Purdue Experiments With Income-Contingent Student Loans 230
HughPickens.com writes: Danielle Douglas-Gabriel writes in the Washington Post that Purdue University is partnering with Vemo Education, a Reston-based financial services firm, to create income-share agreements, or ISAs, that its students can tap to pay for tuition, room and board. In return, students would pay a percentage of their earnings after graduation for a set number of years, replenishing the fund for future investments. Purdue president Mitch Daniels calls the contracts a constructive addition to today's government loan programs and perhaps the only option for students and families who have low credit ratings and extra financial need. "From the student's standpoint, ISAs assure a manageable payback amount, never more than the agreed portion of their incomes. Best of all, they shift the risk of career shortcomings from student to investor: If the graduate earns less than expected, it is the investors who are disappointed; if the student decides to go off to find himself in Nepal instead of working, the loss is entirely on the funding providers, who will presumably price that risk accordingly when offering their terms. This is true "debt-free" college."
However some observers worry that students pursuing profitable degrees in engineering or business would get better repayment terms than those studying to become nurses or teachers. "Income share agreements have the potential to create another option for students looking to pay for college while seeking assurances they will not be overwhelmed by future payments," says Robert Kelchen. "However, given the current generosity of federal income-based repayment programs and the likely hesitation of those who expect six-figure salaries to sign away a percentage of their income for years to come, the market for these programs may be somewhat limited."
However some observers worry that students pursuing profitable degrees in engineering or business would get better repayment terms than those studying to become nurses or teachers. "Income share agreements have the potential to create another option for students looking to pay for college while seeking assurances they will not be overwhelmed by future payments," says Robert Kelchen. "However, given the current generosity of federal income-based repayment programs and the likely hesitation of those who expect six-figure salaries to sign away a percentage of their income for years to come, the market for these programs may be somewhat limited."
Punishing people who get degrees we need the most (Score:5, Insightful)
Re:Punishing people who get degrees we need the mo (Score:4, Informative)
One point of Income Share Agreements (ISA) is that if you're pursuing a STEM or other high-paying degree, you're more likely to make more money overall, so they'll charge you a lower percentage than someone with a less lucrative field. Don't be an idiot and agree to pay back a STEM degree using the same percentage as a sociology major, for example. The anonymous "observers" in the summary are whining about that detail.
One of the positive sides is if the financial services company is going to make money, the prices for an ISA becomes a good proxy for letting students know which potential majors are likely to be more valuable to society and thus earn them more income over the course of the payback period.
So doctors and engineers, yes, womyn's studies, not so much...
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One of the positive sides is if the financial services company is going to make money, the prices for an ISA becomes a good proxy for letting students know which potential majors are likely to be more valuable to society and thus earn them more income over the course of the payback period.
So doctors and engineers, yes, womyn's studies, not so much...
I think students already know which potential majors are likely to be more *lucrative*. A potential student may *value* them differently than society and that is generally why these less lucrative majors are pursued.
The problem is that students still need to eat (and potentially pay back those pesky student loans) and sadly at that age, practicality often isn't high on ones agenda. All the futures markets in ISAs in the world can't fix stupid, just like posting calories per serving in a fast food restaura
Re:Punishing people who get degrees we need the mo (Score:5, Insightful)
THIS. Seriously, treating 18+ year olds as children incapable of making their own informed choices is one of the reasons that student loan debt is an enormous problem.
We don't treat them as children incapable of making their own informed choices. If that was the case they couldn't enter into these contracts in the first place.
No one is even asking for that. They merely want laws governing student loans to take the disparity in maturity and available information between an 18 year old and a bank into account.
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I'm a huge fan of the social sciences to teach people critical thinking, how to argue and write persuasively. done right, it produces well-rounded individuals who can go on to be successful in a number of fields. A university degree is more than a trade school in which you go to school to be a plumber, or a chef, and then graduate and go do these things.
