NPR story on student loans

[JimmyJames 12271]

2 minutes ago, Anastasis said:

false dilemma, and a straw man. good job JDS. 

Every accusation is a confession, especially given all of those parents out there encouraging their kids to take out a quarter of a million dollars in student loans, just like you said. 

[Onboard 2.0 9083]

Don't know the difference between 3k and 30k ?  Has math been removed from HS curriculums ?

[TwiceHorn 31302]

12 minutes ago, TornACL said:

University tuition is on the pharma cost train. So much of the money spent is "free" (loans/insurance) that there's no market penalty for raising prices.

Pharma/medicine train.

[JimmyJames 12271]

1 minute ago, GRHorn said:

You should’ve saved better for your kids’ college Jimbo

Not everybody can have such a great life as you constantly tell this board you have, GRHorn.

And I say that as a big burly man with tears in his eyes who has never cried.  I’m sure your kids are too busy water skiing behind your yachts to have to bother with college and student loans. 

[Anastasis 23397]

3 minutes ago, JimmyJames said:

Every accusation is a confession, especially given all of those parents out there encouraging their kids to take out a quarter of a million dollars in student loans, just like you said. 

Sorry about your brain damage. 

1 hour ago, Anastasis said:

The parent who does not counsel their child that they are shitting the bed by taking out a quarter million dollars in student loan debt is a failure. 

 

[SimonBolivar 10937]

4 minutes ago, Incredulity said:

Factually the don’t have “little value”, they just have less value than what is being paid for them.

How do you assign value to the degree? It's market value is whatever the school is charging as it's non transferable and non negotiable. You can do it based on income earned after graduation as an ROI but it would have to be a pretty big loan for an average 4 year degree to have a negative ROI over the course of a career. 

 

I majored in a humanity and find immensely beneficial as a loan officer as the business side of it isn't complicated...at all.

 

 

[ndawg 1242]

I’ll say this, as someone who has needed the help of nurses and occupational & physical therapists to help put my body back together, I’m sure glad they made the really financially stupid decision to rack up hundreds of thousands in student loan debt for 50-60k / year jobs.

[JimmyJames 12271]

2 minutes ago, Anastasis said:

Sorry about your brain damage. 

 

Complete semantics, but you know that. Its why discussing anything with you is pointless. 

[TwiceHorn 31302]

1 minute ago, SimonBolivar said:

How do you assign value to the degree? It's market value is whatever the school is charging as it's non transferable and non negotiable. You can do it based on income earned after graduation as an ROI but it would have to be a pretty big loan for an average 4 year degree to have a negative ROI over the course of a career. 

 

I majored in a humanity and find immensely beneficial as a loan officer as the business side of it isn't complicated...at all.

 

 

I would think the proper measure would be the difference in lifetime earnings between the post-degree job and the no-degree job.  

[Onboard 2.0 9083]

2 minutes ago, TwiceHorn said:

I would think the proper measure would be the difference in lifetime earnings between the post-degree job and the no-degree job.  

Meaning degreed earners make more than non degreed earners ?

[heso 2748]

A huge part of the problem is for profit schools. The students on average borrow more while accounting for the majority of defaults. 

they are predatory in nature, targeting minorities, low income, first generation college students, and ex-military. These are people that don’t have anyone to guide them. They get targeted by people pretending to have their best interest at heart, but all they care about is getting the loan signed.

The Obama admin was taking steps to kill the worst offenders, but Trump and Betsy Devos are doing their best to revive the industry. 

[Anastasis 23397]

 

10 minutes ago, ndawg said:

I’ll say this, as someone who has needed the help of nurses and occupational & physical therapists to help put my body back together, I’m sure glad they made the really financially stupid decision to rack up hundreds of thousands in student loan debt for 50-60k / year jobs.

Definitely an underpaid profession relative to the inflated cost of training. 

[Anastasis 23397]

2 minutes ago, heso said:

A huge part of the problem is for profit schools.

They are all for profit. 

[heso 2748]

5 minutes ago, Anastasis said:

They are all for profit. 

