Slashdot Mirror
Purdue Experiments With Income-Contingent Student Loans
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."
Want to pursue a STEM or other high-paying degree? No problem, but you have to pay a lot more for your degree.
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.
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.
If God forks the Universe every time you roll a die, he'd better have a damned good memory.
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.
Don't waste your vote! Vote for whoever you want, unless you live in a swing state it won't matter anyways
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...
#DeleteChrome
Private schools want profit first and everything else, like actual education, third.
It's funny how we just keep doing this to ourselves
They need to have staff actually create/update content for students. Generally you pay thousands of dollars for a humanoid speak and spell to drawl at you and show you pretty slides. Staff eat a giant component of tuition money getting lavish life styles with running water, food, vehicles and sometimes single person homes. The students are eating ramen, and it's likely many will live on the streets in my case as I attended college I practically was living from my car. Seeing them bloated and rich after taking my money to deliver me 20 year outdated technology that they just read off slides was infuriating.
The financial component could be taken care of partially by removing much of the physical structure of the school itself and virtualizing it. Virtualization of crappy or useless staff such as mathematics or english teachers would be a big bonus and money saver as well (I see no reason to not stamp the data down vs having it dynamically read out to people, math/english teaching data doesn't change very rapidly). Any other courses where data can be stamped down should be.
They live in a world all their own though, and honestly have no pressure or reason to EVER change the status quo. When we are starving and it doesn't matter to them, nothing does.
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...
The party of stupid and the party of evil get together and do something both stupid and evil, then call it bipartisan.
You may pay more on average, but you'll be debt free, and you'll have access to much more expensive majors that what you'd otherwise be capable.
mind boggling
This is true "debt-free" college
Yeah *only* if you decide 'I just spent 4-5 years getting a degree FUCK IT I am going to go live like a hermit/hobo for the next 15 years'
In the real case it is a 15% loan over 30 years. If you get say a CS degree and an entry level job and never get a raise at 60k a year. That is 270,000 dollars. With pretty much no upper limit on cost. I like how they use a 10k example. Hell 25 years ago when I was in college 10k was *nothing* I could spend that in half a semester at a state school. It costs *way* more than that now.
This also assumes you get a job in your field and make a decent amount of money. Lets say you cant get a job because you were brain dead and picked a specialty that no one else has or they are dime a dozen. You end up as a server making a bit above min wage. Giving up 15% of your min wage earnings would be a terrible idea.
This is a terrible financial instrument designed to rip people off. Much like student loans. Most real loans out there are 1-3% right now. Yet somehow magically student loans are still at the max allowed by law.
As an investor I would have to pool thousands of these together to make it even slightly worth doing. The default rate could be huge.
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.
The first step to a nation of indentured slaves.
Just cruising through this digital world at 33 1/3 rpm...
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,
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.
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.
Custom electronics and digital signage for your business: www.evcircuits.com
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.
What is the difference between this and alimony or child support? Other than it being a choice (then again, so was marriage and having kids, no?)
Sounds thoroughly unpleasant. Not a chance in hell I'd be signing up for this.
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'
For every private business, providing a product is the necessary evil to get your money. Duh.
We used to have a Bill of Rights. Now, with the rights gone, all we have left is the bill.
> replenishing the fund for future investments
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.
"... 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.
-Styopa
This would mean students / parents would have to pay for college directly. This would mean colleges would have to charge lower fees in order to keep classes full. Lower fees would mean that students would not have to take out loans to pay for college. You might call Jesse Ventura an evil right wing facsist faggot, and there are a lot of things I would disagree with him on. He was spot on about college education. E.g. If you are smart enough to go to college, you are smart enough to figure out how to pay for it.
College tuition will continue to rise in cost so long as students continue to take out U.S. government guaranteed loans to pay for it. Sallae Mae is the wet dream of every billionair hedge fund manager.
..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!)
Instead of solving the cost side of the equation, this attempts to solve the payment side.
Are some degrees worthless? That is in the eye of the beholder, not on someone sitting in a corner office.
