistant professors. And by 2006, academic administrators outnumbered faculty.

The Manhattan Institute’s Heather Mac Donald notes that sinecures in academia’s diversity industry are expanding as academic offerings contract. UC San Diego (UCSD), while eliminating master’s programs in electrical and computer engineering and comparative literature, and eliminating courses in French, German, Spanish and English literature, added a diversity requirement for graduation to cultivate “a student’s understanding of her or his identity.” So, rather than study computer science and Cervantes, students can study their identities — themselves. Says Mac Donald, “ ‘Diversity,’ it turns out, is simply a code word for narcissism.”

She reports that UCSD lost three cancer researchers to Rice University, which offered them 40 percent pay increases. But UCSD found money to create a vice chancellorship for equity, diversity and inclusion. UC Davis has a Diversity Trainers Institute under an administrator of diversity education, who presumably coordinates with the Cross-Cultural Center. It also has: a Lesbian, Gay, Bisexual, Transgender Resource Center; a Sexual Harassment Education Program; a diversity program coordinator; an early resolution discrimination coordinator; a Diversity Education Series that awards Understanding Diversity Certificates in “Unpacking Oppression”; and Cross-Cultural Competency Certificates in “Understanding Diversity and Social Justice.” California’s budget crisis has not prevented UC San Francisco from creating a new vice chancellor for diversity and outreach to supplement its Office of Affirmative Action, Equal Opportunity and Diversity, and the Diversity Learning Center (which teaches how to become “a Diversity Change Agent”), and the Center for LGBT Health and Equity, and the Office of Sexual Harassment Prevention & Resolution, and the Chancellor’s Advisory Committees on Diversity, and on Gay, Lesbian, Bisexual and Transgender Issues, and on the Status of Women.

So taxpayers should pay more and parents and students should borrow more to fund administrative sprawl in the service of stale political agendas? Perhaps they will, until “pop!” goes the bubble.

[mlyonsd]

USD (South Dakota) recently added a new degree for 'General Studies' so their newly Division 1 athletes will have something to keep them in school.

Yeah, as an employer that's the kind of awesome knowledge I'll be looking for.

[patteeu]

Originally Posted by J Diddy

College can be done cheaply if that is the goal.

I don't understand what point you're making here.

[patteeu]

Originally Posted by mlyonsd

USD (South Dakota) recently added a new degree for 'General Studies' so their newly Division 1 athletes will have something to keep them in school.

Yeah, as an employer that's the kind of awesome knowledge I'll be looking for.

My resume only has one thing in the Education section: ChiefsPlanet (Sept 2002-Present)

[mlyonsd]

Originally Posted by patteeu

My resume only has one thing in the Education section: ChiefsPlanet (Sept 2002-Present)

n00b.

[J Diddy]

Originally Posted by patteeu

I don't understand what point you're making here.

He said it's driving up the cost of a college education, which you applauded, and too which I replied that it can be done cheaply if that is the goal.

What's not to understand?

[J Diddy]

Originally Posted by patteeu

My resume only has one thing in the Education section: ChiefsPlanet (Sept 2002-Present)

Really? You couldn't tell.

[King_Chief_Fan]

Originally Posted by Direckshun

I think this piece will prove to be prescient.

http://www.washingtonpost.com/opinio...iOV_story.html

Subprime college educations
By George F. Will
Published: June 8

Many parents and the children they send to college are paying rapidly rising prices for something of declining quality. This is because “quality” is not synonymous with “value.”

Glenn Harlan Reynolds, a University of Tennessee law professor, believes that college has become, for many, merely a “status marker,” signaling membership in the educated caste, and a place to meet spouses of similar status — “associative mating.” Since 1961, the time students spend reading, writing and otherwise studying has fallen from 24 hours a week to about 15 — enough for a degree often desired only as an expensive signifier of rudimentary qualities (e.g., the ability to follow instructions). Employers value this signifier as an alternative to aptitude tests when evaluating potential employees because such tests can provoke lawsuits by having a “disparate impact” on this or that racial or ethnic group.

In his “The Higher Education Bubble,” Reynolds writes that this bubble exists for the same reasons the housing bubble did. The government decided that too few people owned homes/went to college, so government money was poured into subsidized and sometimes subprime mortgages/student loans, with the predictable result that housing prices/college tuitions soared and many borrowers went bust. Tuitions and fees have risen more than 440 percent in 30 years as schools happily raised prices — and lowered standards — to siphon up federal money. A recent Wall Street Journal headline: “Student Debt Rises by 8% as College Tuitions Climb.”