Re:Punishing people who get degrees we need the mo (Score:5, Insightful)
Unfortunately, the current social sciences at U.S. Universities is more likely to turn out a 26 year-old government social worker who thinks all parents are idiots who need her detailed supervision and spends her free time in "safe spaces" demonstrating for vague left-wing causes in the hopes of finding an enlightened boyfriend who'll stay longer than one night.
If instead, it were to actually "teach people critical thinking, how to argue and write persuasively." and produce "well-rounded individuals who can go on to be successful in a number of fields.", then the ISA market will value that future success and ability to repay in the future appropriately.
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Reminds me of Hitchhiker's Guide to the Galaxy. Humanity wiped out because everyone thought that the phone sanitizers were a waste of space and not worth keeping around, until they all got infections from unsanitized phones.
To the extent that people end up using their degree directly in work, Women's Studies is valuable in areas like healthcare, social care, politics, psychology, education, HR, journalism and more. There are shortages in healthcare, social care and some areas of education, so such degrees m
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You will also help to reintroduce bonded servants, wahoo, your college owns you for life, now what the fuck could go wrong with that. So for attractive females does that include serving the administration on your back and for males bent over. America you are fucking sick.
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I'd like to see the people with the most money who also claim that there is a "shortage" to offer to pay the tuition for X number of STEM classes so that students could take them for FREE.
Even if they only start with the 100 level math courses.
Would more people end up taking Calc 3? Maybe. Maybe not. If they do, good. If they do not, then the cost won't be a problem.
Switch the focus from getting-money-from-students to getting-more-STEM-students.
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"I'd like to see the people with the most money who also claim that there is a "shortage" to offer to pay the tuition for X number of STEM classes so that students could take them for FREE."
Aren't there private grants in your country?
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Someone has to pay for the Liberal Arts majors to hike through Nepal.
Really, what this is going to do is encourage people to get degrees with no marketable value, then wait out the repayment period. Sounds perfect for the "but I'm entitled to a free degree" crowd. Like everything else that is free, this is going to get real expensive, real quick,
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Regardless, the free degree doesn't mean fuck and you'll still end up at McDonalds afterwards, going back to school until your retirement in order to stave off making the payments.
Re:Punishing people who get degrees we need the mo (Score:5, Interesting)
..what this is going to do is encourage people to get degrees with no marketable value,
What's marketable today doesn't necessarily mean it's marketable in four years. Electrical engineers have a horrible job market now as well as petroleum engineers. When I was in school, a math degree was worth as much as an English degree - all you could do with it was teach. Unless of course you were smart enough to get into actuarial or you minored in CS. Now it means something because unbeknownst to us, it became marketable 10 years later.
Education used to be about bettering oneself. To expanding ones mind and being a better citizen and bettering society. Now, it's nothing but vocational training. Business, engineering, computer science is just vocational training - it's not an education. I learned more about logic and critical thinking in my one Philosophy class than I ever did in any of my Math or CS classes.
And the trend now is to send STEM work overseas ,as well as accounting, law and even some medical.
Ted Turner was pressed by his dad to go to business school. He rejected that idea because he was to learn to lead and not manage. So, he studied the Classics. Study people like Alexander the Great. He took his father's little billboard company and Ted became a billionaire. He made a "worthless" degree work for him.
My point is that training for something marketable at least at the college level is pretty risky. And with employers demanding that people be passionate in what they do, it's kind of hard faking that when you did what you did just to get a job. And if you got the job, you'll be miserable since you're going to be doing it 55+ hours a week 52 weeks a year - vacation? (HA! Try to take it!)
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Sure... for a the small subset of students who had family money. I'm getting old now, and I remember my classmates paying pretty close attention to starting salaries.
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Pants? What's to "design"? This isn't even a college level job. It's a midieval trade.
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You may hate liberal arts majors, who who do you think does the 3d modeling, scripting, and artwork for those games and movies you spend your spare time masturbating to?
Look around, that shit you buy, like your pants, wasn't designed by engineers; it was designed by liberal arts majors and implemented by engineers. Even your cheap-ass corelle plates.
