NPR story on student loans

[Brisketexan 105096]

1 hour ago, TwiceHorn said:

But bolstering the availability of student loans through loan guarantees and whatever other incentives there are had some dire unintended consequences:  liberating state governments to cut support, creating an artificial demand and price elasticity, raising tuition, and all of this conspired to saddle students with unconscionable debt.

Correct.  It's why any approach that creates a pool of gov't tuition dollars to be loaned/granted ALSO needs to come with restrictions on the universities that would accept them.  You want to be eligible to take in students funded with gov't loan dollars?  Cool.  Then you need to meet eligibility benchmarks of your own -- max tuition caps, or max tuition increase caps, that sort of thing.

I'll loan Student X the money to buy a degree, or a car, or whatever you want to substitute, but those dollars can only be spent on a degree, car, or whatever that meet my established criteria.  

Of course, by now, that horse has left the barn.  Not sure how to fix it.  Except to implement those criteria now, or roll them in, forcing universities to reign in their tuition and costs.

[DonkeyCigars 144]

44 minutes ago, Lobo said:

After a two year study by CommonBond...#1 indicator that you are likely to default on your student loan?  Not major, not school, not current job, not income level, not where you live, and not credit score.  

It's whether or not you completed your bachelor's degree/graduated.  There's a reason places list, "Some College" under "Highest Educational Level"  

Not saying it's good, bad, or indifferent.  But the data is in, and it's not even close.  

Boom! Home run insight.

We are talking about this, it seems, largely through the context of those who took out the equivalent of a small mortgage on a house to get some esoteric degree and now works in an entry level job making $45k in an expensive urban city, who wants to have a work-life balance and do things in their youth, while also needing to service massive amounts of debt. At least that's how I hear it framed a lot of the times, but I don't think that is the reality.

It seems to me the reality is that folks who take out student loan money for 1 or 2 years, at the full pop they can get to cover housing and everything else, and then flame out of school-- they are not incentivized or motivated to pay for something that didn't finish or give them value. Is it any wonder then they walk away? It's like taking out a mortgage for a house, and half-way through building it you get in a fight with the builder and yall can't agree to finish it and so it sits a bunch of wood framing and concrete next to a port-a-john, but you have to make payments on it for 30 years the same as if you got the value to live in it. Of course people aren't going to pay.

The blame then, it seems, lies squarely on the predatory schools who took advantage of the poor and lower middle class who were unprepared to do college level work and/or complete a degree. All the community colleges, the for-profit colleges, and directional and 3rd and 4th tier schools. The SFA's and ACC's and Southeast Oklahoma Baptist University's and West Governors and U of Phoenix that took money from people knowing they wouldn't get the value for which they were paying and were saddling kids and their cosigning parents with debt. 

I think if you dug into the data you are going to see a ton of poor, first-generation students who are below the median on aptitude/readiness for college level writing/work who didn't finish and stopped paying.

If you want to forgive the debt for them, great. But any debt forgiveness there should also come with a federal investigation and charges and punitive pain to the universities who operated in bad faith.

Edited November 18, 2020 by DonkeyCigars

[formermav43 4606]

7 minutes ago, DonkeyCigars said:

Boom! Home run insight.

We are talking about this, it seems, largely through the context of those who took out the equivalent of a small mortgage on a house to get some esoteric degree and now works in an entry level job making $45k in an expensive urban city, who wants to have a work-life balance and do things in their youth, while also needing to service massive amounts of debt. At least that's how I hear it framed a lot of the times, but I don't think that is the reality.

It seems to me the reality is that folks who take out student loan money for 1 or 2 years, at the full pop they can get to cover housing and everything else, and then flame out of school-- they are not incentivized or motivated to pay for something that didn't finish or give them value. Is it any wonder then they walk away? It's like taking out a mortgage for a house, and half-way through building it you get in a fight with the builder and yall can't agree to finish it and so it sits a bunch of wood framing and concrete next to a port-a-john, but you have to make payments on it for 30 years the same as if you got the value to live in it. Of course people aren't going to pay.

The blame then, it seems, lies squarely on the predatory schools who took advantage of the poor and lower middle class who were unprepared to do college level work and/or complete a degree. All the community colleges, the for-profit colleges, and directional and 3rd and 4th tier schools. The SFA's and ACC's and Southeast Oklahoma Baptist University's and West Governors and U of Phoenix that took money from people knowing they wouldn't get the value for which they were paying and were saddling kids and their cosigning parents with debt. 

I think if you dug into the data you are going to see a ton of poor, first-generation students who are below the median on aptitude/readiness for college level writing/work who didn't finish and stopped paying.

If you want to forgive the debt for them, great. But any debt forgiveness there should also come with a federal investigation and charges and punitive pain to the universities who operated in bad faith.