The difference between a Goldman Sachs owned EDMC (before its collapse and sale) and a top tier public research university couldn’t be more extreme. 

but you knew that. 

[Anastasis 23397]

Just now, heso said:

The difference between a Goldman Sachs owned EDMC (before its collapse and sale) and a top tier public research university couldn’t be more extreme. 

but you knew that. 

They are all driven by the dollar bill. Tenure track at a tier 1 is driven by overhead billed back to the tower.  That is not to say that there are not substantive differences. 

[ndawg 1242]

23 minutes ago, TwiceHorn said:

I would think the proper measure would be the difference in lifetime earnings between the post-degree job and the no-degree job.  

If you do that, then the difference between 3k and 30k will also not seem like much anymore.

[bonnieblue 542]

Okay, so let's say everyone is smart enough to avoid taking out loans for these much-maligned theater degrees and these students instead pivot into STEM majors. What happens when this glut of STEM majors goes job hunting and plenty are left out in the cold (because there are only so many STEM jobs)? Do we then scold them for not getting theater degrees?

[TwiceHorn 31302]

26 minutes ago, Onboard 2.0 said:

Meaning degreed earners make more than non degreed earners ?

I said "difference," it could be positive, or negative, or zero.

[TwiceHorn 31302]

4 minutes ago, bonnieblue said:

Okay, so let's say everyone is smart enough to avoid taking out loans for these much-maligned theater degrees and these students instead pivot into STEM majors. What happens when this glut of STEM majors goes job hunting and plenty are left out in the cold (because there are only so many STEM jobs)? Do we then scold them for not getting theater degrees?

Some engineers make fine actors and even better set designers and constructors.

[6th Street 6357]

5 minutes ago, bonnieblue said:

Okay, so let's say everyone is smart enough to avoid taking out loans for these much-maligned theater degrees and these students instead pivot into STEM majors. What happens when this glut of STEM majors goes job hunting and plenty are left out in the cold (because there are only so many STEM jobs)? Do we then scold them for not getting theater degrees?

I studied EE in undergrad - roughly half or slightly more of my class were immigrants from India and China on student visas because Americans are either too dumb or too lazy to put in the work. As it stands there is a massive shortage of skilled folks to code, design circuits, etc so we are forced to import talent. 

[Onboard 2.0 9083]

7 minutes ago, bonnieblue said:

Okay, so let's say everyone is smart enough to avoid taking out loans for these much-maligned theater degrees and these students instead pivot into STEM majors. What happens when this glut of STEM majors goes job hunting and plenty are left out in the cold (because there are only so many STEM jobs)? Do we then scold them for not getting theater degrees?

Therein lies the rub. Not every profession requires a degree.  Theater seems like the perfect profession for vocational training like welders, electricians, auto repair.  

[Guest Lobo]

Why don't we underwrite student loans the same way we underwrite real estate loans?  Nearly every college and major and payback potential is treated unilaterally the same.  But with a real estate or business loan, we'd underwrite the location, the short and long term viability, the market risk, the default risk, the comps, etc.  But just about every single student loan is just "$200,000 at X% with Y terms."  What if we looked at which school the borrower was attending, what degree that were pursuing, what the job landscape looked like after that, etc.?  Wouldn't that lead to better rates and less defaults? 
 

I said it on another thread. We track this very closely at UT System.  Number one indicator on a person defaulting isn't their major, amount owned, credit score, or current income.....it's whether or not they actually finished their degree.  Degree-seeking undergraduates that drop out and never finish outpace every other default category 3:1.  That's the most damming thing you can do, is not finish.  

[WBT 20425]

2 hours ago, washparkhorn said:

It didn't cost $100K to get a degree at Texas when Pete Buttigieg studied English at his college of choice.

What economic forces caused the steep inflation in higher education?

asked

1 hour ago, Incredulity said:

The reason student loan debt was made extremely difficult to discharge was to induce lending for a thing that has zero collateral value.

and answered

 

Artificially inflated demand through free money leads to higher prices.

