No Tuition, but You Pay a Percentage of Your Income (if You Find a Job) (nytimes.com)

What if there were a way to eliminate student debt? No, really. Student debt reached a new height last year -- a whopping $1.5 trillion. A typical student borrower will have $22,000 in debt by graduation, according to the National Center for Education Statistics. Now, Silicon Valley is backing a novel idea that proposes to rewrite the economics of getting an education. From a report: The concept is deceptively simple: Instead of charging students tuition -- which often requires them to take out thousands of dollars in loans -- students go to school for free and are required to pay back a percentage of their income after graduation, but only if they get a job with a good salary. The idea, known as an Income Share Agreement, or I.S.A., has been experimented with and talked about for years. But what's happening at Lambda School, an online learning start-up founded in 2017 with the backing of Y Combinator, has captivated venture capitalists.

On Tuesday, Lambda will receive $30 million in funding led by one of Peter Thiel's disciples, Geoff Lewis, the founder of Bedrock, along with additional funds from Google Ventures; GGV Capital; Vy Capital; Y Combinator; and the actor-investor Ashton Kutcher, among others. The new funding round values the school at $150 million. The investments will be used to turn Lambda, which has focused on subjects like coding and data science, into a multidisciplinary school offering half-year programs in professions where there is significant hiring demand, like nursing and cybersecurity. It's an expansion that could be a precursor to Lambda becoming a full-scale university.

Comments

With Apologies to Rick and Morty

[Anonymous Coward]

"and are required to pay back a percentage of their income after graduation"

That just sounds like slavery with extra steps.

Re:With Apologies to Rick and Morty

[Anonymous Coward]

Well, Indentured Servitude really.

Re: With Apologies to Rick and Morty

[Bengie]

From the holistic view, it changes who holds the most risk. Instead of school getting paid no matter what, they most likely only get paid and get paid the most if they create decent employees.

Re: With Apologies to Rick and Morty

[Anonymous Coward]

So I guess the basket weaving degrees will go away right? Since if they really are useless not enough of their graduates would end up playing back.

Second: those that do better than average will pay way more than they would otherwise since they have to cover the cost of all the people that got the degrees but were unfortunate.

Next: what happens if you fail to graduate? You're partial degree doesn't get you better pay from Walmart but your 2 yrs in school cost real dollars. Deferring paying makes any idiot that can get in take a shot at it unless you make them pay the full amount when they drop out ... a very expensive pay after delivery idea.

Lastly: they are offering half year programs in nursing and cyber security: what jobs are available for people in either of those fields with highschool + 6mths worth of education? I could be wrong (it happens) but that sounds silly to me. Nursing is a regulated profession in most places, cyber security maybe more of the wild west but if I'm hiring someone to come in I want them to know more than the IT guys I already have which to me means more education than them not 1/8th albeit highly focused.

Re: With Apologies to Rick and Morty

[Archangel Michael]

Basket Weaving is long been dead. The modern equivalent is the anti-male, anti-patriarchy, anti-european/anti-asian, victimology classes and programs being offered by the socialists in colleges, collectively and jokingly called "Lesbian Dance Theory". There are entire departments at some universities that would cease to exist if they had to justify their fancy barista degrees with post education returns.

These are classes and programs designed to train people to offer those classes and programs elsewhere. There is no actual job that has requirements to know anything about these made up subjects.

But don't worry, someone will come along and tell you why this post is part of the white hetero-normative male patriarchy oppression that is keeping the aggrieved parties unemployed. Because successful people are evil!

Re: With Apologies to Rick and Morty

[Archangel Michael]

Actual basket weaving is still useful, if under appreciated. If I weave a basket, and I've produced something tangible and that has some value, functional and perhaps even artistic. It can and will exist long after the maker is gone if care is taken to preserve it. A basket weaver of significant skill and artistry will create a demand for their product. Voluntary transactions between willing participants will ensue creating a value to society. This is a hierarchy of value that doesn't respect arbitrary groupings by neo-fascist identity politics.

Re: With Apologies to Rick and Morty

[ShanghaiBill]

OTOH, if the degrees and certifications are being sold as personal enrichment, then that's a different matter ...

Nobody should be taking on debt for "personal enrichment". If you need to borrow money to go to college, then you need a degree that justifies the expense.

The art history and philosophy degrees are for students with rich parents.

Re: With Apologies to Rick and Morty

[Anonymous Coward]

I don't exactly agree that the only value of College should be to train people for work. Knowing history and human nature are important skills for a society, but they don't have a lot of crossover for the work world.

In general I agree that many Colleges have become insane asylums, often passing as indoctrination camps for far-left thinking. I just don't agree that a "market approach" is the right idea. The right wing has this equally weird idea that everything is about business, money, and markets. That's as much of a distortion as the whole world is patriarchy and oppression.

We seem to have lost some form of balance. I don't know how to restore that.

Re: With Apologies to Rick and Morty

[Immerman]

I agree with your disagreement - however, so long as colleges are *marketed* primarily as work-training schools, it would be nice if they actually delivered. Nobody is going several years salary (if they're lucky) into debt to acquire valuable sociological perspective.

