5 ms·

Broadly, student loan debt is an economic supply/demand issue. The government keeps supplying loans and (of course!!) schools continue to raise "tuition" as the

by zomg 8y ago

Broadly, student loan debt is an economic supply/demand issue. The government keeps supplying loans and (of course!!) schools continue to raise "tuition" as the supply of monies is nearly endless. A good first step would be to reduce the supply of loan dollars, which would lower the number of students who can pay for college (however, no politician would sign up for that) and theoretically lower prices. There's also a stigma in the US about "blue collar" jobs, which is absolutely pathetic. Plenty of people in America support their families (quite well) working in blue collar industries. As an example, plumbers in my area (New England) can essentially demand their own rate and take on work as they desire. Don't want to pay their quote hourly rate? Well then, you can fuck right off and good luck finding another plumber in the next 2 weeks. We need to do away with the mentality that you HAVE to go to college, because you don't and the majority of those who do are attending are doing so because they are naive and don't know any better.

dv_dt 8y ago
Or we can do as many other nations do, adequately fund public universities (with cost controls on extravagance) causing market forces on private universities to be more price competitive.
- toasterlovin 8y ago
  In-state tuition at public universities is not very expensive. Student loans are being used to pay for other stuff (room and board, probably, or out of state tuition).
  - dv_dt 8y ago
    Then fund room and board to some degree too? For example Germany: https://handbookgermany.de/en/learn/student-finance.html https://handbookgermany.de/en/learn/student-finance.html tution, batchelors degree: free food, semester fee: 250 EUR avg basic student residence hall: 218 EUR/month (this looks like it goes higher as some students elect more than basic accommodations elsewhere..) In the equivalent public US university costs probably almost an order of magnitude higher. ~25-30k.
    - toasterlovin 8y ago
      Some people feel that the best societal arrangement is to let the people who benefit from an optional activity figure out how to pay for that activity on their own. I mean, if people can't seem to figure out how to avoid becoming indentured servants simply because they refuse to be economically productive and live frugally during the 4-6 years of college, how is the answer to just give them more of an ability to use resources without thinking about the consequences? The real problem in the U.S. is that bankruptcy protection does not apply to student loan debt. Change that and the problem goes away.
      - dv_dt 8y ago
        I feel that societal shared loading for university education makes the most sense. Individual loading doesn't help anything about practical independence in our society, while making us all poorer for no social benefit. Bankruptcy protection is a problem, but even if you fix that, significant problems remain. Let me explain: You significantly retard your own economy by weighting all new university grads with significant payments. If as soon as they graduate, some portion of their earnings starts going to repay loans, it's either slowing the flow of money into the economy (if not being spent), or taking money from possible retirement savings growth of that grad. Society and our economy also loses out on not educating sharp people with leading edge knowledge. So by creating this front end debt load, some very sharp people might be unable to take the debt, or others will avoid it, but held back by self-learning things that they could have picked up faster or more comprehensively at university. Societally, productivity is higher with a more educated labor force: https://www.epi.org/publication/states-education-productivity-growth-foundations/ https://www.epi.org/publication/states-education-productivit...
        toasterlovin 8y ago
        The cost of college in the US is not a limiting factor for the types of people who would succeed in college. If somebody is intelligent and not going to college, there is something else at play and it’s not at all clear to me that making college free would fix those kinds of problems. On the other hand, there are a lot of people who are poorly suited to college who would probably attend if it, as well as room and board, were free. After all, what irresponsible 18yo wouldn’t take free room and board in exchange for half-assing some classes. The community college system in the US is actually a pretty good way to figure out which students on the margins are actually able to succeed in an academic setting. All without requiring that taxpayers pay for for room & board. And regarding the economic aspects: it shouldn’t matter who pays for college or when they pay. The same amount of economic activity is happening.
JPKab 8y ago
Personally, I want us to find a way to hold universities accountable for handing out bullshit degrees that aren't remotely worth what they charge. A dead give-away that there is a problem is that every degree costs the same to acquire. That is insane and archaic.
- tsunamifury 8y ago
