Student Loan Forgiveness

[MultiVerse]

A median college experience might be to live with mom and dad, work full time at a shitty job, take community college classes, and then transfer to Cal Poly, fund the final two years with debt, and pray to God that there will be employment available that justifies the loans when you finish. Another typical college experience over the past twenty-thirty years is to grow up around very few people who have completed college, finish high school, work at a dead-end job. Then you see the ITT ad on TV, and get tricked or defrauded by it, only realizing that you've been scammed after a full year. Then you drop out with a year's worth of debt an no credential.

Have a little perspective guys. If any of you make any more comments that would be irrelevant to a student at salt lake community college or Cal State, I'm sending you to the corner with the dunce cap.

The numbers show the opposite is true. The 'median' college experience for nearly half of students is to do the things you're describing, accumulate a bunch of debt and not graduate, then struggle for years to pay the debt off. The fact is students who don't have to work or face a heavy debt burden are much more likely to graduate.

Why the high cost of attending college at all levels matters:
- Part-time enrollment reduces graduation rates
- Full-time employment reduces graduation rates
- Enrolling in a community college may save money, but it reduces Bachelor’s degree attainment rates
- Gap years and leaves of absence reduce college graduation rates

[Buster Highmen]

I think there's also a lot of confusion in this discussion, in general. The fact that Dartmouth or Cal Tech is nominally 60 grand per year these days is irrelevant. The truly-elite private schools don't even give out loan-based financial aid packages by more: it's all grants. The fact that they've got plush student union buildings and too many jerkoff vice provosts is entirely irrelevant.

It's noteworthy that most of these grants are not available to middle class families. So, tuition inflation is relevant for most of the nation. Try filling out a FAFSA form.

Grant Eligibility
Most of our grants (listed above) are awarded only to students with financial need.
https://studentaid.gov/understand-aid/types/grants

Beyond that, I think a lot of people here had very rich daddys, did kind of okay at some private prep school, and then got a BA in bong hits at Bennington before going to a third-tier law school, all on daddy's dime. It is now a lot harder to do that for your own kids or grandchildren because it's more expensive. From a social perspective, this might be a good thing. This sort of glass floor for WASPy slackers doesn't need to exist at all. And this experience is not what college is like for most people - not in the least. The sort of regionally-reputable private schools where the local gentry can send their not-terribly-gifted child are having trouble controlling costs and maintaining relevance, but these schools are tiny and do not matter from a public policy perspective. Frankly, it makes me sad to see these places close because I enjoy bong hits and rural New England more than most, but I'd never send my kid there for a BA and six figures of debt: it's just a bad value proposition.

A median college experience might be to live with mom and dad, work full time at a shitty job, take community college classes, and then transfer to Cal Poly, fund the final two years with debt, and pray to God that there will be employment available that justifies the loans when you finish. Another typical college experience over the past twenty-thirty years is to grow up around very few people who have completed college, finish high school, work at a dead-end job. Then you see the ITT ad on TV, and get tricked or defrauded by it, only realizing that you've been scammed after a full year. Then you drop out with a year's worth of debt an no credential.

Have a little perspective guys. If any of you make any more comments that would be irrelevant to a student at salt lake community college or Cal State, I'm sending you to the corner with the dunce cap.

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Kind of ironic.

[Sirshredalot]

It's noteworthy that most of these grants are not available to middle class families. So, tuition inflation is relevant for most of the nation. Try filling out a FAFSA form.

Grant Eligibility
Most of our grants (listed above) are awarded only to students with financial need.
https://studentaid.gov/understand-aid/types/grants


Kind of ironic.

The truly elite schools are pretty close to a free ride unless Mom and Dad are making north of $150k. They also educate something like 0.1 percent of the nation. So, no, that's not relevant. Nor is the cost of attending Hobart or wherever else you go if you're not up to snuff coming out of prep school and you've got rich parents. That might seem like a problem to you. But, like the cost of your country club membership, it is not a national problem. The tuition inflation that's relevant is the out of pocket cost of attending Cal State or Utah Valley University.

