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Why College Is So Expensive In America - YouTube
"College in the United States is expensive. The cost of higher education just keeps going up. Tuition costs at both public and private universities have doubled since the late 80s, while accounting for inflation.

"I think that it's so ingrained in your head that you have to go to college, that college is the next step after graduation," said Jarret Freeman, a college graduate with roughly $50,000 in student debt. "I think in hindsight, I see that college is not for everyone."

But a college education is becoming more and more necessary to succeed in today's economy. Georgetown University estimates that by 2020, 65 percent of all jobs will require more than a high school degree.

Students graduate with an average of $37,172 in student loan debt. It all adds up to $1.5 trillion across the country.

Watch the video above to learn how higher education became big business, hear from former students facing mounting debt and explore why it's so important to solve the student debt crisis."
colleges  universities  tuition  studentloans  studentdebt  money  2019  education  highered  highereducation  rankings  usnewsandworldreport  wealth  inequality  tests  testing  meritocracy  data  sat  standardizedtesting  funding 
7 weeks ago by robertogreco
Opinion | The Misguided Priorities of Our Educational System - The New York Times
"Consider two high school seniors — one who exhibits strong academic talent and one who does not. For one, December marks the homestretch of a yearslong effort, intensively supported by his school, to prepare the perfect college application. For the other, December is just another month on the path to, well, whatever might come after graduation. The former will likely proceed steadily toward a bachelor’s degree; the latter is unlikely to finish college if he enrolls at all. To whom does our education system owe what?

That second student, to be clear, has done nothing wrong. He probably clawed his way through his town’s standard college-oriented curriculum, though it neither targeted his interests and abilities nor prepared him for work force success. Looking ahead, he faces a labor market in which he may need to work harder than his college-bound counterpart for lower pay, with fewer options and slower advancement. Yet we celebrate the first student and lavish taxpayer funds on his education. To the second student, we offer little beyond a sympathetic “Sorry.” Our education system has become one of our nation’s most regressive institutions.

After high school graduation, the first student can access more than $10,000 annually in public funds to support his college experience. Federal funding for higher education has grown by 133 percent in the past 30 years; combined with tax breaks, loan subsidies and state-level funding, the annual total exceeds $150 billion. That funding will cover not only genuine instructional costs, but also state-of-the-art gyms, psychiatric and career counseling services, and whatever social programming the student-life bureaucracy can conceive. At Ohio State, students living off campus get free fire alarms.

The second graduate likely gets nothing. Annual federal funding for a non-college, vocational pathway, at both the high school and postsecondary levels, totals $1 billion. Certainly, he will need to buy his own fire alarm.

One explanation for this bizarre state of affairs, in which society invests heavily in those headed for economic success while ignoring those falling behind, is the widespread belief that everyone can be a college graduate. If that were true, the shove toward the college pipeline might make sense.

But most young Americans do not achieve even a community-college degree. Federal data show that fewer than one in five students smoothly navigate the high school to college to career pathway. More students fail to complete high school on time, more fail to move on from high school to college, and more drop out of college. Forty years of reform, accompanied by a doubling of per pupil spending, has failed to improve this picture. Standardized test scores haven’t budged. SAT scores have declined. More students enroll in college, but the share of 25-year-olds with a bachelor’s degree did not increase from 1995 to 2015, and it stands barely above the 1975 level.

A second explanation is the widespread belief that a college diploma is a necessary and sufficient “ticket to the middle class.” If that were true, even a small chance at escaping the supposedly sad fate of inadequate education is better than ever admitting defeat.

But while the median college graduate earns more than the median high school graduate, those workers are not the same person — indeed, they are likely people with very different academic prospects. Look instead at the wage distributions for more comparable samples: those with earnings toward the high end for workers with only high school degrees and those at the low end among college graduates. The federal Bureau of Labor Statistics reports that high school grads with above-average earnings (50th to 90th percentile) earn $34,000 to $70,000 annually. College grads with below-average earnings (10th to 50th percentile) earn $28,000 to $58,000.

Pushing people from the former category to attend college and land in the latter category does them few favors. And remember, that assumes they graduate; people in their position typically will not. Remember also, those are the outcomes before we attempt to create an attractive non-college pathway that they might prefer and that might equip them for success.

What might such a pathway look like? For the roughly $100,000 that the public spends to carry many students through high school and college today, we could offer instead two years of traditional high school, a third year that splits time between a sophisticated vocational program and a subsidized internship, two more years split between subsidized work and employer-sponsored training, and a savings account with $25,000, perhaps for future training. Any American could have, at age 20, three years of work experience, an industry credential and earnings in the bank.