Re: With Apologies to Rick and Morty

[Archangel Michael]

The idea of well rounded education is long been touted, but with the advent of the internet, and the wide spread nature of information has eliminated the barrier from 200 years ago concerning who has access to that information.

Further, it is clear from many actions/reactions from colleges that broad / diverse ideas are almost outlawed, and only nominal group think is permitted.

It is my opinion that your argument is being used to foster the antitheses of what you're trying to present as a good.

Don't get me wrong, actual broad and diverse knowledge DOES in fact help both individuals and society as a whole. The humanities however have become the playground for progressive fascists who have no idea what a well rounded education ought to be.

At this point, it is better to pick up a book on your own and expand your own self rather that subject yourself to the short sighted bigots proffering "Lesbian Dance Theory" indoctrination centers as the way to better yourself. It isn't. Education shouldn't end when you leave college.

Already exists in some countries

[ark1]

It is called - taxes.

Re:Already exists in some countries

[Brett Buck]

That's ridiculous. This is a *personal debt* that an individual signed up for, to pay for a personal service. Why should the rest of us end up on the hook for personal choices/mistakes?

      If it's taxes, then I should get a say in what people study, since they are government employees, and also get a say in what they do afterwards. Otherwise, pay for it yourself, and if you can't afford to go to college - DON'T.

Re:Already exists in some countries

[foghelmut]

Because education is a net benefit to society.

Re:Already exists in some countries

[RightwingNutjob]

This is true. Unfortunately a lot of what goes on in universities is not education. It just gets called "education" by people looking to keep the gravy train of subsidized loans coming. It's most transparent in semi-fly-by-night for-profit operations like Corinthian Colleges, but there's a great deal of it going on in private non-profit and public universities too.

UC Berkeley's $10M/year diversity office could pay for 400 students' tuition at in-state rates at most places, but instead it just soaks up money coming up with new and interesting ways to be offended at life. But it's at a university, so it claims the mantle of education and asserts itself to be good.

Fake majors that provide neither marketable skills, nor the much-vaunted soft skills of critical thinking and ethical grounding are all over the place. Some train left-wing activists to make trouble. Others are more benign but soak up four years of time and provide no salary benefit, creating a large cohort of indebted people whose inability to get ahead has led them to become stunted and bitter adults ripe for exploitation by socialist demagogues. These are not a societal benefit. In fact, one could argue they are the greatest threat to freedom and prosperity on the horizon right now.

Re:Already exists in some countries

[Anonymous Coward]

That's ridiculous. This is a *personal debt* that an individual signed up for, to pay for a personal service. Why should the rest of us end up on the hook for personal choices/mistakes?

Because it isn't a personal choice how rich your parents are?

Re:Already exists in some countries

[grasshoppa]

Yes, but can we call some of these degrees "education"? Feminist studies? Auctioneering? Bagpiping?

I could be convinced of the "taxes for college education" angle, but only if we restrict the degrees pursued to an agreed upon list of useful degrees for professions society actually needs. You want to follow your dream of professional bagpipping, fine, but you do it on your own dime.

That is a debt

[ardmhacha]

If you owe someone something (even if it is a percentage of your earnings) that is a debt.

That's called taxes

[Anonymous Coward]

You already pay a percentage of your income if you have a job. This proposal is a matter of budgeting your taxes to fund education. It's plain and simply that.

Maybe colleges should stop being expensive

[Junior J. Junior III]

Or, what if, hear me out now, what if colleges stopped the campus beautification arms race, and quit spending hundreds of millions of dollars on new buildings, and then passed the cost savings on to students?

Re:Vocational debt maybe

[lgw]

I wouldn't want it any where near a normal University, for fear it would kill off the less lucrative subjects.

Lucrative = valuable to society.

Yes, yes, I know, people really hate admitting that. But this is how we measure the need for one more person in society doing whatever it is. If there's a great need for another person, it will pay well. If more people want to do it than are needed, it will pay crap, even if the field is very necessary to society (like teaching), it may be we already have an excess of qualified people, and don't need more right now.

Of course, there's a different argument. There are those who believe that University if for indoctrination by your betters in what you are supposed to believe, and not for mere "vocational" learning of things actually needed. Fuck all those people, individually and collectively, for they are destroying society.

Re:An online bootcamp by any other name....

[JaredOfEuropa]

Well, Y Combinator and Peter Thiel are involved. That should have been your first clue.

Re:Or you could just pay for school

[dgatwood]

It's almost impossible now though. A year's tuition costs more than one year's pay, even with scholarships paying 80% of the way, like I had; you're not going to be able to get a job as a high school grad that pays for University now.

There are still state universities in smaller states where you could live and work for a couple of years to get residency, then start college and (barely) scrape by. But you're right that it isn't nearly as easy as it used to be.

For example, my undergrad uni costs about $9,400 in tuition per year. That's less than a year of minimum wage even after taxes. Of course, you have to deal with books, food, and housing, so getting by on minimum wage would pretty much require finding several other people willing to split the rent on a small apartment off campus. But it should be (just barely) possible to work your way through school there without scholarships.