6 ms·

> But barring shifting to a European model of college funding, I don't see the US allowing dischargeable loans, nor do I think they should, because the reality

by maps 6y ago

> But barring shifting to a European model of college funding, I don't see the US allowing dischargeable loans, nor do I think they should, because the reality of it is that colleges won't reduce their rates nor increase their scholarships, they would just be completely out of reach of poor and middle class students. The reality is that the they should be out of reach to poor or middle class students TODAY. They are not serving those people and are actively making their lives worse by saddling them with outrageous debt and no prospect of meaningful employment. If the US changed bankruptcy it would force the colleges to change as well. Lenders are not going to be sending children into the workforce with zero chance to recoup that loan, and they are not going to want to bloat the college stay to ridiculous proportions.

jedberg 6y ago
Like I said in my initial comment, I don't agree that would be the outcome. I think a lot of smaller college would fail, and the big colleges would keep their high prices, and only cater to the wealthy.
- IG_Semmelweiss 6y ago
  You only need to look at historical examples to know that cannot be the case. Take for example, cars. That's how cars started. Look where we are today. If tuition stays sky high, it will be because of regulatory requirements (and enabling subsidies) to stay sky high, not because theres no market for education for working class folk
bradlys 6y ago
> The reality is that the they should be out of reach to poor or middle class students TODAY. That varies so much by student and to bar a whole class of people out of these things is not going to improve their outcomes. While some students are not served with better employment opportunities by going to college and earning a degree - there are many others who are. Outlawing things to a group of people isn't going to serve them better. It will mean that the entire middle class will be unable to educate into jobs. Educating them about the effort college requires to be successful once you leave would be better.
- skewart 6y ago
  > Outlawing things to a group of people isn't going to serve them better. It will mean that the entire middle class will be unable to educate into jobs. Educating them about the effort college requires to be successful once you leave would be better. Making it harder to get a student loan is hardly "outlawing" anyone from going to college. Schools would still give scholarships. Plus, tuition would almost certainly go down. Right now they can charge as much as they want because banks are will to lend whatever colleges charge. If all of a sudden people stopped buying their product when they raised the price too high then tuition would come back down to what it was only a few decades ago. Even if fewer people ended up going to college it wouldn't limit opportunity. If anything it would likely make it easier to get ahead. Fewer jobs would require a college degree - there wouldn't be enough applicants who have one - and we'd likely see alternatives to college become more popular and widely respected, which would give high school grads more options for how to get started with a career.
  - bradlys 6y ago
    If you're saying that someone who is below a certain income cannot get a loan - how are they going to go to college? Pull-up them bootstraps and find some more money under the couch cushions? You do know that scholarships are not like a dime-a-dozen, right? It's not like every university waives tuition at middle class incomes. If you want to limit the cost of college then doing it by putting caps on how much a university can charge could be a more straight forward option than hoping costs come down by limiting loans to those who can't afford the cash option. (e.g. If a university wants state funding then they need to cap their student costs) Even then - loans would still need to happen for people who can't afford much more than their basic housing expenses (if even that - think about kids who get kicked out at 18). You're speaking in a lot of "if market forces behave the way we all think they should thanks to basic econ like supply and demand" but that's not how things always work in the real world. Considering ~50% families don't have any retirement savings and don't have an emergency fund, do you really their kids are gonna be able to afford all the expense things associated with college? (Remember - these people just got out of high school! They have likely never had a job and have no money at all)
jonkho 6y ago
Here is an idea: let’s have colleges themselves act as the guarantor for a student loan. This way the incentives are aligned; if the colleges are poor judge of a students talent (and admit too many low performers), or having teaching standards are too weak will stand to lose money when a student cannot secure a job and repay their loans.
- bonestormii_ 6y ago
  Wow. I really like this actually.

by maps 6y ago

jedberg 6y ago

Like I said in my initial comment, I don't agree that would be the outcome. I think a lot of smaller college would fail, and the big colleges would keep their high prices, and only cater to the wealthy.

IG_Semmelweiss 6y ago
You only need to look at historical examples to know that cannot be the case. Take for example, cars. That's how cars started. Look where we are today. If tuition stays sky high, it will be because of regulatory requirements (and enabling subsidies) to stay sky high, not because theres no market for education for working class folk

bradlys 6y ago

> The reality is that the they should be out of reach to poor or middle class students TODAY. That varies so much by student and to bar a whole class of people out of these things is not going to improve their outcomes. While some students are not served with better employment opportunities by going to college and earning a degree - there are many others who are. Outlawing things to a group of people isn't going to serve them better. It will mean that the entire middle class will be unable to educate into jobs. Educating them about the effort college requires to be successful once you leave would be better.

skewart 6y ago
> Outlawing things to a group of people isn't going to serve them better. It will mean that the entire middle class will be unable to educate into jobs. Educating them about the effort college requires to be successful once you leave would be better. Making it harder to get a student loan is hardly "outlawing" anyone from going to college. Schools would still give scholarships. Plus, tuition would almost certainly go down. Right now they can charge as much as they want because banks are will to lend whatever colleges charge. If all of a sudden people stopped buying their product when they raised the price too high then tuition would come back down to what it was only a few decades ago. Even if fewer people ended up going to college it wouldn't limit opportunity. If anything it would likely make it easier to get ahead. Fewer jobs would require a college degree - there wouldn't be enough applicants who have one - and we'd likely see alternatives to college become more popular and widely respected, which would give high school grads more options for how to get started with a career.
- bradlys 6y ago
  If you're saying that someone who is below a certain income cannot get a loan - how are they going to go to college? Pull-up them bootstraps and find some more money under the couch cushions? You do know that scholarships are not like a dime-a-dozen, right? It's not like every university waives tuition at middle class incomes. If you want to limit the cost of college then doing it by putting caps on how much a university can charge could be a more straight forward option than hoping costs come down by limiting loans to those who can't afford the cash option. (e.g. If a university wants state funding then they need to cap their student costs) Even then - loans would still need to happen for people who can't afford much more than their basic housing expenses (if even that - think about kids who get kicked out at 18). You're speaking in a lot of "if market forces behave the way we all think they should thanks to basic econ like supply and demand" but that's not how things always work in the real world. Considering ~50% families don't have any retirement savings and don't have an emergency fund, do you really their kids are gonna be able to afford all the expense things associated with college? (Remember - these people just got out of high school! They have likely never had a job and have no money at all)

jonkho 6y ago

Here is an idea: let’s have colleges themselves act as the guarantor for a student loan. This way the incentives are aligned; if the colleges are poor judge of a students talent (and admit too many low performers), or having teaching standards are too weak will stand to lose money when a student cannot secure a job and repay their loans.

bonestormii_ 6y ago
Wow. I really like this actually.