Richard Vedder, an Ohio University economist, writes in the Chronicle of Higher Education that as many people — perhaps more — have student loan debts as have college degrees. Have you seen those T-shirts that proclaim “College: The Best Seven Years of My Life”? Twenty-nine percent of borrowers never graduate, and many who do graduate take decades to repay their loans.

In 2010, the New York Times reported on Cortney Munna, then 26, a New York University graduate with almost $100,000 in debt. If her repayments were not then being deferred because she was enrolled in night school, she would have been paying $700 monthly from her $2,300 monthly after-tax income as a photographer’s assistant. She says she is toiling “to pay for an education I got for four years and would happily give back.” Her degree is in religious and women’s studies.

The budgets of California’s universities are being cut, so recently Cal State Northridge students conducted an almost-hunger strike (sustained by a blend of kale, apple and celery juices) to protest, as usual, tuition increases and, unusually and properly, administrators’ salaries. For example, in 2009 the base salary of UC Berkeley’s vice chancellor for equity and inclusion was $194,000, almost four times that of starting assistant professors. And by 2006, academic administrators outnumbered faculty.

The Manhattan Institute’s Heather Mac Donald notes that sinecures in academia’s diversity industry are expanding as academic offerings contract. UC San Diego (UCSD), while eliminating master’s programs in electrical and computer engineering and comparative literature, and eliminating courses in French, German, Spanish and English literature, added a diversity requirement for graduation to cultivate “a student’s understanding of her or his identity.” So, rather than study computer science and Cervantes, students can study their identities — themselves. Says Mac Donald, “ ‘Diversity,’ it turns out, is simply a code word for narcissism.”

She reports that UCSD lost three cancer researchers to Rice University, which offered them 40 percent pay increases. But UCSD found money to create a vice chancellorship for equity, diversity and inclusion. UC Davis has a Diversity Trainers Institute under an administrator of diversity education, who presumably coordinates with the Cross-Cultural Center. It also has: a Lesbian, Gay, Bisexual, Transgender Resource Center; a Sexual Harassment Education Program; a diversity program coordinator; an early resolution discrimination coordinator; a Diversity Education Series that awards Understanding Diversity Certificates in “Unpacking Oppression”; and Cross-Cultural Competency Certificates in “Understanding Diversity and Social Justice.” California’s budget crisis has not prevented UC San Francisco from creating a new vice chancellor for diversity and outreach to supplement its Office of Affirmative Action, Equal Opportunity and Diversity, and the Diversity Learning Center (which teaches how to become “a Diversity Change Agent”), and the Center for LGBT Health and Equity, and the Office of Sexual Harassment Prevention & Resolution, and the Chancellor’s Advisory Committees on Diversity, and on Gay, Lesbian, Bisexual and Transgender Issues, and on the Status of Women.

So taxpayers should pay more and parents and students should borrow more to fund administrative sprawl in the service of stale political agendas? Perhaps they will, until “pop!” goes the bubble.

Eliminate student loans from the gov
I worked my way through and others can do the same

[patteeu]

Originally Posted by J Diddy

He said it's driving up the cost of a college education, which you applauded, and too which I replied that it can be done cheaply if that is the goal.

What's not to understand?

I applauded because it *is* driving up the cost of college education. Just because you can get a degree from a combination of community college and directional state for the same amount of money that an ivy league degree used to cost doesn't mean costs aren't going up rapidly.

So I guess I don't understand the relevance of your statement. The goal, btw, is to get the same (or better) quality degree (from the same school with the same amount of teacher/student interaction) you could have gotten 30 years ago for about the same amount of money plus a reasonable level of inflation. It can't be done.

[Loneiguana]

You can no longer work through college. It cannot be done.

I am a twenty-eight year old, non traditional undergrad. at the cheap state school in Springfield, MO.(I am paying for early mistakes). I work two jobs. One is at a restaurant for the money, the other is working as an English Tutor on campus so I have something on my resume. I work 30 hours a week, Tutor 7 and have 15 hours of class.

My total bill last year for the spring and fall semesters was over 7,000 dollars. I only made, at the restaurant, 16,000 and some. (Tutoring pays minimum wage). That is almost half of my yearly salary. Could you put half of your yearly salary towards tuition? And this is a cheap state school.

I only receive one federally grant from the government for 1300 dollars, divided out over two semesters. The State says I earn too much for a state grant.

I also did a few years at the cheap cheap Tech. School down here. (the math and speech classes among others.)

My wife graduated over a year ago and now works for the state in Child Social Services (Springfield is the number one city for child abuse and neglect in MO.) Her position requires a Degree, but hardly pays enough to meet the student loan repayment - (she has some out of state loans) - near 300 a month.

