4 ms·

Just stop guaranteeing them, let students default on them. All these guaranteed loans that can't be discharged allows academic institutions to ratchet up the p

by mc32 5y ago

Just stop guaranteeing them, let students default on them. All these guaranteed loans that can't be discharged allows academic institutions to ratchet up the price. Let them calculate risk and price them accordingly.

rendall 5y ago
This is the correct answer
dehrmann 5y ago
The guarantee is the only reason the loans are made. Otherwise, you're lending a lot of money to someone with no income and no assets, and no one will want to make that loan.
- mc32 5y ago
  If the program turns out successful students, I don't see why not? If the program turns out unmarketable skills, sure, charge through the roof and steer kids away from a useless degree.
- bee_rider 5y ago
  And then the colleges will have to reduce prices or go out of business.
  - rhexs 5y ago
    University employees are, unfortunately or not, consistent one party voting blocs. Cuts to them are highly unlikely.
    - bee_rider 5y ago
      Why not? I'm a university employee. Grad student, so maybe skewed a bit (are we talking about more permanent administrative employees? They I guess have different interests, since they aren't transient like me). 1) I'm going to, absent some massive political shift, vote for Democrats for the rest of my life anyway. So, they don't really have to play for my vote. 2) Playing around with boring stuff like tweaking market forces around by changing how loans work is sufficiently indirect that blame can probably be dodged. 3) We're all aware that the current system is pretty bad, a new solution that at least purports to be an attempt at something better can be sold to me pretty easily. 3a) Keep in mind that, at least in the STEM departments, the instructors are there for essentially irrational reasons -- they could make much more money in industry. At least some of the motivation is to produce interesting science and help students, paycheck be damned. Changes that hurt the last while helping the first two will probably be accepted with only minimal grumbling as long as they aren't too painful.
- loeg 5y ago
  They'd actually have to underwrite on the basis of the value of a degree -- yeah, no one is going to lend money to the same people who wouldn't be able to repay their loans after graduation. That's good!
  - SamuelAdams 5y ago
    This is a slippery slope though. This effectively turns universities into career-training centers. Eventually enrollment in less-profitable subjects, like dance and art, will decrease, forcing colleges to drop it from their programming. Then suddenly we have a society that does not appreciate art or dance or whatever other subjects were dropped. This is the slippery slope - creditors get to decide what others know and learn and pay attention to. Knowledge is no longer widely available - the experts (professors) might still teach at a college, but will be forced to either pivot or leave when the university slashes their programs. They could teach privately or for free, but I am guessing the number of students who they would normally teach drops significantly.
    - mc32 5y ago
      This is not a problem. Tooo many kids graduate with degrees in which they cannot find decently paying jobs, so they end up in a different field altogether. Why have that initial non-starter in the first place and place them into a career that has better potential in the first place? Once there are too few people in the arts, demand will incentivize more people to get into that field. Moreover, don't we currently have a problem where we don't have enough students going into STEM?
    - kingrazor 5y ago
      Is this really a problem though? Wouldn't arts programs simply move to being something offered to and studied by those wealthy enough to do so? I'm genuinely curious.
    - theandrewbailey 5y ago
      > This effectively turns universities into career-training centers. Isn't that the case already? Aren't most university students looking to increase their career prospects? Wasn't that the whole point of telling generations of kids to go to college, so that they'll get better jobs?
- BeFlatXIII 5y ago
  Good. Accelerate and force the "everyone must go to college" issue. Revert it to scholarship-only (plus the rich dunces who can afford full tuition).
janejeon 5y ago
+1. Defaults exist for a reason - they force the lender to think about whether someone can pay off a debt or not, and we got here by giving everyone a loan, whether they could pay it off or not.
sharker8 5y ago
This create market driven dynamics in which degrees basically are tailor made for industry. This approach disincentivizes pure research for scientific purposes.
- mc32 5y ago
  You're saying companies DON'T want researchers? In any case, if there is a specific need for specific research, I'm sure the gov can figure out a way to incentivize particular useful tracks which the market ignores. Grants programs, etc.
  - sharker8 5y ago
    Companies value people who can apply the scientific method (experimental design, data gathering, data analysis, etc). They hire people who have acquired this specific knowledge often through grants. Whether these subsidies lead to application of the specific knowledge gained through the grant underwriting process is debatable. Companies will hire people who studied something that requires the scientific method for which there is maybe no market, and make them apply that approach to things for which there is a market.
- abnry 5y ago
  There is a tension between the two purposes universities have: To train students and to do research. I want both, but I have a hard time disapproving of more focus on training students, as they are the true customers of universities.
  - bee_rider 5y ago
    A future where universities looked more like community colleges situated next to research institutes, rather than weirdly blending the two, could be neat. Have people really interested in teaching rather than research teach the 100/200-level courses. The scientists next door can teach seniors and juniors, and show up for guest lectures.
- throwawayboise 5y ago

by mc32 5y ago

rendall 5y ago

This is the correct answer

dehrmann 5y ago

The guarantee is the only reason the loans are made. Otherwise, you're lending a lot of money to someone with no income and no assets, and no one will want to make that loan.

