Without government backed student loans for literally anyone who wants it, you suddenly dry up the money for colleges. They are forced to compete on degree cost and quality alone, and degree ROI will likely start to get factored into the price. College used to be relatively low cost long ago and easily accessible to the middle class, even lower middle class. Yes, the colleges will be hurting and screaming if they took that money away but they did this to themselves. Their entire business model is based on never ending government subsidy, essentially free money. At this point it will require a reckoning but this is always the case when you set up systems like this with good intentions and bad outcomes.
You see almost the same phenomena with Uber vs traditional taxi's. The government forced taxi's to buy medallions to operate a certain number of drivers because they didnt want the streets overrun with taxi's, with each medallion costing hundreds of thousands and even up to a million dollars in places like NYC. A taxi driver essentially had to have a second mortgage to operate. Along comes Uber and that whole government backed system gets crushed and starts to look ridiculous and artificially inflated in price. Yes, the taxi drivers got screwed, but it was the "good intentions" of the medallion system to keep the number of taxi's low that screwed over the consumer with higher cost rides compared to a market driven approach with companies like Lyft and Uber competing to the bottom. Let the market do the same for colleges. They have fancy campuses now.
There have been other ideas where student loan ROI is factored in and the college themselves must cover the cost of the loan if your degree turns into a lower paying job and the percentage of your loan payment exceeds some percentage of your income. Either way they have skin in the game that's EXACTLY whats needed.
I think an Uber or AirBnB of higher education is just around the corner. Uber wasn't simply a policy-change in taxi-cabs. It was a change in tech that allowed drivers to find the customers. AirBnB is about computer-based rating system which allows providers and customers rate each other. Computers and internet make that kind of thing possible.
Hey why not allow students to take courses from multiple universities online, and rate those courses? Let professors rate their students, but also students rate their professors.
And pandemic makes people see that they can (or must) study from home anyway, with their computer and video-connection. That simply wasn't technically possible 20 years ago.
E-learning has its pros and cons, but it is still a new field which has room to improve.
I think you're demonizing gov't intervention in education, but you can't expect a democratically elected Congress to not try to prevent China/Russia to overtake them in science/engineering. College fees are insane, and loans are almost predatory, yes. But if banks don't give you a loan to go to school, shouldn't the government intervene?
Also, I don't want VC backed colleges "competing" to maximize revenue/some arbitrary metric if colleges will go the way of Uber/Lyft.
The ROI idea is great and may be a good compromise. You may lose some non-STEM majors though, and I think that's a bad thing. Maybe the different colleges within a uni (eng, math, lib arts) should have different tuition.
If the fear of Chinese or Russian engineering is a real thing, one can limit loans to engineering degrees, not to music, for example.
Another thing the government can do is to provide a limited loan for college and not for master degrees. In my company most assistants (lowest ranks in the office) have masters degrees because it's free (in Europe), a total waste of money.
And another: the more money the government gives, the higher the fees. OK, give less money, still help the students but not that much as today, get lower prices due to lowered supply.
There are already very affordable college options - the reason many schools charge more is because of demand and exclusivity.
This is another example of sensationalism. According to an article on Forbes -> "The average student loan debt for members of the Class of 2018 is $29,200"
Is that really so egregious?
Isn't it more likely that semi-skilled labor jobs disappeared increasing the demand to go to college for a good job? I don't think the loans are enough to justify the increase.
I would say that if someone was housed, clothed, and fed for four years while they worked perhaps only at a summer job, that being only $29K in debt is quite a good deal.
It's not just tuitions, books, and fees. You could make tuition and books free and someone still has to cover your living expenses for ~4 years of (mostly) not working at a paid job.
29k in debt is the deal - that's the average of a graduating class, so people ARE finding ways to provide for their needs and go to school and come out with 29.
*Assuming these numbers are accurate - I'm not here to get into a statistical debate on the numbers. But assuming that number is accurate.
What's the variance in the set? how do you know it's not bimodal with many students having scholarships or parent paid tuition, food, and board; then other students mostly graduating with 50k plus debt?
It's too high if the degree doesn't lead to employment or is not useful in employment. Consider the cost over a lifetime: it is much more than 27-37k after it is paid off and there is no way to discharge the debt. It's a risk that is put on students who are 17-18 and the effect is essentially to increase worker desperation of 21-22 year olds - suppressing labor costs to employers while increasing the monthly bills of the employee. Why should students pay for this while living for 4 years in poverty conditions when there is arguably little tangible benefit beyond checking a box required by employers?
> Why should students pay for this while living for 4 years in poverty conditions when there is arguably little tangible benefit beyond checking a box required by employers?
They wouldn't. But there is a tangible benefit for many, that is why they are willing to spend this money to go to school.
No one forces kids to go to school at 18 just like it doesn't force kids to blow money on credit cards and rack up debt, or buy cars on ridiculous interest rate loans, or spend high rent in over-priced apartments so they can be near the cool bars. No one forces kids to go to the private school for 40k a year over a local school at half the price.
No one forces parents to not save more money for college, or to help their kids more.
The fact that these things continue is evidence enough - the cost benefit is college is still worth it. I've seen little (besides rich white Silicon Valley types who are loaded railing against the establishment)evidence otherwise.
The fact that it continues is not evidence of effectiveness of educational ability, it’s evidence of structural entrenchment of the process due to the efficiency with which the process can extract value from students without options or perspective.
I think if you look at what modern on-campus housing and amenities have evolved to become, I struggle to agree with a description of that experience as "poverty conditions".
I’ve heard that narrative too.. Dorms with 2 people in a 15x10 space was my first experience. Then there was a whole bubble of slum lords renting barely habitable split homes built a century ago near campus for the same amount my parents pay on their mortgage. Large minority of college students report being hungry and not being able to afford food. Sure there were some nice new buildings as seen on tv, many of them weren’t and had terrible seating and lighting though.
You see almost the same phenomena with Uber vs traditional taxi's. The government forced taxi's to buy medallions to operate a certain number of drivers because they didnt want the streets overrun with taxi's, with each medallion costing hundreds of thousands and even up to a million dollars in places like NYC. A taxi driver essentially had to have a second mortgage to operate. Along comes Uber and that whole government backed system gets crushed and starts to look ridiculous and artificially inflated in price. Yes, the taxi drivers got screwed, but it was the "good intentions" of the medallion system to keep the number of taxi's low that screwed over the consumer with higher cost rides compared to a market driven approach with companies like Lyft and Uber competing to the bottom. Let the market do the same for colleges. They have fancy campuses now.
There have been other ideas where student loan ROI is factored in and the college themselves must cover the cost of the loan if your degree turns into a lower paying job and the percentage of your loan payment exceeds some percentage of your income. Either way they have skin in the game that's EXACTLY whats needed.