I'll probably be downvoted on a forum like this, but I worry about the most successful universities using their funds to subsidize those who would be fine without it. I was actually made aware of this by a wealthy Stanford alumni which has a fairly broad program for undergraduate tuition assistance. Graduates of mid/low tier universities seem more and more likely to have to compete with better credentialed people with lower debt.
Don't get me wrong, this is fantastic on an atomic level, and the levels of debt required to get an MD these days is insane (have a lot of family in the field). Also, it's not like this is a unique structural disadvantage, just a new one.
IDK. The same thought process led me to not being able to complete college due to financial reasons.
Despite being emancipated, FAFSA still considers you a dependent until you're 24. I was told that only with documentation of leaving an abusive household would a dependency exception grant be applied. So according to FAFSA I was supposed to use all this money that I didn't have to pay for college. By 24 I had dropped out and gotten a development job, now putting me outside of the income level where I'd get even federal loans (and quite frankly I still can't take on that debt load).
Just make college free. Trying to make all of these complicated rules to make sure that a few people aren't "getting one over us" is just making more cracks for people to fall into. If you're concerned that the rich are going to somehow use the system without paying, structure the backing tax so that they pay their fair share. No one cares that high school is free for the rich too. Everyone pays in, everyone can participate.
I think not being able to default on your student loans is the main factor in rising costs. There is no reason not to give out a student loan of any amount if it is guaranteed money. And there are many people who struggled to graduate highschool, or people who have no idea what they want to do in life in any way, that are getting crazy large loans to go to very expensive and demanding schools and and are very likely to drop out and have nothing substantial in return. They might only go for one year but then BAM, now they got near $30,000 in debt to pay with little to no job experience and no degree.
With students able to get loans of nearly any amount, the schools have no reason not to raise tuition prices, and that extra money ends up feeding a bunch of administrative bloat, a significant amount of which gets turned around into crazy marketing and advertising schemes to trick more fresh highschool graduates into taking out loans to pay for the crazy tuition. The first time in most of these people's lives where they are expected to take out a significant loan of money and are easily manipulated into potential financial traps. For many of them it is the first financial decision in their entire life and it rivals the cost of buying a house.
I think you're right, at the same time if allowed to walk from student loans... wouldn't we see a similar incentive on the student side?
I would find it pretty tempting when graduating to ... default. You've got plenty of time to fish your way out of bankruptcy as you're young, you don't have much for assets or anything...
That seems fine to me. Banks are in the business of calculating risk on loans, they can work out under what conditions they're willing to loan money to students who have little to lose by declaring bankruptcy.
If they basically shut down all student funding, that doesn't seem like a huge problem either - it's a fairly bad model and I think society would benefit for from the pressure to find a better way to educate people.
It's a difficult question, it would have a lot of unpredictable knock-on effects. But subjecting the industry to market pressures seems a move in the right direction.
Banks [...] can work out under what conditions they're
willing to loan money to students [...] If they
basically shut down all student funding, that doesn't
seem like a huge problem either
The problem arises if they decide "We'll only loan money with a wealthy co-signer" and that locks out working class kids from college and the class mobility opportunities education provides.
I considered that briefly, but honestly I disagree. Class mobility is a pleasant fiction we tell ourselves about, but the data suggest that it is nothing more. Since 1980, the prime time of our current every-goes-to-college education paradigm, social mobility has fallen off a cliff.[1] And frankly, it was never a major feature of society.
For deeper socioeconomic reasons, pretty much everyone in the truly lucrative fields like law and medicine is already quite well-off, and people who graduate from other degrees generally either end up in poorly-paying fields like academia, or else in careers that half a century ago didn't require tertiary education at all.
That would cause a crazy economic implosion in the education sector. Anything like that would need to be done very gradually or else there would be massive layoffs at every university all at once.
The clear result of this would be parents that can afford to send their kids to college will send their kids to college by just paying for tuition. Interest rates will go up significantly, which makes the math on taking out a loan worse for anyone that doesn't need one. It would be a death spiral for loans.
I'm not convinced the politics of subsidizing education get better after that. There's a very high risk that a large and powerful swath of the country reacts to it with "I worked my ass off to pay for my kids to go to college, why should I subsidize yours?" The resulting increase in inequality is bad for society as a whole, but honestly it's a feature for most upper income parents.
It would probably put some pricing pressure on college, but the predictable knock-on effects are really really bad.
> I think not being able to default on your student loans is the main factor in rising costs. There is no reason not to give out a student loan of any amount if it is guaranteed money.
Just because the loans can't be discharged during bankruptcy proceedings doesn't mean the lender gets their money back. Default rates are high (and rising). The lender may get some money, but that doesn't mean they get their principal back, let alone a sufficient interest to justify giving out the loan in the first place.
The mechanism by which you default on a loan is bankruptcy. If you can't discharge a loan in bankruptcy, you can't default on it.
Some people never make enough money to pay it off, after which the government will pay the loan off after a few years. The lender gets payed anyway. These are risk free loans for lenders.
Note that 'default' is simply 'a debtor has passed the payment deadline on a debt they were due to pay'. 'Bankrupt' is 'a legal finding that imposes court supervision over the financial affairs of those who are insolvent or in default'.
See how 'bankrupt' is done to someone who is already either insolvent or in 'default'?
> The mechanism by which you default on a loan is bankruptcy. If you can't discharge a loan in bankruptcy, you can't default on it.
This is absolutely, completely, 100% wrong. Defaulting on a loan means that the borrower has failed to repay according to the agreed-upon terms.
> Some people never make enough money to pay it off, after which the government will pay the loan off after a few years. The lender gets payed anyway.
This isn't really true either. The lender is not guaranteed to be paid their principal back.
> These are risk free loans for lenders.
If these were truly risk-free, then the interest rate on private student loans would be roughly equal to the current actual risk-free rate of investment (because any new lender could always capture additional loans by undercutting their competitors and still make a profit).
Except, that's not true at all. The interest rate on private loans is quite high. In fact, it's significantly higher than the interest rate on mortgages, which are loans backed by collateral that can actually be seized.
>The lender is not guaranteed to be paid their principal back.
This may apply for personal loans, where real money is given up; but, it's not really correct to call a bank, the originators of most private student loans, as far as I know, a 'lender'; as, banks don't lend their own money, but create new money through promissory notes.
> This may apply for personal loans, where real money is given up; but, it's not really correct to call a bank, the originators of most private student loans, as far as I know, a 'lender';
It is 100% correct to refer to a bank as a lender. This is standard use of terminology.
Do you have an official reference? I would believe that persons in the industry may use slang terms, but technically it would be incorrect to refer to a bank as a lender in most 'loans' they perform.
If you check the Promissory Notes, I'd guess they probably don't say "lender", except as possibly an alias for a definition that is not equivalent to the standard definition -- wherein, one forgoes actual physical property (cash, for example) for another's use; with the expectation that the property will be returned at some point (possibly with some form of payment to compensate for the real loss of property).
Edit: Do you think Wells Fargo has myriad $100k bundles just sitting around waiting for students to take? I don't think so. They use their power to create new money, rather than loan out the entire principal from their reserves.
I like the idea of withholding tuition from future earnings. That way we can get rid of all the "underwater basketweaving" courses that are so popular today, and focus on the ones that the economy actually needs (as in, is willing to pay top dollar for).
There's one "but" however: this does absolutely nothing to improve affordability, so some mechanism needs to be devised to reduce overhead costs, and put a cap on profits. I would prefer if that mechanism were market-based as well.
I very heartily disagree with letting the market decide education priorities, for two reasons.
First, education is chock full of positive externalities, which will never be realized correctly. While "the economy" doesn't need underwater basket weaving - or art history, or literature - society still does. Even if people don't work in their field, the world is better for the increase in knowledge. Man does not live on engineering alone.
Second, the invisible hand can only do its work in a world where the effects of decisions are predictable. Given the long lead time on a choice of major affecting your income - at least four years, arguably more if you factor in choice of AP classes on high school - that's never going to be the case. Say this system had been in place in the 90s, and say you're okay with underwater basket weaving students getting the short end of the stick because, well, they signed up for it. Fine. But what do you say to the computer science class of 2001?
"culture" may be good, but at what price? If the price for that degree were 10 million dollars, you wouldn't be insisting we get lots of those degrees. Everything has its price based on how much value it offers.
The problem with every economic system is information -- though that is far less of a problem in a capitalistic society with constitutional freedom of speech (capitalism helping to prevent the black box that forms around centralized economies like socialism, communism, or crony capitalism/fascism). This problem is on full display with those liberal arts degrees. Students leave high school knowing practically nothing about society or how money works (the fault of our education system removing most practical courses from the curriculum). What they have been taught from an early age though, is that getting a degree is the path to success. They hear about making X thousands of dollars more per year if they get one (without the nuance that a select few degrees making a lot more than average offset the entire liberal arts division) and they want to be successful so the go without any real-world knowledge to provide balance.
Instead of getting directed to a degree that will ensure their livelihood, they are told to "follow their heart" and "do what makes you happy". Unfortunately, the definition of a job is "something you wouldn't do for free" and people work jobs to get money to do the things they want so much they'll pay for them.
The simple fact is that most kids aren't cut out for college. They are much more suited for technical schools where they can learn the trades that keep the world turning (and they could leave making far more than a liberal arts degree with practically no debt). But they aren't told about that and instead wash out of the hardest degrees into meaningless degrees that offer a kind of debt slavery without any reward whatsoever. If they had gone to technical school, they could work less, make more, and spend that excess to culture themselves however they like.
That's just, like, your opinion, man. Society certainly does not need so many graduates in English Literature: there are only so many open positions at McDonalds, and they as a rule do not require a degree.
If there's market demand, society can pay real cash money for it. It used to be that most writers, painters, historians, etc, etc, had to also have an useful day job. _Albert Einstein_ had a day job up to a point. There's nothing wrong with that if the market can't support full-time work in a certain profession.
The second part of your argument I do agree with: there are a lot of details to flesh out. Maybe it will compel the colleges to teach broader sets of skills, since if they teach a narrow profession that's not useful they don't get paid.
> That's just, like, your opinion, man. Society certainly does not need so many graduates in English Literature: there are only so many open positions at McDonalds, and they as a rule do not require a degree.
This strikes me as a deeply sad view of the world. As an individual, a well-rounded education is a life-enriching thing, even if it doesn't directly tie into your professional career. As an overall society, having a more highly-educated populace is a net positive for everyone.
> It used to be that most writers, painters, historians, etc, etc, had to also have an useful day job.
And if you look even farther back in time, most artists were supported by a rich patron who believed in the value of art.
In Germany, college is free, but there are a smaller number of slots available for majors which are not in demand. Is this also a “sad view of the world”?
>> This strikes me as a deeply sad view of the world.
That's not a "view of the world", that's _objective reality_. There aren't enough jobs for those folks to take, so they end up at proverbial McDonalds. Those that do get jobs often don't get a wage that a degree that's in higher demand would command. That's the world that already exists, you can't will it away no matter how you finance people's education.
>> That's not a "view of the world", that's _objective reality_.
That's just, like, your opinion, man. Setting aside arguments as to the mere existence of "objective reality". You're essentially saying "the way I see it is the only way to see it", which does not help convince someone who sees it differently.
>If there's market demand, society can pay real cash money for it.
The point of my argument is that this is one of those cases where that's not going to happen, because we're talking about positive externalities. A generally educated populace, especially in the liberal arts (reading, critical thinking, political science, etc.) is a powerful but diffuse societal benefit in a way that doesn't really have a buyer.
What that likely means is that society needs to collectively come up with a powerful institution to serve as a patron of education and the arts. We could all pay in some token amount of money, and then experts could redistribute it in more globally-optimal ways. While we're at it, that institution could probably take care of a lot of other externality-related problems, like building roads and maintaining some sort of conflict-resolution system. And we should probably all get a say in how it runs. Hey, wait a minute, this sounds familiar...
English major here! I never got the McDonald's gig, but I am now helping the economy and keeping the world turning by making money as a useful software engineer. :)
I wouldn't use the stern-faced "useful" language, but I agree with you about it being perfectly fine to have a day job and pursue literary/artistic interests on the side. TS Eliot insisted on keeping his job as a bank clerk. Gladstone wrote serious history at night after discharging his duties as the English PM. Etc, etc.