For all the religious fanatics, wouldn't Jesus have a philosophy degree?
For all the anti-teacher fanatics, weren't you taught by a teacher?
The country needs a mix of people, not just STEM people.
Instead of indebting our next generation that is gonna create wealth for the country, or make deals so rich people can leech cash from whatever the next generation is gonna make after graduating, How about just make education free? I know. Crazy Commie talk!!
A Loan by any other name, such as ISA, is still a Loans.
Loans lead to higher prices for education and lower income should one decide to honor their name & obligation by paying the Load back.
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 sticking the money in a bank account than taking that option.
The debt is also structured in such away that any outstanding balance is waived upon death.
make it so you can't go under min wage as well or say any one makeing under X a year does not need to pay any thing back.
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.
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.
...at the increasingly inventive ways to be found to screw the poor; HUZZAH!
Requiem for the American Dream
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 restaurant, the message is either ignored or treated as a temptation to spite.
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.
"I'm too busy to research this and form an educated opinion, but I do have time to tell everyone my uninformed opinion."
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.
Hi! I make Firefox Plug-ins. Check 'em out @ https://addons.mozilla.org/en-US/firefox/addon/youtube-mp3-podcaster/
Welcome to the world of Indentured Servitude. thought we got rid of that idea centuries ago.
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.
And FYI, I am a fucking engineer, but I know most engineers can't design for shit. And in fact many of them are actually pretty stupid fuckers outside of what they were taught in school. That's why Apple makes a shit load of money on it's mediocre products; they don't have dumb-ass engineers designing them. iPod vs brown squirting Zune for instance, and being an engineer I'm sure you remember those crap Archos MP3 players from a few years back.
we've turned students into investments for predatory lenders. If you think those lenders hadn't noticed and haven't started taking steps to maximize the amount their "investments" borrow you're nuts. Education has gone up in price for two reasons: We pulled billions in federal subsidies and the middle class has eroded to the point where their competing with the poor for what few scholarships are left. That leaves our investor class in a prime position to swoop in with big loans and big profits. Rent seeking at it's finest...
Hi! I make Firefox Plug-ins. Check 'em out @ https://addons.mozilla.org/en-US/firefox/addon/youtube-mp3-podcaster/
to bypass rules and laws about how much interest can be charged for certain types of loans. I can't think of any other reason to do this.
Hi! I make Firefox Plug-ins. Check 'em out @ https://addons.mozilla.org/en-US/firefox/addon/youtube-mp3-podcaster/
Pants? What's to "design"? This isn't even a college level job. It's a midieval trade.
A Pirate and a Puritan look the same on a balance sheet.
So, they are basically reinventing education funded by income tax? What a novelty!
There's nothing like $HOME
Yes, some countries have realized this and are increasing opportunities for tradesman careers but haven't realized the built-in flaw. I can't go to wood-working classes for 3 years, then get a diploma saying I'm skilled (in basic wood-working). I can do that with business/ICT/hard science at a university. Trade apprentices also get less welfare than university students, making them less desirable despite a similar earning potential. Trade qualifications need to reduce their dependance on the 3-year apprenticeship, which also reduces the number of qualified people. So while purists might bitch about a degree in surfing and marine studies (with physics, meteorology, zoology, environmental sciences), it's moving higher education into the area of fixed skill jobs, which is desperately needed.
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!
"There is more worth loving than we have strength to love." - Brian Jay Stanley
Welcome to the world of Indentured Servitude.
Indentured servitude, just one step away from outright slavery.
"non-profit" does not mean charity or unbelievably high quality or even moral fibre. It just means a different financial structure.
Pants? What's to "design"? This isn't even a college level job. It's a midieval trade.
The voice of ignorance.