Community colleges are cheap, and state schools are too (relatively speaking). I believe the biggest culprits here are small (and not so small) mediocre private schools. As an example:

https://www.usnews.com/education/best-colleges/the-short-list-college/articles/colleges-where-graduates-have-the-most-debt
 

SCHOOL (STATE)		AVERAGE DEBT LOAD, CLASS OF 2018		PERCENTAGE OF GRADUATING STUDENTS WHO BORROWED		U.S. NEWS RANK AND CATEGORY
Maine Maritime Academy		$55,644		94		5, Regional Colleges (North)
Bryant University (RI)		$54,067		70		7, Regional Universities (North)
Carthage College (WI)		$52,380		79		14 (tie), Regional Colleges (Midwest)
Mansfield University of Pennsylvania		$52,243		64		164-215, National Liberal Arts Colleges
Baylor University (TX)		$50,172		52		79 (tie), National Universities
Union University (TN)		$49,824		67		185 (tie), National Universities
Texas Christian University		$49,197		35		97 (tie), National Universities
Quinnipiac University (CT)		$48,544		70		153 (tie), National Universities
Western New England University (MA)		$46,591		81		218 (tie), National Universities
The Catholic University of America (DC)		$46,437		69		139 (tie) National Universitie

 

[DonkeyCigars 144]

44 minutes ago, formermav43 said:

Community colleges are cheap, and state schools are too (relatively speaking). I believe the biggest culprits here are small (and not so small) mediocre private schools. As an example:

https://www.usnews.com/education/best-colleges/the-short-list-college/articles/colleges-where-graduates-have-the-most-debt
 

SCHOOL (STATE)		AVERAGE DEBT LOAD, CLASS OF 2018		PERCENTAGE OF GRADUATING STUDENTS WHO BORROWED		U.S. NEWS RANK AND CATEGORY
Maine Maritime Academy		$55,644		94		5, Regional Colleges (North)
Bryant University (RI)		$54,067		70		7, Regional Universities (North)
Carthage College (WI)		$52,380		79		14 (tie), Regional Colleges (Midwest)
Mansfield University of Pennsylvania		$52,243		64		164-215, National Liberal Arts Colleges
Baylor University (TX)		$50,172		52		79 (tie), National Universities
Union University (TN)		$49,824		67		185 (tie), National Universities
Texas Christian University		$49,197		35		97 (tie), National Universities
Quinnipiac University (CT)		$48,544		70		153 (tie), National Universities
Western New England University (MA)		$46,591		81		218 (tie), National Universities
The Catholic University of America (DC)		$46,437		69		139 (tie) National Universitie

 

I don't think so. How many people do you know who flame out of TCU and Baylor? How many kids who are below the median in ability to do work or read at the college level do you think go to these schools? How many first generation college kids go to expensive tier-2 private schools? Probably not many.

I think where the price tag might be much lower and definitely relatively lower (e.g. Baylor vs. Paul Quinn College or Sam Houston State), the for-profits, the bad schools, the community colleges and the all around indiscriminate schools are the ones students paid and rung up a lot of debt in critical mass due to volume. 

Obviously neither one of us is proving the case based on proof of data, but based off of hypothesis I disagree with your assertion, I think.

Edited November 18, 2020 by DonkeyCigars

[Brisketexan 105096]

9 minutes ago, DonkeyCigars said:

I don't think so. How many people do you know who flame out of TCU and Baylor? How many kids who are below the median in ability to do work or read at the college level do you think go to these schools? How many first generation college kids go to expensive tier-2 private schools? Probably not many.

I think where the price tag might be much lower and definitely relatively lower (e.g. Baylor vs. Paul Quinn College or Sam Houston State), the for-profits, the bad schools, the community colleges and the all around indiscriminate schools are the ones students paid and rung up a lot of debt in critical mass due to volume. 

Obviously neither one of us is proving the case based on proof of data, but based off of hypothesis I disagree with your assertion, I think.

Dude, community colleges are butt-cheap.  You really can't rack up that much debt going to one.  They're kind of the last great bargain in higher ed.

[Hank Scorpio 17729]

If Biden does do some sort of student debt forgiveness my prediction is that it is very minor and only applicable to a small subset of borrowers. He’ll probably appoint a blue ribbon committee full of former Wall Street or tech assholes  who will produce a report recommending 2.5% debt forgiveness for borrowers below the poverty line from 2010-2020 with over $200,000 in student loans and a job in an approved sector. 

[Hank Scorpio 17729]

 

 

[Nice Guy Eddie 13511]

1 hour ago, Lobo said:

After a two year study by CommonBond...#1 indicator that you are likely to default on your student loan?  Not major, not school, not current job, not income level, not where you live, and not credit score.  

It's whether or not you completed your bachelor's degree/graduated.  There's a reason places list, "Some College" under "Highest Educational Level"  

Not saying it's good, bad, or indifferent.  But the data is in, and it's not even close.  

I've always thought that having a student loan payment but zero degree, must be the biggest kick to the balls. That would be like buying your girlfriend dinner every night but she goes home with another guy. Every night for 20 years.

[Guest Lobo]

And the other guy speaks French and studied Art History and Philosophy at Scripps College.  And she only lets him do anal, nothing else.  

Damn you, Henri and BBVA! I thought you stood for something else! 

Edited November 18, 2020 by Lobo

[TwiceHorn 31451]

2 hours ago, Brisketexan said:

Correct.  It's why any approach that creates a pool of gov't tuition dollars to be loaned/granted ALSO needs to come with restrictions on the universities that would accept them.  You want to be eligible to take in students funded with gov't loan dollars?  Cool.  Then you need to meet eligibility benchmarks of your own -- max tuition caps, or max tuition increase caps, that sort of thing.

I'll loan Student X the money to buy a degree, or a car, or whatever you want to substitute, but those dollars can only be spent on a degree, car, or whatever that meet my established criteria.  

Of course, by now, that horse has left the barn.  Not sure how to fix it.  Except to implement those criteria now, or roll them in, forcing universities to reign in their tuition and costs.

Yep, there's definitely an expectation interest throughout the market, students and colleges.  Pulling the plug completely would really upset a bunch of apple carts in an unpleasant way.

There has to be some kind of drawdown, and I think a partial loan forgiveness can and should be a part of that.