Regarding choice of degree, the value of a liberal arts degree is difficult to argue for---and against. It's not like, say, math where you can do the proof or you can't. You can model the system such that transformations actually map onto transformations in the target domain or you can't. But I can often tell when someone has a (successful!) liberal arts degree by, to give one example, how careful they are with imprecise language. And, to give another, how light of a hold imprecise concepts have on them, how flexible and playful they are in such thinking (this has nothing to do with being unable to be "rigorous").
But also the fact is the system did not work for most people. Partly because most students just aren't suited for it...and that's fine. And especially with how broken college is now (for one, non-STEM subjects tend to allow the student to choose from a smorgasbord of unrelated courses instead of systematic growth over years). IMO far fewer people need to go to college, we should increase the funding and prestige of vocational school, and non-STEM subjects need to more regularly be taught again in a demanding way.
But you're in indentured servitude either way, except it's debt servitude, and there's no accountability on the part of the college for teaching you anything that's actually useful. Under the proposed setup, the college is directly incentivized for maximizing your earning potential. I like that a lot. Think of it as a tax that you'd pay in e.g. Germany anyway in order to get "free" education, except the amount you pay directly depends on the quality of education and people who chose to get vocational degrees don't have to pay for you. The whole thing entirely bypasses the government, so that's at least 30% savings right there.
> "I think not being able to default on your student loans is the main factor in rising costs."
The law responsible for this situation (the Bankruptcy Abuse Prevention and Consumer Protection Act) was passed in 2005. Prices had already been rising for decades. I'm not saying it hasn't had an effect, but it can't possibly be the "main factor," because it literally didn't exist when prices started to rise.
In short, the free market has found a very lucrative cash cow for all involved. A select group of people are getting fabulously rich off this broken system, and since they control it there is no incentive to stop. Of course, someone is getting shafted. The students, in this case.
Definitely not a free market. If the government didn't guarantee student loans, the banks would have been a lot more conservative in giving out loans. In fact, this is easily the biggest factor in the rapid rise in tuition.
The parent posts detail the ways the government has distorted the free market, and your takeaway was that this is the free market's fault...? So was the '06 housing bubble was the free market's fault as well?
Quite so. It was the "free market" that gave out those loans, it was the "free market" that repackaged the CDOs knowing full well the repercussions in case of defaults, it was the "free market" that stacked rating agencies, regulators, courts, even academia, to prevent their cash cow from going away, or from suffering any kind of personal responsibility for their crimes.
I think you missed your opportunity to learn something because the parent post was being too subtle.
Both student loans and the housing loans leading to the crisis are blinding examples of the government interfering with the risk assessment process of large loans resulting in a failure.
Students get loans they can't realistically payback because the issuers know they are (mostly) safe from bankruptcy.
In the early 2000s the 'gift' of the affordable housing bill was to issue a bunch of mortgages to people who realistically couldn't pay them back either. Leverage against loans by the banks made it systemic, but the root cause of the housing crash was trash loans that would never have been issued if it weren't for the government offering guarantees.
College is expensive because so much money is available in the forms of subsidies and loans. If the federal government stopped guaranteeing loans, and cut back on other subsidies, the cost of college would be much much lower.
People call for X to be more affordable > government subsidizes X > X absorbs all subsidies and becomes even more expensive > people call for X to be socialized.
Maybe instead we should start to unwind student financing. For example: let students discharge student loans via bankruptcy. That would give financiers pause and would put an upper bound on what many universities could charge.
> let students discharge student loans via bankruptcy
This is a fine idea, but you have to recognize that this just means approximately no one gets student loans (and those who do get them don't need them). Think about it: if you come out of college with, say, $20k of debt (granting that this might bring down prices) and no assets, bankruptcy is a very tempting option. Student loans are just inherently problematic - the people who need them have no assets, and the thing they pay for can't be used to secure the loan.
Sure, prices would come down, but partially because so many people would be priced out and demand would drop. The solution has to involve more than that.
A potential solution is HECS here in Australia for university.
It's a government loan that anyone who goes to a HELP approved course can obtain (nearly all proper university courses) and it gets taxed out of your future earnings, and is indexed at (almost) CPI (e.g. this year it was indexed at 2%).
There is still argument here on whether it should be free (University used to be free in Australia) or a higher rate of repayment (the government tried to index it at the bond rate which would make it an indefinite tax on a high proportion of those with HECS debts...) but it does work in the sense that it doesn't drive anyone into the ground and allows anyone with high enough marks to go to uni without worrying about course fees - and it still will eventually be repaid.
Can someone with better knowledge on these areas than I tell me why a loan system like HECS would or wouldn't work in the US?
> This is a fine idea, but you have to recognize that this just means approximately no one gets student loans (and those who do get them don't need them).
The vast majority of student loan loans are issued by the federal government since private lenders are cut out of the federally-guaranteed Stafford loan program, so changing rules on discharge won't meaningfully effect loan issuance without some other federal policy change.
> Think about it: if you come out of college with, say, $20k of debt (granting that this might bring down prices) and no assets, bankruptcy is a very tempting option.
So make them hard, as they are now, to discharge for some period of years after they would regularly first enter repayment, and then subject to discharge like normal unsecured debt.
Or, just eliminate the federal student loan program and special bankruptcy treatment of student loans in favor of robust federal need-based and public-service-based grants.
> The vast majority of student loan loans are issued by the federal government since private lenders are cut out of the federally-guaranteed Stafford loan program, so changing rules on discharge won't meaningfully effect loan issuance without some other federal policy change.
This is a good point - I think of Stafford loans as inextricably tied to the no-discharge terms, but that's probably not the case. Perhaps cutting out the no-discharge terms would just be a backdoor to government-provided university-level education.
Bull. Student loans did not become non-dischargeable until the mid-2000’s; and before that plenty of people got loans and there was no epidemic of graduates immediately declaring bankruptcy. You’re spouting propaganda talking points from predatory lenders.
There actually was. Particularly with doctors and lawyers.
Among regular students, not as much, but discharging hundreds of thousands of dollars of debt for a few years of bad credit when you're making hundreds of thousands of dollars is a great deal. It was a rational decision to make.
> Think about it: if you come out of college with, say, $20k of debt (granting that this might bring down prices) and no assets, bankruptcy is a very tempting option.
You actually have to convince a judge that's appropriate. And the court has a wide variety of tools at it's disposal to reach an equitable decision. From telling the petitioner to get stuffed all the way to telling the creditors to get stuffed.
Can you cite a case of this happening? As far as I can tell, chapter 7 cases are only ever denied for failing to file properly (missing deadlines, failure to disclose, etc), or kicked over to chapter 13 (which would be pretty remarkable in a case involving the little to no income of most students).
If we were being reasonable about student loan debt Chapter 13 or 11 would be more appropriate than Chapter 7. Both of those allow for debt service to be renegotiated.
Student loan debt is a particularly odious bit of neoliberal policy, forcing students to take on debt for something other societies provide for free, non dischargable and guaranteed by the state.
In Europe when the government subsidies things, they usually also put a cap on what the organisation is allowed to charge. See for example universities and trains in the UK.
> people call for X to be socialized
Alas it never gets to the final step: X is socialized.
> People call for X to be more affordable > government subsidizes X > X absorbs all subsidies and becomes even more expensive > people call for X to be socialized.
The problem is that government subsidizes loans. It doesn't do something like capped match. The government should just say, "We will cover your need-based education burden up to $20,000".
Something like this would make most state schools accessible to most kids and yet, put a big limitation on how much schools can raise tuition. Some schools will raise it up to 40k, others will keep it at 20k, both will try to maximize intake for their tuition.
Simply handing out unbounded, undischargeable loans is just crazy!
This sounds like government should pay people subsidiaries directly. Like an HSA but for more than just health. If you use the account for school it's tax free otherwise there are fee or the transaction is declined. How much more amazing would service from utilities be if they had to go through customer to get the same subsidiaries they get now.
I have taken an education loan from a bank in another country. They literally only approved me for a maximum of $30,000 loan. Let me explain how that worked.
I had to pay first 15% from my account, they would pay the remaining 85%. Every semester, once I showed a receipt that I paid 15% to the university, that bank would wire the remaining 85% directly to that University.
What did this do to my decision making? I literally only chose universities for which I could afford the upfront 15% and the max of $30k. I chose this university even though I had admit from other universities which had higher tuition.
What impact does it have on universities? Universities with higher tuition start seeing a decline in enrollments. I got out with a max $30k debt, of which I paid 15% out of pocket already, per semester.
I could've dropped out of school and joined again a few years later but that loan would still be available to me for 7 years.
Woah there... govt subsidizes what? This isn't about subsidies (except for loan guarantees), it's about unsecured credit and debt that can't be discharged in bankruptcy. That (like credit card spending, 8 year car loans, and payday lending) is a recipe for rising prices and high eventual bankruptcy rstes, but it's not govt subsidy. It is regulatory capture.
The government backing a huge portion of the loans and creating special treatment for the loans are both, ya know, subsidies. They are slightly indirect.
Yes, that is why I called out loan guarantees. Regulatory capture (special treatment) on the other hand, is not subsidy any more than granting a patent/trademark is a subsidy... it's regulatory capture (the opposite of effective regulation). Corporations don't get to blame the govt for the rules that industry paid for... see what you made me do!
To bring down cost you don’t bring down the subsidies, but you let the government negotiate price limits on subsidized goods and services.
This is how health care and college subsidies work in my country. The government negotiates with the universities and medical industry what the price and the subsidy level will be. Schools and health care can opt out of the subsidy scheme and shrink their market to the rich or opt in and have lower margins with higher quantities. Most choose to opt in, even the top tier.
The trick is using the negotiating power of government, which is something U.S. politicians are unwilling to do.
== That would give financiers pause and would put an upper bound on what many universities could charge.==
It would also limit the pool of people who could get a loan for college in the first place. Maybe we can take a page from other developed countries who don't seem to have the same problem.
It seems to be a pattern in America where we act like a problem has no answers, meanwhile the rest of the world contains many potential solutions to the problem.
Remember when college used to be cheap enough for people to afford working summers? I don't remember because that was before my time, but that was also before the subsidies and loans were made available by the feds. Turns out, if you dump money into an industry while increasing demand and not changing supply, prices will increase.
That was because states covered most of the budget. Austerity policies changed that. And supply and demand is not applicable to macroeconomics, which education is part of.
States still cover most of the budget. As someone who went to school while poor and on a scholarship, I hated this, the price was so inflated because
1) The government pays the majority of it if you're poor, schools know you'll pay
2) If you're middle class your parents pay half of it, the government pays half of it, schools know they'll pay
3) If you're upper class, you might have a legacy admission and the school knows your parents will pay and probably donate to the school too
There's a difference between the government funding education and the government funding students. Costs are high because the government funds students (sometimes), not education.
And very few people get government scholarships, most get loans which must be repayed: essentially an extra tax on the middle class.
Government funds most public universities to an absurd degree. Tuition is a drop in the bucket for most schools. Government loans are an extra tax on everyone, and are best seen as a money transfer from all taxpayers to public institutions.
Grants and scholarships are different, FWIW. Pell grants can be an extreme amount of money depending on your income bracket, but given the prior knowledge that people at each income bracket will make up the difference in amount (for a service like education), it can be seen as increasing school prices by the highest paid amount.
Yes I suppose you're technically correct. But government grants hardly pay for poor people's education, especially considering they trap them in the cycle of being unable to pay for books and food without earning too much to lose the grant.
I'm not following your comment, Federal student loans started in 1958 [1] but costs didn't start to skyrocket until the late-80s/90s. Since the late-80s costs have more than tripled at public universities after adjusting for inflation from about $3,000 to almost $10,000 [2].
==dump money into an industry while increasing demand==
Did the money create the demand or are you saying they dumped the money while also creating demand?
==not changing supply==
Do public universities have the same number of available seats as they did in 1958? 1980? 2000?
> For example: let students discharge student loans via bankruptcy.
