Catch phrases that make sense until you think about them
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Y'know,,, I have a gold card. It's pretty cool, I can charge lotsa stuff. But I'd never charge a $100 pizza, cause I'm not an idiot. I know that a pizza is one dollar crust and fifty cents worth of sauce etc.etc. plus a dollar labor to put it all together plus a gentlemanly profit equals twelve dollars. That's what it costs, and what's reasonable and fair. If Dominos raises their prices too much I'll go to Pizza Hut, and that keeps 'em both honest.((SNIP))
College costs were driven up by the same mechanism as real estate. Easy access to loans for whoever wanted them. The big difference is that when home owners figured out they couldn't pay a 500k mortgage with a 40k per year annual income they just walked away from the house and took their 7 year credit hit. If you take out 100k in student loans you have them forever (more or less) until they are paid off. Put a cap on the amount of money students can borrow and you will see college costs drop. Make student loans forgivable in bankruptcy and you will see college costs drop.
So if easy credit made college costs go nuts, I have 2 questions...
Why didn't the hallowed free market keep this under control?
and - where'd all that money go?
Your example is flawed. A better example would be.... You and all your neighbors have a gold card and you all want pizza. All the pizza joints realize this and decide to steadily raise prices. The pizza joints know you are all using gold cards and have a pretty good idea where the soft cap is on your credit so they keep the pie prices in range of that year after year. After 10 years of this you get fed up because you are now paying $100 for a pizza pie. You want to buy chicken wings for significantly less money instead but society has led you to believe that you need to eat pizza in order to provide a good life for your family. With this in mind you keep paying for pizza and set up a tent on wall street so you can b1tch about "The Man".
So... why didn't the hallowed free market keep this under control? It's not the job of the free market to control anything. In fact, I would argue the free market is working exactly like it should in this case. People want to go to school and are willing to pay what colleges are charging. If people stop paying what colleges are charging prices will drop. Since people are being provided deferred loans they just keep paying and figure they will deal with the cost later.
Where is the money going? Who knows. University presidents do whatever the hell they want for the "good" of the university. This could be in the form of better perks for faculty, athletic programs, bonuses, etc..0 -
Looks like this is going to last awhile.
As I see it, the issue is not necessary "can everyone figure out a way to get to college", but more "is it really a good thing for the nation as a whole to be saddling an entire generation (or two) with college loan debt that is equal (or greater than) many of their parents' first mortgages?
Regardless of the pseudo "morality" issues that people continue to focus on, from a practical standpoint, i don't see how that helps the long-term future of the country. It's like everything else in today's economy---the colleges get theirs, the banks REALLY get theirs (from both the students and the government), and the students and their families are left holding the giant bag o' debt.
I know when times are tough, it's easy to want to circle the wagons and say "I've got mine--you're on your own". Those who feel that society has an obligation to help out the less fortunate are ridiculed and dismissed as being "impractical" or "socialists". Helping others is "something we can't afford", and, anyhow, the lower and working classes are just lazy deadbeats looking for a free ride ("I know a guy who............"). Or some people sincerely believe that there is nothing you can do, we've spent money and it doesn't work, so that's just the way it is.
However, IMO, when your middle class starts to erode the way it has, and the pathways to upward mobility are slowly choked off (as has been shown is happening in the US), then eventually everyone pays. I don't know of any country in history that has continued to grow stronger and make progress while downgrading the educational opportunities for its younger generation.
So when I say "America works best when it works for everyone", to me that's not some flowery idealistic jargon. It's a practical and critical mission statement for how we deal with our fellow citizens.
I desperately want a like button for this post. When I think about the debt a typical college grad is saddled with by age 30 it makes me want to pull out my hair, and those who go on for a Masters or PhD are even worse off. There's tens of thousands in student loan debt even if you worked all through college (I know because I did!), there's usually a car payment (15-20 thousand) then there's a mortgage for those who can still manage it on top of their other debt. Double that for a married couple, but don't always double their income, because if there are children, one is quite likely to drop down to part time or not working at all while the children are young. Usually the woman, which will hurt her chances of a high salary later.