I would bet that someone who designs pants can spell 'medieval' better than you can :p
Captcha: Adduce. This we adduce to show that one need not be capable of spelling, in order to have a superiority complex.
there is already this option, if you have potential to be top 1% engineer or doctor or anything else, you can get stipend from a lot of big companies, all you have to do is sign you will work for them X number of years after graduation where X is 10 years or even less, even if your not top 1%, there are options, for example USA military does this even if your not really as intelligent
if you meant that Facebook should pay for 100 STEAM degrees, and students can afterwards decide freely where to work, that sounds moronic because what if those people decide after to work for Google instead? they were paying tuition for their competitor workers, and that way REDUCING amount of money they will make instead of increasing it with this investment
That's great and true but has fuck-all to do with what he said.
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.
I live in California; I got a two-year degree in computer science with no debt. The minimum wage here is about $9/hour. With my two year degree and several years' experience I was getting $12.50 to $13.92 an hour -- a great wage in many parts of the country, barely enough to scrape by with around San Luis Obispo. I'm currently racking up about $10k of debt per year for three years to finish my four year degree, also in computer science, in the hopes that someday I'll be able to stop living paycheck to paycheck and maybe even afford a car with less than a hundred fifty thousand miles on it.
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.
Called Income Based Repayment. https://studentaid.ed.gov/sa/r... However it only applies to some kinds of loans made in the pasr ten years. Some politicians want it to be retroactive and universal.
Funny you say this. It sounds like you are implying banks are predatory lenders taking advantage of students and if only the government would step in and fix it everything would be better. Now for some reality...
90% of student loans in the USA are from the Federal government. They are the ones doing predatory lending. They are the ones that made it so student loans can't be dismissed in bankruptcy. They are the ones taking away your SS payments in retirement for your outstanding student loans. This didn't happen when the banks ran it. But wait, there's more....
Its like this to pay for (wait for it...) the ACA! Yep, the ACA is budget neutral because student loans cover part of the shortfall. This can only be changed by rewriting the ACA.
What you are asking for your got in spades and you sound more upset than ever about it.
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's studies double major.
That's almost funny.
deleting the extra space after periods so i can stay relevant, yeah.
Let's drop this 'age' bullshit. If you can join the army at 18, you should know that going to a private school (with no money) and major in middle-age studies is a dump idea. I have no sympathy for this morons, especially when they skip community college and other state schools to go to a private school knowing full well they are POOR.
... 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 tuition and actually SAVE money from our federal budget compared to the enormous amount of money we dump on banks to prop up the failing student loan "industry".
It's obscene what we're allowing to happen to our young people; starting life with a massive debt really puts a huge roadblock on the path to prosperity and happiness, one that is not easily overcome, even when working hard. My wife had private loans for an average cost university. They make the loans sound so simple, but by the time you graduate you have 8+ loans (at least one for each semester, but possibly more since sometimes a bank is not willing to give a loan for the complete cost of a semester, so you have to get another one from someone else to finish it out) each with a minimum of at least $50 and before you know it, your monthly minimum is a mortgage payment of $600+ a month. So we're effectively requiring students to pay a mortgage right out of school (on top of the real rent/mortgage and cost of living). But then when students ask for higher wages to pay that bill, many of the older generation scoff and call the kids "entitled". If companies and HR want to continue demanding degrees for every position, then they need to pay the cost of doing business and raise wages.
So tuition should be free to everyone, at any time, funded by taxes from individuals and businesses alike. Aside from obvious young adults age 18-22, I think we should encourage anyone of any age to attend college whenever they wish, and push the idea of microdegrees or certifications or badges, or whatever you want to call them. Why shouldn't a 30, 40, 50 year old be able to attend an engineering seminar to brush up on skills? Or a history class for fun (better use of time than sitting in front of the TV!)? We should encourage everyone to pursue life-long learning, not just the fresh-out-of-high-school crowd. We can do that when tuition is free and there is no financial risk to giving it a try and backing out later if demands of life (kids, work, etc.) prove too much that particular semester.
Bernie Sanders has called for tax-funded tuition-free universities. If you want to see this too, chip in a few bucks to his campaign.
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.
Pants? What's to "design"? This isn't even a college level job. It's a midieval trade.
Like building bridges, roads, and homes. We don't need engineers or architects for those either.