To reverse the system’s regressive nature, we should shift our college subsidies toward funding this new pathway. The burden of financing a college education remains manageable for those who actually graduate and use their degrees. They will still be the economy’s winners, even while paying off loans. That some young Americans assume unaffordable debts is not an argument for yet more spending on college, but rather a reminder that its value proposition can prove to be a poor one.

For student borrowers unlikely to graduate, the current subsidies succeed mainly in luring them toward a substantial investment of time and money that is both high-risk and low-return. If a good alternative existed, they would be well served to take it. Certainly, the choice should remain theirs. But to decide wisely whether college is worth the cost, they need to actually face the cost.

People often applaud vocational education in theory, provided it is “for someone else’s kids.” Those kids are most kids, and a false promise of college success does more harm than good. We owe them our focus and the best pathway that we can construct — one that carries them as close as possible to the destination their college-bound peers will reach, and sometimes beyond."
orencass  education  vocational  colleges  collegprep  universities  schooliness  academia  inequality  advising  youth  children  economics  training  income  highered  highereducation  risk  careers  unschooling  deschooling  studentloans  society 
december 2018 by robertogreco
Here's Fresh Evidence Student Loans Are a Massive, Generational Scam - VICE
"Over the centuries, America has bestowed generous, state-sponsored privileges upon select classes of its citizens. Veterans and old people get free socialized healthcare—and, for the most part, they love it. Corporations (who count as people, look it up) get sweet tax breaks and, in the case of defense contractors, no-bid deals to build extremely expensive weapons unlikely to be used in the near future. And young people get thousands and thousands of dollars of student loans to pay for college, putting them in a hole they might spend the rest of their lives digging out of.

Obviously, one of these things is not like the others—the United States has put many students in the position of making decisions that can determine their financial futures when they're teenagers. This has nightmarish consequences: Some 44 million people have $1.5 trillion in student loan debt on the books. And even when young people do get through college and find a decent job, many can't fathom possibly buying a home or taking on other trappings of adulthood when faced with decades of monthly loan bills.

The worst part is that those who sought an elite education on the widely accepted notion that it would help them later in life were basically sold a bad bill of goods.

All that debt provides awfully little payoff in terms of boosted wages, even as it ensnares more and more people and hits youth of color especially hard, according to a new paper released Tuesday by two researchers at the left-leaning Roosevelt Institute. Research fellows Julie Margetta Morgan and Marshall Steinbaum concluded that more and more debt hasn't significantly boosted income for college grads—it just seems that way because high school grads without BAs are making less than they once did. They also found that looking at decent rates of repayment by student debtors is a misleading way to look at the scale of this crisis. And thanks to workers lacking the power they once enjoyed in an increasingly skill-obsessed economy, young people are often being pressured into getting extra degrees on their own dime (which is to say by taking on more debt) for minimal payoff.

For some perspective on how America let student loans get so out of control, why taking on debt is so often a mistake, and what we can do about it, I called co-author Julie Margetta Morgan for a chat.

VICE: Why do you think this has been allowed to get so bad, to the point not only that it's widely known as a crisis, but one that gets worse and worse?

[A] Julie Margetta Morgan: We have seen the overall amount of student debt grow and we've seen some of the industries around repayment get worse over time, although default rates recently got a little bit better. But I think that the reason why it's sort of been allowed to exist as this quiet crisis is that there's not a lot of agreement among experts that, on the whole, student debt is getting worse. I think that's because experts primarily look at measures around successful repayment of the loan as the target. And in this paper we try to take a slightly different look. First of all we interrogate those questions around repayments themselves—so we have a section around, like, experts have said that student debt is not a bigger burden now than it was a generation ago. And yet if you delve into the figures a little bit deeper you can see that, in fact, it is worse—the burden is worse but the repayment plans are slightly better, which masks the burden on students.

So part of what we're trying to do here is combat some of the common wisdom in the higher education policy world—what we tend to hear is: Yeah, students are taking on a lot of debt but ultimately that debt is worth it because their degrees are paying off in the long run. And we're finding that that's not necessarily true.

[Q] Is the most radical conclusion you reached here that the increased debt burden people are bearing is not paying off in terms of boosted income? Or is that already well known?

[A] That higher education is not paying off in terms of overall changes in the distribution of income is definitely apparent to labor economists but not necessarily apparent to higher education policy experts and those who advocate on behalf of students, because we are so often fed the college earnings premium as the single measure of whether college pays off over time. Yes of course college still pays off, but it pays off because it's becoming less and less viable for someone to make a living with just a high-school diploma. It's no longer this thing of, I'd like to earn a higher income, I guess I'll go to college. It's like, I have to go to college in order to not end up in poverty—and I'm also forced to take on debt to get there.