Ataturk's reply to this is dead below but I must agree with the (spirit of the) comment. While I support letting students discharge loans via bankruptcy, I VEHEMENTLY oppose making this applicable to loans already signed. This is absolutely ridiculous and anyone who supports this kind of position should be barred from public office on grounds of insanity.
EDIT: I also think income and means testing ought for any government program or service ought to be illegal. You cannot say "you must make below $n to be eligible for this government program". I know the economists in the audience will bellow and bicker and say that we have limited resources that we must allocate "logically" but guess what macroeconomics is nonsense anyway because out here in the real world people don't behave logically. We need to make it against the law to use income, means, or property testing for any government program or service. Can't afford to offer it to the entire population regardless of income? Either increase taxes or rollback the program. Can't have it both ways.
I'd say that a politician who stares at a problem head on and refuses to deal with it, because we didn't deal with it in the past, is the insane one.
Student loans have become incredibly predatory and the banks were the ones who had the information to realise these were bad loans, but they lobbied the government to make it so they had to do no due diligence. Now they've fucked up and unless something is done about the loans they are all going to start defaulting anyway.
The default rate is already growing[1]. Based on the number of people I know who are making minimum payments and waiting 20 years for the loans to be forgiven based on income levels, I expect a large portion of expected revenue on these loans is going to evaporate starting after 2028 when everyone who got bad terms and a shit job after the great recession start to become eligible.
It's already a house of cards and we should just deal with it instead of tying large portions of the population to these bad deals
> It's already a house of cards and we should just deal with it instead of tying large portions of the population to these bad deals
I guess the taxpayer is kind of screwed when it comes to Federal loans. I still think it is a bad idea to retroactively change laws even if the idea seems popular. As far as I understand, an individual's loan obligations don't automatically transfer to their surviving family members so if you have a massive student loan it will die with you.
If the loans were predatory, lets ban them going forward. If we find illegal activity and predatory behavior I am all for prosecuting bankers and throwing people in prison. In fact, I will go further and say we should rid of all the silliness of deductions and credits in income tax toward education loans as well.
New York made a good first step with its excelsior program. While I don't like the income ceiling for the program, I think overall this is the way forward. I think we should expand the program to allow people to go to school part time for free. Private schools can either compete with free public education or shut down.
> I'd say that a politician who stares at a problem head on and refuses to deal with it, because we didn't deal with it in the past, is the insane one.
I am all for dealing with the problem but I still firmly and politely OPPOSE any effort to make it easier to discharge existing loans with taxpayer money. I am not an expert on this matter though so I don't know much about it. All I know is we cannot give a handout to people who went to college by signing a loan letter and pay for it with resources that could have gone to people who didn't go to college.
I think the first good step is to make private education loans go away the same way as any other private loan going forward. I don't know how we can apply this to direct federal loans.
> As of June 30, 2010, Congress stopped the guaranteed student loan program for newly issued loans.
> If a borrower defaults on a guaranteed loan, the federal government pays the bank and takes over the loan. The federal government pays approximately 97% of the principal balance to the lender. At that point the federal government owns the loan and the right to collect payments on the loan.
Yeah, no. If you have a guaranteed loan (which apparently you can't get anymore), I say you are on the hook for it for life especially if you start making money later.
Ah I thought you were treating private and federal loans as the same. I'm with you on private loans being treated as regular loans, let them go away in bankruptcy.
For federal loans, the position the US is in with them needs to be unwound. It's not even a choice at this point, it's worse than how inflated the housing crisis happened and if we don't deal with it on our own, it's going to just show up as a surprise.
That's not to say we need to wipe the slate clean at once. We could just do a 10% or 5% haircut on all loans every year and treat it the same way as an entitlement. We will need to fund it of course, and it will not be painless, but that's the position the countries gotten itself into.
Not doing something to cut down the massive amount of debt that is already dealing with large amounts of defaults is just be willfully ignorant of the risks.
>Yeah, no. If you have a guaranteed loan (which apparently you can't get anymore), I say you are on the hook for it for life especially if you start making money later.
The only things we saddle people with life for are prison sentences for murder and rape. Student loan debt shouldn't be at that level of seriousness. Think about it. If you had a debt from the government that followed you _forever_, why even be part of the system anymore? You are incentivized to either not work, or work and hide every bit of income. If you don't give people a path out of an issue, they aren't going to play by the rules anymore
> The only things we saddle people with life for are prison sentences for murder and rape.
I said that because I assumed the government can afford to suspend payments if your income goes below a certain level. I doubt an ordinary person has the ability to work and hide every bit of income. The good people at IRS work hard and those (bastards over at) state departments of revenue work even harder.
In practice, you're right. The taxpayer has to eat the cost. And I am sure how things will eventually happen when things eventually need to happen. Politicians hate saying no to their voters. The Republican nominee for POTUS in 2012 was at a debate or a town hall before the election and I remember him going on a rant about simplifying the tax code to a round of applause. One woman got up and asked what about credits and deductions with contributions toward their child's college fund and the nominee didn't have the strength to say he wants them to go away. Guess what if we want to simplify the tax code, we have to get rid of credits and deductions. If you can't say that to people who just applauded to you saying simplify the tax code, it will never happen. No politician wants to do that because that will destroy their career.
This is just what I think. I have no realistic way of influencing public policy. (:
Wait, you are suggesting that medicaid, food stamps and low-income housing assistance should be offered to everybody? I don't think I have heard this suggested before. I'll have to ponder this.
> Wait, you are suggesting that medicaid, food stamps and low-income housing assistance should be offered to everybody?
Yes. None of these programs should exist if we can't offer them to 100% of the population. Both Democrats and Republicans use these programs as a vote bank and it polarizes our public discourse.
Means testing is basically a compromise between the two extremes that you offer: fund them completely (by raising taxes) or drop them completely (because they're too expensive). That's the best you're going to get in a system where lots of people with vastly differing views have to agree on a single conclusion: a compromise that makes everyone a little bit unhappy.
Don't forget the gymnasiums, stadiums, aquatic centers and all the other high-priced facilities that schools have constructed to compete for those easy-to-get student dollars. Because who can learn in an environment without swimming pools?
For the most part, those types of facilities are paid for out of athletic department funds and donations.
yes the sorts of facilities that universities build for athletics are extravagant and many would say ridiculous, but they really don't have a bearing on the cost of tuition.
You often do because the cost of administering financial aid and loan programs is much more than if the government simply funded education. The same applies to healthcare: you need dozens of administrators because you have dozens of insurers to deal with. Simplify the system so all costs are paid for by the state and your costs go down.
That's backwards. College is expensive because demand is extremely high. Subsidies increase that demand by making college affordable for most, but the suggestion that the subsidies themselves are the problem is plain wrong. We wanted an educated workforce, we've got one. We can say we don't want one, but to blame our efforts to educate people as the problem with education is not productive. We either educate people or we don't. We increased demand on purpose (and we should have!). Of course prices are going to go up! Normally supply would expand to keep up, but something is rotten in education. Teachers get paid a pittance, there were several high profile accreditation frauds, and the natural inclination towards prestige as worth more than the actual diploma combine to seriously limit our ability to expand and mitigate prices.
As the supply of available money increases, there is no incentive not to increase tuition. Any system that is flooded with money experiences price inflation.
Because students are not able to discharge their debt in bankruptcy, they constitute a riskless loan opportunity to the lenders, who throw money at them.
A sad side-effect of this as that the price inflation that this causes is forcing more and more students who might have otherwise been able to finance their tuition without loans, into needing loans also, thus dooming more and more of the next generation into huge debts that will effect their ability to buy houses, start families, and save for retirement.
Considering the millions of people struggling to pay for college and desperate for lower tuition, this is totally untrue. This is like saying, "if we didn't have food stamps, food would be half the cost."
Actually providing an "unlimited" stream of capital, does cause inflation. That's global fact: e.g. New Zealand real estate has started becoming unaffordable [google -- it was in the news these days] due to U.S. and other millionaires pouring in cash.
I am not going to make the analysis for food stamps. Maybe some stores would have lower prices, no idea, as I don't know the model of issuing food stamps.
Think it like this: Alice comes to your store and says I am going to pay 50% of whatever Bob buys. Bob has spending power x. Now Bob, suddenly can buy 2x. However, Bob can buy that many stereos costing x (wlog) and is probably going to just spend x/2 and let Alice pay the other x/2.
Or you can say, well I am the only store in town selling stereos, so now stereos cost 2x, as I know you can afford them. Bob, as he has to buy the stereo, is going to pay x and the store owner is going to pocket an extra x, as it is a monopoly (or oligopoly) and thus can keep the prices high.
So, if you substitute Bob with an average student and Alice with the government, you will see that the student kept paying the same (at best -- you have to account for market pressures here, general currency inflation etc which cause more inflation) and the government has to keep paying now (or you know break the oligopoly; set different rules).
If we provided people with unlimited special accounts only good to buy food (with money, not food stamps), this would definitely affect prices in groceries.
That's reductive. Food and education are very different industries, and the scale of subsidies to individuals is HUGE in education compared to food stamps.
Plus, the nature of the subsidy is important. State-sponsored universities don't seem any more culpable than private ones in this mess.
I think the reverse of what he said was true: that tuition has risen artificially because of all the free money. But yeah I'm also skeptical that tuition would decrease even close to the same way if the money were removed. I think they'd cut supply before they cut price. Especially with the all too common "but you need a degree" fallacy
Assuming 1 teacher making 100k teaching 20 students * 5 classes * 3 credit hour classes a semester ~= 333$ / credit hour. 128 credit hour degree ~= 43k over 4 years. And that's assuming relatively small average class size and ignoring adjuncts etc.
Yet, many schools are charging 4-10 times that much. The question becomes what are the 3+ other people doing if not teaching and can you get rid of that?
PS: And sure some professors make well over 100k and facilities are not free, but again many people even at expensive schools are pulling in less than that.
Professors aren't paid terribly -- adjuncts, lecturers, and teaching assistants typically are. That's because there are far more people jockeying for teaching positions than there are positions available.
But saying college is expensive because it's inefficient begs the question: why is it inefficient? I'm inclined to think that the amount of federal money available is, at least, a factor...
College is inefficient because instead of just paying out of the taxpayers, we created a roundabout system of loans and banking that serves no one except shareholders.
> Interestingly, increased spending has not been going into the pockets of the typical professor. Salaries of full-time faculty members are, on average, barely higher than they were in 1970. Moreover, while 45 years ago 78 percent of college and university professors were full time, today half of postsecondary faculty members are lower-paid part-time employees, meaning that the average salaries of the people who do the teaching in American higher education are actually quite a bit lower than they were in 1970.
> By contrast, a major factor driving increasing costs is the constant expansion of university administration. According to the Department of Education data, administrative positions at colleges and universities grew by 60 percent between 1993 and 2009, which Bloomberg reported was 10 times the rate of growth of tenured faculty positions.
> Even more strikingly, an analysis by a professor at California Polytechnic University, Pomona, found that, while the total number of full-time faculty members in the C.S.U. system grew from 11,614 to 12,019 between 1975 and 2008, the total number of administrators grew from 3,800 to 12,183 — a 221 percent increase.
tl;dr: In markets where the cost of education is less than the increase in wages, the real cost of education isn't the fee, it's the relative effort of passing it.
Yes, it will cost a lot and yes we need to find a way to fund it, but giving all communities fair access to education is in everyone's best interest.
Increasing the base level of education makes everyone a more intelligent, informed citizen and voter, and will have a positive impact on the progression of our country. I think it's a bad idea to be penny pinching in this regard. I also think everyone being educated, and learning how to think for themselves (which I find is the key greatest value of getting higher education) will keep the people in power from herding everyone around like sheep, and will lead to more progress and innovation.
I will gladly pay a higher portion of my salary if it means the general populous can think for themselves, has a means to climb if they wish to, and the base level of education of the people in my country increases.
I agree with a lot of your points, but the way to increasing the base level of education isn’t through making all colleges free — it’s through investing in and making community colleges free.
Why? If we’re trying educate the entire populace instead of a few high achieving high schoolers, we should recognize that a majority of people can’t afford to up-end their lives, move far away, and spend 4 years getting a degree.
Community colleges, emphasis on the community term, would allow for people — local people — to educate themselves without drastically affecting their livelihoods. In this way, community colleges can also potentially act as job retraining facilities.