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[rod9301]

I’m mostly pointing out that you continue to conflate bogeymen. Sure, there’s bloat. Let’s address that (and the EO explicitly attempts to address that) but there are a myriad of factors driving rising costs, and not all of them are easy financing. And your tenuous argument in re: class warfare, which as far as I can tell is your primary rail against loan forgiveness if only because none of your other arguments really make sense as arguments against that particular action, is far from grounded in cold hard facts….



…. Anymore than pointing out that costs have not risen in lockstep with inflation is an issue at all, much less the issue we are addressing. US inflation is an average. Surely you are aware. Some costs increase, some costs decrease.

Are you trying to say that college tuition in the US if not crazy high?

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[Buster Highmen]

The truly elite schools are pretty close to a free ride unless Mom and Dad are making north of $150k. They also educate something like 0.1 percent of the nation. So, no, that's not relevant. Nor is the cost of attending Hobart or wherever else you go if you're not up to snuff coming out of prep school and you've got rich parents. That might seem like a problem to you. But, like the cost of your country club membership, it is not a national problem. The tuition inflation that's relevant is the out of pocket cost of attending Cal State or Utah Valley University.

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It is relevant since $150k for a family of 4 on either coast isn't living high. And when UWashington in-state tuition is above $30k, that limits affordability and is an integral part of the tuition inflation discussion. The claim that a family making $150k can afford an $80k yearly tuition is completely out of touch with the upper middle class, let alone the middle class.

Nice dig with the country club reference, but we don't belong to any, so there's your relevance.

Lack of affordability for top tier schools for most of the country as well as mediocre schools is all relevant. Tuition inflation across the spectrum is relevant.

[Buster Highmen]

Are you trying to say that college tuition in the US if not crazy high?

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No he's saying its irrelevant for top tier schools where the middle class hoi polloi shouldn't be concerned about.

[Bunion 2020]

How much will Joe Biden's student loan scheme cost?

It's a simple question that should have a clear answer. But now more than a week after his announcement, President Biden and his team don't have one, even when pressed repeatedly.

Of course, there is a clear answer. The latest Penn-Wharton model shows the Biden plan will add more than half a trillion dollars to the deficit. The National Taxpayer's Union Foundation estimates every taxpayer—most of whom never took out a student loan themselves, and many who faithfully repaid their loans—will effectively be charged $2,500. The so-called forgiveness will cost more as a one-time expense than it has cost to fund the school lunch program since 2000—more than two decades!

The Biden team's responses to the simple question were jarring reminders of the administration's economic ignorance and low regard for taxpayers. Education Secretary Miguel Cardona's "answer" was that cancelling billions of dollars in loans would be "offset" when "loan payments restart" next year—in addition to canceling some loans, the administration extended by four months its pause on requiring student loan repayments.

There are a few glaring problems with that answer. First, the student debt holders Cardona mentioned are "paying back" the money they borrowed themselves, which is already on the U.S. balance sheet, not "paying for" someone else's cancelled loan. Second, the added four-month delay in restarting loan repayments will cost at least another $16 billion, on top of more than $100 billion it has already cost to have loan payments and interest suspended since March 2020, the beginning of the coronavirus pandemic. Third, and most importantly in the larger picture, the federal student loan program was a massive money loser before Biden announced both debt "relief" and new payment plans that will significantly reduce how much will be repaid. The remaining loan balances are now that much less likely to be repaid in full. The program, and thus taxpayers, will lose even more money.

Recall that the complete federal takeover of higher education lending was done to help "pay" for Obamacare and other spending. It was budgeted to produce $58 billion in revenue from 2010-2019. Instead, it had cost American taxpayers billions well before Biden's announcement this week. A recent GAO analysis put the figure at a $197 billion loss. An independent audit commissioned by the Department of Education while I was secretary pegged that number at more than $400 billion.