You're talking about completely different worlds. Someone who goes into art and 3d modeling isn't the liberal arts majors that people are complaining about. Someone who loves to draw and comes up with a reasonable plan to make a living at it isn't the problem. Likewise for the person who wants to be a writer or a musician and has an actual plan. You can make a living as an artist, a musician, or a writer. The odds are probably much better that you can scrap by as a "starving artist" than it is that you
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"It's completely irresponsible to go into debt without any plan on how you're going to pay it back"
Maybe you are right but then, what would you call the one that lends money to somebody without a pay back plan?
Specially considering that most probably the lender knows to the petty detail what are the chances and income distributions for somebody majoring in hellenic studies while the 18 y.o. potential borrower does not.
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"It's completely irresponsible to go into debt without any plan on how you're going to pay it back"
Maybe you are right but then, what would you call the one that lends money to somebody without a pay back plan?
Specially considering that most probably the lender knows to the petty detail what are the chances and income distributions for somebody majoring in hellenic studies while the 18 y.o. potential borrower does not.
I would agree completely except that a majority of student loans are funded by the federal government which doesn't differentiate between different majors. If student loans had actual real underwriters then they most likely would look at majors and have different risk profiles for different majors. Another gotcha is that because the federal government does not differentiate between majors, once you have a bachelor's degree, you are no longer eligible to get student loans to pursue a different bachelor's d
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Want to pursue a STEM or other high-paying degree? No problem, but you have to pay a lot more for your degree.
Isn't paying more for something that's worth more just normal market behavior? For that matter, engineering and science programs typically also cost the school more, but are somewhat subsidized by tuition from cheaper humanities programs.
That said, there is the issue that engineering degrees are also more valuable to society, which may want to provide its own incentives.
My idea: involve the employers in these ISAs. Plenty of employers already cover tuition in exchange for working a set number of years wit
Re:Punishing people who get degrees we need the mo (Score:4, Insightful)
Private schools want profit first and everything else, like actual education, third.
Nope, what you described are for-profit schools. There are plenty of non-profit private schools that provide a great education and value their standards highly.
Re:Punishing people who get degrees we need the mo (Score:4, Informative)
"non-profit" does not mean charity or unbelievably high quality or even moral fibre. It just means a different financial structure.
Re:Punishing people who get degrees we need the mo (Score:4, Insightful)
Virtually all respected colleges and universities with any sort of historically recognized quality are non-profit.
For-profit universities (if they can even be called that) are in many cases little more than diploma mills. The primary goal is to move bodies through the system as efficiently as possible and extract the maximum payment, not provide a usable education.
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For every private business, providing a product is the necessary evil to get your money. Duh.
in other words (Score:3, Insightful)
With investment in other asset classes being unproductive, Purdue turns a portion of its foundation money into a bank to loan to its own customers. It's like the car makers' financing arms, just more speculative contracts.
Sounds like a good idea. (Score:5, Informative)
Re:Sounds like a good idea. (Score:4, Informative)
This is pretty much what university students in the UK have had since the early 2000's, but without offering different terms for different fields. Instead, some career paths, e.g. nursing, are incentivised with bursaries.
It comes at a cost though. The UK government believes that [bbc.co.uk] around 45% of university graduates will not earn enough to repay their student loans. Of course almost all will pay some, and a lot will pay most of it - but there is an outstanding bill. In the UK the government (i.e. taxpayers) underwrites student loans and will pick this up ,,, I'm not sure what will happen in the USA - or if they will just charge a lot more to those who earn more to make it cost neural.
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People not paying them back is probably a result of the huge increase in tuition fees, and the increased interest rate of the new loans.
My 2004 loan was ~£1k fees per year, plus ~£4k living costs, so £20k in total, at (currently) 0.9% AER. This would be paid back in 30 years assuming a constant salary of just £26000.
A student now, with £9k tuition fees plus the same living costs, would have £52k of debt at 3% AER. They would need a constant salary of £46k to pay it
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Yer tryna take da pish, innit?