In the UK, they give relatively modest loans (I think like 10,000 pound sterling annually, adjusted for tuition a bit) that are forgiven after some defined period of time after having paid on them according to schedule.  Tuition remains sane and payable by the modestly wealthy, and people aren't completely overwhelmed by it.

[TexasEd 8066]

18 hours ago, Huckleberry said:

The return is their future productivity, just like it was for the generations who went to college cheap because it was subsidized. 

In the 30s we had Civilian Conservation Corps and the return to the public for pay were improvement projects for National Parks and other publicly owned lands.

I think this generation has an opportunity to help with education, veterans benefits, healthcare for underserved communities among others.  We have people signing up for the military and other government programs that have tuition assistance every day.  But doing something for the country is too much for some set of the population to get a free education?

"Ask not what your country can do for you, but what you can do for your country" seems like a foreign concept to the current generation.  

Another way to say it would be to give people a hand up, not a hand out.  The hand up is something they have a stake in, they earn it through their contributions to get to a better place than they could on their own.  There is a greater sense of pride by having skin in the game, something of theirs contributed. 

This is in contrast to the welfare mentality where people expect things to be given to them for nothing in return. Even small children know that to get Christmas gifts they should be good.  Do people forget this concept when they get older?

Edited November 18, 2020 by TexasEd

[TexasEd 8066]

5 hours ago, wildcat09 said:

This. We're the first generation that is actively taxed for trying to get an education. Nothing brings out my desire for guillotines more than this shit. Education is such a foundational necessity for any developed country and the GOP is stuck in the 18th century, thinking it should be a privilege only the wealthy (and those who might be immediately useful to them) get to enjoy. 

I agree that the goalposts have been moved.  When I went to college tuition was more heavily subsidized by state taxes and the administrative to operations costs at colleges were much lower.  

Did we take the tax money that went to the colleges and use it to back the private loans in this no discharge privatization scheme that made some politicians and their buddies rich?  Probably so.  So let's fix that too instead of just discharging debt and having the same problem come back to get us again.

[TexasEd 8066]

3 hours ago, Nice Guy Eddie said:

The govt should only guarantee a certain amount of debt and i don't think that amount should be overly high. If a student wants more loans, then find it on the open market. Otherwise find a cheaper alternative for education. Everyone wants their perfect school and degree but that student needs a Rolling Stones lesson in that you can't always get what you want.

The schools should also be held accountable in that if their drop out rate is too high, then their students should get less (fewer?) loan guarantees. That might sound like it punishes those students but those students should move on and let the school fail.  (I realize this is impossible due to the tight relationship between govt and universities.)

Our higher education basically works as a capitalistic system with a govt safety net. That will never work well. 

This should be a core principle of any student loan reform program.

[Brisketexan 105096]

1 minute ago, TexasEd said:

This should be a core principle of any student loan reform program.

I also think requirements on cost/tuition control of any institution accepting the benefit of student loan dollars should be a core principle.

[wildcat09 29349]

Is literally a single person advocating for discharging current debt and NOT doing something to address the broader problems?

[Dahobbs 17534]

55 minutes ago, DonkeyCigars said:

I don't think so. How many people do you know who flame out of TCU and Baylor? How many kids who are below the median in ability to do work or read at the college level do you think go to these schools? How many first generation college kids go to expensive tier-2 private schools? Probably not many.

I think where the price tag might be much lower and definitely relatively lower (e.g. Baylor vs. Paul Quinn College or Sam Houston State), the for-profits, the bad schools, the community colleges and the all around indiscriminate schools are the ones students paid and rung up a lot of debt in critical mass due to volume. 

Obviously neither one of us is proving the case based on proof of data, but based off of hypothesis I disagree with your assertion, I think.

Wow, this post is completely divorced from reality. Seriously, you have no idea what you are talking about and probably shouldn't even have an opinion here. Let me help you:

"During the 2018 - 2019 school year, the reported tuition at public two-year schools [community college] is an average $3,660."

https://www.cnbc.com/2019/04/12/tuition-at-community-colleges-is-3660-a-year-on-average.html

Community college isn't driving student loan debt or defaults.

You're also focused on the wrong problem. You think the issue is that students don't pay their debt. But that isn't the primary problem. The problem is that even for students who do pay their debt, it tends to cripple them for the future by preventing long term investment and delaying milestones like homeownership.

11 minutes ago, TexasEd said:

I agree that the goalposts have been moved.  When I went to college tuition was more heavily subsidized by state taxes and the administrative to operations costs at colleges were much lower.  

Did we take the tax money that went to the colleges and use it to back the private loans in this no discharge privatization scheme that made some politicians and their buddies rich?  Probably so.  So let's fix that too instead of just discharging debt and having the same problem come back to get us again.

This is the equivalent of the Office Space "fixing the glitch" bit. You're leaving an entire generation burdened with massive debt because "fuck it." Fixing the issue going forward is great, but we just abandoning everyone else is stupid and, IMHO, immoral.  But perhaps I'm misunderstanding your post. 

[TexasEd 8066]

11 minutes ago, Dahobbs said:

This is the equivalent of the Office Space "fixing the glitch" bit. You're leaving an entire generation burdened with massive debt because "fuck it." Fixing the issue going forward is great, but we just abandoning everyone else is stupid and, IMHO, immoral.  But perhaps I'm misunderstanding your post. 

I have a string of posts that were addressing different facets of the problem.  This needs a comprehensive solution and only reading one of them without the others leaves a lot of holes.  I have not even addressed all the problems because it would take more time than I have.

