Monday, August 9, 2010

Paying the Freight

My daily read over at Capre Diem and I found two items that I knew in my heart but had not statistics to nail to. The good Professor Perry has a rich graphic on the sky rocketing College tuition problem and actual figures on what costs the government mandates when you employ someone and its effects on small business.
Tuition Bubble:

As a debtor to a huge college loan (the same as my first house in fact), I had always felt that the Student Loan Guarantee program actually hurts this country more than helps. The reason is simple supply and demand violated by government meddling. First, if someone can't afford tuition they don't go to school or they go where they can afford. Under the "normal" rules of supply and demand, the school that priced itself out of the market (by high salaries or by handing out scholarships to moron athletes) they would suffer and have to do something. You know, make themselves more competitive. If someone steps in and mucks with this very delicate system like, let's say guarantee's the loans for anyone that wants' to go to school, no matter what the costs! Well then there is no motivation on the school to hold down those costs. The result:
Yeah, look at that curve; it's like the space shuttle climbing into orbit. Just can't wait for the crash!! It frosts my shorts that the average semester costs to go to an average school here today, is more than what it costs for a whole degree back only 20 years ago. And as long as the government continues to guarantee the loans that line will continue to climb up or until a crash occurs. Can't happen soon enough as far as I am concerned, especially now that the Executive branch convinced the Congress to take over that market completely, they can steer these loans to only those people they want and into fields they think the country requires. Can anyone say, Central Planning? Yep
Employment Pain:
The good Professor Perry points us to a Wall Street Journal story about what it costs to actually create a job today, what with all the mandates pressed down from that holy pedestal of Congress and the Administration. They detail a 33% surcharge to employ anyone in this country all attributable to government program requirements. That's a whopping high number. In a salary of $44,000.00 it costs the employer a total of $74,000.00 once all the taxes, fee's and surcharges are added into the mix. And this includes all sorts of stuff like Unemployment, Social Security, Medicare and all other sorts of rules and regulations. It's worth the read and makes you wonder who in his right mind will spend that kind of money in overhead to hire someone for what amounts to be a minimum wage job.
The sad part is that the Democrats and PresBO are not done with their work and continue to whittle away at our once dynamic business and industrial base. One job at a time.
BT: Jimmy T sends.


Bag Blog said...

This is a subject that is near to us right now. Jesse is wanting to go back to college (she has an associates degree). She is looking at Midwestern State U in Wichita Falls, TX, which is about as close to us as any Okie college. We keep talking to her about tuition and scholarships since she would be transfering with a 4.0 GPA. My thought is that if they don't give her some sort of scholarship, she should take her business elsewhere. She just shakes her head at me as if I'm not educated myself. But you are right about the sky rocketing price of education. It makes me a bit crazy - which Jes would agree with :)

By the way, I posted a photo of one of my art students who made Eagle Scout.

JimmyT said...

My daughter had a couple of scholarships and one outright grant but together they amounted to very little once you look at her total tutition bill. And the sad part is that she did not go to what you would call a "name brand" school. I can't imagine what it costs for say Penn State or U of Penn. I went to Temple back in the day and they are still a 3rd or 4th tier school but their tutition is still way up their.

BT: Jimmy T sends.