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 fields that are considered good for the economy, such as STEM, by offering loans at no or even just lower interest. Why? because the purpose of the loans is to make money. You want to get a PHd in underwater basket weaving? Sure, here's $300k to fund your education and you don't even have to think about repaying it until you finish school. While you're at it, here's a couple credit cards to pay for pizza and beer with your friends and a new 60" TV!
Sounds like the free market at work. I thought this site worshipped the free market?
apple design sucks. go fuck yourself.
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 can be a professional ball player. I have no problem with someone pursuing their dreams and either having a backup plan or knowing that they might not ever make a lot of money. The problem is when someone wracks up a huge amount of debt on a major without a clue what they are going to do with it after they graduate. If you have 80k dollars worth of debt and you either have no career plan or your only career plan is to paint what you want and hope people fall in love with your paintings then you have a problem. Likewise if you have 80k dollars worth of debt and you're planning on getting a job that pays only 20k per year. You should never go into debt for a degree that you have no idea how it will help you get a job and if you're going to go into debt on a long-shot major then you need to have a plan, a backup plan, and a backup to your backup plan on how you're actually going to pay your debt back. It's completely irresponsible to go into debt without any plan on how you're going to pay it back whether it is for a house, a car, or an education. And winning the lottery (or the virtual lottery) doesn't count.
...student loans from the government are supposed to be for low-income families. Wait, but they did it through the banks, because it was easier and quicker and more efficient. ... to deny them such things.
Well said. +1 Insightful
apple design sucks. go fuck yourself.
Ass hurt much?
Because their stock price shows otherwise. And unlike M$, Apple wasn't the one negotiating illegal deals with hardware manufactures.
What. You think they'll let you just keep going back to school to stop the repayments permanently? If that's a loophole in the rules right now, give it 5 years and it'll be shut tight as soon as they realize people are using it.
"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?
"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.
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.
-- All that is necessary for the triumph of evil is that good men do nothing. -- Edmund Burke
I'd prefer to see the college/university itself taking the risk. Many schools have absurd endowments - billions - where the interest alone could fund every student's tuition. If the school took the risk, they'd be incentivized to provide an education that would maximize the student's earning potential (at least in the early years after graduation, depending on how the contract was structured). There would probably be a lot fewer chicano-asian-lesbian literature studies majors as a result, but I doubt the world will be found wanting as a result.
I find it hard to believe how a message of "we will teach you well so you can be successful" mindset would be a bad thing if the college/university has a stake in doing a proper job of it.
But, what do I know, the only thing I learned in college was how to drink a shit-ton of beer...
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.
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.
The party of stupid and the party of evil get together and do something both stupid and evil, then call it bipartisan.
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.
So this is in some ways a loan with much kinder terms and higher risk for investors. It also seems targeted at lower income higher risk students. So what is the total amount owed? My bet is if this takes flight it will be much higher than a comparable loan.
The line about the lack of consumer protections ought to give everyone pause.
That won't happen unless minimum wage is raised to something livable.
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 with them (including the U.S. government). Universities can act like unions, doing collective bargaining on behalf of the students (I am not assuming the universities' intrinsic benevolence here, but presumably students will choose to go to universities which can get them the best deals). Conversely, government and businesses might do a much better job of bargaining down tuition prices than loan subsidied college students have been doing. And instead of gambling on the future, students enter into the arrangement knowing exactly when they are going to be able to afford a mortgage. There are plenty of potential problems, but I think the present process of "guess a good major to land a job from an unspecified employer and make indefinite earnings and by the way your wager is $100k and 4-6 years of your life" leaves a lot to improve.
When things get complex, multiply by the complex conjugate.
It's not necessarily "Liberal Arts", but it is liberal arts.
And as an artist or musician, you might make hundreds of millions ala Damian Hirst, or you might be doing phone support like an asshole I knew who thought he was a better artist than his teachers. Hell I knew assholes with STEM degrees who never got decent jobs.