mc32 5y ago
If the program turns out successful students, I don't see why not? If the program turns out unmarketable skills, sure, charge through the roof and steer kids away from a useless degree.
bee_rider 5y ago
And then the colleges will have to reduce prices or go out of business.
- rhexs 5y ago
  University employees are, unfortunately or not, consistent one party voting blocs. Cuts to them are highly unlikely.
  - bee_rider 5y ago
    Why not? I'm a university employee. Grad student, so maybe skewed a bit (are we talking about more permanent administrative employees? They I guess have different interests, since they aren't transient like me). 1) I'm going to, absent some massive political shift, vote for Democrats for the rest of my life anyway. So, they don't really have to play for my vote. 2) Playing around with boring stuff like tweaking market forces around by changing how loans work is sufficiently indirect that blame can probably be dodged. 3) We're all aware that the current system is pretty bad, a new solution that at least purports to be an attempt at something better can be sold to me pretty easily. 3a) Keep in mind that, at least in the STEM departments, the instructors are there for essentially irrational reasons -- they could make much more money in industry. At least some of the motivation is to produce interesting science and help students, paycheck be damned. Changes that hurt the last while helping the first two will probably be accepted with only minimal grumbling as long as they aren't too painful.
loeg 5y ago
They'd actually have to underwrite on the basis of the value of a degree -- yeah, no one is going to lend money to the same people who wouldn't be able to repay their loans after graduation. That's good!
- SamuelAdams 5y ago
  This is a slippery slope though. This effectively turns universities into career-training centers. Eventually enrollment in less-profitable subjects, like dance and art, will decrease, forcing colleges to drop it from their programming. Then suddenly we have a society that does not appreciate art or dance or whatever other subjects were dropped. This is the slippery slope - creditors get to decide what others know and learn and pay attention to. Knowledge is no longer widely available - the experts (professors) might still teach at a college, but will be forced to either pivot or leave when the university slashes their programs. They could teach privately or for free, but I am guessing the number of students who they would normally teach drops significantly.
  - mc32 5y ago
    This is not a problem. Tooo many kids graduate with degrees in which they cannot find decently paying jobs, so they end up in a different field altogether. Why have that initial non-starter in the first place and place them into a career that has better potential in the first place? Once there are too few people in the arts, demand will incentivize more people to get into that field. Moreover, don't we currently have a problem where we don't have enough students going into STEM?
  - kingrazor 5y ago
    Is this really a problem though? Wouldn't arts programs simply move to being something offered to and studied by those wealthy enough to do so? I'm genuinely curious.
  - theandrewbailey 5y ago
    > This effectively turns universities into career-training centers. Isn't that the case already? Aren't most university students looking to increase their career prospects? Wasn't that the whole point of telling generations of kids to go to college, so that they'll get better jobs?
BeFlatXIII 5y ago
Good. Accelerate and force the "everyone must go to college" issue. Revert it to scholarship-only (plus the rich dunces who can afford full tuition).

janejeon 5y ago

+1. Defaults exist for a reason - they force the lender to think about whether someone can pay off a debt or not, and we got here by giving everyone a loan, whether they could pay it off or not.

sharker8 5y ago

This create market driven dynamics in which degrees basically are tailor made for industry. This approach disincentivizes pure research for scientific purposes.

mc32 5y ago
You're saying companies DON'T want researchers? In any case, if there is a specific need for specific research, I'm sure the gov can figure out a way to incentivize particular useful tracks which the market ignores. Grants programs, etc.
- sharker8 5y ago
  Companies value people who can apply the scientific method (experimental design, data gathering, data analysis, etc). They hire people who have acquired this specific knowledge often through grants. Whether these subsidies lead to application of the specific knowledge gained through the grant underwriting process is debatable. Companies will hire people who studied something that requires the scientific method for which there is maybe no market, and make them apply that approach to things for which there is a market.
abnry 5y ago
There is a tension between the two purposes universities have: To train students and to do research. I want both, but I have a hard time disapproving of more focus on training students, as they are the true customers of universities.
- bee_rider 5y ago
  A future where universities looked more like community colleges situated next to research institutes, rather than weirdly blending the two, could be neat. Have people really interested in teaching rather than research teach the 100/200-level courses. The scientists next door can teach seniors and juniors, and show up for guest lectures.
throwawayboise 5y ago