[Q] Is there any evidence that, thanks to income growth in the last year or two, college debt is paying off more than it did?

[A] It remains to be seen, but I'm not sure that it's a good idea for us to tie higher education policy—how we fund college—to the swings of the labor market. Our focus should be on taking the risk off of the individual and spreading it across the public, because the public is getting a lot of the benefit of college degrees.

[Q] Have you seen any indicators that people—including the communities hit hardest by college debt—might actively be avoiding college because of the specter of endless debt?

[A] We have lower levels of college attainment already among African American and Latino populations and we do see polls that suggest people are more and more skeptical of the value of college. And that's exactly the result we don't want to see. We don't want to see the people already discriminated against in the labor market avoiding going to college.

The other trend that comes to mind is this trend of programs that we would have previously considered trade programs, whether they're now being offered at for-profit colleges or as industry credentials that are trying to become part of the mainstream higher education system and get access to the loans. So there's a world in which people are trying to avoid getting the loans but the loans are actually following them to these trade programs.

[Q] But given that discrimination, is it not rational to—in some cases—calculate against attending college given the massive debt burden and how it hits some communities extra hard?

[A] I think it's absolutely at an individual level a rational decision that we're seeing people make. And at a national level we ought to be concerned about that and looking to change policies so people don't have to make that decision.

[Q] I know one of your aims here was to reinforce that this is a worse crisis than people think, but isn't the problem that Republicans just don't care?

[A] There's obviously a group of policymakers who don't want to deal with it. But I think there's another subset of policymakers who are looking at the student debt crisis through the lens of repayment—that the goal is to ensure that people can repay their loans. Keeping people out of default shouldn't be the biggest goal we set for ourselves.

If student debt is a crisis, is the answer that we should have less student debt? Or just that people are able to make their monthly payments? Our answer is that we should have less debt overall.

[Q] Part of your paper is about how workers keep getting pressured to gain new degrees and credentials that load them up with debt—all because they have no power. Is this about unions disappearing, or what would help there?

[A] Certainly the declining power of unions is one part of it. The lack of say for average workers in the decision-making at the companies they work for, the increase in corporate concentration within the economy—the rise of monopoly power makes it harder for workers to have a say, because there are fewer employers. And back during the recession, the scarcity of jobs made it harder for employees to have power and negotiate for themselves.

[Q] It's hard not to read the paper and feel like taking on student loans is maybe (very often) a mistake or even that the larger system is a scam. Even when students are not being preyed upon by for-profit schools or predatory lenders, the whole seems flimsy or even fraudulent. Is that unreasonable?

[A] I don't think it's unreasonable. I think of it as a failed social experiment that young people are caught in the middle of. It wasn't intentionally sold like a scam, but the way young people experience this is they were told: You go to college, you study, don't worry so much about how much it costs, it's going to be worth it in the end. And they get out on the other side, they have a ton of debt, they are working as hard as they can, but they're not getting ahead—they're treading water. They're making payments on their debt, but not able to buy a house, they're not able to save for retirement. You were sold on a promise, you come out on the other hand that that promise was false, and everybody looks at you like, What's wrong?

One of the things I thought was so exciting about writing this paper is it puts data to that deep frustration that we see in younger generations right now.

[Q] It doesn't seem likely that we'll see a major overhaul of the system in DC right now, with unified Republican control. But what can and should be done, the next time Democrats have control of the government, or in the meantime?

[A] There are things we can do right now. it's encouraging to see what's happening in the courts—some great student advocates and lawyers have taken action to make sure the [Education Secretary Betsy] DeVos administration at least enforces rules on the books to help get student loan cancellation for a smaller group of borrowers and limit predatory practices at for-profit schools.

As we look to the future, we have to think a lot bigger. We should be looking at both free and debt-free options for college. Free college at public universities and more debt-free options for students. That's how we take care of generations… [more]
studentloans  health  healthcare  inequality  2018  economics  socialsafetynet  society  us  education  highered  highereducation  colleges  universities  juliemargettamorgan  marshallsteinbaum  debt  income  policy  politics  labor  markets  capitalism  work  unions 
october 2018 by robertogreco
John Green's tumblr • Fascinating chart from The Economist (not famed...
"Fascinating chart from The Economist (not famed for its liberal bias) showing how already-rich universities are receiving the most gifts from donors.

In the accompanying article, they write, “Philanthropy may be tilting America’s higher education system even further in favour of the rich.” 