This is fair. I'm saying all higher education, so if upending your life doesn't work for you, you could choose a local school or community college.
Also the regular admissions system would be in place, so higher achievers would still exclusively get into more prestigious schools, it's just that money won't be a factor.
Personally from experience, the prestige comes with network and the network is where it's at. The connections you have definitely grease the upward escalator.
Most people who go to college don't upend their life. By the numbers ~60% of students go to schools 100 miles or less from home. Obviously the numbers are far different for graduate school but I think the point still stands that subsidizing all college doesn't suddenly require people to move to the other side of the country.
There's also a big difference between classes at a local community college and a university. Some community colleges are quite good, and you can always try to transfer to a 4 year university before graduation. However, it would be incredibly dishonest to pretend that the quality of education between the two is the same or that employers view a degree from a community college the same.
For instance both MD and PA have notoriously few and poor community colleges. But both states have an abundance of very good colleges. Free tuition for all would mean more people could attend those schools as opposed to being forced to attend a poor CC just because that's all they can afford.
Can you elaborate on the Californian bias with regard to community colleges? Is the California community college system better/worse than other states?
I’m a native Californian that went straight to a 4 year, but I sometimes think about how much cheaper college would have been if I had gone to community first.
Went to CC in California. Paid ridiculously little. All classes transferred, started with killer foundations at a fraction of the cost. Transferred to UC. Been employed 8 years. Nobody's ever asked where the first 2 years of college were from. Not even for my first job.
I don't know why more people don't go that route. It's like $26 dollars a unit, the books cost more than the classes do. The professors were dope as hell - especially in the hard sciences. Plus you didn't have a lecture hall with 150, 200 kids in it - you had 30, 50 for a "big" class. The instructors always showed up to office hours, they all spoke great English, and actually cared if you understood the material - they weren't ditching class to prepare for a conference, or having a TA do the actual teaching. They genuinely liked their subjects.
Going to CC is practically a secret weapon. I'd hire a CC graduate over a "bootcamp" graduate any day of the week.
I believe the California community college system is better than most states. Let me elaborate.
In the summer before my freshman year, I didn't really have much to do, and so I decided to take up a course. My options were to either take it at the UC where I'd attend, or to take an equivalent offering at a local CC. When I looked at the price, there was a 10-fold difference, $2000 against $200.
It was a no brainer to enroll at the CC: transferring credits was easy because the UC system and the CC system already have an agreement [1]. This is in addition to the transfer agreement between the two institutions, where CC students are guaranteed admission to some of the UCs if they fulfill the requirements [2].
Before the first day, I recall having low expectations; I had bought into the mindset that a smaller tuition meant a shabbier campus and a worse experience. I was dreadfully wrong: the place was modern, and my class size numbered around 15 people.
More over, its population was diverse. I didn't see only college students; there were middle schoolers, high schoolers, international students, and even parents dragging their children to camps. In general, the place had people serious enough about their education that they would spend a nice summer doing so.
Here, it seemed was a greater emphasis on the community side of college. I want to mention that this is in contrast to what I've previous seen. I came from a high school which didn't focus on getting people ahead, but on only keeping them from following behind; that was the primarily the idea of summer school. I've also heard of high school students paying for private SAT/ACT tutoring, and for online AP courses. In hindsight, CCCs act as equalizers in the field of education -- I would even say they are the modern day equivalent of churches in our state.
> Why? If we’re trying educate the entire populace instead of a few high achieving high schoolers, we should recognize that a majority of people can’t afford to up-end their lives, move far away, and spend 4 years getting a degree.
On the other hand, consider a state like Maine, which has under 1.5 million people and a bunch of good state universities for a variety of disciplines that a community college isn't equipped to teach. You don't have to move that far away (I moved two and a half hours away from where I grew up, and tbh I wish it had been further) and when you're leaving high school it's probably more common than not that your life isn't really settled enough to upend.
(I think making community colleges free, too, is a very good idea.)
More people should read, “The Case against Education: Why the Education System Is a Waste of Time and Money”
People take it a priori that more education is always good — when there’s a lot of evidence that the vast majority of higher education (in both time and dollars spent) is wasted.
Free but not compulsory, right? You don't need higher education for a lot of jobs and many people do not wish to attend college. I also think it's wrong to imply that people who haven't attended higher education can't "think for themselves". My 2 cents.
I'm saying it will increase the average level of individual thinking, but not saying that it's a requirement. I'm simply saying those people that forgo schooling because it's not economically feasible for them, will have the ability to do so and thus one large factor in keeping people down is eliminated.
The problem I have with free college is that college, while expensive now, is already nearly compulsory for a lot of jobs that don't require it. A degree in any irrelevant thing is used as an arbitrary deciding factor. Free college will make for compulsory college as everyone will need a degree to have a chance. Then we actually lose value from the opportunity cost of people not working.
Disclaimers: obviously, yes, I think education is great in general. And I actually don't mind social education. I just think it's easier to get this wrong than right.
Except colleges won't make people more intelligent. For the most part, it won't even make people more informed. For many people (especially the incremental people that would go to college if it were free), college is an extended 4-year vacation, during which they immediately forget everything they learned, because they never need to use it on the job.
> I will gladly pay a higher portion of my salary if it means the general populous can think for themselves, has a means to climb if they wish to, and the base level of education of the people in my country increases.
No one is stopping you from doing so. Donate some money to local youth or a scholarship fund.
However, it seems like you want to force everyone else to pay a higher portion of their salary to this cause.
would not increasing the base level of education decrease the chance of the currently ruling party staying in power? does not seem like a wise course of action (edit: for them).
>FAFSA still considers you a dependent until you're 24
You can certainly "game" the system still. One could easy join the military, from there you'd get out around that age, they you'd be independent and you'd still have a GI bill to pay for most of it.
Or like me, I went to a tech school for aviation maintenance, graduated in 1 year, started working full time at age of 20. But by 21, I knew this wasn't the right field for me (too low pay for the amount of work required). I saved my money, quit when I was 24 and enrolled in a 4 year uni for CS full time with only $5k in my bank account.
I lived with my grandparents that were about 40 miles from the uni. The $5k got me through one year just fine since I didn't have to pay for rent or food. For the second year, I went back into the aviation field as a contractor making $22 an hour. After 6 months I had $10k in the bank. I then started my second year of college but to my surprise, since I hadn't filed with the IRS the past year and claimed an income of $0 in the previous year, I then qualified for about $6k in pell grants. So with $10k and pell grants, I went to college full time for another 4 years and graduated debt free (yes, it took me 5 years to graduate, perhaps I'm a little slow..). Actually not totally debt free, I still pay $50 a month for my tech school degree loan from 15 years ago...
>Despite being emancipated, FAFSA still considers you a dependent until you're 24.
It's ridiculous.
Parents divorced and one parent is an asshole? All they need to do is refuse to hand over their tax returns.
Parent remarried? FAFSA wants to see the tax returns of the step-parent and takes THEIR income into account, even if the marriage only occurred the previous year.
Needing parental tax returns is a ridiculous thing for an adult.
Actually in a divorce scenario, FAFSA only requires information about the custodial parent’s household (so if you’re independent you can effectively choose which one). But yes, doesn’t change the fact that the whole concept is dumb. If they’re using tax returns to determine ability to pay, they should also follow the IRS’s rules on dependency.
Raise the income tax, create a VAT, kill the mortgage-interest tax deduction, add a Financial transaction tax, tax capital gains like normal income, stop subsidizing fossil fuel extraction, add a carbon tax, and lower the threshold for the inheritance tax and raise the percentage.
College is largely an exercise in social credentialing and signaling. If we make college free, the people who want to get ahead in society will just go to expensive graduate programs in order to distinguish themselves. Then the discussion will shift to fully funding those programs...
Our current system is very fair. Take out a loan if you need to, but make sure your post graduation prospects justify taking a loan out. If they don't, then don't get the loan.
One of the major reasons why college is so expensive today is because the availability of loans means Universities are able to continuously hike tuition in support of ever expanding bureaucracies (not in support of the core educational mission) without fear of students not being able to pay, because the loans mean students can always secure funding! Society is basically writing them a blank check... The answer is NOT to give them even more money!
College education has become a financial black hole that will only expand if we throw more money at it.
PhD students getting stipends are essentially contract employees. They are doing work, either as associate instructors or research assistants, for that money.
You prefer an under-educated population? The most valuable asset we have in the technology and service based economies is human capital. We need a creative and educated population to continue to compete. I think we should eliminate all for-profit education and preferably make all universities public.
Why do you assume that degrees are "worthless?" How are you defining "worthless?" Based on the research, getting a degree significantly increases your earning potential. But I would argue that even if that wasn't the case and everyone got philosophy, literature, and history degrees, our country would be significantly better positioned globally.
And I agree with your statement that the problem starts earlier. Although most of our issues with primary and secondary public education can be traced to poverty and racism. So, I think we should raise taxes to address those as well :D.
You have to be careful with conflating causality. As we turn college more and more into highschool 2.0, we're going to see the correlation with increased earnings start to deteriorate. There's a simple matter that we're greatly increasing the supply of college educated individuals which, in turn, will have a diminishing effect on their demand which will drive earnings down. The only way this will not happen is if there's a proportional (which is to say sharp) increase in the number of available and desirable positions for college educated individuals.
This is also ignoring that we've greatly widened the demographic attending colleges. The reduced selectivity means that the average person is not going to be as top-notch as they were at one time, which means that the average expectation of an individual with a college degree will also go down. This will also have an aggregate depressing effect on our earning:education correlation. More important than ever will become median earnings for college graduates. The top graduates are earning vastly more than ever before which will mask the overall problem.
I’m referring to all the unemployed and underemployed college graduates complaining about the debt they are in. Simplify transferring the debt somewhere else isn’t fixing anything, it is just shifting the drain on society. College is highly useful for some people, and not others. We should do more to make sure it is available to those who would benefit, and offer different things for those who prefer or need trade skills.
Who is undereducated? We managed to create a civilization that went to the moon back when the vast majority of people never went to college. Germany continues to be a leading industrial power while lagging most of Western Europe in college statistics (especially "academic" college like we have in the U.S.)
Is it possible to simultaneously have an over-educated population and an under-educated population? I am having a hard time squaring the two prevailing ideas on this issue. One is that we need more/free education because an educated population is best. The other is that we need to import vast amounts of new unskilled labor so we have someone to pick our fruit. I realize you only espoused one of these ideas, but I am curious if someone holds both those positions and would help me understand how both can be true at the same time.
People will still go for the degrees they go for today, which for the most part are degrees they believe will provide a good return on their investment of _time_. On top of that, unis would need to limit how many people are accepted to a penguin program, because how many qualified teachers can they throw at that?
Beyond admissions quotas, I imagine that if gov’t does decide to fully subsidize unis, they too will impose limits per field of study. This is already done in European countries that subsidize uni.
Finally, I think with “guaranteed” gov’t loans, unis have already taken a lot of their skin out of the game. They don’t have to worry about that student defaulting on their loan later, the gov’t does. Or even for private loans. If you had a seemingly infinite bank account, would you penny pinch or see how many new toys you could buy?
Then don't fund Shady St Uni. Put criteria in place for evaluating, and make sure the universities have skin in the game.
(Also, not every degree that doesn't immediately result in you making $250,000/year is worthless. And students are pretty motivated already in pursuing degrees that they see jobs in. Even if your education is free, if you put in 4+ years into something that you can't do anything with, you're still not profiting. Students themselves would still have skin in the game even with free education.)
Ok. Do that first and I might support it. But the guaranteed loans for everyone system of today has not only inflated costs, it supports a bunch of worthless crappy schools. Go look at the list of universities in the US, and find the bottom 100. They are as offensive and wasteful as a $10,000 toilet seat.
Not sure why this is downvoted. There are plenty of degrees that might be useless for making an employer more money, but provide important work for society.
Very well, but what is your objection to zoology? Normally, people pick an arts subject when arguing about poor-value degrees.
