The epidemic has obscured the biggest problem faced by the higher education industry: it's far too expensive.
For the last couple of decades the industry has been in a debt-fueled frenzy of higher executive pay and shinier facilities. The debt has been incurred not by the service providers but by their customers.
People graduate with good preparation to be a schoolteacher, health-care worker, librarian, social worker. That's great. They graduate with many tens of thousands of dollars of debt. That cripples them and messes up their lives.
The so-called reform of the bankruptcy system in 2005 made it hard for graduates to declare bankruptcy. That shifted the risk from the lenders to the graduates.
There was a time when student-loan officers would call university executives and say "Jack here wants to borrow $70,000 to pay your tuition so he can be a schoolteacher. Are you serious? We both know that's far too much debt for the pay he expects. We'll loan him $30K, and you better come up with the rest in grants or lower tuition." Those conversations kept a lid on education prices.
But that doesn't happen any more. Education lenders are dangerous predators and students are their lawful prey. No wonder would-be students are refusing to play the game.
Which is the US government, who will rubber stamp any loan amount as long as a college is getting the money. Which is eventually the US voters’, who love to vote for the politicians who cut taxes, who can do so by reducing the amount government contributes to the the colleges.
Politician that cuts spending on education and increases lending to students is hailed for cutting taxes and assisting students in obtaining education. This is the end result after decades of gutting society.
Both private institutions and the government are student loan lenders in the US. The government also guarantees a lot of private loans.
It's good to clarify which lenders you're referring to when you say "Education lenders are dangerous predators". Do you think that the Federal government is enabling private lenders by guaranteeing their loans?
> The government also guarantees a lot of private loans.
No, they don't. A rider to the ACA removed government subsidies of private loans. The federal government is now solely an issuer (though I believe their portfolio still includes some loans that were originally private but later bought out by the government).
It's also important to point out that state governments are contributing less and less to public education across the board, which also impacts the financial situation of public universities.[0]
Universities see the writing on the wall: that state money is dwindling and therefore more financial burden needs to be placed on students. I agree with your main points, though.
Isn’t the average student loan debt ~$36k? That’s not much more than a new car. And there’s income based repayment. And it gets forgiven after 20 years. The interest rates aren’t too bad (I recall having one at 6%).
The only actual skill I gained in college came from my own efforts outside of class. I paid for the chance to be in a learning environment on my own for several years.
I looked at going back to school for about a year and and no matter how I spun the numbers I wouldn't be able to afford it. I dont have the time, space or likely the coherency to explain it all in a single HN comment, but the way the costs were structured and the financial aid system struck me as quite blunty, incredibly stupid.
For the last couple of decades the industry has been in a debt-fueled frenzy of higher executive pay and shinier facilities. The debt has been incurred not by the service providers but by their customers.
People graduate with good preparation to be a schoolteacher, health-care worker, librarian, social worker. That's great. They graduate with many tens of thousands of dollars of debt. That cripples them and messes up their lives.
The so-called reform of the bankruptcy system in 2005 made it hard for graduates to declare bankruptcy. That shifted the risk from the lenders to the graduates.
There was a time when student-loan officers would call university executives and say "Jack here wants to borrow $70,000 to pay your tuition so he can be a schoolteacher. Are you serious? We both know that's far too much debt for the pay he expects. We'll loan him $30K, and you better come up with the rest in grants or lower tuition." Those conversations kept a lid on education prices.
But that doesn't happen any more. Education lenders are dangerous predators and students are their lawful prey. No wonder would-be students are refusing to play the game.