Student Debt Now Outweighs Credit Card Debt (1 Viewer)

[cpwill]

Hooray for Government Intervention driving up prices while enabling debt as a solution!

:mrgreen: huked On natyonilizashun wurked for us!

Student debt just surpassed the country’s credit-card debt for the first time. It is projected to top $1 trillion this year, according to the New York Times, when it was less than $200 billion in 2000. For the class of 2011, the mean student-debt burden is nearly $23,000, up 8 percent from a year ago...

What are students going into hock for? In their book Academically Adrift, Richard Arum and Josipa Roksa sift through data that only Bluto could relish.

They cite the work of labor economists Philip Babcock and Mindy Marks showing that in the early 1960s, college students spent 40 hours per week on academic work; now they spend only 27 hours per week. In 1961, 67 percent of students said they studied more than 20 hours per week; now only one in five study that much....

Full-time instructional faculty dropped from 78 percent in 1970 to 52 percent in 2005. “On average,” Arum and Roksa write, “faculty spend approximately 11 hours per week on advisement and instructional preparation and delivery.” The rest is devoted to research and sundry other professional and administrative tasks.

The hiring binge on campus has been devoted to what sociologist Gary Rhoades calls “managerial professionals” specializing in sundry student services...

If increasingly students don’t study, teachers don’t teach, and college employees aren’t primarily concerned with either, it raises the question of what the hell happens on campus. Well, many students have a grand time during a years-long vacation from real life. They enjoy state-of-the-art facilities, socialize, and figure how to come away with the credential of a degree in exchange for minimal effort. (That is, if they graduate at all — four-year institutions only graduate about a third of their students in four years, and two-thirds of them in six.)

This is not a formula for drinking deeply from the fountain of learning. Arum and Roksa find only minimal gains in critical thinking, complex reasoning, and writing for many students. Forty-five percent of students barely ticked upward after two years, and 36 percent hadn’t budged after four years...

well, at least we're getting something for our money. embarrassing facebook photos.

 

[tessaesque]

I'm only taking 6-9 hours a semester and I spend well over 30 hours a week studying. I guess that's the benefit of not having a "free" or "payment deferred" ride to college.

 

[digsbe]

It's not the government's fault that universities are expensive. I can only go to school because I have federal loans, state aid, a Pell Grant, and an academic scholarship.

 

[tessaesque]

It's not the government's fault that universities are expensive. I can only go to school because I have federal loans, state aid, a Pell Grant, and an academic scholarship.

No? Rick Perry removed a long standing law in our state that had capped tuition rates at state universities. We saw a 20% increase in student fees in the first year, with no changes in services.

 

[digsbe]

No? Rick Perry removed a long standing law in our state that had capped tuition rates at state universities. We saw a 20% increase in student fees in the first year, with no changes in services.

My point was that the government doesn't make them expensive, the universities do. I would support government caps and the like. I do find the report disturbing regarding college study time. I study frequently, roughly 5 hours per day when I can. However, I also work a job. Between being in class for 30 hours, studying on top of that, and working a job 15-20 hours per week that is a 55+ hour workweek minus time studying outside of class. I would like to know if their statistics counted how many students had jobs or if working college students has gone up percentage wise. From my observations, a person's area of study and their financial status affects the amount of study time that they have.

 

[tessaesque]

My point was that the government doesn't make them expensive, the universities do. I would support government caps and the like. I do find the report disturbing regarding college study time. I study frequently, roughly 5 hours per day when I can. However, I also work a job. Between being in class for 30 hours, studying on top of that, and working a job 15-20 hours per week that is a 55+ hour workweek minus time studying outside of class. I would like to know if their statistics counted how many students had jobs or if working college students has gone up percentage wise. From my observations, a person's area of study and their financial status affects the amount of study time that they have.

I work full time. I do school work from 5:30 until usually 10:30 4 nights a week, and then most of the day Sunday as well (sometimes also Saturdays).

 

[Harry Guerrilla]

It's not the government's fault that universities are expensive. I can only go to school because I have federal loans, state aid, a Pell Grant, and an academic scholarship.

Government subsidy has made it easier for non serious students to attend.
Taking up seats and creating an artificial demand, that wouldn't be there otherwise.

The student turnover rate in many schools is high, meaning that the demand created is not entirely useful as the people do not complete the schooling.

It's pleasant and well meaning ideas, gone wrong.

 

[WI Crippler]

Government subsidy has made it easier for non serious students to attend.
Taking up seats and creating an artificial demand, that wouldn't be there otherwise.