  This isn't the case. Law, Medical, and MBA's all cost more partly due to expected income.
- thfuran 8y ago
  How are you measuring the worth of a degree? And do you think designer brands of durable goods (or even consumables) shouldn't be allowed to charge more than other brands?
- linuxftw 8y ago
  Here's how to hold them accountable: People stop buying their product. Unfortunately, mass brainwashing has been super effective, everyone's gonna get rich buying index funds and going a 4 year degree, just you wait and see!
- godelski 8y ago
  Why not the banks who are giving out the risky loans? They know a degree in underwater basket weaving isn't going to pay off a $100k loan. In most other circumstances a bank does a risk analysis. And it isn't like they don't know what degree the borrower is pursuing. While the banks are giving money the universities are incentivized (because they are profit seeking) to increase prices and provide overpriced degrees.
  - EpicEng 8y ago
    You mean the fed? Because banks wouldn't be giving these loans if they were guaranteed.
  - Eire_Banshee 8y ago
    Student loans are guaranteed by the federal government, right? Thats why banks dont care. Its just the private student loans banks worry about.
mrfredward 8y ago
This is a huge issue because of "price insensitive" buyers. With a large number of people shopping for the biggest name university possible, not the best value, loan availability significantly affects the supply curve. When faced with an irrational consumer, unfortunately, the rational course of action for a university is to spend money on prestige building items like fancy architecture and football, rather than trying to provide the best education for the money.
matmann2001 8y ago
> There's also a stigma in the US about "blue collar" jobs, which is absolutely pathetic. Plenty of people in America support their families (quite well) working in blue collar industries. While I agree with this, I think part of the stigma is that "blue collar" jobs tend to be the ones that get outsourced, automated, or made irrelevant due to technology and internationalization. And there's really not much empathy when that happens. I remember some of the elitist attitudes taken toward the out-of-work coal mining communities that were a hot topic during the last election cycle. I'm not trying to make a statement about which side is right/wrong, but it makes sense that people in general prefer to avoid "blue collar" work, with that sort of a national attitude towards it. With a college degree being the de facto minimum bar to fields with some semblance of lifelong job security, it makes sense that people will attempt to acquire one, no matter the cost.
- rohitb91 8y ago
  But plumbers and electricians aren’t going anywhere whereas radiologists and accountants seem like they’re poised to be next On the automation chopping block.
ssully 8y ago
I agree there is an unwarranted stigma against blue collar jobs, but I think HN romanticizes the professions as well. I have multiple people in my family who work as plumbers and carpenters and it's not as simple as you make it out. When the getting is good, it's nice, but they have all struggled with longish periods of unemployment, injuries, etc.
- zomg 8y ago
  Totally agree on the downside -- when you're down, you're way down. But I'd argue, that's what separates the winners from the losers. A buddy of mine owns a lucrative landscaping business, but once the winter sets in, his revenue literally drops to zero. His solution has been a combination of part-time plumbing work and reallocating capital equipment from his landscaping business for sanding and snow removal. He probably makes more money now in the winter time than he does in the summer.
- magicnubs 8y ago
  I agree--maybe it's because HN skews so heavily towards the other end, that the grass just looks that much greener, but it has a really strange and inaccurate perception of blue collar work. I've worked in a range of blue collar jobs (from landscaping to construction to electrical). Around here at least, the pay ranged from absymal ($8/hr) for unskilled to ($12/hr) for apprentice-level work, less than half of what an untrained, fresh-out-of-college, entry-level position in my current field pays (40-45K), with a much lower ceiling for advancement unless, maybe, if you operate your own business. The hours were terrible (7am-5:30pm Monday-Saturday), and on average required 30-60 minutes commute each way depending on where the job site was, with a "travel allotment" that didn't even cover the fuel costs for my cheap hybrid car, much less depreciation (I was put up in a motel when at sites more than 90-120 minutes away from home). I think people here abhor staring at the same computer screen all day (which I fully admit can be a bummer), and they think a job "working out in the sunshine where you don't have to think hard all day" sounds good. It is absolute hell on your body, and you're working in all kinds of weather in all manner of dirty, dingy environments at all times of the year--some days it's 105 degrees, some days it's 5 degrees. It's loud, stressful, exhausting, repetitive, and often dangerous work, and there's no way I'd go back to it.
- 8y ago

