We’re Not Creating Equal Opportunity In Higher Education, We’re Creating Debt Slaves

students-loans2

In an editorial which seems to be in response to higher education criticism posted on this blog, Grand Forks Herald opinion editor dismisses the idea that government should get out of the higher education business even while admitting that the government’s involvement has created a bubble in tuition and fees:

So, with student-loan debts skyrocketing, why doesn’t the government just get out of the business of subsidizing college students?

After all, by funneling grants and loans to students — more loans than grants these days, but that’s another editorial — the government drives up college costs.

Like traffic expanding to fill a new freeway, colleges grow their budgets to absorb the new dollars. So, cut off the easy money, watch the number of college students fall, then sit back and enjoy the spectacle of colleges cutting costs as well.

Great idea. Right?

Wrong — and wrong not just in any old way, but in a bipartisan supermajority way.

Dennis goes on to point out that Republicans and Democrats alike – both Mitt Romney and Barack Obama – want to continue government-subsidized student loans, grants, etc. Which might be a good point, except that once upon a time there was a “bipartisan supermajority” in favor of promoting home ownership through government-backed, government-subsidized financing.

The political obsession with homeownership began in the 1990’s, and we saw how that story ended in 2008 and 2009. It was the collapse of the subprime housing market, and it was ugly. The housing bubble popped, and home ownership declined:

We’re currently promoting higher education in the same way – through government-backed, government-subsidized loans – and it’s creating the same sort of bubble. Here’s annual growth in tuition, compared to housing, medical care and overall inflation:

The student loan market isn’t as big as the mortgage market, but American student loan debt is larger than American credit card debt. And we’ve been inflating this bubble for much longer than the housing bubble.

This sort of growth is hurting our students. Just the other day I talked to a friend, in his early 30’s and in the middle class, who told me that he and his wife have $100,000 in student loan debt. They expect to be paying it off for the rest of their lives.

Dennis would have us believe that this is just a price we must pay for higher education opportunity. I disagree. We can have that opportunity without making our students into debt slaves, and the solution is to get government out of higher education.

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://flamemeister.com flamemeister

    “We’re Not Creating Equal Opportunity In Higher Education, We’re Creating Debt Slaves”

    And. That’s. The. Point.  The Democraps never dropped the slavery model, they just sublimated it.

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

    The tenured pointy heads and educrats are laughing all the way to the bank!

  • igx

    Probably 80% of what is taught in college is valuable, but it’s just way, way, way overpriced. Terrible situation. It’s going to be hell to undo it. 

    • Guest

      We should begin by preventing sports from ruining the good midwestern schools that havent already been ruined by sports.

      • igx

        I think the NCAA and the BCS are 100% rogue entities accountable to no one. Not to voters; not to shareholders.  There is nothing else like it. 

        • Gern Blanston

          I don’t entirely disagree; but the sports aspect is an aside to the tuition bubble. Other than it may attract students to the ‘glory’ of being a member of a school famous for sports. I supose in that way it does play a role in filling chairs at these schools and keeping the demand for subsidized tuition higher than it should be.

          • igx

            Right. I agree with that. 

            Who the hell “owns” or genuinely supervises the NCAA or the BCS? Seriously. 

  • JustRuss

    Step 1)  Government takes over the School Loan market completely
    Step 2)  Government offers to pay off your debt if you sign a contract to work for the government for a number of years (The military does this already)
    Step 3)  Everyone works for the Government

  • Awfulorv

    What is knowledge? Must one travel to a mountain top to acquire knowledge?  Is knowledge from the person next to you more valuable than  knowledge received from an electronic device? Does one have to heat, or cool, appreciably, that electronic device? Does one need to construct buildings to house that electronic device? Can that device be programmed to answer a specific question from you, and other users, of a like device? Could you use the device to attend class from home?  Could a code or, password, be used to authenticate your participation in, and tests from, said classes?   If you did work from home, would that save expensive gas?   How do online gambling casinos know to pay you, rather than that other guy, your correct winnings, or collect your losses?  Why do we not use the devices available to us to teach grade school, high school, and secondary education? Of course we all know the head in the sand answer.