The student turnover rate in many schools is high, meaning that the demand created is not entirely useful as the people do not complete the schooling.

It's pleasant and well meaning ideas, gone wrong.

Or people get undergraduate degrees in non-useful disciplines like sociology or philosophy, which may be interesting subjects, but have very little job demand outside of teaching said discipline. Then they get jobs that aren't in their field of study, and then they are thusly referred to as "under employed".

 

[UtahBill]

It's not the government's fault that universities are expensive. I can only go to school because I have federal loans, state aid, a Pell Grant, and an academic scholarship.

Dammit, all I had was the GI Bill....and my employer subsidized me as well.

 

[UtahBill]

Or people get undergraduate degrees in non-useful disciplines like sociology or philosophy, which may be interesting subjects, but have very little job demand outside of teaching said discipline. Then they get jobs that aren't in their field of study, and then they are thusly referred to as "under employed".

The worst part is, they think they are smart for having a lot of useless knowledge.
If they were smart, they would be employed. (present recession causes excluded)

Many of those with useless majors will end up joining the useless political party....:roll:

 

[Slartibartfast]

The private colleges in my area are about 3-5x more expensive than state schools. Without the lower prices of those state schools, debt would be much worse.

Either that or more of us would stop at highschool and with the number of highly educated people coming out of emerging countries these days, we would be royally screwed and unable to effectively compete.

 

[Simon W. Moon]

Well to be fair the rough economy means that more people had less support from their parents and they also had a tougher job market. Both of those things would cause someone to have to borrow more money.
The ****ed up economy we've had for the past decade has had many effects across a wide range of aspects of life.

 

[Slartibartfast]

Here's an interesting fact and it might mean that the issue raised in the OP is actually a good thing.

Credit Card Companies See Drop In Defaults And Late Payments

To help avoid late payments, consumers are setting up automatic payments more frequently. Americans are spending wisely and are more likely to buy within their means. As a result, cardholders are carrying less debt. The total revolving debt held by U.S. consumers was $785.04 billion in March compared to a peak of $973.63 billion in August 2008. Credit card companies are smarter as well. Cardholders that defaulted are no longer unable to get credit cards, eliminating the problem before it starts.

Average credit card debt seems to be going down, making other debts grow in % of total (that and mortgage debt going down due to the housing crisis). My greater hope (but it will be a while before I will agree whether it is confirmed or dashed, as I want to see if this behavior is long term or just a fad) is that our culture is changing and people are looking at debt differently.

 

[Harry Guerrilla]

The private colleges in my area are about 3-5x more expensive than state schools. Without the lower prices of those state schools, debt would be much worse.

Either that or more of us would stop at highschool and with the number of highly educated people coming out of emerging countries these days, we would be royally screwed and unable to effectively compete.

Not trying to nit pick but it must be done.

Those private universities sell "premium" and "prestige" education, there isn't a lot of room to compete in the non premium and prestige markets because of the crowding out effect of state schools.

We shouldn't assume that if not for them, no affordable schools would exist.

 

[Slartibartfast]

Not trying to nit pick but it must be done.

Those private universities sell "premium" and "prestige" education, there isn't a lot of room to compete in the non premium and prestige markets because of the crowding out effect of state schools.

We shouldn't assume that if not for them, no affordable schools would exist.

Places like DeVry and Phoenix university not considered a premium education by anyone and are widely understood to be barely adequate diploma mills, yet are much more expensive than state schools.

I just looked it up, an online degree from DeVry is about 8.1k/semester while a state school is around 3k/semester. (online or not)

 

[Harry Guerrilla]

Places like DeVry and Phoenix university not considered a premium education by anyone and are widely understood to be barely adequate diploma mills, yet are much more expensive than state schools.

I just looked it up, an online degree from DeVry is about 8.1k/semester while a state school is around 3k/semester. (online or not)

DeVry is accredited so to call it a diploma mill wouldn't be fair.
The problem arises from the fact that many for profit schools have a hard time getting accredited in the first place.
Though that is moving into the past now.

Of course state schools are cheaper when they're subsidized, that's why it can hugely difficult for a private entity to exist.

 

[Slartibartfast]

DeVry is accredited so to call it a diploma mill wouldn't be fair.

It may not be fair, but DeVry has huge issues with its students defaulting on loans and sticking the government with the bill. So much so, that DeVry has been warned to find a way to lessen the problem or lose the right to their students receiving those loans. So they may be accredited, but they are hardly quality.