[gmr548 16518]

2 hours ago, washparkhorn said:

It didn't cost $100K to get a degree at Texas when Pete Buttigieg studied English at his college of choice.

What economic forces caused the steep inflation in higher education?

In most states, the biggest single driver of tuition increases at public institutions is state funding cuts. Across the country, tuition increases closely mirror cuts in public funding.

https://fivethirtyeight.com/features/fancy-dorms-arent-the-main-reason-tuition-is-skyrocketing/

https://www.demos.org/research/pulling-higher-ed-ladder-myth-and-reality-crisis-college-affordability

https://www.mhec.org/sites/default/files/resources/mhec_affordability_series7_20180730_2.pdf - Also takes an interesting look at the dynamics of net tuition vs full sticker price. Long but worth a look

 

 

 

[gmr548 16518]

1 hour ago, ndawg said:

I’ll say this, as someone who has needed the help of nurses and occupational & physical therapists to help put my body back together, I’m sure glad they made the really financially stupid decision to rack up hundreds of thousands in student loan debt for 50-60k / year jobs.

Only at entry level, and at the low end at that, would a RN/PT make $50k. An assistant type with lower certification may make that or even less depending on the exact job, but they're also not required to get a four-year degree. Hell, RN's don't have to have a four year degree.

[gmr548 16518]

30 minutes ago, WBT said:

asked

and answered

 

Artificially inflated demand through free money leads to higher prices.

This is really only applicable at for-profit schools.

[DeweyCox 366]

My student loans are paid off, but no way would I have accepted “forgiveness”. Forgiveness for what? 

[GRHorn 105]

Who actually sets the tuition for the Ut system? 
 

It’s extremely unlikely but could the Texas Legislature pass legislation capping the price for a period of time?

If they did, what would happen? Is all the financing for the constant construction on campus dependent on tuition increases?

[Onboard 2.0 9083]

Just now, gmr548 said:

This is really only applicable at for-profit schools.

Why ?  When tuition at pretty much all schools began rapidly increasing in the late 80's and beyond.  As college education was pushed more and more, vocational blue color, trade, skills have become scarcer and scarcer.

[TwiceHorn 31302]

1 minute ago, gmr548 said:

This is really only applicable at for-profit schools.

Well it's part of the story.  Take UT for example.  It couldn't raise tuition without permission from the state until about 2003.  That, combined with lack of support from the state (other than the PUF) started the rise in tuition.

Two things would apply downward pressure on the rise:  demand/ability to pay and price competition from other schools. 

Tuition went up 25x in 30 years.

[Mrs Whiggins 13049]

8 minutes ago, gmr548 said:

In most states, the biggest single driver of tuition increases at public institutions is state funding cuts. Across the country, tuition increases closely mirror cuts in public funding.

https://fivethirtyeight.com/features/fancy-dorms-arent-the-main-reason-tuition-is-skyrocketing/

https://www.demos.org/research/pulling-higher-ed-ladder-myth-and-reality-crisis-college-affordability

https://www.mhec.org/sites/default/files/resources/mhec_affordability_series7_20180730_2.pdf - Also takes an interesting look at the dynamics of net tuition vs full sticker price. Long but worth a look

 

 

 

That is probably the biggest one, there is another. At many state schools i.e. UT System and A&M System, administration ratios are growing to nearly equal to faculty. Part of the reason for that if I understand it correctly is the mandates/compliance laws that come from the Higher Ed Board/Federal requirements/NCAA compliance. For example, if the Higher Ed board says you have to increase retention, four year graduation rates, underserved population enrollment percentages, etc etc then it takes more people to implement and monitor programs designed to meet those requirements. Even if things go swimmingly, no one is going to want to work themselves out of a job. Since many faculty already have teaching/research/service job performance reviews for tenure or post tenure review, it is difficult for them to take on those tasks and not have their other areas suffer. After the economic downturn, many faculty had early retirement buyouts and IIRC there was also a hiring freeze, but I don't know if they still have that. So for some schools, their faculty are probably staffed somewhat lean or filled in with adjunct professors. In some ways, the state schools offer a better jobs program for highly paid administrators than the private schools unless the private school has a large endowment. That doesn't mean that the administrators have nothing to offer, but it is one of the reasons that the costs have risen.