Yes (Score:2)
Now that we're treating college as a necessity for getting a job, it's nice to see one that gives itself a financial incentive to actually perform that function.
Nurses or teachers? (Score:4, Informative)
My wife is a nurse (RN). If she chose to work full time, she'd make a very nice income.
Nurses are well-compensated - in the Puget Sound region, anyway...
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At the same time, I am a Middle School teacher with an MBA. With over six years of experience, I am still under 50K/year. While it is more than I would make if I were not a teacher, it is well under the "six-figure" salary that the author seems to think business majors earn.
Re:Nurses or teachers? (Score:4, Insightful)
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Is it becoming so exponentially annoying that it literally makes your blood boil?
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Is that question you are begging before me?
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> I must be getting old but this has started to bother me more and more. Median is an average.
In well defined math, "median" is not an average. It is a midpoint. Where income is strongly skewed by particular categores, such as a few practicioners at the top of the income range making far, far more than the ordinary worker, the "average" is quite misleading about the field as a whole And I'm afraid we see this for teachers: the administrators, the top of the school bureaucracies, often make several times
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Re:Nurses or teachers? (Score:4, Insightful)
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why should one want/need a masters to tech middle school?
Because almost all teacher's unions have negotiated the salary based on education and seniority. Whether or not the person is a good teacher, a master's or PhD degree (usually paid for by the school district) means a big bump in salary.
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which should be wrong IMO. Get paid for the job you do, not the paper you have
Teachers unions claim they are the only profession where it is impossible to judge performance well enough to allow performance to adjust wages. They must believe all other professions have perfect metrics that are impossible to game, such as lines of code written per day.
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To employ the teachers who teach teachers, and reduce competition to those who've been "guided" to contemporary educational philosophy.
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The ridiculous part is how little they teach nurses, at least in Canada. I have a few friends, and basically they just teach them how to make a bed. The "how to use a needle" course is an optional extra. I guess nursing started out as housewives with no extra skills helping out. And the only thing that has changed since then is that the nurses have less skills, and need to be taught the basics of cleanliness.
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The ridiculous part is how little they teach nurses, at least in Canada. I have a few friends, and basically they just teach them how to make a bed. The "how to use a needle" course is an optional extra. I guess nursing started out as housewives with no extra skills helping out. And the only thing that has changed since then is that the nurses have less skills, and need to be taught the basics of cleanliness.
In the US what you are describing is a LPN (licensed practical nurse) which is basically an extinct species (replaced almost exclusively with medical technicians who essentially start with only on-the-job training). Going to school for an LPN is like a community college class.
This is totally different than a RN (registered nurse), or a ARNP (advance registered nurse practitioner) the later of which is basically taking over the role of the GP. RNs generally require basically equivalent to a specialized bac
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At the same time, I am a Middle School teacher with an MBA. With over six years of experience, I am still under 50K/year. While it is more than I would make if I were not a teacher, it is well under the "six-figure" salary that the author seems to think business majors earn.
Teacher pay varies so widely across the US that its hard to paint the whole profession with the same brush. Teachers in my area with only BAs make the same as you in their first year. And considering their pension it would be closer to $75k per year right out of college their pay is not only competitive but borderline excessive. And this is an area where you can buy a 2500 sq ft house for $300k, so I'm not talking about Manhattan or Silicon Valley here.
We do pay much more in property taxes than the national
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The time off for teachers doesn't really count (Score:2)
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they're expected to prep for the school year and keep working on their skills during that time or face layoffs. I've got a lot of friends/family who are teachers. Summer is _not_ a 3 mo vacation for any of them.
Your friends / family either complain too much or work in one hell of a crappy district. My daycare has to reduce its staff because of the teachers who take their students out of daycare during the summer. If you are actually working, you don't have time to take your toddlers out of daycare.