And to all you saying stop taking loans you don't need, you are aware that the majority of people taking out these loans are just at 18. Would a bank give a house loan to an 18 year old that doesn't have a job? No, they wouldn't. Can a 18 year old get a car loan without a job? No. But we happily give them tens of thousands of dollars for a promise they might get a well paying (HA) job one day.

I don't know what the answer is. I love Community colleges and tell everyone to go to a community college first. But the cost of Tuition is insane and goes up every year and it is bankrupting my generation. My wife and I could have bought a new car by now without the mountain of student loans.

[J Diddy]

Originally Posted by patteeu

I applauded because it *is* driving up the cost of college education. Just because you can get a degree from a combination of community college and directional state for the same amount of money that an ivy league degree used to cost doesn't mean costs aren't going up rapidly.

So I guess I don't understand the relevance of your statement. The goal, btw, is to get the same (or better) quality degree (from the same school with the same amount of teacher/student interaction) you could have gotten 30 years ago for about the same amount of money plus a reasonable level of inflation. It can't be done.

I can get a degree from KU now for $8790/year. In contrast at harvard in 1983 tuition was $8200 a year. http://vpf-web.harvard.edu/budget/fa...01/page23.html

Furthermore, you start to see the jump in tuition coming (at least in the case of harvard) well before us being in the student loan business.

[J Diddy]

Originally Posted by Loneiguana

You can no longer work through college. It cannot be done.

I am a twenty-eight year old, non traditional undergrad. at the cheap state school in Springfield, MO.(I am paying for early mistakes). I work two jobs. One is at a restaurant for the money, the other is working as an English Tutor on campus so I have something on my resume. I work 30 hours a week, Tutor 7 and have 15 hours of class.

My total bill last year for the spring and fall semesters was over 7,000 dollars. I only made, at the restaurant, 16,000 and some. (Tutoring pays minimum wage). That is almost half of my yearly salary. Could you put half of your yearly salary towards tuition? And this is a cheap state school.

I only receive one federally grant from the government for 1300 dollars, divided out over two semesters. The State says I earn too much for a state grant.

I also did a few years at the cheap cheap Tech. School down here. (the math and speech classes among others.)

My wife graduated over a year ago and now works for the state in Child Social Services (Springfield is the number one city for child abuse and neglect in MO.) Her position requires a Degree, but hardly pays enough to meet the student loan repayment - (she has some out of state loans) - near 300 a month.

And to all you saying stop taking loans you don't need, you are aware that the majority of people taking out these loans are just at 18. Would a bank give a house loan to an 18 year old that doesn't have a job? No, they wouldn't. Can a 18 year old get a car loan without a job? No. But we happily give them tens of thousands of dollars for a promise they might get a well paying (HA) job one day.

I don't know what the answer is. I love Community colleges and tell everyone to go to a community college first. But the cost of Tuition is insane and goes up every year and it is bankrupting my generation. My wife and I could have bought a new car by now without the mountain of student loans.

That's horseshit. I am a single father, at 38, who works 7 days a week. Two in my field and the other 5 for extra bucks to make ends meet. I bust my ass in school at 18 credit hours so I get scholarships, I bust my ass at work so I get raises, and I bust my ass at home to be a good dad.

**Edit**I jumped the gun and read what you said as you can't work through school. After actually reading what you wrote I see you meant to pay for school as well. My apologies.

[patteeu]

Originally Posted by J Diddy

I can get a degree from KU now for $8790/year. In contrast at harvard in 1983 tuition was $8200 a year. http://vpf-web.harvard.edu/budget/fa...01/page23.html

Furthermore, you start to see the jump in tuition coming (at least in the case of harvard) well before us being in the student loan business.

I hate to break it to you, but a degree from KU isn't going to be anywhere near as valuable as a Harvard degree. It's a black mark for your institution that one of their students is even making this comparison. I don't know why you think it matters that you can now get a Corolla for what a Rolls Royce used to cost.

When do you think the federal government got into the student loan business?

[alanm]

Originally Posted by mlyonsd

USD (South Dakota) recently added a new degree for 'General Studies' so their newly Division 1 athletes will have something to keep them in school.

Yeah, as an employer that's the kind of awesome knowledge I'll be looking for.

The kids I'd be looking for would be smart enough to go into the military for a few yrs, come out, and go to school on their GI Bill getting a degree with no debt.

Just from a discipline standpoint alone I'd take this kid.

[mlyonsd]

Originally Posted by alanm

The kids I'd be looking for would be smart enough to go into the military for a few yrs, come out, and go to school on their GI Bill getting a degree with no debt.

Just from a discipline standpoint alone I'd take this kid.

Absolutely.

[Bwana]

Choose wisely, or you could be pushing a broom or collecting food stamps.

http://www.onlinecolleges.net/2013/0...n-food-stamps/