 

Edit:

One of the things I do in my job is help people define the problem they need to solve.  Here is a partial list of the ones here:

• Existing debt holders and loan forgiveness
• Loan qualification process
• Graduation rates
• Public interest (The ROI for taxpayers)
• Non-dischargeable debt
• Public risk/Private profit 
• on and on

Some of these might need to be broken down to much lower levels

Edited November 18, 2020 by TexasEd

[wildcat09 29349]

And obviously the administration shouldn't do anything over the problems it has the power to (inadequately) address until a perfect comprehensive solution has been figured out. Also, it must be bipartisan. If you can't get Mitch McConnell's enthusiastic buy-in, get fucked.

[Bevo 13576]

On 2/10/2020 at 5:19 PM, 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. 

I skipped what other people have said because I don't cloak room. Students have very limited bargaining power. They are a bunch of individuals against a single entity. Sure it is possible to go to Texas instead of Ivy or Rice but in general the price the school offers is the price you pay. Prices are increasing much faster than inflation. I could go into the reasons why that is occurring, but for now let's just agree that it is a problem. Anyway, the problem that I have with student loans is that they are partly responsible for the lost American dream. People can't buy their first home, they can't plan for retirement, and they are forced to live day to day. What isn't being talked about is the financial industry's part of this. Loans for gad students are at higher interest rates than undergrad which goes against market economics. Interest rates for grad student loans can be about 9%. They are considered non-secured by the government and the financial industry. $60K in tuition plus room and board leaves you with probably $400K in debt when you start paying a year and a half out of school. Interest could reach $40K a year or $3K per month. If you can only afford $2K then each year, principal is growing. At least fix interest rates at 1% so the principal can be payed down and let this next generation live the American dream.

[Brisketexan 105096]

25 minutes ago, Dahobbs said:

Wow, this post is completely divorced from reality. Seriously, you have no idea what you are talking about and probably shouldn't even have an opinion here. Let me help you:

"During the 2018 - 2019 school year, the reported tuition at public two-year schools [community college] is an average $3,660."

https://www.cnbc.com/2019/04/12/tuition-at-community-colleges-is-3660-a-year-on-average.html

Community college isn't driving student loan debt or defaults.

You're also focused on the wrong problem. You think the issue is that students don't pay their debt. But that isn't the primary problem. The problem is that even for students who do pay their debt, it tends to cripple them for the future by preventing long term investment and delaying milestones like homeownership.

This is the equivalent of the Office Space "fixing the glitch" bit. You're leaving an entire generation burdened with massive debt because "fuck it." Fixing the issue going forward is great, but we just abandoning everyone else is stupid and, IMHO, immoral.  But perhaps I'm misunderstanding your post. 

So much of this.  Student loan debt is a poison pill for our whole economy.  

1 -- a huge driver of our economy is consumer spending, particularly big-ticket items like homes and cars.

2 -- we USED to produce some great consumer spenders: people with college degrees (and thus high earning power, meaning more dollars to spend), who were able to start spending money on big-ticket items early in their lives.

3 -- we have now CONVERTED that group from being great consumer spenders to being shitty consumer spenders: people with college degrees who use all of those earned dollars -- dollars that used to buy a new car, or a house, or a GI-Joe with a kung fu grip for little Johnny -- to send in an envelope to Student Debt Bankco Inc. every month.

The diversion of dollars from consumer spending to debt service (with no consumer spending to show for it) is a huge anchor on our economic engine.

Dollars spent at Fancy University don't drive the economy.  Dollars that graduate sends to Student Debt Bankco, Inc. don't drive the economy.  People living their lives and spending money on stuff - that's the fuel.

So understand that solving the student debt problem is about FAR more than solving the problem of Graduate X, who is miserably toiling away, paying mountains of debt with nothing to show for it.  The fact that Graduate X isn't a meaningful participant in our economy is OUR COLLECTIVE PROBLEM, hurting all of us.

[DonkeyCigars 144]

45 minutes ago, Dahobbs said:

Wow, this post is completely divorced from reality. Seriously, you have no idea what you are talking about and probably shouldn't even have an opinion here. Let me help you:

"During the 2018 - 2019 school year, the reported tuition at public two-year schools [community college] is an average $3,660."

https://www.cnbc.com/2019/04/12/tuition-at-community-colleges-is-3660-a-year-on-average.html

Community college isn't driving student loan debt or defaults.

You're also focused on the wrong problem. You think the issue is that students don't pay their debt. But that isn't the primary problem. The problem is that even for students who do pay their debt, it tends to cripple them for the future by preventing long term investment and delaying milestones like homeownership.

This is the equivalent of the Office Space "fixing the glitch" bit. You're leaving an entire generation burdened with massive debt because "fuck it." Fixing the issue going forward is great, but we just abandoning everyone else is stupid and, IMHO, immoral.  But perhaps I'm misunderstanding your post. 

I said this earlier, but I think it's a combination of a) sheer volume combined with b) not finishing a degree or having something to show for the loan you took out. I just googled a few data sets and studies and found one that seems to suggest a relationship, if not exactly a marriage, with reality:

https://www.insidehighered.com/news/2015/09/28/four-surprising-findings-debt-and-default-among-community-college-students

Quote

Community colleges are relatively affordable, and their students tend to borrow less than those who attend other types of institutions. Yet the debt students rack up at community colleges is troubling.