  • borborygmi

    My sons have/had student loans, some private some through the Bank Of North Dakota.  They benefitted greatly from the loans. They did go into professions that were 1. needed and 2. pay well.  To make the college education the domain of the rich would be an injustice to those that can’t afford the education but have the brains and drive to accomplish great things.  Raise the standard of Admissions, leave the loans alone.

    • mikemc1970

      I’m glad that worked out well for your kids, but can you say that is the norm? The problem, as I see it, is that cost of education is being driven rapidly upwards by easy government money. Kids getting into majors they don’t have a prayer at getting a career in and end up upside down on their education costs.

      I don’t mind government backed loans to keep interest down for young people, but lets raise the standards and reserve a majority of the money for majors that have a ghost of a chance at finding enough work in that field, so that they can actually repay the loans. As well as scholarships for military and peace corps service. I believe we’ve talked about this in the past, but I’d like to see a four year commitment for peace corps service. Let’s also not attack career oriented universities that stifles competition with traditional universities. When there is a monopoly in anything the consumer always pays more.

      • borborygmi

        but lets raise the standards and reserve a majority of the money for majors that have a ghost of a chance at finding enough work in that field, so that they can actually repay the loans…….I have no problem with that.   Someone else suggested the money becomes available after the first year.  Don’t have much problem with that either.   Four year committment is also an exceptional idea.

      • borborygmi

        I think the key is the lowering of standards. Raise them don’t lower them. Make money available -to be paid back- for those that are ready for the Univ.  
           The four year comittment will lead to a maturer student, and when they come out a maturer employee.  Corporations could fund some of the education with a committment from the student to work for them.  There would be some yah but situations (Medical Degree etc) but it would be a benefit for the employer, employee and Loan Providers ( in this case the tax payer).  The influx of students would be curtailed along with the loan $ needed.
             

      • igx

        I completely disagree. The cost is unnaturally high, in the extreme, and this country is getting dumber and dumber every day. A liberal arts education like they did it in the old days is a good idea, AT THE RIGHT PRICE. 

        People swallow the liberal agenda of getting something for nothing because they can’t think critically and they don’t know jack about history and how the world works. 

        Plus, you can get a technical degree with a liberal arts education like majoring in finance, accounting or medical related stuff, etc. 

        • Guest

          Unfortunately, lots of people do not get the right primary education, are too dim for other reasons, or are unmotivated.  Nonetheless, forward momentum in academia must be available to everyone, in principle.  So you end up with lots smallish, way-below-average institutions pushing through 75% unqualified students, calling the ‘bachelors’ when I doubt more than 50% could pass a GED test.

          Perhaps some people should concentrate on technical school or, alternately, put in some serious f*cking effort.  There are large waves of lazy, stupid people — tsunamis even — coming at us in the near future… from next door.

          That said, it is a poor policy orientation to be hostile to education wholesale, as the right increasingly is.

  • Gern Blanston

    Look at that graph: intersting how the ‘rogue’ markets (in terms of growth beyond the average CPI) are the ones most influenced by government.

  • KJ

    And the banks have guaranteed income for the rest of your life. Nice racket.

  • Guest

    If you want to major in English, psychology, history, philosophy, art, humanities, economics, etc. then public aid should not be available to you.  If you want to major in science, math, statistics, etc. then public aid should be available to you.

    • sbark

      actually makes some sense,  but then gotta realize its those “soft majors” that supply the Left with disgruntled, unemployed OWS types that can be manipulated.

      Those are the type Dem’cats actually want  more of……….

  • WOOF

    Where the money goes-for profit schools.
     ‘For-profit schools are far more expensive than comparable programs at community colleges or public universities.
    The average tuition for a for-profit school is about six times higher
    than a community college and twice as high as a 4-year public school

    In order to drive enrollment growth, for-profit schools spend heavily on television advertisements, billboards, phone solicitation, and web marketing.
    The pressure on recruiters to enroll as many potential students as
    possible can give rise to recruiting practices that are overzealous or
    misleading.”