Zoology is a biology course, so there's a general scientific background (research, hypotheses, statistics, modelling etc), and zoology in particular is necessary for understanding the spread of animal pests (e.g. insects eating pests), invasive species, human and animal disease (bird flu?), understanding/recording what is in a particular place (perhaps before construction work, or to guide the planning of that).
I believe when most people say “make college free”, they’re referring to a “tuition free” education. There is still a housing cost, which is “skin in the game”.
Eh, my ideal would be like Europe's that gives you a stipend as well to cover room and board. Paying for housing is more than a full time job in a lot of places with universities (particularly the good ones), and ideally we'd want students to be focusing on their studies.
Not a bad idea. There are 1.6M professors (including part time, but let's just assume they're full time). If we paid them 100K each, it would only cost $160B per year. So we can definitely afford to continue with a smaller military.
Obviously the amount of people enrolling and therefore the number of professors will have to increase. However some of that can be addressed by using more internet based lectures, etc..
Also, to backfill the loss to the military, they could require a significant portion of the degrees be in robotics.
We're going to really need that military when China, when we make degrees in underwater basketweaving free for everyone and China (which has a sensible approach to what education is and is not valuable) overtakes us economically and technologically.
The U.S. military accepts something like 20% of its walk-in recruits. [0] When you imagine education as a "socialized entity," I strongly suspect you're not picturing an institution that rejects 80% of the population (for reasons like, say, being too fat).
I don't think you understand. It's a thing we all pay for. It's a publicly funded service that defends the country. It's not about who gets in, it's about how it's paid for. We all pay together for something that is not explicitly for profit that we believe to be for the good of the country. This is socialism.
But also, to your point, colleges would still reject students based on grades. This happens in countries with free college education. Standards are still maintained but it doesn't depend on how much money you have. We would get the best candidates based on merit instead of their parents income.
On the contrary, I don't think you understand how college admissions work. When you're rejected by the military, there's no second- or third-tier back-up plan. But anybody who wants to go to college can go to college and they can get it paid for, no matter how unproductive or frivolous their major.
When Stanford rejects you, you try a state school; when the state school rejects you, you go to one of the state's less prestigious satellite campuses. If they reject you (which is extremely unlikely), you go to community college.
The US right holds the contradictory opinions that socialized government can't accomplish anything effective, and that the US military (which is fundamentally a socialized entity) is amazing and awesome and supremely capable.
It's not free. There is no tuition, but at least in TUM (Munich) there is a 'student union and basic ticket' free. It's €129.40 per semester [1]. There are financial aid options available. This applies to all students regardless of nationality.
TUM is a top technical university by German, European and World standards. [2]
This discussion is ridiculous from an European standpoint.
In Germany all universities (with very few exceptions) are completely free and students have just to pay their cost of living (can apply for subsidies for that too).
There were many studies which showed that ANY fee is a deterrent for students from poor families.
In my opinion the current political development around the world shows that better education is absolutely required for humanity. Education should be financed via taxes (and taxes for high incomes should be increased accordingly to finance it).
I liked the financial transaction tax proposed by Sanders. France, Belgium, and Singapore manage to have this without being known as financial wastelands were no exchanges exist.
Additionally fully nationalize the public schools, and work to remove the administrative bloat that has occurred. I know that the libertarian side here on HN is going to see this and say "more government -> less overhead? does not compute", but hear me out. Their pseudo private status has set up the incentives to de facto remove education from the core mission of universities. Chasing grant money, real estate capital, and investments might technically make them more money, but that flies in the face of what they should be doing, IMO.
I wasn't aware that professors in Germany were unpaid. Or that the NHS was purely volunteer. Or that either countries had abolished private industry in either of those contexts.
Oh wait, no, it just turns out that the turning point-esque meme that socialized services equates to free labor is just absurd.
Wow! You are right! Nobody is entitled to anyone's labor! We should make sure we let the capitalists who use the labor of everyone around them to extract profits.
Nice. Got a bite. Clearly you view the world as a zero-sum game. That's not reality. Reality is - I need help to get something done. You and I talk about you helping me get something done. You and I agree to exchange X value for Y labor. You get something of value and I get something of value. Nobody forced either of us into the agreement... we both did so freely. Wow. So right! So simple! Me like freedom. Me go eat waffle.
I joined the military to get out a bad family situation, after a tour in Iraq I was considered financially independent on the FAFSA due to my veteran status. That designation, in combination with my veteran education benefits, allowed me to pay for school.
While I am thankful it worked out for me, I know this is not a route open to everyone. Unless your family has the financial means (or you get a great scholarship), I am not sure there are many ways to go to college without getting into significant debt.
> Just make college free. Trying to make all of these complicated rules to make sure that a few people aren't "getting one over us" is just making more cracks for people to fall into.
Presumably you mean, increase taxes so we can pay for everyone to go to college? Not everyone wants to go to college. Your proposition means that those people are getting the shaft.
> ...FAFSA still considers you a dependent until you're 24. I was told that only with documentation of leaving an abusive household would a dependency exception grant be applied.
Would you mind saying when and by whom you were told this?
Asking because this was not my experience. While I can't remember if I had to/or was able to finagle my parents' info for FAFSA, I do remember having direct discussions w/my school @ the time so that they weren't trying to factor my parents' assets and income into their aid calculation.
I was told that in my specific situation, I'd need documentation of leaving an abusive household.
Ironically if I had applied to college while I was 17, they have a category for emancipated minor. But since I was no longer a minor, that didn't apply to me.
And to answer you question, this was repeated from several potential schools' financial aid departments.
Well I guess w/o knowing the specifics of our situations it's difficult to know why our experiences were so different, but if that is in fact what you did experience and you weren't trying to game the system (which it seems many people do try, unfortunately), I'm sorry that was your experience-- unless things worked out better for you?
Based on my experience and what you're saying, my sense is that the schools have wide latitude in deciding who they'll consider to be independent. I mean, the FAFSA form requests a bunch of info, but the gov't will calc w/o all of the fields being filled out. I'd guess that they and the schools are saying, 'If you are able to get the data from your parent(s), spouse, etc., you must be on good enough terms for them to contribute. So, gtfoh, w/your excuse(s).' While it's not right, it's convenient for them since, from what a friend in fin-aid consistently told me, there is always more demand for aid than there is supply.
All of this said, just w/respect to the general discussion, people need to give think a little more about what purpose(s) schools actually aim to serve and who benefits from things functioning as they do today. There, unfortunately, is no such thing as free formal schooling; money comes from somewhere. And a shortage of funding for the system isn't even an actual issue today in the U.S.
The questions more people should be asking are 'Why is (formal) education so expensive?' and 'Who is benefiting from this arrangement?' Once more people start figuring out the answers to those questions,-- some of which are actually quite interesting/disheartening/infuriating-- the avg person would be in a much better position. I say this, not musing on some theory, but having researched this a bit for a class I had in uni. Some of the answers are hidden in plain view.
Agreed, this was exactly the thing that led to me dropping out of college as well. In retrospect moving into software was the better decision, and I now have the money to go back if I choose, but folks missing out on the education experience because of poor law is completely avoidable.
regarding "development job... putting me outside the income level":
I faced the same situation; after being rejected, all I had to do was file some extra paperwork ("special circumstances") saying that I'd left my job and no longer had any income.
While "gaining admission to NYU medical school" is likely correlated with good socio-economic background (as do all accomplishment), the correlation is not 100%.
You can get into NYU from a poor socio-economic background, if you work hard and attain academic excellence.
And while all students will appreciate this discount, it will make more of a difference to those who are not "fine without it", i.e. those below the top richest and most privileged (for whom spending $200-300k on education is easily affordable).
Finally, this isn't exactly pure charity out of the kindness of NYU's heart. It's a response to medical candidates choosing other fields due to cost and debt issues:
Per your first argument, even granting that admissions is meritocratic / fair for the sake of argument, the education you receive, networks provided, and simple prestige of the school all provide advantages that you will not find to such a degree at a lower tier school. Tuition subsidies adds an additional major advantage of not having the drag of loans slowing your future economic growth. Again, I understand that society is full of these self reinforcing advantages and that I benefit from many (including a public academic scholarship); the critique is merely incremental.
Per "it will make more of a difference to those who are not "fine without it"". Sure, but it would make more of a difference if needs based and scaled broadly (not sure what restrictions exist on the funds for this aim). Although this line of argument admittedly unravels into base utilitarianism when followed.
This argument is fascinating, because you are in effect arguing that people should be rewarded according to their lack of privilege: "we should give these subsidies to students from 'lower-tier schools' rather than students from 'top-tier schools' who are already well on their way to success".
This is the "social justice" argument.
Now let me ask you this:
If you get sick and require surgery, would you rather be treated by the smart, skilled, hard-working doctor who succeeded in everything he tried, including being accepted into a top school?
Or maybe you'd prefer the under-privileged doctor, who never did well academically, and only got into a lower-tier school, but managed to graduate thanks to your social justice subsidy?
Your argument seems to make society more just and equal, but you support it because it is convenient to appear as just person, and you are isolated from the repercussions of your proposal. In reality, your policy will prefer and encourage mediocre doctors over excellent ones, you just hope it won't affect you.
Thankfully, American society is structured in such a way that a top school like NYU can muster the funds required for the subsidy, and thus we will have more excellent doctors, instead of more poor ones.
That is the least generous take of my argument and not conducive to a productive discussion. Never did I make an argument about social justice or the removal of merit from the system. In fact, I was making an elitist argument, that those with great merit will do fine without a subsidy of their tuition and that the market will award them with or without this fund.
I did not mean to offend you, and apologize if I misread your comment.
Either way, I disagree that the better people will always prevail, no matter the circumstances. By definition, a stronger candidate will succeed where a weaker will fail, but that will only apply up to a particular challenge differential. If you keep shifting resources to the weaker candidate, the stronger will fail or give up, eventually.
On a personal level, I came from an underprivileged background myself, and succeeded due to stronger drive and working harder than most people I grew up with. But there were many points when I wanted to give up, and I know how close I was to ending up in the same failure mode as they did.
Finally, even if your argument was correct, and these medical school candidates would succeed "regardless", the point of these scholarships is to make sure they choose medicine as the field to apply themselves and succeed in. Sure, they'll be successful regardless: they'll just make a great career in investment banking, and leave medicine for those who have less options.
Society wants great doctors, so it pays the most qualified individuals to undertake a course of training and application in medicine. Makes sense, I think.
>>You can get into NYU from a poor socio-economic background, if you work hard and attain academic excellence.
Very true. Unfortunately many times the schools where a kid from a lower socio-economic background will attend will not prepare them for a school like NYU. In fact, sometimes it will probably be a net negative.
Not necessarily the school itself, but the whole environment. Other students will be so disruptive to an entire class or school that they will drag down their piers down with them. And by this I'm talking about gangs, drugs, bullying. And if it is not their piers it may be their family themselves who will drag down the kids (alcoholism, drug addiction, domestic violence).
And it is not like you can just say they should know better, because at that age they don't really know any better. Kids from crappy neighborhoods don't even start in the home base, many times they are not even allowed to play.
I've been in many different socio-economic backgrounds.
First school I went to was the lowest performing school in Georgia, in which I was the only white child. By high school I had moved to the highest performing high school in the state, where the senators sent their kids, etc. "Real Housewives of Atlanta" was from my school district then.
Drugs, alcoholism, bullying, and domestic violence happen in every environment, and in my experience they trend towards those with the means to sustain those habits. The rich kids had been doing coke and molly since they were 13 and have been buying it from their classmates. In the richer burbs, the cops are present to keep out people who "shouldn't be there", and less to keep the citizens who "should be there" from breaking the law. The huge emphasis on "upstanding members of the community" having a "traditional household" hides high levels of domestic violence.
I agree that kids from the poorer backgrounds don't even start on first base, but it's not because of any life choices they've made in a lot of cases.
Out of curiosity, if it wasn't the environmental or family differences, and if the cops aren't preventing crime in the higher-income neighborhoods, what do you think caused the first school to be low-performing and the other to be high-performing?
I don't think it was negative environmental differences, but the positive ones.
The kids in the burbs had been taught to read before they entered school. The teachers are just better, as they're paid better there (school funding comes from property taxes). The kids are pushed to succeed, internalize that, and push eachother to succeed, whereas school in the city felt more like daycare going into prison.