by zomg 8y ago

dv_dt 8y ago

Or we can do as many other nations do, adequately fund public universities (with cost controls on extravagance) causing market forces on private universities to be more price competitive.

toasterlovin 8y ago
In-state tuition at public universities is not very expensive. Student loans are being used to pay for other stuff (room and board, probably, or out of state tuition).
- dv_dt 8y ago
  Then fund room and board to some degree too? For example Germany: https://handbookgermany.de/en/learn/student-finance.html https://handbookgermany.de/en/learn/student-finance.html tution, batchelors degree: free food, semester fee: 250 EUR avg basic student residence hall: 218 EUR/month (this looks like it goes higher as some students elect more than basic accommodations elsewhere..) In the equivalent public US university costs probably almost an order of magnitude higher. ~25-30k.
  - toasterlovin 8y ago
    Some people feel that the best societal arrangement is to let the people who benefit from an optional activity figure out how to pay for that activity on their own. I mean, if people can't seem to figure out how to avoid becoming indentured servants simply because they refuse to be economically productive and live frugally during the 4-6 years of college, how is the answer to just give them more of an ability to use resources without thinking about the consequences? The real problem in the U.S. is that bankruptcy protection does not apply to student loan debt. Change that and the problem goes away.
    - dv_dt 8y ago
      I feel that societal shared loading for university education makes the most sense. Individual loading doesn't help anything about practical independence in our society, while making us all poorer for no social benefit. Bankruptcy protection is a problem, but even if you fix that, significant problems remain. Let me explain: You significantly retard your own economy by weighting all new university grads with significant payments. If as soon as they graduate, some portion of their earnings starts going to repay loans, it's either slowing the flow of money into the economy (if not being spent), or taking money from possible retirement savings growth of that grad. Society and our economy also loses out on not educating sharp people with leading edge knowledge. So by creating this front end debt load, some very sharp people might be unable to take the debt, or others will avoid it, but held back by self-learning things that they could have picked up faster or more comprehensively at university. Societally, productivity is higher with a more educated labor force: https://www.epi.org/publication/states-education-productivity-growth-foundations/ https://www.epi.org/publication/states-education-productivit...
      - toasterlovin 8y ago
        The cost of college in the US is not a limiting factor for the types of people who would succeed in college. If somebody is intelligent and not going to college, there is something else at play and it’s not at all clear to me that making college free would fix those kinds of problems. On the other hand, there are a lot of people who are poorly suited to college who would probably attend if it, as well as room and board, were free. After all, what irresponsible 18yo wouldn’t take free room and board in exchange for half-assing some classes. The community college system in the US is actually a pretty good way to figure out which students on the margins are actually able to succeed in an academic setting. All without requiring that taxpayers pay for for room & board. And regarding the economic aspects: it shouldn’t matter who pays for college or when they pay. The same amount of economic activity is happening.

JPKab 8y ago

Personally, I want us to find a way to hold universities accountable for handing out bullshit degrees that aren't remotely worth what they charge. A dead give-away that there is a problem is that every degree costs the same to acquire. That is insane and archaic.