However you add it all up, it's an unprecedented amount of spending, all brought about by executive fiat. Congress did not appropriate a dime. This brazen and unconstitutional "forgiveness" decree will be challenged and will lose in court, but the truth is that it may not matter to Biden. The move was meant to buy votes, not reform lending or solve a problem. In that sense, the cost is but an annoying detail.

Politicians in Washington don't seem concerned about deficits these days. But American families who are paying in the form of inflation and interest rate hikes are certainly noticing the costs.

None of this is to say we shouldn't continue to expand access to educational options for those who need them. There's just a smarter way to do it.

Not coincidentally, the price of higher education started to skyrocket as every institution learned there was an endless supply of taxpayer-backed loans to pay for it, and as the Obama-Biden administration insisted you wouldn't amount to much if you weren't a college man or woman. More money in the system, plus increased demand, equaled a fat pay day for the higher ed cabal.

While I served as secretary of education, we advanced a comprehensive plan to improve the loan market and address runaway college costs.

First, Federal Student Aid, the higher education lending agency, should be extricated from the U.S. Department of Education. While I believe the federal department is ill-equipped to productively manage much of anything, it is particularly ill-equipped to run one of the nation's largest consumer banks. The agency's presence within the department also makes it subject to political whims. Federal Student Aid should be an autonomous government corporation, like the FDIC. It should have an independent board of directors who hold a fiduciary duty to the U.S. taxpayer.

Second, the federal government should not be the sole lender in the market. A robust private market would offer better terms and shared accountability for repayment. Today, higher education loans have absolutely no underwriting. While that is important to ensure access for those with insufficient credit history, it also needlessly punishes those who could access better terms. I envision a "Lending Tree" model, where following completion of the FAFSA, a student and their family see a menu of available lending options, including the federal government. Getting multiple bids tends to yield a better price.

Third, loans should have better terms. Interest should not be capitalized, and it should wane as students faithfully make payments. Borrowers making payments should always see their balance decreasing. The program's aim should be to incentivize and reward repayment, not make it more difficult. For those who truly cannot repay, loans should be dischargeable in bankruptcy proceedings.

Fourth, universities should be accountable for costs and outcomes. In the current system, universities are guaranteed 100 percent payment from the loan funds. Whether the loan is repaid—or not. Whether students actually derive value from their education—or not. The free flow of cash to fund ever-increasing higher education costs—estimated to be rising five times faster than inflation—must be halted. Federal taxpayer loans should only cover legitimate educational expenses, not ever-expanding DEI offices or lavish lazy rivers or fancy dining options. Schools that provide true value should be rewarded.

Last, but certainly not least, non-college pathways to good careers must be expanded. Despite what Biden claims, the pathway to success in America does not run exclusively through a college campus. Many have started companies, built good careers, and achieved the American dream without a four-year degree. The U.S. must further open these pathways by dramatically expanding apprenticeship programs as well as short-term credential and certificate programs. Corporate America should also end the listless H.R. practice of universally requiring a four-year degree on position descriptions without examining whether it is truly necessary.

Student debt is a big issue. But to borrow a phrase, government isn't the solution; it's the problem. From day one, the federal higher education loan program was built on a lie, and it has fleeced the American taxpayer ever since. President Biden's latest move will only make the house of cards that much more likely to collapse.

Betsy DeVos served as the 11th U.S. secretary of education and is the bestselling author of Hostages No More: The Fight for Education Freedom and the Future of the American Child.

[Supermoon]

If you believe DeVos on anything related to education, I’ve got a bridge in Brooklyn to sell you

[Harry]

Funny, Ms. DeVos has all the solutions figured out, and yet she did not advocate for a single one during her 4 years as Education Secretary.


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[summit]

If you believe DeVos on anything related to education, I’ve got a bridge in Brooklyn to sell you

Well! We can agree on something!