Also, your teenage screwups are far more likely to be swept under the rug or not be noticed in the burbs. Saw more guns in school there. Saw kids get busted for literal pounds of drugs, but because their dad knew the DA or something they got a sealed misdemeanor possession, and had it expunged as quickly as possible.
You know the saying "you're fine as long as you aren't breaking more than one law at a time"? Like don't speed if you have a joint in your car, etc.? That comes from a huge position of privilege that isn't afforded to a lot of the population.
EDIT: Also I was told (but haven't confirmed) that apparently colleges were weighting grades from the higher background school in such a way that you could be a B or C student, and after weighting it was the equivalent of off the charts in the other district. Like literally unattainable, straight As with AP classes (if they were even offered) would still be weighted as less.
Why does a socio-economic background disqualify someone from having drive? How about dreams? Should poor kids flush those for the good of the class? Because they MIGHT have bad apples in their social circle? For circumstances they don't control- we ought to prevent them from being able to change those circumstances via opportunity and hard work?
How common do you think this is? I would bet it is no more common than other shitty circumstances regardless of socio-economic status.
I've never had the displeasure of being around so many drugs as when I went to prep school-- not some random private school, but a legitimately prestigious one to which future U.S. presidents and or their spawn are sent. Kids there were smuggling large quantities of narcotics in and out of the country, sometimes at the risk of death.(No, I am not exaggerating.) They were also robbing each other of said drugs. The difference is that because of the institution(s), players involved, etc., more discretion is involved in how disputes were handled. All of this scales down the further removed one gets from such environs until you reach the disproportionately poor groups, who make up the bulk of the stories that people hear, but not necessarily the bulk of "crime" were they to be policed at the same levels of the former mentioned groups.
Alcoholism, drug addiction, bullying, domestic violence are issues that affect people of 'noble birth', too. In fact, a number of kids I knew in school were acutely aware of the fact that their parents saw them as a burden or impediment to their own lives and as such, sent shipped them off to boarding school. And so, the kids drank and drugged... Fast forward to college, I know of one kid whose parents shipped off on a study abroad trip to "cure his drug addiction." Yeah, he ODed while we were on a ship in the middle of the Pacific-- though he'd scored coke, but surprise, surprise, the nice dealer he'd met while were in a SE Asian port gave him something else.
tldr: Yep, kids from poor neighborhoods often don't start out w/the same advantages as those from higher socio-economic backgrounds, but kids from the latter backgrounds often work vary hard to even the playing field by engaging in self-destructive behaviors that for some reason people like to mostly associate w/being poor. Really the only difference is that certain members of society are more willing to forgive even the worst behavior for one group while penalizing mercilessly those of the other for the most innocuous behaviors.
Ps. A pier is something one might take a walk on. A peer is a member of a cohort, class, etc., ostensibly.
This is a problem we have in Europe as well (at least southern EU where I'm from): colleges are almost free (1000€/yr here, so affordable), even the best ones.
But who can get to the best ones? People from poorer environments unfortunately get a poorer education as well (middle and high schools are of less quality), and it makes it way harder for them.
I am the first person in my family to attend university. Stanford gave me a full ride to study CS and it has made a world of difference in my ability to access opportunities.
I am an anecdote obviously. However, I want it to be known that at Stanford, people at the bottom of the economic ladder receive aid, but people in the middle still get squeezed.
Making tuition free for all would actually be a net positive. Sure. There are people at the top who would benefit, but for the most part, financial aid is financed by the estates of people in that elite socioeconomic class.
I don't really have a point here. This is just my experience of the system.
Yea but historically Stanford was tuition free for everyone. (Like the founders wished it to be.)
So that's why they have such an extensive student aid program, properly not the same anywhere else.
Edit: Actually more of a comment for the post before.
Those competitive jobs will likely to go to the better-credentialed people anyway, regardless of debt status.
On the other hand, perhaps some great minds choose to go into medicine rather than banking, or more important but lower-paying medical disciplines, because they know they won't be graduating with crippling debt. That seems like a big win.
This. Specialties that have a high quality of life but are often impossibly underpaid relative to the student loan debt burden (eg Family Medicine / Rural Medicine) should see a boost in residency candidates.
On the other hand, subsidies that everyone gets are the best kind: they're a small help for people who don't need them, and a big help for people who do need them. And there's no bureaucrats who get to decide if you need them or not.
To be so privileged that the free med school is something you can do without is to be in an almost insignificant percentage of the population. Even for the upper middle class med school costs are huge.
Now less privileged people can see NYU med school as something to aspire to. I fail to see the problem here.
>I'll probably be downvoted on a forum like this, but I worry about the most successful universities using their funds to subsidize those who would be fine without it.
This is the definition of "means-testing" and it is bad. Testing and "checking" that the recipients of social welfare is complicated and doomed to create a group of excluded people who believe they should have merited it. Means-testing introduces fiscal cliffs, creates a separate of haves and have-nots, and lots of other unnecessary anxieties between classes of peoples. The savings means-testing produces is tiny in aggregate and the harm to culture is large.
Moreover, means-testing becomes the fulcrum that anti-social welfare reformists use to destroy programs. Means-testing introduces an additional point of failure, brittleness that can be exploited. It's hard to rip away a program that is granted to all comers, but if there is a clear line between haves and have-nots, they you can just move the line. This has happened multiple times to the Affordable Care Act, and states regularly do this to medicaid and food stamp programs, to their detriment.
The most successful social programs have no means testing: social security, medicare. If you value social welfare programs, you will not inflict means-testing on them.
Just out of curiosity, would you(r family) have been able to afford medical school anyway?
This isn't just for the poor, it's also for the well-educated, solidly middle-class people who still can't afford med school, or have to go deep in debt, thus leading to them being forced to prioritize high-earning careers over those they might otherwise be inclined towards, medical careers that might have a more positive social impact.
Indeed. Some of these universities (Stanford, Harvard) are so filthy rich that they could provide free tuition for everyone and still watch their endowments grow from investment returns alone. Not to mention the enormous gifts they receive from successful alumni. Harvard has received hundreds of millions from the likes of Bill Gates and Mark Zuckerberg.
Graduates of mid/low tier universities seem more and more likely to have to compete with better credentialed people with lower debt.
Or maybe it starts a trend that if you apply yourself and make sure you do really well at X, you can graduate without a lot of debt. Maybe this leads to a world where we get better at helping people find the thing they can excel at so they can qualify for the free ride and then be awesome at their profession after they graduation. And maybe this becomes a trend where other universities decide a full ride is the only thing that makes sense.
There is an S curve where rich people, who can afford to take risks, try new things. They get to winnow out what doesn't work. The things that succeed become popular and this makes them affordable to the masses.
But, first, someone needs to give it a shot. And that someone is usually pretty well-heeled.
How many Billion dollar companies haven't been started because a brilliant but poor entrepreneur was unable to take the risk? How enormous is the societal loss because of this? Frankly I find your position disturbing.
That would presuppose that admission at schools like Stanford is more skewed towards wealthy students than the "lesser" schools. Which I doubt. But even if, then that would be the problem to address, rather than cutting the assistance programs.
It's not even remotely controversial that students at top schools are overwhelmingly more well off than average. At Stanford theres roughly the same number of students whose families are in the top 1% of income as those in the bottom 60%.
But isn't that a tremendous endorsement of Stanford? That they have recruited so well and changed their cost structure so effectively that even the poor can attend?
Not really? Yes there are other schools that are worse than Stanford, sometimes significantly more but take a top public school like University of Texas which has 5x as many students from the bottom 60% as from the top 1% (5.4% and 27.7%)
Stanford is at 17.5% and 18.6%.
For comparison Harvard is better, MIT is significantly better, on par with Texas, Yale and Princeton are slightly worse.
My point was about whether or not the Stanford Students' wealth distribution is more skewed towards higher family income, as compared to other schools.
And additionally, whether or not these differences are driven by academic achievement (which is often higher in higher income families, for various reasons if not more money spent on good grades) or other reasons.
I rarely hear that anymore. I almost always hear "alumni" in all cases. I've tried saying to the librarians of my alma mater that I'm an alumnus and they repeat back to me, "oh, you're an alumni, sure, let me get you alumni access to our system."
Maybe it's common somewhere else to make those distinctions, but they're not common at McGill.
Unfortunately, common or not, the usage of "alumni" in that context is incorrect. It may be a bit pedantic to insist on correctness in Latin, but all other schools use the term correctly and it doesn't reflect well on a well-regarded school to use the term incorrectly.
Yes it is by processes of consensus arising from appeals to stylistic license, shared community language, memes, etc. But not every grammatical error falls into these categories.
Think of it this way - let's say you make a grammatical mistake that most people consider a mistake. You shouldn't hide behind the "language evolves" catch-all card... you should to recognize it as a mistake and try to use the correct form.
Not at all. You have misread me. That language evolves is a common used argument (and there is a place for it) but often used as a catch-all argument to justify errors.
But in this case alumni is in common use in that way and has been for some time. You yourself acknowledged that by starting your comment with "Unfortunately, common or not".
> But in this case alumni is in common use in that way and has been for some time.
I dispute that. Googling doesn't turn up many examples of official usage of alumni in the singular.
I also disagree with your second claim, which is a projection. When I said "common or not", I meant that frequency in itself does not automatically make something correct, and I gave reasons why in a follow-up comment. I didn't claim that usage was common.
I'm not trying to be difficult, but alumni really is plural. Using alumni as singular is not correct.
You could be right, I don't know. Of all the Latin lessons I had in high school, I probably zoned out the most during those that covered the ablative case. :)
When I was at University, I worked for the Department of Annual Giving, at first on the phones. I still remember one of the other callers always starting her spiel with "We're calling all the alumnis." With an English plural on top of a Latin plural, for good measure, I suppose. I cringed every time.
(Though, to be fair, the native English word children is in fact a double plural as well. [The -re is plural, thus early/dialectal forms childer "child [pl.]", and then later with a plural -n slapped on top of the already plural word, presumably because the -re plural ending had become somewhat obscure, just as Latin plural endings are for some modern English speakers.] Doesn't make me cringe any less at "alumnis", despite that.)
My Latin is a little rusty and mixing Latin grammar with English is doomed to be an exercise in futility, but IIRC that declension is only correct if you're using alumn- as an adjective for another noun which is masculine or feminine (which doesn't necessarily match the gender of the person, e.g. agricola is a masculine noun but can refer to a female farmer)
If you're using it by itself as a noun, it's 2nd declension and the ending changes only based on plurality or case, not the gender of the actual graduate(s)
> mixing Latin grammar with English is doomed to be an exercise in futility
I agree. When thinking about the use of "proper" English, I find myself conflicted.
One the one hand, I truly believe that languages evolve, and it's silly to put any one particular version of English on a pedestal. That includes the version(s) one might associated with English speakers who are well-educated and/or wealthy.
On the other hand, I was raised to speak "proper" English, because my father believed that it strongly affects others' first impressions of the speaker's intelligence. I think my father was right about that, although I'm still undecided about how much it matters, and whether or not it's a concern worth catering to.
No, if you're using it by itself as a noun, it's 2nd declension when masculine and 1st declension when feminine, just like most nouns coming from adjectives and exhibiting obvious gender. Agricola and its cousins are exceptions, not the general case. Compare amicus / amica.
Alternatively, if you're using it by itself as an adjective, obviously it will take the appropriate gender. You don't need an explicit noun if you're happy with an implicit "man", "woman", or "thing".
Presumably a combination of reanalysing "alumn-us", "alumn-i", etc. as "alum-nus", "alum-ni", etc. and a phonological preference/constraint against word-final /mnz/. And against /mn/ too: even English column is /ˈkɒləm/ and not /ˈkɒləmn/.
I agree. The system is set to means test in a backwards looking fashion rather than a forward looking one. I don’t think that makes much sense. I don’t especially see why a future-hedge-fund worker ought to get free tuition even if his parents don’t make much money.
That said, insane cost growth is obviously the overwhelming issue in education over everything else. Almost any system that reins that in is going to be superior to one that doesn’t—-even if it is otherwise less fair.
