Posted on 03/10/2015 11:22:10 AM PDT by SeekAndFind
While the closing of Sweet Briar College last week caught many people in higher education by surprise, some saw it as an early sign of an inevitable college implosion.
For years, entrepreneur and billionaire investor Mark Cuban has warned of a "student loan bubble" created by skyrocketing tuition and fueled by an endless supply of student loans.
A radical solution to the student loan problem would be to forgive all student debt, as a viral essay by Robert Applebaum proposed six years ago.
However, Cuban thinks massive student loan forgiveness would just make the bubble keep expanding.
"Forgiving the debt is the worst thing you can do, because all it does is bail out the universities," Cuban said.
Loan forgiveness would just show students that "Uncle Sam" will forgive their debts, according to Cuban. That would encourage students to keep taking out big loans to pay hefty tuition.
(Excerpt) Read more at businessinsider.com ...
Honestly, I think we need a bubble. Bailout the student loans.
I think that the only way this madness ends is an economic apocalypse happens. D.C. is too cowardly to stop otherwise.
So, why bother dragging it out?
The point is that if we dismiss the student loans, then we do not pop the bubble.
We need to make the student loans hurt, so people will stop taking them. Only then will the bubble pop.
You should be free to buy up and forgive as much student debt as you wish.
How about they get these schools for once to clarify just why they need to charge such huge tuition fees? I know former terrorists and fake indians need a lot of money to act as Professors, but still..
I think that to qualify for a student loan, you have to make 3-pointer in one of 3 attempts, [l-ctr-rt] —after that you`re SOL.
Congress should reverse the tread it has taken for the last thirty years of making student loans all but non-dischargeable, and go back to how student loans were treated in the Bankruptcy Code of 1978.
Sorry, “tread” = trend.
That cinches it — the Obamunists will do it.
I know in CA and I imagine most everywhere the professors (and all staff) enjoy high wages , Cadillac health insurance and enormous pensions. They would not be able to keep this up if not for financial aide.
If a student want to get a loan a good place to start is having high school grades checked, and only loan for studies that will enable them to get a job and pay back the loan. If they want a degree in black or LGTQ studies, let them pay for it.
Yeah, I paid my way through college and law school, working two or three jobs, and chasing girls at the same time. But things are different these days. Back then, in college, tuition, room and board (inedible though it may have been), were less than 1K per semester and student loans were impossible to get. Later, when student loans became commonplace, so much money was out there to spend on tuition, the cost of everything connected with it became horribly inflated. Honestly, it would be much harder to work your way through now.
The USA can not reform itself on its present path
The Federal Reserve, printed unbacked dollars to buy government debt, agency debt and to bail out its member banks simply makes it TOO EASY for government to continue on its present path. In fact, one and a half of political parties depend on it.
These days “student loans” pay for everything from food to housing...no wonder they are in the stratosphere....EVERYTHINGs FREEEEEEEE (for awhile)
I agree. No debt should be exempt from bankruptcy. This doesn't mean excusing fraud, but if you lend money to someone with no security you shouldn't expect the government to cover your play by preventing complete debt discharge and forcing the debtor to pay after bankruptcy. Gov't debt as well should be limited to what can be recovered at the time of the bankruptcy and no further.
Seems like we're slowly but surely bringing back debt slavery and indenture. History is replete with examples of why this is bad for everyone, including would-be tyrants.
A local private college (a good one ... Duquesne University) recently put its MBA program on sale. It’s 25% off for part timers looking to earn an MBA at night so long as you enroll in 2015.
My stepson is going to take advantage of it ... he isn’t doing exactly what he wants to do at his current job, but it pays well and he’s getting experience :-) . 1/2 his graduating class from last year are too busy turning down work that’s beneath them.
Anyway, imagine that ... enrollment goes down and prices are lowered. These people are friggin’ radicals! They should be begging for handouts from the Feds to offset their low enrollment so that the elite can maintain their lavish lifestyle, not drop prices for the peons! Seeing that it’s a Catholic school, I’m sure they’ll be accused of all sorts of nonsense once they start cutting into Pitt and Penn State’s profits with these lower prices.
I agree, this is how you fix the student loan issue. Loans should only be available for accredited degrees that are actually used in the work force. Schools covet their accreditation's so they should also treat the degrees they offer in the same fashion. As someone mentioned earlier a $ dollar limit should be put on what I call “throw away degrees” Latino, Black, Woman, LGBT etc. studies These loans should be based on the percentage of the average base pay that particular degree can command. No way a student should incur a $50K loan for a degree in LGBT studies. You want a degree in Latino studies you need to have some skin in the game...
The problem is not the loans. The problem is the degrees that people are borrowing money to obtain. Who borrows $100k plus for a degree in Gender Studies, African American Studies, Theater, or some other non-marketable field? I have hobbies too, but I paid for them for myself rather than borrowing money to explore topics of only personal interest.
What is the default rate on student loans to engineers, economists, accountants, scientists, nurses, biologists, chemists, and other majors that produce a useful skill? My guess is that the “bubble” would disappear if interests rates varied by major. In any case, the bubble is not my problem; it is a problem of those foolish enough to borrow money they cannot repay and of those reckless enough to make those loans.
A splendid idea. And you will find (I have the view from inside a land grant university, but the same applies at private colleges and universities) that the increases in fees mostly support the expansion of administrative superstructure, not lavish faculty compensation. My own institution in the twenty plus years I've been here has given faculty raises that on average scarcely kept pace with inflation, while administrators regularly get raises on the order of 8% per annum, has had the number of full-time faculty shrink by 0.4% while enrollments went up about 25% and the number of administrators and support staff answerable to administrators rather than to faculty rose by 50%.
Attempts to rein in costs imposed by state legislatures invariably cut expenditures on academic program and institutional support for research, not administrative bloat which continues to grow, since they are allocated by administrators all of whom are zealous to protect their own little feifdom, rather than by faculty who would try to protect the core functions of the university -- instruction and research. The only way to fix this is for state legislatures, boards of regents, boards of trustees and the like to specifically direct budget cuts directed at administrative costs and administrative costs only, or better still to reform the internal governance so that administrators serve at the pleasure of the faculty. Unfortunately those bodies are full of people from the professional managerial classes who see university administrators as "their people" and who are happy to see all cuts be shouldered by academic departments whose budgets are already very lean while more resources are provided for more and more management.
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