The teachers you know probably do put in a few hours of professional development here and there over the summer. But it is nothing like working full time. At best you could consider it a 2 1/2 month vacation instead of a
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Umm what kinda daycare do you use? I would think the amount of school children whose parents work during school hours and now need daycare because the kids are out of school would trump the few dozen (if that) teachers who now can care for their kids instead of using a daycare. Also since most teachers are under paid they need to work other jobs in the summer.
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With that attitude I'd suggest you immediately go into administration.
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Oh yeah, I agree they deserve all the money they can get (and not just because my wife is one!).
When we were first married, she worked on a medical floor - so she tended to see the same people over a long period of time. AND many of them were dying (cancer, AIDS, stuff like that). She got a lot of fulfillment from helping them, but sometimes it was brutal when long-term patients passed away - try as they might, nurses can't help but become at least a little emotionally invested in the lives of people they t
University Fees (Score:4, Interesting)
Meanwhile, other countries offer free (as in beer) University / College tuition to all students who qualify academically. Maybe if they didn't piss so much money up against the walls of their sporting facilities - and did their job of imparting knowledge to future engineers, scientists, etc, and not service as a training ground for the professional sporting organizations, they might have more money for their academic function.
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In the US any of these programs would be considered racist since they require you to qualify in high school. It's also being paid for by insane income (averaging 55%) and sales taxes (averaging 20% for regular goods and up to 150% for fuel). The EU model is great for poor people but those that emerge victorious from the poor house after lots of effort and pain (eg. yours truly) will still want to immigrate to the US so as not to piss away their hard earned money into hollowed out funds (they've all been use
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In the US any of these programs would be considered racist since they require you to qualify in high school. It's also being paid for by insane income (averaging 55%) and sales taxes (averaging 20% for regular goods and up to 150% for fuel). The EU model is great for poor people but those that emerge victorious from the poor house after lots of effort and pain (eg. yours truly) will still want to immigrate to the US so as not to piss away their hard earned money into hollowed out funds (they've all been used up to pay for other things and all of them are deeply in debt).
I live in France and live what you're describing. Let me take your points one at a time.
In the US any of these programs would be considered racist since they require you to qualify in high school.
You'll have to explain the racist aspect as school is free to everyone in the US, right through high school. On top of that, to get into secondary education in the US you also have to qualify at the end of high school so I really don't get the point you're trying to make here.
It's also being paid for by insane income (averaging 55%) and sales taxes (averaging 20% for regular goods and up to 150% for fuel)
Not untrue and I'd like to see those taxes cut...and yet I choose to live here instead of the US not least because my kids are getting absolutely
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Free tuition doesn't help with living expenses; students still have to pay for that. Median public four year college tuition in the us is about $10000, probably less than your living expenses.
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If you check the prices of your local community college you will find that price wise they are about equivalent to what is being offered in other countries. The extra amount could easily be paid off by working a job or do as I did and work a full time job which allowed me time for taking classes.
They also have a trades / tech school tracks as we (Score:2)
They also have a trades / tech school tracks as well that are not 4+ years pure class room as well we need that as well.
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Meanwhile, other countries offer free (as in beer) University / College tuition to all students who qualify academically
Like France, where students have to sit for the bac when they are 18, a weeklong process that includes written and oral tests in everything from French literature to math to philosophy. And unlike the SAT, the bac is the sole factor that determines whether a French student will graduate from lycee; grades and extracurricular activities are not considered.
Despite this, at France's open-enro
This is true "debt-free" college." (Score:3, Insightful)
I call BS. This nothing more than owing the Company Store.
Listen, our society, if it weren't for greed, should understand that
an education S/B part of the infrastructure - some states actually
have it in their State's Constitution (but it's rarely honoured).
Some other European countries are starting to see this fact, and
provide for their people accordingly. This is one of the reasons
India is killing the U.S. in STEM - just ask any one of them!
CAP === 'fortify'
commentsubjecthere (Score:2)
Obviously the "financial services firm" expects ROI and then some, and the money comes from proles. Oh how grateful we are for money-shuffling middlemen.
