Saturday, October 29, 2011

Student Loan Money – 2 easy 2 get

One of the few complaints that is making sense coming out of the “Occupy Wall Street” crowd or OWS as a short cut, is the complaint that many young people are carrying a huge debt load after they graduate from college or university, if they graduate at all. Of course, none of them are looking inward and questioning what they were in college for in the first place, I mean how many MBA’s do we really need out there when it is always “Math and Science” that the work force needs. And how many of these idiots took courses either on their own violation or at the hands of Administrators that were absolutely stupid courses like, “The Art of Walking” or “Daytime Serials”.

I bet one regrets spending $15,000 dollars on the course “Science of Superheros” now that you have to actually pay back that tuition money. With interest!

The problem with the OWS crowd is that they want a Bailout of their financial responsibility; they want Big Government@ to pay for their little dalliance in higher education. A free pass from the magical money coffer that most liberals seem to think is theirs for the taking. To be spent on all the social ills in our society, a redistribution of the wealth created by the actual working class.

The big problem as I see it is that money to go to secondary education is too easy to get and has been for many, many years. I say that knowing full well that my Daughter went to university on credit basically extended through her parents (me and the Good Wife). My wife and I are the proud holders of a note that is almost as hard a hit on us financially as the mortgage on our house! But it was the only way for her to get a Degree. And all the loan approvals were done on-line with little or no fuss.

All guaranteed by our mutual relative, Uncle Sam. And that is the root of the problem as far as I can see. With Big Government@ back-stopping all the loans there is very little reason for a bank not to loan the money out, no matter how long it takes someone to graduate if at all, or how many dumb or stupid classes they are made to take, no matter how much the school charges for the course in the first place.

With no one saying "NO" to incoming student’s colleges and universities have had no reason to hold down costs. So, little by little the cost has gone up, courses are added even for no other reason than Political Correctness and the final tally are college degrees that are over inflated. Tuition that is obscene and out of control. Observe the below chart.


That is a real bubble there folks, propped up by yours and my tax dollars. And almost no one is talking about this.

If there was no rich Uncle ready to back any one that came along needing a loan WITHOUT any collateral as backup, then people would either do without going to school or they will be dammed careful where they went and what courses they were taking. People would be shopping with their wallet and maybe even standing up to the school Administrator that was trying to get people into worthless classes or study programs that lead nowhere (like Women or Black Studies).

The lack of perspective new students knocking on doors would mean someone would have to do without a fancy lounge or tenure or a room full of staff. The school would have to justify the tuition and maybe even put on some cost controls.

Schools would actually have to compete with one another for the limited incoming students and maybe just maybe they would go back to actually forcing teachers/professors to actually you know, teach. In my time in university I was never once taught by the professor, some under graduate or other lackey always gave the lectures and passed out the exercises.

With no pressure to hold down costs they schools have gone wild and the graph above shows this. How soon before this bubble bursts? Not soon enough.


BT: Jimmy T sends.