The reason is that students who attend two-year colleges struggle to repay even small loans, and often default on them, a concern that is reinforced by a new study from one of the sector’s primary trade groups -- the Association of Community College Trustees.

Just 17 percent of community college students take out federal loans, the report said, which is much less than at four-year public institutions (48 percent), private colleges (60 percent) and for-profits (71 percent). But students who attend community colleges are more likely to default.

The national default rate for community college students three years after they enter repayment is 20.6 percent

On one hand, the higher dollar amount you borrow doesn't necessarily mean you will not be able to pay it back:

 

(1) Students who borrow the least are the most likely to default.

A growing body of research has found that student loan defaults are concentrated among the millions of students who never earned a degree. Graduates who borrow the most tend to earn the most. But those who take on even a small amount of debt with nothing to show for it face a relatively high risk of defaulting.

Further, not graduating means you will likely default and here the story also confirms

 

Almost 90 percent of students who defaulted left college with debt but no degree or certificate, according to the report. And roughly 60 percent of the defaulters were students who earned fewer than 15 college credits. About 26 percent of defaulters earned no credits at all -- the zero-credit-holder group had a default rate of 58 percent. Students who earned up to 15 credits had a default rate of 43 percent.

In comparison, the report found that students who earned the most credits defaulted at the lowest rates. The default rate for students who earned 61 to 75 college credits -- enough for an associate degree -- was roughly 11 percent.

The report said fixing this problem won’t be easy, because community colleges have open-door admissions policies. Yet it called for policy solutions that promote “academic preparedness and progression,” while curbing borrowing by students in the earliest stages of enrollment. Also necessary are campuswide, data-driven interventions to help student stay enrolled and complete, according to the report.

 

Edited November 18, 2020 by DonkeyCigars

[Errestaurants 2570]

Lots of great points. I think the quality of education at the public schools is terrible in most states. In Texas after the UT system there is a big drop off in quality and getting into UT Austin is difficult.  If you’re an above average student but can’t get into Austin and don’t want to attend UTD or UTA then what are choices for quality education? That’s where the TCUs and Baylor’s come in. Of course there is always Aggie land. 

I wish Texas could figure out the California system where you don’t need to go to UCLA or Berkeley for a quality and affordable education. 

[Dahobbs 17534]

6 minutes ago, DonkeyCigars said:

I said this earlier, but I think it's a combination of a) sheer volume combined with b) not finishing a degree or having something to show for the loan you took out. I just googled a few data sets and studies and found one that seems to suggest a relationship, if not exactly a marriage, with reality:

https://www.insidehighered.com/news/2015/09/28/four-surprising-findings-debt-and-default-among-community-college-students

Again, you're focused on the wrong problem. Default isn't the problem. Hell, allowing bankruptcy and true default would be actually go a long way to fixing the system. The problem is as described by @Brisketexan: we're sabotaging our economic engine by converting what was once a community subsidized investment (education) into something students have to payback over a lifetime.

[DonkeyCigars 144]

Further the latest data set I could find estimated roughly 10mm community college students in 2018. The "student persistence" rate meaning, continuing with education (for those not graduating) at any higher education was 62.1% (and 54% returned to the same school).

That means ~38% were either taking a break or dropping out.

Of course dahobbs was nice enough to show the median cost of a community college, but further investigation reveals the loan amounts to be much higher (due to taking out more to pay for housing, food, etc. as I suggested):

Of course, community college students have other costs to consider tuition and fees. The College Board estimates that when room and board is taken into account, these students are on the hook for roughly $12,320 per year and after grants and scholarships are taken into account, they owe closer to $8,270.

So if you took a swag worst case scenario and said, only 50% of the 38% dropped out to never get a degree and you know the data means that 60% of those who dropout within the first two years with less 15 hours and don't earn a degree is 60% and just take 30% of that to be safe:

18% of 10mm = 1.9mm

1.9mm * $12,320= $23,408,000,000 (and that is assuming only 1 year when a handful would also have more debt from another year).

And this is just a back of the napkin exercise to maybe challenge what people like brisket or dahobb won't entertain or think is a significant enough issue, because community college is viewed as cheap. Imagine when adding the real culprits who charge 3x-4x and students drop out, like the for-profit and other schools who will take unprepared warm bodies for the tuition.

[Brisketexan 105096]

3 minutes ago, Dahobbs said:

Again, you're focused on the wrong problem. Default isn't the problem. Hell, allowing bankruptcy and true default would be actually go a long way to fixing the system. The problem is as described by @Brisketexan: we're sabotaging our economic engine by converting what was once a community subsidized investment (education) into something students have to payback over a lifetime.

Correct.  Bankruptcy and default -- both in terms of numbers of events and the dollars in play -- are non-issues.  The problem with student debt isn't people going into bankruptcy.  It isn't them defaulting on a $5,000 balance.

The problem is that we've crippled what should be the turbo-boosters to our economic engine.  The dollars they'd be spending at Stereo-a-rama, and Bubba's Ford dealership, and buying a starter home in Shady Acres Estates, and buying some nice clothes at Snooty Sally's Boutique.....they instead spent at Fancy University and mail to Student Debt Bankco.  That's it.  That's the problem.  It's a problem for ALL of us, particularly the folks who make their living selling stereos, Fords, houses, and fancy clothes, and the folks who sell THOSE people lunch, and movie tickets, and everything else.

[DonkeyCigars 144]

8 minutes ago, Dahobbs said:

Again, you're focused on the wrong problem. Default isn't the problem. Hell, allowing bankruptcy and true default would be actually go a long way to fixing the system. The problem is as described by @Brisketexan: we're sabotaging our economic engine by converting what was once a community subsidized investment (education) into something students have to payback over a lifetime.