[californiagrown]

When i first gradutated college, i spent the first few years living the same as when i was in college in an effort to pay off my loans ASAP. I lived poorly, and put a lot of money towards loans while many of my peers partied hard and spent freely. Now, they are recieving a $10k bailout to pay off their loans and i receive no benefit and lost years of partying. Therefore, i would like the government to pay for $10k of blow, and alcohol for me. Maybe a govt sponsored, no holds barred, bender weekend in Vegas to make it up to the folks who did the responsible thing when young, and missed out on some of the debauchery. I think that is fair.

[schuss]

A lot of college prices have risen also because state aid was cut. In the case of UNH above - less than 10% of funding is provided by the state. Services growth/bloat is actually a moneymaker because of the money foreign/out of state students bring in. Why do you think places like ASU are investing in it instead of education quality?
You really want to make a difference - get real about limiting athletics spending an make college about learning again, as the trustees and boosters want that cachet, not education, and they're the ones with the purse strings.

[rod9301]

A lot of college prices have risen also because state aid was cut. In the case of UNH above - less than 10% of funding is provided by the state. Services growth/bloat is actually a moneymaker because of the money foreign/out of state students bring in. Why do you think places like ASU are investing in it instead of education quality?
You really want to make a difference - get real about limiting athletics spending an make college about learning again, as the trustees and boosters want that cachet, not education, and they're the ones with the purse strings.

Well said

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[MultiVerse]

Services growth/bloat is actually a moneymaker because of the money foreign/out of state students bring in. Why do you think places like ASU are investing in it instead of education quality?

Schools are spending more on amenities for any number of reasons including increasing their rankings, because affluent families demand them, and because highly paid administrators are making the decisions — owing to the flood of student loan debt making it all possible.

A study from The American Council of Trustees and Alumni (ACTA) shows the growth in spending on student services and administration is the biggest contributor to increasing college costs and not legislatures that reduce state appropriations. There's even a natural experiment proving that's the case. The handful of schools making a concerted effort to spend less per student on services and administration have managed to hold the line on tuition increases by keeping them at or below the rate of inflation.

Most colleges and universities are engaging in runaway reckless spending with little to show for it other than endless student debt.

[rod9301]

Schools are spending more on amenities for any number of reasons including increasing their rankings, because affluent families demand them, and because highly paid administrators are making the decisions owing to the flood of student loan debt making it possible.

A study from The American Council of Trustees and Alumni (ACTA) shows the growth in spending on student services and administration is the biggest contributor to increasing college costs and not legislatures that reduce state appropriations. There's even a natural experiment proving that's the case. The handful of schools making a concerted effort to spend less per student on services and administration have managed to hold the line on tuition increases by keeping them at or below the rate of inflation.

Most colleges and universities are engaging in runaway reckless spending with little to show for it other than endless student debt.

True

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[summit]

Schools are spending more on amenities for any number of reasons including increasing their rankings, because affluent families demand them, and because highly paid administrators are making the decisions — owing to the flood of student loan debt making it all possible.

A study from The American Council of Trustees and Alumni (ACTA) shows the growth in spending on student services and administration is the biggest contributor to increasing college costs and not legislatures that reduce state appropriations. There's even a natural experiment proving that's the case. The handful of schools making a concerted effort to spend less per student on services and administration have managed to hold the line on tuition increases by keeping them at or below the rate of inflation.

Most colleges and universities are engaging in runaway reckless spending with little to show for it other than endless student debt.

Bears repeating

[schuss]

Schools are spending more on amenities for any number of reasons including increasing their rankings, because affluent families demand them, and because highly paid administrators are making the decisions — owing to the flood of student loan debt making it all possible.

A study from The American Council of Trustees and Alumni (ACTA) shows the growth in spending on student services and administration is the biggest contributor to increasing college costs and not legislatures that reduce state appropriations. There's even a natural experiment proving that's the case. The handful of schools making a concerted effort to spend less per student on services and administration have managed to hold the line on tuition increases by keeping them at or below the rate of inflation.