tsunamifury 8y ago
This isn't the case. Law, Medical, and MBA's all cost more partly due to expected income.
thfuran 8y ago
How are you measuring the worth of a degree? And do you think designer brands of durable goods (or even consumables) shouldn't be allowed to charge more than other brands?
linuxftw 8y ago
Here's how to hold them accountable: People stop buying their product. Unfortunately, mass brainwashing has been super effective, everyone's gonna get rich buying index funds and going a 4 year degree, just you wait and see!
godelski 8y ago
Why not the banks who are giving out the risky loans? They know a degree in underwater basket weaving isn't going to pay off a $100k loan. In most other circumstances a bank does a risk analysis. And it isn't like they don't know what degree the borrower is pursuing. While the banks are giving money the universities are incentivized (because they are profit seeking) to increase prices and provide overpriced degrees.
- EpicEng 8y ago
  You mean the fed? Because banks wouldn't be giving these loans if they were guaranteed.
- Eire_Banshee 8y ago
  Student loans are guaranteed by the federal government, right? Thats why banks dont care. Its just the private student loans banks worry about.

mrfredward 8y ago

This is a huge issue because of "price insensitive" buyers. With a large number of people shopping for the biggest name university possible, not the best value, loan availability significantly affects the supply curve. When faced with an irrational consumer, unfortunately, the rational course of action for a university is to spend money on prestige building items like fancy architecture and football, rather than trying to provide the best education for the money.

matmann2001 8y ago

> There's also a stigma in the US about "blue collar" jobs, which is absolutely pathetic. Plenty of people in America support their families (quite well) working in blue collar industries. While I agree with this, I think part of the stigma is that "blue collar" jobs tend to be the ones that get outsourced, automated, or made irrelevant due to technology and internationalization. And there's really not much empathy when that happens. I remember some of the elitist attitudes taken toward the out-of-work coal mining communities that were a hot topic during the last election cycle. I'm not trying to make a statement about which side is right/wrong, but it makes sense that people in general prefer to avoid "blue collar" work, with that sort of a national attitude towards it. With a college degree being the de facto minimum bar to fields with some semblance of lifelong job security, it makes sense that people will attempt to acquire one, no matter the cost.

rohitb91 8y ago
But plumbers and electricians aren’t going anywhere whereas radiologists and accountants seem like they’re poised to be next On the automation chopping block.

ssully 8y ago

I agree there is an unwarranted stigma against blue collar jobs, but I think HN romanticizes the professions as well. I have multiple people in my family who work as plumbers and carpenters and it's not as simple as you make it out. When the getting is good, it's nice, but they have all struggled with longish periods of unemployment, injuries, etc.

zomg 8y ago
Totally agree on the downside -- when you're down, you're way down. But I'd argue, that's what separates the winners from the losers. A buddy of mine owns a lucrative landscaping business, but once the winter sets in, his revenue literally drops to zero. His solution has been a combination of part-time plumbing work and reallocating capital equipment from his landscaping business for sanding and snow removal. He probably makes more money now in the winter time than he does in the summer.
magicnubs 8y ago
I agree--maybe it's because HN skews so heavily towards the other end, that the grass just looks that much greener, but it has a really strange and inaccurate perception of blue collar work. I've worked in a range of blue collar jobs (from landscaping to construction to electrical). Around here at least, the pay ranged from absymal ($8/hr) for unskilled to ($12/hr) for apprentice-level work, less than half of what an untrained, fresh-out-of-college, entry-level position in my current field pays (40-45K), with a much lower ceiling for advancement unless, maybe, if you operate your own business. The hours were terrible (7am-5:30pm Monday-Saturday), and on average required 30-60 minutes commute each way depending on where the job site was, with a "travel allotment" that didn't even cover the fuel costs for my cheap hybrid car, much less depreciation (I was put up in a motel when at sites more than 90-120 minutes away from home). I think people here abhor staring at the same computer screen all day (which I fully admit can be a bummer), and they think a job "working out in the sunshine where you don't have to think hard all day" sounds good. It is absolute hell on your body, and you're working in all kinds of weather in all manner of dirty, dingy environments at all times of the year--some days it's 105 degrees, some days it's 5 degrees. It's loud, stressful, exhausting, repetitive, and often dangerous work, and there's no way I'd go back to it.
8y ago