No matter what you do; there are no guarantees of success. I know plenty of assholes who go from failure to failure and some are ready for social security. Other assholes who strike gold and make it on the first shot, (and not talking about the virtual lottery).
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.
Chaos - everything, everywhere, everywhen
"This is true "debt-free" college."
Bullshit spin. If it didn't have to be paid back then it would be debt free.
blindly antisocialist = antisocial
"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 degree even if that second bachelor's degree would actually allow you to get a job.
It's the Free Market (TM)!
Investors will simply refuse to invest in bad degrees!
And there's no way the government will get involved, creating a moral hazard by forcing investors to pour money into riskier degrees (just like they'd never force insurers to offer hurricane insurance in a hurricane-prone flood-plain).
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.)
Ted Turner was expelled from college. I guess we can therefor conclude that becoming a billionaire does not require a college degree at all.
I've been meaning to go back and finish my Ph.D. in post-modern transcendental feminist dance therapy.
They can take as high a percentage of zero as they like for as long as they wish.
Just say no to more then 40 hours. Make America great again.
Cheap storage VM.
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 might attract favourable student loan terms.
const int one = 65536; (Silvermoon, Texture.cs)
SJW, n: "Someone I don't like, and by the way I'm a fuckwit" - AC
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.
This.
Employers used to see people with degrees as being high quality material that they could mould into what they wanted. Now they don't want to spend any money on training or try to retain staff for long periods while they build up skills, they want a fully trained drop-in work units.
const int one = 65536; (Silvermoon, Texture.cs)
SJW, n: "Someone I don't like, and by the way I'm a fuckwit" - AC
Perhaps you could add a persuasive comment on why you believe he is wrong, rather than some pithy BS regarding Fox News. I tend to agree that students need to spend more time evaluating issues from multiple vantage points, and to clearly communicate their thought and feelings on an issue. How can we have a civilized discussion when both parties cannot accept that there is more than one point of view?
This.
Employers used to see people with degrees as being high quality material that they could mould into what they wanted. Now they don't want to spend any money on training or try to retain staff for long periods while they build up skills, they want a fully trained drop-in work units.
Perfect example: My company had a situation where my boss wanted to get a new person for a job and started the HR process to hire from outside. I asked him why Joe, a person in another job in the department, couldn't just slide in there and then we would hire a less risky lower-level person. After all, we knew what Joe was capable of. He gave 3 reasons: 1 HR doesn't like moving people around, his boss looked down on shuffling in a department as it apparently looks like "right sizing" is on the horizon, and Joe didn't have that job so it was harder to sell to the superiors.
Well, we put out the job listing and hired someone from a rival. Within 1 week, I knew she had lied on her resume and Joe had to be assigned to help her almost full time. My boss even got a "thank you for taking her" note from his equivalent at the rival. Within the month, Joe was hired into her old job and we had to replace him anyway. Year later, she is still working here and is actually slowing us down but can't be fired because the chain of command doesn't want to admit they made a mistake and to go through the trouble of hiring a new person.
It may be anecdotal and confirmation bias, but the refusal to hire from within has on all occasions (more than just that one) lead to either a wash or a situation where the company shot itself in the foot. Talk to various employees and they all have stories like that. Even if the person is perfect for the job, the change in systems alone can cause issues for months as the habits they got in to have to change.
As if the student loan crisis weren't already financially debilitating and enslaving enough.
I don't watch or listen to either. Perhaps you should turn off the Bernie Sanders ads and PMSNBC.
Aww, did I trigger you?
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 might attract favourable student loan terms.
So basically fields where many many other degrees can also prepare you for?
I guess this is why so few women get into STEM. Why take a degree in STEM when a degree in women's studies is just as good at getting good paying jobs?
Ignore the reports that engineering degrees pay the best while social work and psychology pay the least
"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."
Why is this 'best of all'? I wouldn't loan money to this type of program, there is no incentive on the recipient to pay back the money.
That won't happen unless minimum wage is raised to something livable.
