Grand Forks Herald: Please Pay No Attention To The Student Loan Bubble

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When the higher education/student loan bubble pops, the folks at the Grand Forks Herald should be indicted (figuratively, not literally) as co-conspirators. Because despite a report illustrating the bubble perfectly, despite a report in their own paper showing that student loan debt has exploded even as the degrees students are purchasing have fallen in power, the Herald’s editorial page continues to poo-poo the problem.

“So, why do students keep enrolling?” asks Tom Dennis at the beginning of today’s editorial. His point, if the cost is so high and the degrees are falling in power, why haven’t more students opted not to go to college?

I’d answer with another question: Why did people keep taking out subprime loans, and why did banks keep issuing them, right up to the point when mortgage market collapsed? The answer, of course, is because the federal government kept buying up the loans. Fannie Mae and Freddie Mac were back or buying subprime loans until they couldn’t any longer, and the banks kept issuing the loans as long as the feds were buying.

And, because the low-cost loans were available, Americans kept taking out first, second and third mortgages to finance vacations and all the other foolish things people got up to in the midst of the bubble.

The same is true of student loans. The government is still backing the loans. Heck, in 2007 the government raised the ceiling on the amount of money which can be lent to students. And there is still a very strong push in society for kids to go to college whatever the cost. In fact, newspapers like the Herald are very much a part of that problem.

So, yeah, kids are still buying in because the bubble is still inflating. And college, obviously, isn’t a bad deal for every student (just as every mortgage issued at the height of the subprime bubble was a bad one). But that doesn’t change the fact that there is a bubble, and publications like the Herald are doing their readership a real disservice by prioritizing reflexive defense of all things higher ed over the truth.

Rob Port is the editor of SayAnythingBlog.com. In 2011 he was a finalist for the Watch Dog of the Year from the Sam Adams Alliance and winner of the Americans For Prosperity Award for Online Excellence. In 2013 the Washington Post named SAB one of the nation's top state-based political blogs, and named Rob one of the state's best political reporters. He writes a weekly column for several North Dakota newspapers, and also serves as a policy fellow for the North Dakota Policy Council.

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  • http://nofreelunch.areavoices.com/ Kevin Flanagan

    State media will always provide cover for the state education cabal. They have a quid pro quo. This won’t end well.

  • ec99

    Moot evidence as to why the Herald ceased allowing comments on their stories and op/eds. Jacobs and Co just couldn’t stand the fact that their points were not only subject to criticism, but many times based thinly veiled defenses of their sacred cows (usually advertisers). For well over a decade, Tom Dennis has shown his inability to legitimately argue a point. His use of logical fallacies, questionable statistics, and quotes from those who strengthen his argument while ignoring those who don’t, pretty much render his pieces as little more than propaganda.

  • zipity

    Rob! No fair arguing with the Herald using logic and reason…..!

    Don’t you know it’s wrong to ridicule the mentally infirm?

  • devilschild

    If the GF Herald still allowed comments on their articles this op/ed would have been crticized…which is why the GF Herald doesn’t allow comments on their articles anymore. They can’t take the heat.

    • http://sayanythingblog.com Rob

      There’s some truth in that.

      I can tell you, from experience, that it’s not easy to run a political news/opinion site with an open comments section. The criticism can be bruising, and often unfair.

      But I’ve always felt running an open forum is worth it.

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