Math word problem:. If cost of funds is 2.5%, and 15% of borrowers don’t repay, what interest do you need to charge to break even (not including cost of collecting)? The more who don’t pay back, the higher the interest. The higher the interest, the worse the cycle becomes since people can’t pay back.
The average college graduate pays about $5800 more a year in federal taxes than the average high school graduate. Over 30 years, that totals about $172,000. If that’s divided by the 4 years it takes to get a college education, the government would break even if it paid every student $42,000 a year to attend school.
This doesn’t even consider that with the degree, the person is less likely to ever need unemployment or welfare, that more students would complete high school if they could see a clear way to a really good job, and that they would be enriching the Social Security and Medicare funds. They would also be paying a larger amount in all other types of taxes. And, the person who takes the job he would have been doing without the education is contributing to society instead of being unemployed.The best investment we could make to keep America strong is to not just forgive all student loans but to make all higher education, including trade schools, etc totally free, as long as the student is making decent grades, and increase the number of schools and teachers to make room for all who can profit from the education. We don’t, even at a time of high unemployment, have so much a lack of jobs as we have a lack of people who have the skills to perform the jobs that are available- in other words, a lack of education
Young people damn well better get a post-high school education, even if it is a trade school. You won’t be able to make a living operating a backhoe when a computer can do it for a lot less than minimum wage.
Back in my day college loans were mostly a private matter between you and the bank. The govt helped the banks a bit with discounted rates but the bank still owned the risk.
To qualify you had to bring in your HS transcripts, a course of study plan and in some cases an acceptance letter from the school. Your major had to be in a field that had a solid chance of gainful employment that was sufficient to pay back the loan without bankrupting you.
The critical point here is that without the federal guarantee, a banker was unlikely to lend to a basket weaving major. We didn’t have courses like the weird stuff you see today, and you certainly wouldn’t have gotten a tuition loan for a gender studies major, etc, etc.
You want to see tuition come back down? Eliminate federal loan guarantees and require students to actually pass meaningful entrance exams. Turn off the free money faucet, open up trade schools and stop peddling the BS about “everyone need a college degree”.
Màiri almost 5 years ago
There certainly is a general feeding frenzy going on, with the predators trying to grab everything.
But is it because they believe the pendulum will soon begin to swing back…or because they believe the end of everything is near?
NeedaChuckle Premium Member almost 5 years ago
Go to trade school and learn a trade. Make money instead of owing money. You can then afford college.
MikeLikeComix Premium Member almost 5 years ago
Math word problem:. If cost of funds is 2.5%, and 15% of borrowers don’t repay, what interest do you need to charge to break even (not including cost of collecting)? The more who don’t pay back, the higher the interest. The higher the interest, the worse the cycle becomes since people can’t pay back.
How do you break this cycle?
A# 466 almost 5 years ago
How about pay-day loans: 300 or 400 percent interest?
suzalee almost 5 years ago
Tuition goes up in state universities because state legislatures cut funding. Yet, that is never addressed in public discussions.
Radish the wordsmith almost 5 years ago
Thanks predatory capitalist society! Republicans fully support your viciousness.
Diane Lee Premium Member almost 5 years ago
This doesn’t even consider that with the degree, the person is less likely to ever need unemployment or welfare, that more students would complete high school if they could see a clear way to a really good job, and that they would be enriching the Social Security and Medicare funds. They would also be paying a larger amount in all other types of taxes. And, the person who takes the job he would have been doing without the education is contributing to society instead of being unemployed.The best investment we could make to keep America strong is to not just forgive all student loans but to make all higher education, including trade schools, etc totally free, as long as the student is making decent grades, and increase the number of schools and teachers to make room for all who can profit from the education. We don’t, even at a time of high unemployment, have so much a lack of jobs as we have a lack of people who have the skills to perform the jobs that are available- in other words, a lack of education
GaryCooper almost 5 years ago
University tuition is free in most other countries. If they can do it, we can.
Radish the wordsmith almost 5 years ago
Who’s picture is that above the file cabinet in the first panel?
Not the Smartest Man On the Planet -- Maybe Close Premium Member almost 5 years ago
Wow, a scathing indictment of predatory credit cards. How courageous.
Jeff1159 almost 5 years ago
Don’t think you’re going to pay, then we care. (Johnny Carson’s Art Fern).
Retired engineer almost 5 years ago
Young people damn well better get a post-high school education, even if it is a trade school. You won’t be able to make a living operating a backhoe when a computer can do it for a lot less than minimum wage.
Andylit Premium Member almost 5 years ago
Back in my day college loans were mostly a private matter between you and the bank. The govt helped the banks a bit with discounted rates but the bank still owned the risk.
To qualify you had to bring in your HS transcripts, a course of study plan and in some cases an acceptance letter from the school. Your major had to be in a field that had a solid chance of gainful employment that was sufficient to pay back the loan without bankrupting you.
The critical point here is that without the federal guarantee, a banker was unlikely to lend to a basket weaving major. We didn’t have courses like the weird stuff you see today, and you certainly wouldn’t have gotten a tuition loan for a gender studies major, etc, etc.
You want to see tuition come back down? Eliminate federal loan guarantees and require students to actually pass meaningful entrance exams. Turn off the free money faucet, open up trade schools and stop peddling the BS about “everyone need a college degree”.