I agree with you, it's just part of the problem I'd focus on as a easy lever to fix or change. And further wanted to double-click into it because your response, and brisket's as well, was to be incredulous about the numbers and possible impact because it might be a bit counterintuitive.

I'm shocked at how many articles and studies I found outlining a "shocking problem of debt in community college" or something like that. Google it for yourselves.

Edited November 18, 2020 by DonkeyCigars

[Dahobbs 17534]

5 minutes ago, DonkeyCigars said:

Further the latest data set I could find estimated roughly 10mm community college students in 2018. The "student persistence" rate meaning, continuing with education (for those not graduating) at any higher education was 62.1% (and 54% returned to the same school).

That means ~38% were either taking a break or dropping out.

Of course dahobbs was nice enough to show the median cost of a community college, but further investigation reveals the loan amounts to be much higher (due to taking out more to pay for housing, food, etc. as I suggested):

 

 

So if you took a swag worst case scenario and said, only 50% of the 38% dropped out to never get a degree and you know the data means that 60% of those who dropout within the first two years with less 15 hours and don't earn a degree is 60% and just take 30% of that to be safe:

18% of 10mm = 1.9mm

1.9mm * $12,320= $23,408,000,000 (and that is assuming only 1 year when a handful would also have more debt from another year).

And this is just a back of the napkin exercise to maybe challenge what people like brisket or dahobb won't entertain or think is a significant enough issue, because community college is viewed as cheap. Imagine when adding the real culprits who charge 3x-4x and students drop out, like the for-profit and other schools who will take unprepared warm bodies for the tuition.

Dude, seriously. 

  I just re-read your article and noticed something:

Quote

 

Just 17 percent of community college students take out federal loans, the report said, which is much less than at four-year public institutions (48 percent), private colleges (60 percent) and for-profits (71 percent). But students who attend community colleges are more likely to default.

The national default rate for community college students three years after they enter repayment is 20.6 percent, the report said, compared to the overall average of 13.7 percent.

 

The default rate may be slightly higher among community college students, but few actually take out federal debt compared to 4-year colleges. The student loan crisis isn't being generated by community college grads. And, again, the problem isn't default. Default hurts banks.  Making excessive payments hurts the students. Those actually paying their loans are also those most hurt. Not that non-payment really means anything since the debt isn't dischargeable and will haunt people until they die. 

Edited November 18, 2020 by Dahobbs

[TwiceHorn 31451]

Default on student loans is the logical end point of a) irresponsibility; or b) loans granted that didn't match the value received; or c) being overburdened with student and other debt, which is probably just a combination of a) and b).  Defaults aren't the problem, but they are indicative of the problem.

Looking at defaulted loans probably doesn't tell the whole story, but it's a good place to start an analysis.

[Bevo 13576]

Fix interest rates at 1% and limit tuition increase to inflation and I would be happy. Giving $10K to student loan debtors seems to be a lobbyist fix and won't address any of the underlying issues. Feel good legislation that misses the mark.

Edited November 18, 2020 by Bevo

[TwiceHorn 31451]

8 minutes ago, DonkeyCigars said:

Further the latest data set I could find estimated roughly 10mm community college students in 2018. The "student persistence" rate meaning, continuing with education (for those not graduating) at any higher education was 62.1% (and 54% returned to the same school).

That means ~38% were either taking a break or dropping out.

Of course dahobbs was nice enough to show the median cost of a community college, but further investigation reveals the loan amounts to be much higher (due to taking out more to pay for housing, food, etc. as I suggested):

 

 

So if you took a swag worst case scenario and said, only 50% of the 38% dropped out to never get a degree and you know the data means that 60% of those who dropout within the first two years with less 15 hours and don't earn a degree is 60% and just take 30% of that to be safe:

18% of 10mm = 1.9mm

1.9mm * $12,320= $23,408,000,000 (and that is assuming only 1 year when a handful would also have more debt from another year).

And this is just a back of the napkin exercise to maybe challenge what people like brisket or dahobb won't entertain or think is a significant enough issue, because community college is viewed as cheap. Imagine when adding the real culprits who charge 3x-4x and students drop out, like the for-profit and other schools who will take unprepared warm bodies for the tuition.

I don't think community colleges are a huge problem.  Mainly because a significant chunk of those taking student loans have no real business trying to earn a bachelors degree from a rigorous institution.  And they're cheap, and tend to be local, so you know the money lent is being spent on actual school costs and not living large.

Plus, I think Jucos deliver a lot for the dollar, even for the not-very-serious-student.  

But for the serious student, I think they're a great way to test the waters, get your feet under you, pick a decent major and go on to earning a meaningful degree at a reasonable cost, whether that's an AA in something vocational at the judo, or moving on to the four-year commuter school to earn a BA or BS in something.

I suspect that a number of four-year universities work pretty hard to keep "failing" students enrolled and blowing that loan money for as many years as possible, while earning a dubious educational/professional return.  That includes some pretty reputable ones.

[Brisketexan 105096]

4 minutes ago, Bevo said:

Fix interest rates at 1% and limit tuition increase to inflation and I would be happy. Giving $10K to student loan debtors seems to be a lobbyist fix and won't address any of the underlying issues. Feel good legislation that misses the mark.

Well, we need to address the issue both going forward AND for people who are currently crushed by debt.