[GSU&UT 1798]

1 hour ago, bonnieblue said:

Okay, so let's say everyone is smart enough to avoid taking out loans for these much-maligned theater degrees and these students instead pivot into STEM majors. What happens when this glut of STEM majors goes job hunting and plenty are left out in the cold (because there are only so many STEM jobs)? Do we then scold them for not getting theater degrees?

Lol, I had a Bio degree in 2009 and came to UT for grad school and just couldn't hack it and dropped out. I could not find a job for several months even at biotech labs, eventually after temping for Pearson I got a job with the American Cancer Society that paid less than $30k a year before getting a job in a toxicology lab.

[hobbes2702 12849]

3 hours ago, Asithappens said:

May be better placed in Daily Texan, but there are some political aspects to the student loan "debacle".

It's a problem, to be sure, but, and this chaps my hide a bit, the story on NPR (so far) has not said anything about whether the choice of taking out these loans was a wise one, or even a good one. Owing $100k when you're a theater/radiotvfilm/undergrad psych major is stupid. The student may not be stupid, but they have made a stupid decision. (if you want to argue that people who make stupid decisions are stupid you won't get much argument from me).

They said that students don't know the difference b/t taking out a $3,000/yr loan vs a $30,000/year loan. It's all just a number and you sign your name. Give me a fucking break. 

If there's anything we should have learned by now, it's that you can't prevent stupid people from being stupid. 

I would like to see the data on some of these loans: amount, major, school, did they graduate, etc. 

Again, if you took out $100k in loans and you're a theater major then you get no sympathy from me. Sorry. 

You’re looking at the issue backwards. It’s not whether or not it’s stupid to take that loan. The issue is why does college now 100k dollars when you could work and summer job and pay for it just 30 years ago.

[elfenix 34180]

^^ need to drop the S from STEM

https://www.theatlantic.com/business/archive/2013/09/why-the-s-in-stem-is-overrated/279931/

[gmr548 16518]

54 minutes ago, Onboard 2.0 said:

Why ?  When tuition at pretty much all schools began rapidly increasing in the late 80's and beyond.  As college education was pushed more and more, vocational blue color, trade, skills have become scarcer and scarcer.

For one, let me rephrase. I'm sure one could cherry pick some cases at public schools, but is only the main driver at for-profits, and to a lesser extent privates because more of their revenue comes from federal student loans. The main reason tuition has been exploding ad state funded schools since the 80's is because funding has not kept pace with inflation and enrollment, and in many cases has been slashed outright, particularly in the past 20 years.

Typically, when publics get some sort of reprieve in the way of fed/state funding increases, they tend to pass it on to students through either decreased net tuition (ie: more institutional grants/scholarships decreasing a student's out of pocket cost) or increased spending on instruction/programs/services. Despite the fact the federal loan money remains freely available to students even when publics see some sort of funding boost, they do not raise their tuition when these funding increases come. Tuition at public schools is very strongly correlated with funding. For-profits, however, are almost entirely reliant on federal student loans and absolutely plan their pricing around its availability. That much is well documented.

45 minutes ago, Mrs Whiggins said:

That is probably the biggest one, there is another. At many state schools i.e. UT System and A&M System, administration ratios are growing to nearly equal to faculty. Part of the reason for that if I understand it correctly is the mandates/compliance laws that come from the Higher Ed Board/Federal requirements/NCAA compliance. For example, if the Higher Ed board says you have to increase retention, four year graduation rates, underserved population enrollment percentages, etc etc then it takes more people to implement and monitor programs designed to meet those requirements. Even if things go swimmingly, no one is going to want to work themselves out of a job. Since many faculty already have teaching/research/service job performance reviews for tenure or post tenure review, it is difficult for them to take on those tasks and not have their other areas suffer. After the economic downturn, many faculty had early retirement buyouts and IIRC there was also a hiring freeze, but I don't know if they still have that. So for some schools, their faculty are probably staffed somewhat lean or filled in with adjunct professors. In some ways, the state schools offer a better jobs program for highly paid administrators than the private schools unless the private school has a large endowment. That doesn't mean that the administrators have nothing to offer, but it is one of the reasons that the costs have risen.