The silver-lining, if this is done correctly (lol), is that it'd leech off salaries that live comfortably anyway.
ok (Score:5, Insightful)
"... some observers worry that students pursuing profitable degrees in engineering or business would get better repayment terms than those studying to become nurses or teachers..."
And that sounds completely REASONABLE.
TAANSTAFL, people.
I know you really want a giant grant so you can get that PhD in Russian Literature but you know what? To live, you need money. To have money, you need to have a job. Life is work, and work is (usually) shit. If you're staggeringly lucky, you get to do something you love for pay. More often, you rationalize whatever enjoyment you can out of what gig you can get.
But you're simply not entitled to do what you want, and have someone else pay for it. I'm sorry if your parents never taught you that. We can talk all day long about the bullshit costs of colleges, and I'll entirely agree with you. My dad? Full ride as a football player in 1955 to the U of MN, this was noted in the paper as worth $300/year.
I went to the same school in 1986-1990, and my college education cost about $3600-$4500 annually as I recall.
My son going to the same school this year, it's about $25k/year.
Using RoI calculators on the web, my dad's tuition this year would be $2600.
Mine would be $9800.
That's absolute horse shit, and personally I suspect at least part of it has to do with ample grants and easy loans since the mid 1980s. Clearly, it's not going to teachers.
A breath of fresh air (Score:2)
Yes, far from "worrying" about this, I was in fact EXPECTING that the quality of the major you had in terms of employability would be factored in. It would restore balance to a totally out of whack system where a kid that doesn't know any better can easily rack up debt that will follow them into retirement!
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"better repayment terms than those studying to become nurses or teachers..."
and yet you immediately make a comparison to "PhD in Russian Literature".
News for you bud - nurses and teachers, and even the occassional PhD in Russian Lit are necessary in a society and if you don't make education available to people who want to be nurses and teachers, eventually you will find that at some point you won't have enough of them. And while your market forces are making it more interesting to students, the salaries ha
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You're failing to consider state funding of the U of MN, which has been declining steadily since 1991. It's peak levels for receiving state funding were in 1961 and 1977. Those funds need to be made up from somewhere. When your parents tell you they were able to put themselves through school on nothing but a summer job and some elbow grease, well, they are failing to thank the taxpayers.
Crazy thought (Score:2, Interesting)
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How do you blame this on Obama or the liberals? Its the conservatives they try to fight to get right of federal public education. If they had their way some middle schoolers in the bible belt would be learning of creationism as a scientific fact and might never even hear of the theory of evolution. The right wants to send education to the stone age and no child left behind has fucked us.
Also if you make financial aid available only on a merit based system (which i assume is your GPA at graduation) you le
Similar to Australian HECS / HELP system (Score:2)
Australia uses a system that is call HECS - HELP to fund students. This is provided to all students by the government and is them funding your tuition fees and then the loan recouped from your earning later in the form of a slightly higher tax rate. The loan provided has interest calculated at the rate of inflation so there are no real penalties in not paying it off quickly.
There is currently a discount of 10% applied to the education fee if you decide to pay it upfront but you are financially better off
Hard to make it work (Score:4, Insightful)
The only way I could see this working is if it were the only option for financing college. We would have to completely eliminate conventional student loans. Otherwise, the results will be very predictable. People planning on high paying careers in engineering or finance will choose conventional loans, since that's a better deal for them. These agreements will be used mainly by people who don't expect to make much money for a long time. The companies financing them will take that into account, and find that to earn a reasonable payback, they have to set the repayment percentage really high. High enough that most people will end up worse off, not better.
Remember, risk has negative value. You have to pay people to accept risk. Under these deals, the companies take on more risk. They won't do that unless they get something in return, that is, unless their projected profit is greater. So on average, graduates have to end up paying more, not less. And unless you force the wealthier graduates to bear that whole burden, it will end up falling on the poorer graduates.
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This sounds like an attempt (Score:4, Insightful)
Purdue reinvents the wheel - news at 11 (Score:2)
How much of "college" is really necessary? (Score:3)
FWIW, I think people are better off with the eponymous well-rounded education, but I also think they're better off with 5 years of global travel, too, but that isn't the kind of hoop-jumping social standard (yet) that a 4 year college degree currently is.