The problem arises from the fact that many for profit schools have a hard time getting accredited in the first place.
Though that is moving into the past now.

I have no problem with accreditation, I want a reasonable assurance that my education dollar means something for my future, or else why invest in myself? However with that assurance, I will (and have) invested in myself, now I make more money for my own well being, I pay more taxes which helps society, and I work for a company and provide value to them as a worker and thus help the economy.

Of course state schools are cheaper when they're subsidized, that's why it can hugely difficult for a private entity to exist.

Which is precisely my point. We would be even worse off if we had to pay more.

 

[Harry Guerrilla]

It may not be fair, but DeVry has huge issues with its students defaulting on loans and sticking the government with the bill. So much so, that DeVry has been warned to find a way to lessen the problem or lose the right to their students receiving those loans. So they may be accredited, but they are hardly quality.

Their default rate looks to be well within the limits, but even then it's more realistic of an actual default rate when the price reflects some more comparable to what the market would charge.

I have no problem with accreditation, I want a reasonable assurance that my education dollar means something for my future, or else why invest in myself?

Of course but accreditation is the main issue here.
If the school is accredited then it is carrying the weight of validity.

Problems arise from the fact that for profit schools have to go through a national accreditation agency and that the regionals don't accept their credits for transfer as policy.

If the department of education accepts all forms of the accreditation as valid, then the regionals are just discriminating for anti competitive reasons.

Which is precisely my point. We would be even worse off if we had to pay more.

How do you know that would be the case though?
I hate that things like this are always assumed.

It pretends that nothing else changes except for profits charge higher fees for admittance.

 

[Slartibartfast]

Their default rate looks to be well within the limits, but even then it's more realistic of an actual default rate when the price reflects some more comparable to what the market would charge.

For-profit schools default rates higher--US Ed Dept | Reuters

I may have been wrong about DeVry specifically, not sure, but it is a huge problem for the industry.

Of course but accreditation is the main issue here.
If the school is accredited then it is carrying the weight of validity.

Problems arise from the fact that for profit schools have to go through a national accreditation agency and that the regionals don't accept their credits for transfer as policy.

If the department of education accepts all forms of the accreditation as valid, then the regionals are just discriminating for anti competitive reasons.

I went to a private college and my wife did for a couple of semesters as well (she dropped out when she got pregnant with our first son). In both cases, we transferred credits in from a public school and that private school accepted less than 50% of them because their classes vs the public school's classes were different enough in content as to be invalid (and I went through the syllibi myself and they were different). My wife had the same issue when she transferred her private college credits back to a public school.

Given that experience, I don't know if it is descrimination or if its just differences in the individual degree programs. Right now I lean towards the latter. Especially given that in this state, degree programs and undergraduate classes tend to be standardized between universities.

How do you know that would be the case though?
I hate that things like this are always assumed.

It pretends that nothing else changes except for profits charge higher fees for admittance.

Two things. When a public service is privatized, costs tend to go up for their clientelle. We have seen this happen over and over, especially in things like roadwork and utilities.

Also, DeVry (or Phoenix, Strayer, etc else if you prefer) is already higher, why would these sorts of schools lower their costs if they have less competition?

 

[Harry Guerrilla]

For-profit schools default rates higher--US Ed Dept | Reuters

I may have been wrong about DeVry specifically, not sure, but it is a huge problem for the industry.

Yes I agree that is an issue, but is it more reflective of the realistic costs of providing college education, without state subsidy?

Not trying to throw your words at you, but this is one of those, "it's not always black and white" situations.
(I want a meaningful discussion, so I'm seriously not trying to be a dick.)
We don't have any meaningful private school statistics to compare it to.
I guess the best we can do is compare it to other subprime loan averages.

I went to a private college and my wife did for a couple of semesters as well (she dropped out when she got pregnant with our first son). In both cases, we transferred credits in from a public school and that private school accepted less than 50% of them because their classes vs the public school's classes were different enough in content as to be invalid (and I went through the syllibi myself and they were different). My wife had the same issue when she transferred her private college credits back to a public school.

Given that experience, I don't know if it is descrimination or if its just differences in the individual degree programs. Right now I lean towards the latter. Especially given that in this state, degree programs and undergraduate classes tend to be standardized between universities.

Even then though, if they teach the material from a different perspective but you are more educated, shouldn't it transfer?
I think standardization can lead to missed opportunities to learn, if important material is left out.

Two things. When a public service is privatized, costs tend to go up for their clientelle. We have seen this happen over and over, especially in things like roadwork and utilities.