Of course. I am not saying it's 100 percent, data doesn't support that. But especially for publics, it is by far the biggest and accounts for the majority of cost increase, and I think from a political perspective the publics are what we're concerned about. Just like every other sector, jobs have been consolidated at colleges too. There are more white collar admin, but just like the private sector, there are fewer clerical folks and technology has increased productivity. Just as companies in the private sector can now operate cost effectively with fewer, better paid employees and contracting/automating out the things on the low end, higher ed can be and has been run the same way. Also, public universities have added fundraising and development arms that count as a significant part of those payrolls, but they're revenue generators. Agreed on athletics. Particularly football and even more particularly D1 football below the highest level. Shit's expensive.

 

Edited February 11, 2020 by gmr548

[FORTY NINE TO ZERO 2630]

2 hours ago, ndawg said:

I’ll say this, as someone who has needed the help of nurses and occupational & physical therapists to help put my body back together, I’m sure glad they made the really financially stupid decision to rack up hundreds of thousands in student loan debt for 50-60k / year jobs.

Many nurses do not go 100k In debt. Plenty of great programs at inexpensive schools 

[Fat Bastard 593]

Way too much emphasis in this country on telling all kids they need to go to college.  I don’t have the numbers, but it “seems” like, compared to every other country on this planet, we have more colleges/universities per capita. Also, unnecessary. There needs to be a much bigger driving force to vocational jobs, which pay very well, and do not incur the massive debts that traditional colleges do. That begins at the HS level with good counselors and realistic parents.  
 

I have no faith that it will happen.   I just paid back over 400k in my wife’s school loans and took about 7 years (accelerated in the last 2). Many of those loans were private loans with up to 12% interest. Absolutely fucking criminal. And she had collateral, she’s an MD. But, in residency, only making 60k/year, you can’t expect to put any kind of dent in that number and the juice is running the whole fucking time. 

[tchookem 3900]

I got that, but I was wondering why it was so.

Short answer: when the politicians allowed money lenders into the student loan game, they also let the money lenders make the rules.

[David Dennison 18661]

1 minute ago, Fat Bastard said:

Way too much emphasis in this country on telling all kids they need to go to college.  I don’t have the numbers, but it “seems” like, compared to every other country on this planet, we have more colleges/universities per capita. Also, unnecessary. There needs to be a much bigger driving force to vocational jobs, which pay very well, and do not incur the massive debts that traditional colleges do. That begins at the HS level with good counselors and realistic parents.  
 

I have no faith that it will happen.   I just paid back over 400k in my wife’s school loans and took about 7 years (accelerated in the last 2). Many of those loans were private loans with up to 12% interest. Absolutely fucking criminal. And she had collateral, she’s an MD. But, in residency, only making 60k/year, you can’t expect to put any kind of dent in that number and the juice is running the whole fucking time. 

That sounds great, but as long as employers use a degree as a hiring metric, demand for a college degree is only going to increase.

[heso 2748]

4 minutes ago, David Dennison said:

That sounds great, but as long as employers use a degree as a hiring metric, demand for a college degree is only going to increase.

And employers outside of trades with specific non-college training aren’t going to stop using a degree as a hiring metric. It’s a simple indicator of baseline skills: communication, critical thinking, problem solving, writing, etc. No not everyone that has a four year degree excels in all of those areas and one can certainly excel in those areas without a degree, but using it as a filter is going to be pretty effective. 

[David Dennison 18661]

13 minutes ago, tchookem said:

3 hours ago, workswithseed said:

I got that, but I was wondering why it was so.

Short answer: when the politicians allowed money lenders into the student loan game, they also let the money lenders make the rules.