So much of "going to college" isn't about the well-rounded part for probably 90% of the students -- it's about achieving some vocational credential that employers want before they will hire someone. In many cases, the vocational education really has no bearing on the actual vocation. A degree in marketing doesn't actually provide you with the specific education to do any specific marketing job.
And even where this is some kind of specific vocational skill being learned (engineering, medicine, etc), how much of even those educational experiences are spent on classroom instruction that's actually vocationally beneficial? Could we train civil engineers in 3 years instead of 4 by cutting out the crap? Could we train doctors in 6 years or even 5 if we cut out the nonsense? Is it REALLY vocationally beneficial for a doctor to have a semester or year of organic chemistry?
There's so much hand-wringing about the cost of college but almost never does anyone question the underlying assumption that the college experience as we know it is actually beneficial. Much of it seems to be a way of socializing the costs of corporate HR screening and training, much of which would be better for the corporations to do themselves, so they can focus on the specific attributes and skills they want.
And if you think about it, it doesn't even socialize those costs well -- the in-demand jobs demand higher salaries, so where there is demand for workers the corporation is paying some of the inflated educational costs themselves. It all seems to be a giant pork barrel for Universities, who manage to jack of tuition relentlessly without ever reforming a sclerotic educational system that doesn't really produce well-rounded graduates anyway.
Fed student loans already do this (Score:2)
Better repayment terms for profitable majors (Score:2)
We need to stop whining about basic loan fundamentals. The current distortions in student loan business are problematic and every time some tiny incremental change in the right direction comes about, a whole host of whiners come out complaining that people who are less able to repay their loans in a timely manner would get worse payment terms. Well no shit! I'm sorry but out of all the problems in higher Ed, focusing too much on ROI when picking majors ISN'T one of them. Just ask any anthropology and women'
"Debt-free" (Score:2)
That's almost funny.
We Already Have A System Like This... (Score:2)
... It's called taxes. You pay an amount proportional to your income, plus or minus adjustments based on your personal situation.
Public universities, colleges, tech schools, etc., should be completely free to all citizens, paid for by tax dollars. This is an investment in our citizens and our culture and worth the tax money. Most students on average would pay the money back and then some in taxes over their working lifetimes anyway, so it's a net win. Plus, studies have shown that we could offer free tuitio
Student loans and ridiculous increases in college (Score:2)
tuition are a scam. It's all been financially engineered to extract as much baby boomer money as possible. The idea is to enslave the kids to inescapable debt (thanks, republicans!) from which the only rescue is for mom and dad to pay off the loans for them either while they're still alive or via inheritance after they're gone.
There's no policy that limits loans to courses of study that are likely to result in sufficient income to service the debt. There's no policy to encourage people to go into the fie
Look at the Total (Score:2)
The line about the lack of consumer protections ought to give everyone pause.
pff (Score:2)
"This is true "debt-free" college."
Bullshit spin. If it didn't have to be paid back then it would be debt free.
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If you don't work then the investor loose on you. You have no requirement that you have to work or what you have to earn. If you want to get your degree and then go flip burgers for your entire career you will end up paying the investors nothing.
I think that's the real problem here (Score:2)
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It's a much better deal for the student than a loan, particularly if he's getting a degree that isn't very marketable. With a loan he's still on the hook for payments even if he comes up empty on the job search.
Personally, I don't see how this can work - it's too good of a deal. There's much less incentive to find a remunerative job after graduation - lots of people will find jobs that just pay enough to buy video games and pot while they're waiting out the contract in mom's basement.
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As opposed to someone getting something for nothing...? You are more than welcome to not agree to the repayment terms and not get the "free" education in return.
You can hardly take a single step in here without someone making some baseless comment about indentured servitude or robber barons. How about you get some proper education and discover the real meaning of those terms rather than using them as the basis of some pathetic comment, eh?