Also, DeVry (or Phoenix, Strayer, etc else if you prefer) is already higher, why would these sorts of schools lower their costs if they have less competition?

Utilities isn't a fair comparison, they are legal monopolies.
Something I do not think should be privatized unless the state completely fouls up management.

Road work tends to save money with competitive bidding and privatization.
If it's crony behind closed door stuff, I tend to agree that it would be more expensive.

Just because something appears more expensive, doesn't mean the former was less expensive.
The varying methods of taxation used to finance public sector goods can lead a person to believe that something is cheaper, when it actually isn't.

The education market is heavily skewed, in my opinion.
I do not believe the demand exerted on it, is what actual market demand would create.
Typically that lowers prices.

 

[Boo Radley]

Hooray for Government Intervention driving up prices while enabling debt as a solution!

:mrgreen: huked On natyonilizashun wurked for us!



well, at least we're getting something for our money. embarrassing facebook photos.

Humor aside, this is a real problem without an easy answer. Education isn't free, and not something that can easliy become less expensive. The debt that is. As for students and teachers? I see a lot of both who do it right. I don't suggest that there ar enot some who don't, as I know more than a few. But often the that problem is somewhat overplayed.

I will say this though, if education is a business, than making money is key, the bottom line. this makes students customers, and they define what they are buying. If the customer only wants the paper, that is what some business will be more than willing to give them. Hell, it's cheaper and provides more profit margin. I hear that's good in the market place.

 

[Boo Radley]

Places like DeVry and Phoenix university not considered a premium education by anyone and are widely understood to be barely adequate diploma mills, yet are much more expensive than state schools.

I just looked it up, an online degree from DeVry is about 8.1k/semester while a state school is around 3k/semester. (online or not)

This is exactly right. The market doesn't just produce prestigeous institutions, but predatory ones as well.

 

[Slartibartfast]

Yes I agree that is an issue, but is it more reflective of the realistic costs of providing college education, without state subsidy?

Not trying to throw your words at you, but this is one of those, "it's not always black and white" situations.
(I want a meaningful discussion, so I'm seriously not trying to be a dick.)
We don't have any meaningful private school statistics to compare it to.
I guess the best we can do is compare it to other subprime loan averages.

No worries, I think its an honest question. It probably the closest we have to the market price for a standard college education, meaning its not a good deal for many at that cost. However, one thing should be noted. Those types of school typically do not offer art or other humanities type degrees, but stuff like business, IT, etc. Things that are in demand, yet the default rate is still extremely high. However, businesses continue to want these types of degrees, even when starting pay is too low to sustain the tuitiion fees unsubsidized.

Even then though, if they teach the material from a different perspective but you are more educated, shouldn't it transfer?
I think standardization can lead to missed opportunities to learn, if important material is left out.

I can't say if I am more educated for going to a private school. I just went there because it is 10 minutes from my house and my parents told me they would foot the bill.

Utilities isn't a fair comparison, they are legal monopolies.
Something I do not think should be privatized unless the state completely fouls up management.

Road work tends to save money with competitive bidding and privatization.
If it's crony behind closed door stuff, I tend to agree that it would be more expensive.

Just because something appears more expensive, doesn't mean the former was less expensive.
The varying methods of taxation used to finance public sector goods can lead a person to believe that something is cheaper, when it actually isn't.

The education market is heavily skewed, in my opinion.
I do not believe the demand exerted on it, is what actual market demand would create.
Typically that lowers prices.

Perhaps, but on the other hand, we need more degreed individuals to protect our market against outsourcing.

 

[UtahBill]

Our kids went to college mostly on "parentship". They had academic scholarships that helped the first year or so, after that it was all on us.
Our plan was to get them educated and employable, so they don't come back and live with us later on....married, with children, so to speak.
So far, so good..
A good secondary reason to send them to college is so they can hopefully find a spouse that is also educated and employable...or at least employable.
We know some people who are in their retirement years and are still supporting a few of their kids. That was never part of MY retirement plan.

 

[cpwill]

It's not the government's fault that universities are expensive. I can only go to school because I have federal loans, state aid, a Pell Grant, and an academic scholarship.

......


and when the government subsidizes goods by providing price supports, what happens to their price?


all those federal programs that you mentioned are increasing the price of school.



healthcare and education are two sectors in our economy that the government pays for much or most of, and they are the two sectors that are seeing skyrocketing costs..... which are used to justify increased government expenditures..... which lead to higher costs.......