Completely different situation, but something like that is discussed in Italy too, where the majority and most prestigious university happen to be public: why should we make the tuition free for everyone, specially when it's so low here, refusing the moneys of more riches people that pay more?
The natural solution is invest more in scholarships, at least here. I'm sure that the situation in US is fully different though.
University may be affordable without loans if it were not for all of the capex expenditures every year and needless administration. Education has a huge HR problem. Lots of people doing nothing and it is sucking our young dry.
I would say it is pretty hard to determine who would be fine without it. Just because a student is from a wealthy family does not mean that the family will pay for their kids tuition.
The paywall hits for me before the source(s) of the subsidies is identified (assuming they are identified). So how much is public and how much is private?
"NYU raised more than $450 million of the roughly $600 million it estimates it will need to fund the tuition package in perpetuity, including $100 million from Home Depot founder Kenneth Langone and his wife, Elaine."
This is amazing. I graduated from medical school two years ago with $300,000 in debt. I'm a software developer on the side and would love to stop residency to try a healthcare startup and/or pursue a research, but the risk is too great - I need the attending salary to pay off the debt.
I’ve started thinking of the obligation to stick in industry to pay off my loans as an analog to having an organization like the US military pay for my degree. I have a few friends in the military studying at university for free. Their payment for those degrees essentially consists of X number years of obligatory post-degree military service, in addition to whatever military obligations during their study. [1]
It’s an imperfect analog I think, but it’s helped me contextualize my situation and remove some feelings of bitterness towards the debt I still owe.
[1] I’m not military so I don’t know 100% how that works - open to corrections
I was active duty military for over 10 years. I went to bootcamp shortly after my 18th birthday. My job required 6 years service obligation; air traffic control. Before I separated I had my bachelors and two masters degrees paid for.
Most of your tuition is covered while you are active duty, $750 per credit hour. If not you can tap into your GI Bill to pay the rest; I did this as I didn't want to fund any of it. Though I could have paid the difference, saving my GI Bill, which would have netted more money for school.
Overall, you analogy is correct. But the military is an easy route when you are 18 - 22 (easier than most people think), as most jobs are not combat related. My job provided services to the general public as well.
ROTC (military scholarship[1]) pays tuition as you go, so there's no debt incurred. If the military allowed[2], you could study underwater tiddlywinks without any concern for unpayable loans.
You're analogy works for academic programs that lead to careers that pay reasonably well. But, not for underwater tiddlywinks - no amount of time spent in that field will allow you to pay down the debt.
1 - They pay for four years, plus some expenses. Generally, if you drop out of the ROTC program after the start of year two, you owe Uncle Sam whatever has been paid on your behalf. If you finish the program, you are committed to 4+ years of service (differs by branch and job role, with some allowing the commitment to be split between active duty and reserve).
2 - ROTC programs prioritize technical degrees and foreign languages over other degrees.
> You're analogy works for academic programs that lead to careers that pay reasonably well. But, not for underwater tiddlywinks - no amount of time spent in that field will allow you to pay down the debt.
Agreed, but that’s your onus to calculate the cost/benefit (whatever those benefits may be) of any pursuit, not just academic. It’s just especially important for studying in the US, given the insane cost of education.
Like you said, there’s a skew towards technical degrees, but I think about me and my peers at 18 and man we had no idea what we were doing and had little context for how such a big life decision would affect us down the road.
Sounds like smart thinking to me. I do similar rationalizing myself, and I wouldn’t worry too much what others think.
These things are tough to reconcile but we are all wrestling with them, and we have to keep our heads healthy to contend.
The only mistake I’d warn against is letting this influence your judgement of others, or your prescription for future generations. They are counting on us and we are counting on them. The point about the military speaks to the reality that you are not alone, but the bottom line is we have been dealt an injustice. We must not pass this nonsense on to those depending on us to make it right. We’ve got to stand together against the agregious opportunism undermining the livelihoods of Americans.
If nothing else, I don’t want to bare this weight through my middle age and still have the kids speaking of me in the way they speak of baby-boomers today. This isn’t to say the baby-boomers are to blame, but it is tough to feel sorry for them given the opportunities they had.
I’d much rather get the praise the Great Generation gets. Let’s work for it.
Love yourself, and all the moreso by loving others as well.
> The only mistake I’d warn against is letting this influence your judgement of others, or your prescription for future generations.
I’m curious what your segue is from contextualizing and rationalizing decisions I’ve/we’ve made for myself/ourselves to judgements on others.
My point, I guess, was that it’s easy to think of university costs purely in monetary cost and ignore the inherent time-cost required to pay.
The calculus I did when looking at schools was: it costs X much, median starting salary for this field is Y, I’ll have to “do my time” for Z years as payment for my education. Looking at it that way, I’m paying for school with time, not money.
My brother did this - but went full-on. Deans list silver star at the airforce, pentagon, largest hosputal in the airforce, now is the director of the VA for Alaska.
Yeah they paid for everything - but it had its issues - but he was also exceedingly lucky.
So only do this if you want to do medical and military for a really long time.
this is the one issue I never see proposed by the politicians trying to buy votes with free college. it should only be "free" provided you give back to society as prescribed by the education you receive. this might mean there is no free college for the profession you choose but so be it. we have it for teachers and there are other fields that would warrant investment as well.
Everyone studying could give back to society in some way. It doesn't really need to be related to the degree, honestly. I'd expect this to be paid work, though, because most folks can't just go without income for 1-3 years giving back to the community. This would simply wind up being civil service work for the most part.
Most folks can train as a CNA and do some sort of home health care, for example. Most folks have the ability to work in school kitchens, provide janitorial services for schools, hospitals, and government buildings. Many folks have the capacity to work in day care centers, as substitute teachers, bringing meals to the elderly, mowing lawns for folks that need it, different sorts of service for parks and other public places, and so on.
You can specialize this for some areas: Art degrees? Make beautiful areas. Theater? Free to the public plays. Language degrees? Help out at community centers or translate for folks that need it.
These things allow for necessary training - like plumbers, electricians, car mechanics, business managers, and so on - that aren't traditionally the "give back to the community" sorts of jobs, yet are pretty good to have. Including all sorts of schooling allows for a better educated, well-rounded society in general. As a bonus, the civil service will give folks a chance to be around people they might not otherwise meet.
We can do this before, during, or after college. Part time or full time.
I'd also exempt some folks. Doctors, nurses, teachers, and anyone else in such roles - the folks that by the nature of their jobs, give back to the community and are better off simply doing their jobs as soon as possible.
If I may ask, how exactly do you have the time to be both a resident and a software developer? There aren't enough hours in the day. Do you even sleep?
Heh, I'll chime in as I did residency at a busy program and advanced my coding skills on the side. Even working 80hr+ weeks you find downtime. Some of that you use for sleeping and studying. With whatever's left, some of my co-residents liked to read. Others had sort of social lives outside the hospital. For me, I coded with most of my freetime. It helped scratch an itch-- problems are solved with 100% certainty, errors can be found with testing preventing many mistakes before they actually affect people, you can build something with your creative juices and get a level of independence not possible in medicine... The list goes on. But my point is, residency is demanding, but you still have a little downtime here and there.
To parent and others, with due respect, I assumed that the OP was a professional software developer, based on the phrasing about using software to pay bills. Coding on your own time is more so a hobby, but as soon as you try to make money from it, even consulting on the side, the hours pile up. There's opening your own business, contracting, soliciting clients, meetings, status updates... way more than just the programming aspect.
So in these cases, we talking coding as a hobby, or coding as a profession alongside medicine?
I did a prelim-surgery intern year. The hours are worse than medicine, but there are way less "mandatory" activities (no lectures, no endless rounding, etc.). For the most part, you're on the floor waiting for pages. I used the time between pages to write code.
Now I'm a radiology resident and have much more time.
Someone make this: a plugin for an IDE that pops up a page from a whitelist (probably of documentation, but it could be anything you want to study) whenever you compile.
There is time for life outside of residency. My wife started residency with a 5 month old and had another child half way through, this delayed her graduation a total of 4 weeks.
I think the debt level is crazy. But it sounds like you wish you’d had a free medicine degree so that you could be free not to practise medicine. I’d think if you get the degree for free then you almost should feel more obligated to practise.
Um... we do kind of need some research doctors. It might not be traditional practice, but how else are we going to advance medicine? I would think similarly about doing things with a healthcare startup - doctors are in the unique position of understanding medicine to a degree that makes it more likely to base the startup around actual facts instead of simply hiring a practicing doctor as a consultant for the project.
There are more roles in medicine than simply delivering care.
48 yo surgeon here - be careful, bc without board certification, you'll limit yourself to who will let you work in their clinic. You're getting paid for residency, just do two more years, get your FP / int med certification.
As an aside, I went to UNC Chapel Hill 1992-1996 and it cost $2k/year tuition. Now it's $20k. We've had a shift in attitude in this country of "why am I paying for something that benefits someone else," but it's going to bite us in the ass down the road as intelligent / hard working people say "why should I accumulate debt to work that hard? I'll just choose something else."
General Surgery and OB/Gyn have gone from being the hardest residencies to get, to now only requiring you graduate from medical school. The hours and the pay are the reason. Orthopedic surgeons get $1000 to put a scope in a knee and scrape a little whereas general surgeons get $400 to take out an appendix in the middle of the night. Ortho is hardest residency to get.
I was top 25% of my class and if I tried to become a surgeon 10 years earlier, I wouldn't have. Most older surgeons were top 1% of their class. My senior partner was, and man is he super smart. Anyway, I still love my job, but the hours suck (80/week). Society benefits from my service (returning sick people to the workforce) and taxes I pay ($200k / year). Not too bad return on investment, imo.
You're going to work as a "GP" with at most one third of the training of almost every other doctor in practice? Seems like you're shorting your future patients a bit. My advice as someone who sees a lot of patients who were incompetently managed at urgent care is to avoid going this route. You're setting yourself and your patients up to fail with potentially devastating consequences.
This is not surprising. On my last two visits to late night urgent care I encountered complete incompetence. On the first occurrence, the Doctor did not know how to suture my hand. She put in four sutures when at least twice as many were needed and placed them way to close to the margin. She failed to even clean it properly. It ripped open again while I was sleeping. On the next, unrelated visit, the doctor was drunk. His face was all red and he reeked of alcohol.
> You're going to work as a "GP" with at most one third of the training of almost every other doctor in practice?
Not really a GP, more like a glorified triage nurse. Urgent care is where they give antibiotics out generically, and immediately transfer anybody sicker to the ED. (worked there, done that as part of residency)
> I'm a software developer on the side and would love to stop residency to try a healthcare startup and/or pursue a research, but the risk is too great - I need the attending salary to pay off the debt.
This is exactly why I pressed a giant pause button halfway through my MD to get a PhD in computer science. There was no other time I could do it. After 4th year? Too much debt; also looks bad for residencies to take time off. After PGY-1? Too much debt; would hurt me if I wanted to do a full residency. After residency? Too much debt; also that forces me to wait quite a few more years before pursuing my research/software dev ideas.
Right now I can manage the debt from the first two years with my graduate stipend + summer internship gigs in the industry. If I had waited even one more year to do this, the debt would have been be prohibitive.
Geniune question: why does a degree cost that much? Is it the teaching staff salaries? Is it extremely state of the art equipment? Is it possible to disrupt that?
Some things that don’t help are the artificial restrictions on building new medical schools, the difficulty of becoming a doctor in America if you were trained in a foreign country (even a developed country like France), and union-style laws that prevent nurses from doing routine procedures reserved only for licensed MD’s (even banning certificate programs).
What? High demand made a degree skyrocket to $300,000? Half of Europe provides free education and doesn’t have a quarter of a million cost per student even close.
But it would be a total waste for society if they paid your education in full and you did not practice.
One related challenge of inexpensive education is the 'brain drain'. I am Canadian and hold a PhD in Engineering. Tuition was about 3,000 CAD a year throughout my education, with scholarships I ended up no dept at all. Now the temptation is move to the US or Europe is pretty strong, but I am still far from having 'repaid' the gouvernement's 100s of thousands of dollar (with ~160,000$ of in-pocket scholarships) investment in me.
I think free or near-free education is great, but it's a bit of a gamble.