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Yea, this is really ludicrous. They own a part of you forever?
If the educators were free to fish for good prospects, this could maybe be ok, if not morally questionable. But when you realize that you'll still need to check all the "enough of this sort of person" boxes, this gets even spookier.
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With a four year degree costing around $96,000 that is not that high of a return for investors. So in the case of this person that one of the better investments.
Re:How Innovative (Score:4, Insightful)
Two thirds of college students graduate with no debt whatsoever. Only about 11% have debt larger than $36000 (the average cost of a new car).
If you choose to go into debt under these conditions by choosing to take out loans to get an overpriced degree that doesn't lead to a good career, it's your own fault; it's clearly not necessary for succeeding in life.
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If you choose to go into debt under these conditions by choosing to take out loans to get an overpriced degree that doesn't lead to a good career, it's your own fault; it's clearly not necessary for succeeding in life.
That's kind of a simplistic take on a complex subject.
Not everyone has the means to pay for a degree in the field they want or need. Not everyone is suited for a given field. Not everyone is blessed with enough income to afford any degree, let alone a more expensive one. Does that mean they should be able to try to get one?
If no one could afford to go to school to become a heart surgeon or a pediatric specialist, should we just throw up our hands and go "Gee whiz, too bad there's no doctor available for you
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That is somewhat of a simplistic rebuttal to a complicated subject.
There are such a thing as *scholarships* that some people get to help them pay to attend schools which they cannot personally afford. Although some of them are need based, but some are simply are merit based (a strange concept). Sometimes people can given partial scholarships or even full scholarships to attend a school (such as medical school) and not even have to pay back anything (e.g., my uncle for instance got one of those mysterious
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Yes, and not everyone can get them, which is why they're highly prized.
So you're poor (or just low-income) and unable to get one of these magical *scholarships*. What does one do then? For now the only real option is to go into debt.
Make education free or low cost and it would obviate many of the issues that surround higher education. Other countries do it, we can probably find a way. I know, how about we stop waging wars at 5 trillion bucks a pop? I bet you could put at least 3 or 4 deserving students through school for that much money.
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What is simplistic is your view that education is "too expensive" or that "it should be free, period." or your assumptions about the cost of medical education. The numbers are clear: there is no student loan crisis; almost all graduates have either no debt or no problem paying back their loans. And in the US, 65% of high school graduates go on to college, compared to 45% in places like Germany whe
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n both places, only about half of those who enter actually graduate, which tells you that many people who enter university shouldn't have gone in the first place.
Is that what that tells you? Do you have some kind of test you can do to know in advance which half a student belongs to? Are you sure that the people who drop out didn't benefit from their time despite not earning a degree?
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No, I don't. What I do know is that if people pay for stuff with their own money, they make more careful and prudent choices.
I'm quite sure that even many of the people who don't drop out don't benefit from their degree. So, yeah.
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What is simplistic is your view that education is "too expensive" or that "it should be free, period."
I know, it's crazy, huh? Just like providing K-through-12 education was dismissed as nutty and "too expensive" when the idea was proposed. But the fact is that K-through-12 education has been one of America's most potent and effective tools for improving life and the overall economy in this country for the last 50 years or so.
People in other countries literally dream of providing a basic education for their kids whereas we take it for granted.
(I know this because my wife comes from one of those countries an
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We are doing it. US government per-student spending on education is already substantially higher in PPP$ than countries like Germany, France, and the UK, and it's comparable in terms of percentage of GDP (around 5%). Because we are spending so much money, 65% of Americans go on to university after high school (compared to 45% in, say, Germany). You're fabricating a crisis or problem that simply doesn't exist.
we also need to drop the idea of college for all (Score:3)
we also need to drop the idea of college for all and stop makeing so that you need to go to a 4 year of more school to get a job. We need more tech / trades like settings that only take 1-3 years.
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That won't happen unless minimum wage is raised to something livable.
Income contingent tax (Score:2)
Welcome to the world of Indentured Servitude.