Take away the obligation of Graduate X to keep servicing $50k of debt year in, year out, immediately puts all of the money he would have sent Student Debt Bankco into the economy, year in, year out.  It takes a huge governor off the economic engine.  

A smart approach addresses both future loans and current debt.

[formermav43 4606]

4 minutes ago, TwiceHorn said:

I don't think community colleges are a huge problem.  Mainly because a significant chunk of those taking student loans have no real business trying to earn a bachelors degree from a rigorous institution.  And they're cheap, and tend to be local, so you know the money lent is being spent on actual school costs and not living large.

Plus, I think Jucos deliver a lot for the dollar, even for the not-very-serious-student.  

But for the serious student, I think they're a great way to test the waters, get your feet under you, pick a decent major and go on to earning a meaningful degree at a reasonable cost, whether that's an AA in something vocational at the judo, or moving on to the four-year commuter school to earn a BA or BS in something.

I suspect that a number of four-year universities work pretty hard to keep "failing" students enrolled and blowing that loan money for as many years as possible, while earning a dubious educational/professional return.  That includes some pretty reputable ones.

I spent a year at ACC before I went to UT. It's not because I wasn't a serious student, but because I did not go as a freshman (went to UT Tyler on full scholarship and hated it) and then took a couple of years off to work. Even though they had accepted me as a freshman, after I took time off, I found they wouldn't take me initially as a transfer, presumably because there was that gap. So I saved my money, moved to Austin, knocked out a year of basics at low cost, and then transferred in. It was a great solution for me.

[TwiceHorn 31451]

15 minutes ago, formermav43 said:

I spent a year at ACC before I went to UT. It's not because I wasn't a serious student, but because I did not go as a freshman (went to UT Tyler on full scholarship and hated it) and then took a couple of years off to work. Even though they had accepted me as a freshman, after I took time off, I found they wouldn't take me initially as a transfer, presumably because there was that gap. So I saved my money, moved to Austin, knocked out a year of basics at low cost, and then transferred in. It was a great solution for me.

Exactly the type of thing that I think Jucos are good for. You don't get into the "quitter" do-loop that a four-year school might kind of lock you into.

Back in my day, though, Dallas County Community Colleges were about $36 for a three hour class, while UT was $12.  Also, the rigor was lacking, although I really enjoyed a couple of the profs (took history and government and technical writing/third substantial reaming component at Richland).  The rigor was lacking because of all the fucking Tech students asking "is this gonna be on the test"?  The whole course was dumbed-down because of them. 

Edited November 19, 2020 by TwiceHorn

[JimmyJames 12271]

8 hours ago, bernorange said:

The road to hell is paved with good intentions.  Affordable college.  Affordable housing.  Once government gets involved, markets get distorted.  And it's not a problem until it is and then it's really a problem.

Stupid ass post repped by a bunch of morons.

[Anastasis 23469]

28 minutes ago, formermav43 said:

I spent a year at ACC before I went to UT. It's not because I wasn't a serious student, but because I did not go as a freshman (went to UT Tyler on full scholarship and hated it) and then took a couple of years off to work.

Same, except I was not as serious a student as I needed to be, at least the first couple semesters.  I took a very good chunk of required courses for pennies compared to what I would have paid at UT. Only thing that kinda sucked is that I didn't have a real strong UT social network as a result, but I had a strong social network through avenues. If you use them right, community colleges are the best value in higher education, esp if you are able to roll the credits into a strong STEM or other high demand degree field. 

[fattyflattie 4639]

Trying to catch up on the subject, but anything in any of the plans for those that took their loans serious and paid them back in a timely manner?   I don’t even want to think about what my 401 would look like if I had poured that money into it right out of school.  Tax breaks, credits, hell maybe even loosen limits on investment accounts to allow for lost time.  Is it a good idea to be pouring so much into 529’s for my kids? 

[Beau Vine 54212]

1 hour ago, Errestaurants said:

I wish Texas could figure out the California system where you don’t need to go to UCLA or Berkeley for a quality and affordable education. 

Pipe dream.  No one wants to pay for that.  

Shit, I'd settle for a Colorado-level system -- they have three public schools that are better than Texas's second-best school.

[Beau Vine 54212]

1 hour ago, TwiceHorn said:

I suspect that a number of four-year universities work pretty hard to keep "failing" students enrolled and blowing that loan money for as many years as possible, while earning a dubious educational/professional return.  That includes some pretty reputable ones.

Freshman retention and 4-year graduation rate are two key variables in basically every college rating system, so that's the real motivation.

 

[Beau Vine 54212]

1 hour ago, Bevo said:

Fix interest rates at 1% and limit tuition increase to inflation and I would be happy.

You should have mixed an economics course into your life at some point.  

[Bevo 13576]

8 minutes ago, Beau Vine said:

You should have mixed an economics course into your life at some point.  

You mean like an MBA . If you have an economic point, make it. I will be glad to read it slowly.

[Beau Vine 54212]

1 hour ago, Bevo said:

You mean like an MBA . If you have an economic point, make it. I will be glad to read it slowly.

You need to get a refund if your MBA taught you nothing about price ceilings.  

[Bevo 13576]

58 minutes ago, Beau Vine said:

You need to get a refund if your MBA taught you nothing about price ceilings.  

Go on....

[Randolph Duke 4034]

14 hours ago, TwiceHorn said:

Default on student loans is the logical end point of a) irresponsibility; or b) loans granted that didn't match the value received; or c) being overburdened with student and other debt, which is probably just a combination of a) and b).  Defaults aren't the problem, but they are indicative of the problem.