[wildcat09 29265]

There’s a whole lot of “not everyone should go to college” elitism going on here. We’ve got a ton of problems in our country, but too many people are educated sure as shit isn’t one of them. 

[David Dennison 18661]

5 minutes ago, wildcat09 said:

There’s a whole lot of “not everyone should go to college” elitism going on here. We’ve got a ton of problems in our country, but too many people are educated sure as shit isn’t one of them. 

Wait til the people who think humanities are a waste of time start opining.

[bonnieblue 542]

2 hours ago, TwiceHorn said:

Some engineers make fine actors and even better set designers and constructors.

And I'm sure some theater majors make excellent [insert job of choice]. Outside of a few specific career paths with certain prerequisite knowledge needed at the undergraduate level, I think most companies would benefit from hiring employees from a diversity of educational backgrounds. Maybe the theater major brings some creativity to the strategy planning or the engineer brings some structure to the creative endeavor. 

[Fat Bastard 593]

College didn’t educate me for shit. I was already educated by the time I got there. All college did was get me a degree that allowed me to get a second, high paying degree that educated me plenty. 
 

How many majors are marketable and allow for jobs that can sustain a family, owning a home, etc???  Sure, you can get a philosophy degree and end up starting your own business in something completely unrelated and have $50M in the bank by the time you’re 50, but most likely, you’ll have some shitty 30k/yr job and live in an apartment with roommates forever and lament how life isn’t fair. 
 

Here’s a solution. You want a degree with zero real life usefulness that doesn’t pay for shit once you graduate? Make the universities have the student pay in cash —those majors are not eligible for loans.  Oh, you don’t want to study engineering, business, or natural sciences?? Too fucking bad, hippie, leave. 

[elfenix 34180]

2 minutes ago, Fat Bastard said:

natural sciences

[wildcat09 29265]

3 minutes ago, Fat Bastard said:

College didn’t educate me for shit. I was already educated by the time I got there. All college did was get me a degree that allowed me to get a second, high paying degree that educated me plenty. 
 

How many majors are marketable and allow for jobs that can sustain a family, owning a home, etc???  Sure, you can get a philosophy degree and end up starting your own business in something completely unrelated and have $50M in the bank by the time you’re 50, but most likely, you’ll have some shitty 30k/yr job and live in an apartment with roommates forever and lament how life isn’t fair. 
 

Here’s a solution. You want a degree with zero real life usefulness that doesn’t pay for shit once you graduate? Make the universities have the student pay in cash —those majors are not eligible for loans.  Oh, you don’t want to study engineering, business, or natural sciences?? Too fucking bad, hippie, leave. 

This here is how you‘ll end up with every college being aggy.

[David Dennison 18661]

5 minutes ago, Fat Bastard said:

College didn’t educate me for shit. I was already educated by the time I got there. All college did was get me a degree that allowed me to get a second, high paying degree that educated me plenty. 
 

How many majors are marketable and allow for jobs that can sustain a family, owning a home, etc???  Sure, you can get a philosophy degree and end up starting your own business in something completely unrelated and have $50M in the bank by the time you’re 50, but most likely, you’ll have some shitty 30k/yr job and live in an apartment with roommates forever and lament how life isn’t fair. 
 

Here’s a solution. You want a degree with zero real life usefulness that doesn’t pay for shit once you graduate? Make the universities have the student pay in cash —those majors are not eligible for loans.  Oh, you don’t want to study engineering, business, or natural sciences?? Too fucking bad, hippie, leave. 

AI is coming for you.

[Fat Bastard 593]

I wholeheartedly agree natural sciences degrees by themselves are shitty and only allow you to teach HS biology, but many of them are springboards for careers in medicine, pharma, and if played smartly with a business degree or good business acumen, can land yourself on the good side of health care (not the shitty side where I work, think ChiTownDoc side)

[elfenix 34180]

an educated citizenry and a body politic requires more than human calculators figuring out how to squeeze another 100th of a percent out of the oil patch or a piece of silicon.