Most colleges and universities are engaging in runaway reckless spending with little to show for it other than endless student debt.

So how do we get trustees an others to stop going for flashy things? I see way more admins prioritizing things that give them press releases than cost control measures.

[Core Shot]

Bears repeating

Fucking bears

College would be better without them

[summit]

So how do we get trustees an others to stop going for flashy things? I see way more admins prioritizing things that give them press releases than cost control measures.

Right trustees they only need to worry about, after academic basics, what offerings feel attractive to students (student life experience, sports, clubs, luxuries) to get more applicants who will get loans funded no matter what the college charges.

Dischargeable student loans and/or regulatory standards for school performance =
Banks now care about education value propositions for a school when considering loan sizes and rates =
Academic and student success vs tuition cost is a key metric =
Now trustees need to focus on cost controls and boosting academics + student success to make it so that 1. Banks are willing to loan to their students 2. Students can get loans that will allow them to cover the school costs

[californiagrown]

So how do we get trustees an others to stop going for flashy things? I see way more admins prioritizing things that give them press releases than cost control measures.

Admins prioritize getting money for their schools. Kids prioritize the "college experience", which basically means an all inclusive resort experience. I mean, there are very few kids who will pick a shitty commuter school for cheap, over a big fun university with sports, and incredible food and buildings and a true "college experience". It really comes down to attracting kids and their (parents/governments) money. College stopped being about academics and preparing for a career a few decades ago. Now its just a hazy party purgatory of sorts between childhood and adulthood that is accessible to everyone, and actually beneficial to relatively few.

Expecting 18 year olds to voluntarily choose less fun now, for smaller loan payments 50% of their lifetime from now is moronic. And the colleges know that. And they profit/grow off that.

[Jong Lafitte]

Fucking bears

College would be better without them

Some rich brown gets in just cuz his mommy donated a bunch of money and now we all have to use bear cans in the dorms. Put his book bag up in the quad with a PCT hang, not looking so hot now, eh grizz? Not to mention, unicycle theft goes up. What's the world coming to?

[Supermoon]

Admins prioritize getting money for their schools. Kids prioritize the "college experience", which basically means an all inclusive resort experience. I mean, there are very few kids who will pick a shitty commuter school for cheap, over a big fun university with sports, and incredible food and buildings and a true "college experience". It really comes down to attracting kids and their (parents/governments) money. College stopped being about academics and preparing for a career a few decades ago. Now its just a hazy party purgatory of sorts between childhood and adulthood that is accessible to everyone, and actually beneficial to relatively few.

Expecting 18 year olds to voluntarily choose less fun now, for smaller loan payments 50% of their lifetime from now is moronic. And the colleges know that. And they profit/grow off that.

You’re making a lot of assumptions about what college is like these days, and who’s going, and I just don’t know if there’s any data to back that up.

https://nirsa.net/nirsa/2022/06/29/r...llment-trends/

This article breaks down a lot of what’s going on and shows a focus on mental health for students because a large percentage of dropouts do so because of stress, anxiety, and other mental health problems. So all the “amenities” people complain about are healthcare services, mentor programs, advisors, etc. campus rec is a way for students to meet people, make connections and build relationships. That matter as much as job training for future life skills and wellbeing.

Enrollment is declining overall, but it’s hitting men, especially underrepresented populations, hardest, and in-state schools the most. The rich, white Ivy Leaguers are still going to their fancy resort schools.

There are basically no “cheap, fun, party schools” anymore for anyone. Let alone people who need in-state assistance

[MultiVerse]

FWIW, the American Council of Trustees and Alumni study referenced on the previous page shows "Spending on student services had no correlation with graduation rates at public institutions, despite the fact that it is growing considerably faster than spending on instruction."

[Supermoon]

Funny, but maybe not surprising that the donors and the administrators have differing views on where their money should go

[MultiVerse]

Or for that matter NIRSA the leading advocate for the advancement of campus 'wellbeing.'