Looking at defaulted loans probably doesn't tell the whole story, but it's a good place to start an analysis.

or: c) serious long-term health health problem that changes career track, d) economic shifts affecting multiple industries, or e) ....., or f).....

The other side of the morality filter has to be the irresponsibility of lenders making federally guaranteed loans to with no reason whatsoever to believe the loans could ever be repaid.

Applying morality to economics usually distorts the economics. Exactly why the default occurred has nothing to do with the economic logic of discharging the debt. Bankruptcy courts don't apply morality filters on debtors. The economics of bankruptcy are based on assets vs debts.

Either there is a collective benefit to discharging defaulted (or even current) student debt, or there isn't. If there is, do it. If there isn't, don't. If laws were broken, then let the legal system address those issues. We need to leave morality out of the equation.

 

 

Edited November 19, 2020 by Randolph Duke

[TwiceHorn 31451]

26 minutes ago, Randolph Duke said:

or: c) serious long-term health health problem that changes career track, d) economic shifts affecting multiple industries, or e) ....., or f).....

The other side of the morality filter has to be the irresponsibility of lenders making federally guaranteed loans to with no reason whatsoever to believe the loans could ever be repaid.

Applying morality to economics usually distorts the economics. Exactly why the default occurred has nothing to do with the economic logic of discharging the debt. Bankruptcy courts don't apply morality filters on debtors. The economics of bankruptcy are based on assets vs debts.

Either there is a collective benefit to discharging defaulted (or even current) student debt, or there isn't. If there is, do it. If there isn't, don't. If laws were broken, then let the legal system address those issues. We need to leave morality out of the equation.

 

 

Fair point.  Like I said, doesn't tell the whole story.  But you can certainly get a picture of what student loans are doing to people by looking at defaulted ones.

My point was not to inject morality, although that is certainly implicit in my mention of irresponsibility.  I think it would be naive to think that there are not some who just don't pay their debts, period.  And some who choose not to pay back their student debt because there are fewer consequences than other debts.

And sometimes people deliberately default on student debt because it's that or foreclosure.  So that's quite a Hobson's choice.

And the bankruptcy laws also implicitly and explicitly apply some moral standards.  A number of debts are exempted from discharge for essentially moral reasons (fraud, intentional injuries, criminal fines and restitution).  A Chapter 13 bankruptcy gives a broader discharge than a Chapter 7 and also does not generally seize the debtors' assets because the debtor makes an attempt to pay what s/he can.

Edited November 19, 2020 by TwiceHorn

[CooterBrown 18006]

16 hours ago, Brisketexan said:

Dude, community colleges are butt-cheap.  You really can't rack up that much debt going to one.  They're kind of the last great bargain in higher ed.

I've always wondered why we don't have 4-year community colleges. Some, like ACC, offer a random 4 year degree. ACC offers a Bachelor's in Nursing.  I know their main function is more workforce development than the university mission of providing a more well rounded experience for students. They should skip all the soft sciences and liberal arts, but at this point, there's no reason they can't offer 4-year degrees in select majors that still fit within their mission at a cost similar to or slightly more than what they charge already.

[safe sex 11709]

In my experience ACC nursing students are the best prepared out of those who come to do clinicals with us, and I see students from literally every college with a nursing school in the area. 

Strongly disagree that community colleges should drop the liberal arts. 

[TwiceHorn 31451]

3 minutes ago, CooterBrown said:

I've always wondered why we don't have 4-year community colleges. Some, like ACC, offer a random 4 year degree. ACC offers a Bachelor's in Nursing.  I know their main function is more workforce development than the university mission of providing a more well rounded experience for students. They should skip all the soft sciences and liberal arts, but at this point, there's no reason they can't offer 4-year degrees in select majors that still fit within their mission at a cost similar to or slightly more than what they charge already.

I guess the answer to that would be the commuter school universities.  UTD originally was an upper-division only school.  

I think once they become a bachelor's granting institution, broadly, there's more pressure for accreditation and the things Beau Vine mentions as far as retention stats and whatnot.

[CooterBrown 18006]

1 minute ago, trauma babe said:

In my experience ACC nursing students are the best prepared out of those who come to do clinicals with us, and I see students from literally every college with a nursing school in the area. 

Strongly disagree that community colleges should drop the liberal arts. 

I didn't mean drop liberal arts but they shouldn't offer 4-year degrees in liberal arts. Sorry if that wasn't clear.

[CooterBrown 18006]

37 minutes ago, TwiceHorn said:

I think once they become a bachelor's granting institution, broadly, there's more pressure for accreditation and the things Beau Vine mentions as far as retention stats and whatnot.

That's probably mostly driven by federal funding requirements, some peer-induced to be part of the university club, and some legitimately required.  The first doesn't apply to community funded colleges, the second can be avoided, and the  third can be done.  As for retention, that's all federal and state funding requirements which don't apply here.  Improved retention is a good thing though but that can be mitigated due to the low cost and by setting entrance requirements once you complete your 2 year program prior to acceptance into the upper division courses.

 

Edited November 19, 2020 by CooterBrown

[TwiceHorn 31451]

1 hour ago, trauma babe said:

In my experience ACC nursing students are the best prepared out of those who come to do clinicals with us, and I see students from literally every college with a nursing school in the area. 

Strongly disagree that community colleges should drop the liberal arts. 

Just curious, why do you think that is?  Are the teechurs practicing?  More "practical" curriculum?  Maybe students already working in healthcare (LVNs or whatnot)?