Being a debtor nation is not a good thing. And I never even mentioned luxuries like credit cards.0 -
yolo----I swear this phase makes me want to hurt people... Not because of what it means but because it seems to be everyones reason for every stupid desicion they ever made and they say it all the time
I have a friend who convinced somebody that it meant "You Obviously Love Oreos." That made me giggle.0 -
My son just got a huge amount in Pell grants and Stafford loans. He has everything covered and doesn't have to pay back any loans until graduation. Interest rate wasn't bad, either. He's on his way to a small, private school out of our state. I just don't understand when I hear people say they can't afford to go to college any more.
A friend of mine did not qualify for any college loans because his parents made too much money. They refused to help with a dime towards school. He had to work his way through and never finished and it was NOT easy for him.
Same with my boyfriend. He only got $42 from Pell Grants, but he is in a unique situation because he has Muscular Dystrophy, and he has A LOT of doctor appointments, medications, medical equipment, etc that he also has to pay for. And one of the girls that I work for has to pay for her own personal assistants and her tuition because the government seems to think that having somebody to help you do the things that you have to do for everyday life is frivolous, and it's "entitlement." Really, that's the difference between her just collecting Social Security whilst staying in bed all day vs being a productive citizen.0 -
Too much to argue with here.{{SNIP}}
So if easy credit made college costs go nuts, I have 2 questions...
Why didn't the hallowed free market keep this under control?
and - where'd all that money go?
Your example is flawed. A better example would be.... You and all your neighbors have a gold card and you all want pizza. All the pizza joints realize this and decide to steadily raise prices. The pizza joints know you are all using gold cards and have a pretty good idea where the soft cap is on your credit so they keep the pie prices in range of that year after year. After 10 years of this you get fed up because you are now paying $100 for a pizza pie. You want to buy chicken wings for significantly less money instead but society has led you to believe that you need to eat pizza in order to provide a good life for your family. With this in mind you keep paying for pizza and set up a tent on wall street so you can b1tch about "The Man".
So... why didn't the hallowed free market keep this under control? It's not the job of the free market to control anything. In fact, I would argue the free market is working exactly like it should in this case. People want to go to school and are willing to pay what colleges are charging. If people stop paying what colleges are charging prices will drop. Since people are being provided deferred loans they just keep paying and figure they will deal with the cost later.
Where is the money going? Who knows. University presidents do whatever the hell they want for the "good" of the university. This could be in the form of better perks for faculty, athletic programs, bonuses, etc..
1 - nobody "Led me to believe I needed" anything. You really do need it. In 21st century USA there are 3 paths to a solid middle class lifestyle and the "American Dream". 1 - inherit it. 2 - entrepreneur it. or 3 - get a solid college education. That's it, there are very very few other paths. Unions are gutted, good jobs are outsourced to 'body shop" contractors, just about anything you can learn at a trade school or OJT pays crap. For most of us a college education is the best way to make it in today's world.
((About the folks in the tents. Working folks wages have stalled or declined for 30 years while "the rich have gotten richer" at a staggering rate. When wall st. destroyed the economy a couple years ago, they all did just fine with their slightly smaller bonuses, golden parachutes and a very generous Gov't bailout. Meanwhile the common folks are really suffering. I don't agree with everything the OWS folks are talking about, but they do have a few points.)).
2 - ""People want to go to school and are willing to pay what colleges are charging."" people have to go to school if they want to live the american dream. I work for a big chemical company, we have a lot of engineers here and they make a very comfortable living, and they all have at least a 4 year degree.
""If people stop paying what colleges are charging prices will drop."" If you don't pay you don't get the degree, and you can't get the job. 'nuff said. This outfit will not even talk to you without reviewing and verifying a solid CV first. I consider this a good program, would you want untrained folks designing/building/operating plants full of dangerous chemicals?
What I meant about the free market keeping this under control is - why didn't supply and demand and market pressures keep this to a manageable cost? If Wendy's charges too much for hamburgers folks go to McDonalds, and that keep 'em both honest. If College A goes nuts with their tuition charges, students should flock to College B. The lack of 'customers' at college A would influence them to hold priced down or go out of business. Micro-econ 101 stuff,,, why doesn't it work with colleges? Why has higher ed gotten so expensive?
3 - "Where is the money going? Who knows. University presidents do whatever the hell they want for the "good" of the university. This could be in the form of better perks for faculty, athletic programs, bonuses, etc.." If a business wastes money stupidly they will go out of business. Why doesn't this happen with colleges? I do believe in the free market when it works. Why doesn't it work with higher education?
Oh yeah,,, a catchphrase,,, "What you talking 'bout Willis?" :laugh:0
