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Chinese Companies Are Buying Up Cash-Strapped US Colleges (bloomberg.com)
An anonymous reader quotes a report from Bloomberg: Chinese companies are taking advantage of America's financially strapped higher-education system to buy schools, and the latest deal for a classical music conservatory in Princeton, New Jersey, is striking chords of dissonance on campus. Beijing Kaiwen Education Technology Co. agreed in February to pay $40 million for Westminster Choir College, an affiliate of Rider University that trains students for careers as singers, conductors and music teachers. The announcement came just weeks after the government-controlled Chinese company changed its name from Jiangsu Zhongtai Bridge Steel Structure Co. The pending purchase rankles some Westminster faculty and alumni, who question what a longtime maker of steel spans knows about running an elite school whose choirs sang with maestros Leonard Bernstein, Arturo Toscanini and Seiji Ozawa. Alumni are among those suing in New York federal court to block the sale, saying it violates Westminster's 1991 merger agreement with Rider and will trigger the choir college's demise.
At least someone is investing in education.
No sig. Move along - nothing to see here.
So many of the students at US colleges are already Chinese, so buying some schools out would be a logical next step.
But wouldn't it be wondrously ironic if a Chinese buyout is what it takes for our liberal arts schools to return to their traditional role of passing on the history and culture of Western civilization? It would be acceptable to teach the works of dead white men once more.
Colleges are also going to want to ask themselves: in this era of blisteringly high tuitions, why are so many of them "cash-strapped?"
How does a school which charges $40,000/yr in tuition end up cash-strapped?
When the world was on the gold standard, running a trade deficit was a big deal. If the deficit was not addressed quickly, gold reserves would run down, and the country could quickly find itself in a position where it did not have enough hard currency to buy the things it needed. Regular folk on the street could easily see the impact of not producing enough goods to sell overseas as you needed/wanted to import. Countries had industrial policies. Politicians lost power on account of not managing the trade deficit.
When the US ended the gold standard (because it ceased generating trade surpluses) and currencies floated, it gave politicians a number of new tools to manage (fudge) trade deficits. The first was that countries like the USA, which held global reserve status, could inflate away the value of their currencies and hence any debts owned in those currencies. You could just give a foreign country a bunch of dollar bills, then print the value of those away so when the foreigner came to buy some goods from you a little while later you didn't have to give them as much stuff.
As you can imagine, foreign countries didn't really like this (nor domestic savers) so politicians had to find other ways to balance the deficits. The biggest trick they found to doing this was in the form of liberalized international capital flows. Basically, this now meant that you could buy a bunch of goods from a foreign country, and instead of having to trade them back some hard goods, you just sold them part of the capital assets of your country. Houses (either directly, or in the form of ever growing mortgage debt), businesses, infrastructure. Even the future earnings of your children in the form of treasury bills (future tax obligations) and student loans. Politicians could just flog this all off so that the flow of cheap shiny toys would continue without their voters having to build the factories or perform the labor to earn them.
Of course countries like China are also playing a dangerous game, as US voters could eventually decide to default on those payments (e.g. foreign buyer bans), which is why China is rapidly trying to reduce its dependence on US trade. But for now most people are happy to trade their house and children for cheap manufactured goods, while simultaneously moaning that the Chinese want something in return.
The prosperity of US is built partly on the fact that its considered a safe haven for investments. Doesnt matter if you are a corrupt Chinese bureacrat, a Nigerian scamster, a Rwandan genocidal warlord, a Korean monopolist Chaebol kingpin, a south American drug kingpin, a corrupt Indian politician, an inbred European ex Royal with ill gotten Nazi loot; The US welcomes all investments.
The US does not grab your property for personal crimes. It only confiscates property belonging to nation states it has disagreements with.
So once you have made your money and would like to go clean you invest it in USA and retire to the US.
This reputation is hard won and many a constituional and moral principle has been sacrificed for this key pillar of prosperity.
You dont want to endanger it just to feel some Schadenfreude over the Chinese losing money on their investments.
Rather you should keep rooting for a booming US economy with constant inflow of foreign money. A booming economy lifts all boats.
**Life is too short to be serious**
Good fences make good neighbors.
Now that's an ironic statement when talking about a country fighting for sanctuary cities and utterly defiant on applying that logic to Mexico...
... but this comes from the brain dead idea that everything is privatized.
You can't buy a german or french university. Well, we have a few "private schools", too. Sure. But I don't even have one in mind while I write this.
Cost free eBook I read (by iBook/Kobo/Amazon/ObookO/Gutenberg etc.): "The Green Odyssey" by Philip Jose Farmer.
I think that more people are becoming aware of how its almost essentially impossible to discharge student loan debt and that even if you're getting a discount, paying back $80,000 in loans when you have a degree that isn't going to guarantee an ability to pay that back anytime soon is a losing proposition.
Colleges are also going to want to ask themselves: in this era of blisteringly high tuitions, why are so many of them "cash-strapped?"
