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The article is restrained in its conclusions, but it seems obvious - anecdotally - that it's causal. There is no cost of living adjustment for student loans.

The article is restrained in its conclusions, but it seems obvious - anecdotally - that it's causal. There is no cost of living adjustment for student loans. They don't cost less if you live in Indiana than if you live in Manhattan. Even income-based repayment only helps so much. If you really want your student loan payments to be a smaller proportion of your income, you need a higher-paying job. As an example in my field, law school cost of attendance is approaching $100,000/year. People are graduating with almost a quarter million dollars in debt. That leaves almost no choice between a small town Midwestern law firm paying $40,000 indefinitely, and a Vault 100 firm paying $160,000 (or higher!) with guaranteed lockstep raises every year. Sure. Some of those people would have competed for BIGLAW jobs before. But student loan debt is dispositive.

cm2187 8y ago
I have mixed feeling on that. In the UK I understand that the repayment of the student loan is conditional to resources. Then I think it’s not too bad as effectively you end up paying for the studies you get the benefit from, rather than making others pay for your studies. And if you don’t get the benefit, then the cost becomes socialised. But on the other hand the people who have to make these decisions are 17 or 18 year old kids. Some of these kids will be impressively mature, most will not. Then it becomes a function of how well their parents know their way around the system and high tuition fees create a big hurdle. Then you get social selection and it’s counterproductive.
- TheOtherHobbes 8y ago
  By definition the only people who need loans are the people who can't afford them. They have to take a gamble on their own learning and earning skills and the future state of the economy - the latter being something they have no control over, and realistically, no understanding of. The reality is the system will collapse anyway within the next ten years, probably with significant economic wreckage, and the next generations will wonder why anyone ever thought it was a good idea. Is social selection an unfortunate byproduct, or a deliberate goal?
beambot 8y ago
How many of your classmates made it into the Vault 100 firm... 10%, 20% max?
- torstenvl 8y ago
  In my program, nearly everyone who wanted one. Admittedly, the disparity I used is stark and not everyone has those options. But you don't need Vault 100 to be making six figures fresh out of law school. Even if it's a choice between a small town firm in Mishawaka or Marquette versus $110,000-$120,000 in Indianapolis or Grand Rapids, it's still going to be a major thumb on the scale for people with outsized debt to move to the city.

cm2187 8y ago

I have mixed feeling on that. In the UK I understand that the repayment of the student loan is conditional to resources. Then I think it’s not too bad as effectively you end up paying for the studies you get the benefit from, rather than making others pay for your studies. And if you don’t get the benefit, then the cost becomes socialised. But on the other hand the people who have to make these decisions are 17 or 18 year old kids. Some of these kids will be impressively mature, most will not. Then it becomes a function of how well their parents know their way around the system and high tuition fees create a big hurdle. Then you get social selection and it’s counterproductive.

TheOtherHobbes 8y ago
By definition the only people who need loans are the people who can't afford them. They have to take a gamble on their own learning and earning skills and the future state of the economy - the latter being something they have no control over, and realistically, no understanding of. The reality is the system will collapse anyway within the next ten years, probably with significant economic wreckage, and the next generations will wonder why anyone ever thought it was a good idea. Is social selection an unfortunate byproduct, or a deliberate goal?

beambot 8y ago

How many of your classmates made it into the Vault 100 firm... 10%, 20% max?

torstenvl 8y ago
In my program, nearly everyone who wanted one. Admittedly, the disparity I used is stark and not everyone has those options. But you don't need Vault 100 to be making six figures fresh out of law school. Even if it's a choice between a small town firm in Mishawaka or Marquette versus $110,000-$120,000 in Indianapolis or Grand Rapids, it's still going to be a major thumb on the scale for people with outsized debt to move to the city.