I don’t think there’s any maybe about it. 

Harvard is (obviously) a great school. And because Harvard has an endowment of $32 billion, they can afford to give out a lot of scholarship aid; in fact, over 70% of their students receive aid; the amount is calculated based on family income and assets.

But at least according to Harvard’s financial aid calculator, you have to be ungodly rich not to be in that >70% of kids who receive scholarships. Like, if your parents make $150,000 a year, you personally have a $100,000 trust fund, and your parents have $1,000,000 of assets (not including their home), you get a scholarship.

The ~28% of Harvard students who don’t get merit scholarships are RICHER than that. Basically, over a quarter of Harvard student are in the top 5% of Americans when it comes to income and wealth. 

Meanwhile, as seen in the chart above, less-rich schools attract less donation money, which leads to smaller endowments and fewer scholarship dollars, which means more students have to take out loans, which only increases the U.S.’s already untenable economic inequality."
universities  highered  highereducation  endowments  2015  inequality  wealth  donations  harvard  riceuniversity  financialaid  loands  studentloans  debt  philanthropy  charitableindustrialcomplex  stanford  yale  princeton  sartmouth  duke  johnshopkins  philanthropicindustrialcomplex  capitalism  power  control 
june 2015 by robertogreco
Colleges Are Raising Costs Because They Can | Al Jazeera America
"Why does college cost so much? Commentators continue to look for clues. So far, two main schools of thought have emerged. According to the first, fees have increased to make up for declines in government appropriations for higher education. According to the second, bloated administrations are wasting the money on frivolous extras unrelated to the core instructional mission.

Though the two views aren’t mutually exclusive and both are supported by evidence, there remains an ideological divide between them. People who believe educating citizens is the government’s job, no matter the cost (generally those on the political left), tend to believe the first, while people who would rather shrink government (generally those on the right) are more inclined to the waste hypothesis. As a result, explaining college-cost increases becomes a kind of proxy fight in which neither side accepts the other’s good faith and both are usually proved right.

In an op-ed for The New York Times, law professor Paul F. Campos widened the gap. While its title, “The real reason college tuition costs so much,” oversells the case a bit, its main point is sound: Government funding for higher education has gone up a lot. Even if funding per student is down a little bit as more kids pursue degrees, calling it a massive defunding is disingenuous. However, because Campos didn’t focus much on the subsidy per student, it opened him to attack from his opponents. And attack they did, in Slate, Crooked Timber, Inside Higher Ed and elsewhere. Still, Campos is right that the defunding explanation is weak, even in light of increased enrollment.

In 20 of the past 31 years, both per student funding and tuition have increased at public two- and four-year institutions. Tuition increased in every year except 2000, even in years when there were sizable increases in state outlays. The three periods when state support fell all followed recessions, when state legislators were dealing with reduced tax revenue and a glut of new students who were frustrated out of job market and into the classroom. This results in a clear correlation between decreased funding per student and ever-escalating tuition in the early 1990s, early 2000s and since 2008 — but taken together, they account for only a third of those 31 years. That fails to explain the decades-long pattern of consistent tuition hikes. More important, the data give us no reason to believe that if government support had only increased, colleges wouldn’t have raised tuition anyway.

One problem with the college-cost debate is that most commentators look at only two sources of revenue: state appropriations and tuition. But as any administrator will tell you, these are the least interesting parts of a school’s budget. From a college president’s perspective, there’s only so much schools can do to influence the legislature, and the potential for tuition hikes is constrained by their competitors, if nothing else. Other sources, however, such as grants, gifts, discretionary appropriations and investment income, aren’t subject to the same limitations. Administrators who want to set themselves apart from their peers (and in this market, who can afford not to?) focus their energy where they can make the biggest and most noticeable difference."



"When it comes to chasing the big bucks, tuition and state appropriations aren’t created equal. Whereas state appropriations have a pile of strings attached, fees are universities’ to do with what they will. They’re free to use it to finance capital projects like the Cooper Union building or investments in labor automation or eye-catching amenities or grant-friendly research facilities or debt service or hedge fund fees or administrators’ salaries. Given a choice between a dollar from the state and a dollar from students, any smart college president would rather have the latter. Fee income allows, for example, the University of California system to go to Wall Street and get bonds for giant construction projects, pledging tuition hikes to cover the debt.

