Shocking, horrors, eh?

From a PR email:

Eight in 10 U.S. adults with student loans (81 percent) say they made financial or personal sacrifices because of the amount of their loans.

Presumably it would be better if everyone had to struggle with their tax bills to pay for the university educations of other people?

18 comments on “Shocking, horrors, eh?

  1. “it would be better if everyone had to struggle with their tax bills to pay for the university educations of other people?” That’s how it was when I was young. As my father said “I’ve paid for your education and that of half your friends.”

  2. That number should be 100%, and you don’t need a survey the tell you so. The entire point of a loan is that it provides a current benefit in return for a future sacrifice.

  3. I sacrificed staying in bed and having a wank this morning so that I could go to work and earn enough money to eat. You tax-paying shitehawks owe me thirty quid for a handjob.

  4. There are two solutions to the student debt problem (three if you count doing nothing):
    1. Give taxpayers money to students
    2. Make higher education cheaper

    The first option is popular with Bernie Sanders supporters, but not with anyone else.
    The second option should be popular with everyone (except academics and other university staff), but it’s hardly ever discussed as an option. The cost of getting a degree in the US has skyrocketed over the last couple of decades, yet there’s no evidence that the quality of the education has improved.

  5. Andrew M is right: the costs have gone up because more money is available in the form of these soft loans.

    Massive downward pressure on costs would solve it.

    Trouble is, the costs (cuts! Evil Tories! etc) would fall on the actual education, while the bureaucrats continued just as before.

    Privatisation may be the only option. Let them sink or swim.

  6. Agreed; even most British universities are grossly over-priced; American ones are shocking.

  7. At present a student is accepted on a course offered by a university, and on the strength of that offer someone lends said student the necessary money. Why?
    The theory is that the human capital of the student is raised enough that he will earn so much more after graduation as to benefit him/her financially even considering the cost of paying back the loan.
    If it doesn’t work out the problem is between the student and the lender, the university keeps all the fees.
    The incentive therefore is for universities to attract and offer places to as many students as possible on whatever course attracts students. If the student fails, or if the course fails to raise the student’s human capital the fees have been paid.
    Effectively the university certifies that a particular student will benefit from a particular course and then others take the hit if they are wrong
    It would be better if Universities were required to put up a financial guarantee to support a student loan application. Then they would have an incentive to check whether the courses on offer are actually beneficial and whether the student’s accepting are capable of benefitting from them.

  8. I think Tim is missing the real point, if a loan to improve someone’s earning potential causes them problem then it has been badly invested and this is not a good thing.

  9. @Pat, If I were a student under the regime you mention, I would kick my heels for 12 months (or whatever) after graduation and then claim my refund.

  10. @ Pat
    It might work
    My old college puts up an overall majority of the cash to pay for each undergraduate’s education. My wife’s in “another place” also subsidises its undergraduates significantly, but not quite as generously. They are (among) the most academically prestigious colleges in the UK’s top two universities.
    So, it’s been tried, found to succeed, and rejected out of hand by educational bureaucrats.

  11. The real problem is the low and ever slipping standards of school leavers who then need higher education to make them more attractive to employers.

  12. I’ve long pondered and given opinion on this topic. As disclosure, I was very very very lucky to get industrial sponsorship – quite generous sponsorship. Had I not done so, because of parental income etc, my parents would have had to fork out a LOT.
    The state pays for education up to a certain level – on the basis that an educated population is more productive etc. This makes sense.
    But then the state says that at some arbitrary point, they longer pay for education because “the person will benefit from the education” (by way of higher pay.)
    Now if the figures are true about how much extra graduates earn compared to non-graduates, then the extra tax they will pay on that would repay the cost of their degree – and then some. So the state paying for their continued education (as it used to do under the grant system) is in investment. The state pays out, it gets a return both from the income taxes the person pays, and the general benefits to the economy.
    If this is not logical, then what’s the case for the state paying for A-level education ? Secondary education ? Junior education ?
    There seems to be a certain amount of political double standards and misdirection going on whenever this is discussed. But then why should honesty and politics be assumed to be bedfellows !

  13. I have paid for just about everyone else’s kids to pass through primary and secondary school so why shouldn’t I also subsidise their university education. Maybe there’s a payback, but I can’t see it.

  14. @Geoff Taylor- I was thinking more like 15 years, if you can find that much idleness you’ve got a large trust fund from which the (obviously unnecessary) loan could be repaid.
    We need to stop taking all things academic at the value placed on them by the vendor. They have a massive incentive to exaggerate.
    I’d rather give them an incentive to be honest and then trust the people than haveq politicians assess their true worth at public expense.
    The more so as politicians commonly attribute their own success to their education- many would have succeeded anyway. As would many successful non politicians.
    In a discussion on Samizdata some years ago it came to light that in the mid 1800s Britain was far the wealthiest nation I’m Europe, with far the poorest education. By 1900 British education had improved dramatically, but her relative wealth had declined.

  15. I’d suggest that the state fully funds higher education, but only for subjects where graduates on average pay higher rate tax within 10 years of graduation.

    If establishments wish to offer other subjects and students pay for them, fair enough.

  16. @Simon,

    But what about those of us who don’t get free university duration but still go on to earn high salaries and pay the same taxes, for longer.

    Education should be free up to the school leaving age, then you should be grown up enough to make your own decisions and pay for them.

  17. Andrew Duffin:

    You’re right that the availability of loans and other aid has raised the price of a college education. I remember when I was a freshman 25 years ago that we had to fill out financial aid forms. The college determined how much the family was able to pay toward the education, with the rest of the price made up by a combination of scholarships/loans. Being smart enough to get into college, I was smart enough to figure out that if more financial aid was available, my family would still be considered able to pay the same amount, and that extra money would go somewhere, likely to higher prices.

    That having been said, I’ve read the the rise of “diversity” administration has led to a general lowering of the ratio of real teaching staff to non-academic staff at many colleges. Cut out those administrators and you could probably save a reasonable amount of money.

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