The tuition is high because state funding has dried up substantially and because there is something of a bidding war for talent between universities. A research professor can bring in a LOT of revenue to the university but they don't come cheap. Universities make a lot of money off of research patents courtesy of the Bayh-Dole Act. Plus for a lot of schools we have one of the major parties that tends to oppose using any tax dollars to educate people - especially when the people hired with that money tend not to vote for for them.
You do realize that student loans are federally-insured, and every student that defaults or goes bankrupt incurs a cost to the American taxpayer, right?
The reason student loans can not be discharged by bankruptcy is that it used to be very common for students to take out student loans, declare bankruptcy after graduation, then simply rent an apt until their bankruptcy was 'over' so they could buy a house...
Ken
Why did state funding dry up? Because the federal government came in to save the day.
What country are you living in? That's certainly not the case in the US. State schools are supported by state funding and that funding has been falling. Federal funding has not kept up so tuition has had to rise to at least partially offset the falling state support. State funding has dried up because certain members of the populace don't like taxes even when those taxes actually benefit them.
Why does education need to be funded at the federal level?
Because education is a public good that benefits us all. We live in a single country and can cross borders freely so claiming education funding and support should be restricted to the state/local level is idiotic.
Seems like education pre1980 wasn't as bad as it is now and post1980 has been characterized by disregard to meritocracy, title 9, increasing costs, and lower quality.
You might want to take off your rose colored glasses. I got much of my education pre-1980 and so I think your argument is a bogus strawman.
I think that more people are becoming aware of how its almost essentially impossible to discharge student loan debt and that even if you're getting a discount, paying back $80,000 in loans when you have a degree that isn't going to guarantee an ability to pay that back anytime soon is a losing proposition.
It's an education; they shouldn't have used a loan to pay for a useless degree.
I'm a minority race. Save your vitriol for white people.
Steel is one of the reserved State-Owned Enterprise segments of the economy, where the Chinese Government maintains complete control over the players in the industry. Just like banking, telecom, aviation, and a few others. Private control is basically forbidden - it's the Central Government, provincial Government, and other Government-employed players only who can own or control a steel foundry. That said, China really isn't Communist, so much as it is a fascist oligarchy, with extreme Government control over key industries and extreme control over Government by a few hundred families in Beijing.
Browsing at +1 - no ACs, I ignore their posts. So refreshing!
Rider is a private institution and has a flat fee for everyone. They charge $40K to start - regardless of where the student comes from.
Browsing at +1 - no ACs, I ignore their posts. So refreshing!
Civil forfeiture isn't "grabbing the property of people who commit crimes." It's grabbing property WITHOUT proof of a crime. Much worse.
How does a school which charges $40,000/yr in tuition [rider.edu] end up cash-strapped?
Are you kidding? Have you walked through a university campus and looked around? All those huge, beautiful, buildings aren't going to cover themselves with ivy.
Well, actually, they are, but I think where you see where I am going with this.
Constructing a building costs millions. It is even more expensive when you make it look like some thing that you expect to see on a college campus. You have to build a lot of these, or students aren't going to show up. You have to hire a bunch of top academics. Some will be really expensive to retain. (Ai CS specialists yes, ancient Latin experts not so much). In order to keep them around, you have to give them whatever they need to do 'cutting edge' stuff. (Supercomputers, Lasers, and Libraries, oh my!). You don't have tens of millions in cash, so all these buildings you bough, you bought them on credit, so there are loans to be serviced. Also, you gotta pay people to keep them looking nice and in repair, as a bunch of snot nosed special little flowers try to shit all over them. (I saw one genius in the dorms where I went to school using the ceiling sprinkler pipes as monkey bars...)
And then you have to pay a few top administrators the big bucks, because they are essentially doing the work of a top level CEO, managing budgets, dealing with the press, inking deals with the private sector to get more funding and help to keep your research cutting edge, shaking down rich alumni, and keeping all the asylum inmates / students from killing each other.
All that 'free' money you get from the government? They don't just drive a dump truck up and empty it in your personal scrooge McDuck money bin. You have to jump through hoops to get it and employ a small army of accountants and office workers to do accounting and manage financial assistance programs, because the majority of students attending universities aren't named Gates or Zuckerberg.
It adds up quick.
HA! I just wasted some of your bandwidth with a frivolous sig!
FTFA: It's an opportunity for chinese schools to upgrade their art education.
"Xu Guangyu, chairman of Beijing Kaiwen and a choral singer in college, said the two institutions can operate in harmony. He runs K-12 schools in China and said Westminster could provide the knowledge to help upgrade arts education for his students. Xu said he won’t cut Westminster’s budget or staff. Westminster’s programs include master’s degrees in choral conducting, sacred music and organ performance, and notable alumni include Dorothy Maynor, founder of the Harlem School of the Arts, and Yannick Nezet-Seguin, incoming music director of the Metropolitan Opera in New York.
“They can set up our entire music curriculum and bring all kinds of exchange opportunities,” Xu said. “It’s pretty difficult to find these musical resources.”
How's life in the hypocrite lane?