    http://harkin.senate.gov/help/forprofitcolleges.cfm

  • borborygmi

    Where does personal responsibility come into play?   Has anyone held a gun to the students head and order them to college.   Where to the parents fit into all of this.  Where does free enterprise marketing fit into this.  Woof indicates that advertising is misleading. Isn’t that just free enterprise.   The contract is called a LOAN  (a thing that is borrowed, esp. a sum of money that is expected to be paid back with interest )  up front. Again it looks like freedom loving liberty minded people are making an individual choice.  PERSONAL RESPONSIBILITY, SELF CONTROL.    Oh no it is some ones  fault.  It is the gov’t’s fault.  Bull Pucky.  If they didn’t make cigarettes people wouldn’t smoke.  Rob rants about self control when it comes to smoking or food or what ever else saying it looks like the gov’t doesn’t think we can make an intelligent decision..  Why not the same approach to school loans, or bad  mortgages.  Just because people are selling doesn’t mean you have to buy.

    • igx

      The problem is the math, the risk / reward  looked a lot better before the financial crisis. The government and the Federal Reserve fooled people int to doing dumb things that weren’t going to work out because  of the false boom since 1999 or arguably since Nixon closed the gold window. 

      The government and the Fed  made debt for consumption or overpriced education look like a good idea, which is what they wanted. It’s a scam to help the Political Class get to through the next election. That’s all that the parasites in D.C. care about. 

      • borborygmi

        Still no one is holding a gun to anyones head to sign on the dotted line.

        • igx

           Fed and government intervention truly makes economic decisions and risk taking problematic. The return on investment on college  looked a lot higher and more dependable before the crisis. 

      • Econwarrior

        It’s a typical govt-produced bubble, based on the faulty premise that demand is a dependent variable.  Rather than allowing the free market to supply all the available demand, the govt tries to “stimulate” demand, thus jacking up the price.  Happens every time.

  • sbark

    Good stuff from Am Thinker……..Sheldon Richman points out, the purpose of public education is not to aid in the development of a learned populace, but to produce unthinking workers. Based off the educational system of 19th-century Prussia, America’s public schools were originally designed to condition children toward a sense of “obedience, subordination and collective life.”

    The goal was compliance, never enlightenment.
    The progressive movement has been successful at turning public schooling into an unquestioned sacred cow. If you disagree with the idea that government should have any control over education, you are automatically accused of desiring an ignorant population
    The goal behind stalling the jump in interest rates is not to help students. It is to continue the cycle of union payoffs, campaign kickbacks, and fostering a learning environment where government decrees go unquestioned
    It therefore shouldn’t be surprising that Mark Zuckerburg, Bill Gates, and Steve Jobs were all college dropouts. The fact that their creative thinking wasn’t a byproduct of the college industrial complex is a real lesson in itself.

    so…………add Big Educ in as another “religion” of the Dem’cat Leftists……..can the students leave it even if they want to?

    • Econwarrior

      Actually, the original purpose of public education was to produce lots of mediocre students, since we were a mostly rural nation at that time.  Excellence was not supported, in order to achieve uniformity, so it went at the speed of the  slowest student, assuring a steadily declining standard.  If we really want to produce achievers, we need to encourage achievement and reward it.  It’s called PROFIT.

  • WOOF

    2 + 3= ?
    Solve this equation?
    You can have a lucrative career in sub-atomic physics.

    Great paying jobs available at Large Hadron Collider at
    Cern in Switzerland.

  • WOOF

    Obama Orders For-Profit Schools to Stop Scamming Our Troops

    “One of the worst examples of this is a college recruiter who had the
    nerve to visit a barracks at Camp Lejeune and enroll Marines with brain
    injuries”
    http://www.dailyfinance.com/2012/05/03/obama-orders-for-profit-schools-to-stop-scamming-our-troops/

    • http://realitybasedbob.sayanythingblog.com/ realitybasedbob

      God has truly blessed America with such a good man to be our President.

      • Guest

        I’m sure Allah appreciates your praise of his choice. Too bad you’re in the country.

      • Econwarrior

        True for President Reagan; since then, not so much, especially the punk fascist now in the WH.

    • Econwarrior

      More of his divisive, class warfare propaganda.

      • WOOF

        You would find it divisive to protect troops from shameless, criminal business practices disguised as educational opportunities.

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