Since everyone has been talking about education bubbles ad nauseum, figured this article could be of interest. An excerpt: It’s a story of an industry that may sound familiar. The buyers think what they’re buying will appreciate in value, making them rich in the future. The product grows more and more elaborate, and more and more expensive, but the expense is offset by cheap credit provided by sellers eager to encourage buyers to buy…. A New York Times profile last week described Courtney Munna, a 26-year-old graduate of New York University with nearly $100,000 in student loan debt — debt that her degree in Religious and Women’s Studies did not equip her to repay. Payments on the debt are about $700 per month, equivalent to a respectable house payment, and a major bite on her monthly income of $2,300 as a photographer’s assistant earning an hourly wage. And, unlike a bad mortgage on an underwater house, Munna can’t simply walk away from her student loans, which cannot be expunged in a bankruptcy. She’s stuck in a financial trap. http://pajamasmedia.com/richardfernandez/2011/02/20/bubbles-bursting/#more-12902
Maybe just maybe that degree is actually worth something if she chose to pursue something relevant to her major.
Chuckrox8 Wrote: ------------------------------------------------------- > Maybe just maybe that degree is actually worth > something if she chose to pursue something > relevant to her major. Or maybe, just maybe, the average 22 year old is not a good credit risk for $100k in uncollateralized debt?
Chuckrox8 Wrote: ------------------------------------------------------- > Maybe just maybe that degree is actually worth > something if she chose to pursue something > relevant to her major. Are there jobs that are relevant to a degree in Religious and Women’s Studies? Or more importantly, are there jobs that are relevant to a degree in Religious and Women’s Studies that pay enough to make a $700/month student loan payment and still have a decent standard of living? I suspect I’ll catch a lot of flak for this and I’m sure the details would be a nightmare, but maybe the amount of available loans should have some basis in the earnings potential of the degree being pursued. If you went to the bank and asked for $100,000 in financing so you could build a house that will be worth $60,000 when you’re done, they will have security escort you out of the building.
Perhaps we could sell equity in our future earnings potential instead of a debt model. I will give you 10% of my earnings for the first 10 yrs out of college if you send me to University of Chicago. Where is the innovation in education?
These people need to use their head. You don’t load up with $100,000 of student load debt and hope to pay it off with a degree in Religious studies. Its a risk reward situation. Its one thing if you are in medical or law school, but even these professions there is a significant risk if you are carrying that kind of debt.
Not unless you want to teach or run a non-profit. Maybe it’s bad parenting. My parents, my father specifically, told me that if I did not follow a business, engineering, or pre-med track in school then he wouldn’t help me out with tuition. I thought he was being a little harsh and restrictive at the time, but I am quite happy with the end result. I probably would have ended up with a history degree making $20,000 at the local library otherwise. She better start digging for that gold. I have a friend that went to a top 10 school, received an English degree, and is now waitressing tables. She could easily find another job, but that is the life she enjoys. Her father easily spent $125K on her college degree that has absolutely no value in her current situation. Some people…
Chuckrox - your father is a smart and sensible man. This person is an idiot to spend that much on a Women’s Studies and Religious education degree. What kind of moron spends over 100k on an education they could have gotten by hanging out at a women’s shelter and swinging by church every Sunday? I’m trying to convince my sister to bail on her pursuit of a psychology degree and enter some form of business (maybe marketing?). I don’t understand people that pursue pointless degrees, especially in this economy. It’s great that people wanna pursue their dreams, but at some point they must become realists and realize they need to make money to survive in this world.
I think there is an interesting issue in the value of general education vs. specialization. Universities have an interest in promoting specialization. “With our great program, you will learn the specific skills to get into this high paying job, and you can do it quickly.” Then you can charge a premium, but the education isn’t very useful if you can’t get that specific job. On the other hand, there is more general skills education (not vocational, just more “thinking skills”), which doesn’t seem to help you get a specific job, but actually can lead to a more flexible, retrainable workforce, as long as employers agree that the person can quickly learn necessary skills for the job. This kind of education is probably more useful on average, but doesn’t command a premium tuition rate. What we really need is a way for companies and employees to share the costs of specific training that will help the company but reduce the employee’s risk of being trained for somethign that they won’t be able to use elsewhere. The CFA model comes close, requiring a general education to get started, but then spawning a set of course providers to actually deliver the business specific education.