That won't happen until we decide human life is precious and worth saving... even after it leaves the womb. Until then, we will have a tournament system, where there's enough for everyone, but the guys at the top take 100,000x more than they need, which creating a death struggle to not be left off the bottom rung of the pyramidal ladder.
https://en.wikipedia.org/wiki/Tournament_theory
The nice thing about the ISA idea is that people don't have to argue and debate which degree programs are valuable, real investors have to put their money where their mouth would be and the ones who can't predict the values properly will quickly lose enough money to leave the market to the people who can make money at it by predicting someone's future prospects effectively.
It's essentially doubling as a prediction market for the value of a particular program of study.
The party of stupid and the party of evil get together and do something both stupid and evil, then call it bipartisan.
I've met plenty of social sciences graduates and talked to them enough to see their attitudes in person, but haven't seen anything on Fox News except one of the recent presidential debates in the last year or so (can't actually remember the last time I watched the channel beyond the one debate), so I'm not exactly a regular watcher. Thanks for the advice, though. It's too bad it was based on false premises and completely devoid of valid content.
The party of stupid and the party of evil get together and do something both stupid and evil, then call it bipartisan.
Thank you, this is what I was thinking too - this is a horror, not a good thing.
It's not a bad idea, but it's not a fix for the problem and it is by no mean "debt free college" when wages are garnished to pay it back. It really depends on the career the student has after college too. They may not make enough money to do anything for the economy like buying a house, car, settling down with a family, etc while they're paying it back which means the net result is no change for the college tuition problem.
I suggested a fix to that supposed shortage years ago: Drop tuition for STEM degrees and remove any restrictions on the number of students per program. Yes, the classrooms will get crowded (so what, my Math I class at a Germany university had 1,200 students in it, by Math II it was down to a few hundred), but everyone gets a fair chance and students will drop out of the programs. Still, the number of graduates will rise significantly. And best of all, the graduates do not have to compete for the top paying jobs as much because they do not leave college at the brink of bankruptcy. Since I mentioned it, Germany has very low tuition, capped at 500€ per semester with the fees being typically much lower than the max. You have to pay for room and board on your own, but in almost all university cities student apartments are available (most of them one room studios). Also, most universities include the half year local and regional public transit without restrictions in the fees. If you are a legal resident of Germany you can also apply for BAFöG, which is a federal subsidy and determined on your own and your parents income. The subsidy is paid out half as a grant and half as a no interest loan. If you pay back that loan in a lump sum there are significant discounts offered. Why does the US not offer something like that? How come that US education has morphed from educating the young to a multi-billion Dollar for profit service industry? How come that US tuition rose sharply the past ten years while the expenses for academia remained flat? Do we really have to have the money pits of college athletics (all but maybe two or three programs lose money) that siphon off incredible amounts of cash from what universities should do? Do we really need the manicured greens and posh buildings? Do we really need the excessive amount of administrative staff that does not have any impact on the quality of studies? US colleges are nothing else than a massive employment program and you are paying for it!
But they are still in it for the money, even state schools are interested in cash first, education second. Have a look at the tuition costs of Union College, a private, non-profit, tax exempt university. They did have the NCAA ice hockey champions a few years back, but otherwise while still being a good school they are not that stellar given the steep price. And the real kicker is that Union was founded solely because at that time the middle class could not afford the established colleges and wanted a low cost alternative.
Like churches, state funded universities are considered non-profit. But, as we all know they are both anything but non-profit.
There is a reason that you can join the army at the age of 18 and it isn't because you are expected to be able to make rational decisions by that age. When you are that age you are very easy to manipulate and testosterone is kicked into high gear making us a little more prone to want to fight.
Is there really a better candidate for military recruitment? Poor decision making skills, still in the midst of confusion from puberty, easy to brainwash, and predisposed to show the women that he is a good, disposable man to protect them, by "protecting" all of them by going to war.
Military recruitment of 18 year olds is predatory and unjust.
I'm with you on this one. These days the social sciences have become little more than loudspeakers for feminist propaganda. Their teachings have no basis whatsoever in reality.