Declines in per student appropriations at the very least give administrators good cover to increase tuition, even if the two variables aren’t quite causally tied. And high salaries for administrators appear to be the consequence of changes to higher education’s incentive structures as much as a cause: The competition for ever more funds launches competition for ever larger fundraisers. At the end of the day, college tuition is going up for the simplest of reasons: Demand is inelastic, and it’s exceeding the supply. Despite the price increases, enrollment has kept rising. As long as the Treasury is willing to write larger and larger student loan checks and as long as high school grads see no other option besides college to advance their career prospects, tuition will keep going up. If we’re not willing to change our higher education system from the foundation, arguing over the proximate causes of the cost crisis won’t do anyone any good."

[via “the university as a machine that turns student loans into real estate”
http://nathanjurgenson.com/post/115941651935/college-tuition-is-going-up-for-the-simplest-of ]
universities  colleges  tuition  2015  highered  highereducation  economics  markets  malcolmharris  cooperunion  loans  studentloans  policy  government  paulcampos  funding 
april 2015 by robertogreco
The College-Loan Scandal: Matt Taibbi on the Ripping Off of Young America | Politics News | Rolling Stone
"How is this happening? It's complicated. But throw off the mystery and what you'll uncover is a shameful and oppressive outrage that for years now has been systematically perpetrated against a generation of young adults. For this story, I interviewed people who developed crippling mental and physical conditions, who considered suicide, who had to give up hope of having children, who were forced to leave the country, or who even entered a life of crime because of their student debts.

They all take responsibility for their own mistakes. They know they didn't arrive at gorgeous campuses for four golden years of boozing, balling and bong hits by way of anybody's cattle car. But they're angry, too, and they should be. Because the underlying cause of all that later-life distress and heartache – the reason they carry such crushing, life-alteringly huge college debt – is that our university-tuition system really is exploitative and unfair, designed primarily to benefit two major actors.

First in line are the colleges and universities, and the contractors who build their extravagant athletic complexes, hotel-like dormitories and God knows what other campus embellishments. For these little regional economic empires, the federal student-loan system is essentially a massive and ongoing government subsidy, once funded mostly by emotionally vulnerable parents, but now increasingly paid for in the form of federally backed loans to a political constituency – low- and middle-income students – that has virtually no lobby in Washington.

Next up is the government itself. While it's not commonly discussed on the Hill, the government actually stands to make an enormous profit on the president's new federal student-loan system, an estimated $184 billion over 10 years, a boondoggle paid for by hyperinflated tuition costs and fueled by a government-sponsored predatory-lending program that makes even the most ruthless private credit-card company seem like a "Save the Panda" charity. Why is this happening? The answer lies in a sociopathic marriage of private-sector greed and government force that will make you shake your head in wonder at the way modern America sucks blood out of its young."



"We're doing the worst thing people can do: lying to our young. Nobody, not even this president, who was swept to victory in large part by the raw enthusiasm of college kids, has the stones to tell the truth: that a lot of them will end up being pawns in a predatory con game designed to extract the equivalent of home-mortgage commitment from 17-year-olds dreaming of impossible careers as nautical archaeologists or orchestra conductors. One former law student I contacted for this story had a nervous breakdown while struggling to pay off six-figure debt. It wasn't until he tapped into one of the few growth industries open to young Americans that his outlook brightened. "I got my life back on track by working for a marijuana delivery service in Manhattan," he says. "I've had to compromise who I am . . . because I started down a path that I couldn't turn away from. Student loans aren't hope. They're despair.""
matttiabbi  education  studentloans  studentdebt  debtslavery  depression  economics  finance  highereducation  highered  colleges  universities  2013 
august 2013 by robertogreco
StickWithANose » Student Loan Scam
Graphic describing the problem and its history, with suggestions about how not to fall into the trap at the end
studentloans  money  finance  government  policy  education  salliemae  debt  debtslavery  history  law  legal 
september 2010 by robertogreco
Student Loans are the New Indentured Servitude - The Atlantic Business Channel
“College student-loan debt has revived the spirit of indenture for a sizable proportion of contemporary Americans...not a minor threshold that young people entering adult society & work, or those returning to college seeking enhanced credentials, might pass through easily...major constraint that looms over the lives of those so contracted, binding individuals for a significant part of their future work lives. Although it has more varied application, less direct effects, & less severe conditions than colonial indenture did...& it does not bind one to a particular job, student debt permeates everyday experience w/ concern over the monthly chit & encumbers job & life choices. It also takes a page from indenture in extensive brokerage system it has bred, from which more than 4000 banks take profit. At core, student debt is a labor issue, as colonial indenture was, subsisting off the desire of those less privileged to gain better opportunities & enforcing a control on their future labor.”
education  economics  slavery  studentloans  academia  capitalism  debt  credit  finance  colleges  universities 
october 2009 by robertogreco

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