They have public service loan forgiveness and income based repayment programs for people who work for a non-profit, government agency, or under-served area. All this girl needs to do is work for a non-profit or government agency for 10 years and they’ll forgive her loans; also her payments will be determined by her income. At the end of the day government backed federal student loans are a good investment because it’s so flexible and forgiving! This girl needs to work the system, do her ten years in public sector, eat some Ramen noodles, and then go back to photography after then years; you would think she would be doing that already. Isn’t that the point of religious/women’s studies, giving back to the community? http://www.ibrinfo.org/ "Income-Based Repayment (IBR) is a new way to make your federal student loan payments more manageable. And if you’re a teacher or work in government or at a nonprofit (501©(3)) organization, you might qualify for a new type of public service loan forgiveness (PSLF) after 10 years of eligible payments and employment. "
Three solutions I think: either stop broad state subsidized tuition funding totally, require colleges to allow only as many students to enroll in a major as proportional to the estimate of future employment positions in that field (for Art History that is 6), or require more stringent criteria for attaining funding. I like the last way. Honestly, many people go to college at 18 because they simply don’t know what else to do. Right now, one gets out of college what they put in. It makes zero sense to subsidize C+/B- philosophy students. No offense to philosophy, I think those were some of my best classes. This is just reality. I’m a fan of broad education (was P,P & E). Specializing is something can be good given the proper educational basis, but not when it’s some esoteric faux field like socioanthrocommunology. A little more from that article, broadening the argument: What is in the way are the institutions and attitudes we’ve accumulated over the second half of the Twentieth Century. What is in the way are all the things we wanted and now find we can’t afford unless we change our institutions or modify our wants. We have accumulated, along with our entitlements, a vast pasture full of sacred cows which we have declared immortal. The 21st century was peculiar in that many regarded it as the permanent extension of the 20th, that End of History. All future time was dedicated by definition to the perfection of the 20th and the grazing of the sacred cows. The world had enumerated its rights in the hundred years just past and was going to devote the eternity following to enjoying them. But there was one problem. Beyond the notions of “collective bargaining” rights, or “the right to food”, “right to migrate”, “right to carbon credits”, “right of return”, or the “right to welfare” or whatever rights people thought they had, was the crass question of whether the society on whose transfer payments were going to underwrite it could afford it. The unrest that is sweeping the world is underlain by a struggle between the core idea of market economics that you can’t get something for nothing and the fundamental promise of every statist politician that of course you can.
What kind of degrees do the officials at the Vatican have? With that kind of a degree I would shoot for a Pope’s role. No?
brain_wash_your_face Wrote: ------------------------------------------------------- > Three solutions I think: who are you trying to hold people accountable, larry summers? i think they need you in wisconsin.
I think we should start by reducing college to 3 years with a smaller number of more basic, broader, less specialized majors while reducing electives. Those who want to take electives should do so and study for longer, but it shouldn’t be required. It will probably reduce a lot of costs for students and state university systems.
Let’s be real here. Any rational 18 year-old will take on debt as far as they dare. Like a previous poster mentioned, the people handling the student loans are very flexible and work with you based on your income. So these kids have two choices: 1.) Take on debt, get whatever degree looks cool, hang out at college for X years and party. Graduate and if unable to find a job…it’s okay because the loan people will be really nice to you… OR 2.) Actually think about what you want your career to be about, study hard, do all the things needed to get a offer, and then graduate with a great paying job. Now look at those two choices and ask yourself how many 18 year-olds really will choose number 2? These kids don’t have a clue. All they know is that they get “free” money to get away from their parents and have a blast at this place called “college”. Trust me, I was one of those dumbasses a few years back.
Six years later…is the higher education bubble bursting?
https://www.theatlantic.com/business/archive/2017/07/college-bubble-ends/534915/