What a surreal discussion about something obvious: University and college should be free for everyone. First, this is a great equalizer in the positive way: it does not depend on how wealthy your parents are, so you get an equal opportunity. Second: the society as a whole benefits from well educated people. Accounts need well trained doctors, doctors need well trained accountants, both need an engineer to craft them a reliable car, etc etc...
Countries like Germany show that university/med school can both be free and high quality. Od course also in Germany some private elite universities exists where you have to pay (it is ok, I like diversity). But to get a perfect career, a state run university is all you need.
Always replace "free" with "I'm paying for you". I don't know what's "obvious" about me paying your tuition fees. For once, I may be happy to fund your auto-mechanic studies as I know I'll need you to fix my car. But if you're studying ancient Akkadian I'm less inclined to pay your bills.
That is like saying you only want to pay taxes towards the roads you drive on yourself.
Would you be better off if all publicly funded roads where instead private and required you to pay tolls per usage? You would defiantly get an bill more matching your usage, and people who don’t drive would pay less. But it at least feels like we are better off with public roads because they all add value to society as a whole.
The same goes for education. You don’t care about Akkadian studies, but perhaps someone does who thanks to his education can focus on that and earn enough money to buy a car from you auto mechanic keeping him in business making life better for you.
Indeed, many do advocate that paying for the roads you drive on through tolls would be a much better system. I don't think it's unreasonable to not want to subsidize certain fields of study with public money.
In the past, when a smaller percentage of people were "educated" the marginal value of educating an extra member of society was very high. It seems much lower to me now that information is cheap and freely available.
Education is not about memorizing information. It is about learning how to think. If anything, this is of much more value now that we're drowning in so much information -- and so much misinformation.
Not really. It’s more like getting outraged when the government wants to build a road that does nothing. imagine they build half a bridge over a body of water and stop. Do you want to pay for that useless thing?
I actually took an Akkadian course during my undergraduate years. It doesn't help directly with most careers, of course. But that and the other humanities courses I took there and in high school make me a better-rounded member of society.
Especially grateful for the Islamic Civilization course giving me an informed attitude toward Muslim friends and colleagues, and for my Latin and French studies helping my SAT scores and enabling me to immigrate to Quebec.
My degree was in computer science overall. Though aspects of student life and paid employment at my university helped my career and skillset way more than even the CS classes.
In my particular case, my parents paid for my education, but they could only afford that because US science education funding policies when they were students let them gain cheap entry to well-paying professions. Both of their undergraduate degrees were in the humanities.
Before that, my one grandfather who went to college got a good education at what was then a free city university, and I'm sure it helped his attitudes toward my dad's education. Many of my great-grandparents were poor Jewish immigrants at a time when the US immigration policies were extremely open for healthy light-skinned immigrants from Europe (even their low-class type).
I've had several high-paying tech jobs and paid plenty of taxes to society, but clearly these elements of my family history are factors in enabling that, not just anything about my career-related classes.
All of which is to say, we all benefit from affordable education, in surprisingly broad ways that rebound down generations and across spheres of activity. We shouldn't take a narrow vocational approach to this.
Indeed. Also please stop saying “freeway” and start saying “somebody else paying for me way” next time you’re giving directions.
It’s commonly understood that “free” in the context of public services means paid for collectively by government. We totally get that and are still cool with it.
If you are not super rich most likely you are paying a tiny fraction towards the higher education of someone else's child. Plus if you have kids you benefit from the same system. I actually know several people with useless degrees that now have well paid jobs here in Germany, one studied Ancient Greek and Latin and is now at Germanies federal reserve the other studied art history and is now a SAP consultant. Those degrees are also much cheaper than training everyone in STEM fields.
You, my fellow German (Frankfurter? I know too many people at the federal reserve...), are making the same mistake as most: beancounting and measuring everything in money. Degrees in Ancient Greek and Latin mean that besides being rich in money, society is also rich in culture. We might need more STEM probably, but we would miss the people knowledgeable in cultural things a lot.
Good luck training more than 2% of your population in math without significantly degrading the difficulty, I studied math and probably half of the people dropped out after the first semester.
"Investing" people who graduate from university earn more than people who don’t. Skills and thinking patterns developed in studying any advanced degree generalize to other pursuits. It doesn’t matter that the critical thinking skills etc were built in a subject you personally do not value. The person is improved through the process and their earning potential is increased.
Your return on investment comes later when they’re paying taxes, which are on average higher than they would have been without assistance.
At scale, this kind of investment will pay for itself. There will undoubtedly be outliers on the down side you’d be able to point to, but did you know that philosophy degrees are disproportionately represented among CEO’s?
Don’t pick the subjects, just invest in it all and reap the rewards.
It will help offset your "social assistance" costs as well. Food stamps, housing supplement, welfare... education gets people out of that.
> did you know that philosophy degrees are disproportionately represented among CEO’s?
I did know this, but I wonder which way the causality goes. perhaps CEO's are disproportionately likely to have come from wealthy families who could afford to send them to elite liberal arts colleges and/or afford to pursue a degree without direct applications.
>> Always replace "free" with "I'm paying for you".
Your thinking is flawed in this regard. Sure you are paying "my" tuition fees. But in an either indirect or direct way, you (you as the society, not necessarily you as the single person) are also profiting from my services. And as you are more than a being measured by money, but a human with a cultural background, even studying Akkadian on taxpayer's money might be ok (as long as not everyone does it).
I am a semi-libertarian myself so I get your argument somehow. Then again I am for equal opportunity (not equal outcomes) and providing education for free is a great equalizer and a great way that people can actually live up to their potential (or not, in which case they still need well educated doctors, car mechanics, whatever...). Good education also does not have to be really expensive by itself, it is a matter of organizing. When I hear the big US universities hording billions, I know that there is too much money in the system.
"Be civil. Don't say things you wouldn't say face-to-face. Don't be snarky. Comments should get more civil and substantive, not less, as a topic gets more divisive."
"Free" means someone else should be paying for it. Now, as an average income guy I will never earn as much as a Doctor and will vehemently oppose any move to pay for these would be rich people's education. If the degree is worth something, please pay it yourself.
>Countries like Germany show
All these kids are more than welcome to go to Germany and save $500K in tuition fees.
Now, as an average income guy I will never earn as much as a Doctor and will vehemently oppose any move to pay for these would be rich people's education
Yet... that would cease to be the case. You wouldn't be paying for rich people's education. You'd be paying for education for whatever person put in the study time to be a doctor, based on actual merit instead of merit + money. It means that you would have that same chance at schooling. It would mean that doctors could make less money and it probably more likely to live in areas with fewer doctors. And hey, if they become rich, they'll be paying it back into the system and paying for more education that you, as an average-income worker, ever would.
Publicly funded MDs means they aren’t as well paid. It’s no longer a super privileged class who took a great financial risk they must be rewarded for. They are paid well, just like an engineer. But I’m sure if you look at what a Danish doctor earns you’ll see one reason why healthcare is cheaper to produce there.
Once higher education is a public service and not a personal investment, there is much lower returns expected.
I do not live in the US and therefore I am not sure why medicine has been singled out as a worthy profession to receive subsidy over many others? Don’t those in the medical profession get paid reasonably well over there? Aren’t there other professions equally necessary for a functional society that don’t get compensated as well as they should like teachers, social workers and those in the voluntary sectors who would be better off with this money? I personally think this is a misjudged priority in the grand scheme of things.
1. This isn't an "either/or" proposition. This is one university that is making medical education free. There are other universities and programs that have free or low cost programs for the jobs you discuss.
2. Medical school education is phenomenally expensive in the US, unlike training for the other jobs you give as examples, and this expense has a structural impact that negatively impacts our health care system. The high cost of education is one reason that so many doctors opt for higher paying specialties that have higher salaries but don't necessarily result in an overall healthier society.
It's also the case that medical students are a pretty good risk. Graduation rates are very high [0] compared to the broader population of undergrads [1].
We sometimes talk about college as a binary -- "Did you go to college? Yes/No? Should we pay for college? Yes/no?" -- but there are enormous differences in experiences and outcomes across majors and institutions.
The expense of medical school makes going unreachable for a portion of people. The pay comes later, after all the schooling is complete, and then paying back the loans can still be a burden. From what I have seen, anyway.
And yes, there are other professions equally necessary. To be fair, though, most of those jobs don't require the same level of debt either, and are more obtainable by folks with lower incomes pre-schooling.
I hope this helps to decrease the costs of medical care in the US to some extent as it removes one pressure for doctors to earn extra money charging for things that might not need to be needed.
edit: Just so I am clear I know that there are lots of other influences on healthcare costs and doctor debt isn't the only pressure they face. Doctors do have some influence on cost (if not large) and if pressure on them is removed in any way some of them may choose to spend that extra time helping their patients money go further. Small early influences can have large effects on a system so I am hoping that this kind of influence might change attitudes enough to have a large longer term change.
Hospitals in America aren't actually a free market. You cannot choose not to buy, and in emergency situations you can't actually compare prices between sellers. Hospitals charge whatever they can get away with and insurance companies get a discount because they have some leverage- but you and I don't.
All this would really do is help lower the medical providers costs. Likely it will give them additional funding to lobby against socialized health care.
Generally speaking, when exactly can you compare prices in a non-emergency situation? I have gotten to the point that every time I see my doctor, I ask for the costs because I enjoy the awkward and ultimately unanswerable question and I like bringing the problem to the surface rather than pretending it doesn't exist.
It's truly ridiculous how hard it is for hospitals to answer this question sometimes. We've occasionally received the answer that they won't know the price until after the appointment because they won't know which code to charge until they've provided service. Then you ask what the cost of the likely codes are and they still have no idea.
Doctor's pay is not the driving factor behind increasing medical bills... administrative expenses at providers in insurance, opaque and arcane cost structures negotiated as deals between providers and insurance companies, and record profits at both insurance companies and providers point to a system that's cannibalizing itself. This will do nothing to costs even if implemented universally as it does nothing to address the actual causes of rising medical expenses.
As I understand it, salaries are only one of the many ways that doctors make money. Many "providers" are doctor-owned. Perhaps a more general statement would be that decreasing the cost of medical care will unavoidably decrease the income and/or wealth of doctors.
I don't see a problem with this, so long as doctors can earn a decent living. An idea I've thought about is that medical school is free, but doctors primarily earn their income by working for the government, for a salary. It might attract different people, who stand to benefit from that bargain.
What I've noticed about the debate is that everybody who is getting rich, is pointing the finger of blame at everybody else. Chances are, they're all gouging us.
> I don't see a problem with this, so long as doctors can earn a decent living.
There's an enormous opportunity to disrupt doctors. Doctors, particularly in the US, are grossly overpaid for the value they deliver. As I said below, there's an extra $100-$250 billion a year that gets sucked up by doctors. Frankly, the vast majority of what doctors end up doing -- collecting information, analyzing it, prescribing a course, repeat -- does not warrant the salaries doctors commandeer.
The industrialization of healthcare can't be done inside the existing system and the government certainly won't help which is what makes things tricky. But it's why you see Amazon, JP Morgan, Google and Uber starting their own healthcare companies and pushing into this industry more and more. [1] There's a great deal of money to be saved here while potentially improving outcomes. The current system, where a single doctor works obscene hours while spending 15 minutes with each patient, is just dumb.
This is just a secondary effect. The primary issue is the principal agent problem. There's effectively no limit to what doctors can charge because demand isn't limited by price. So they charge a lot.
> As I understand it, salaries are only one of the many ways that doctors make money. Many "providers" are doctor-owned.
No, nowadays, private practices are a dying breed. Most physicians are, in fact, salaried. And that salary isn't actually all earnings, because a large chunk of their business and professional expenses (insurance, continuing education, various licenses, etc.) all have to be paid out-of-pocket. These expenses are not generally tax-deductible, because of the AMT thresholds, so doctors' actual disposable income is dramatically less than you would think just by looking at the raw salary number. It's very different from other fields (like software engineering) in this regard.
But the earnings aren't all salaries either. As I understand it, doctors earn salaries from employers, but as I understand it, they are also leading investors in provider systems and in the malpractice insurance system.
They're not getting poor. The only thing I'm suggesting is that reducing the cost of care will make them poorer, but that could be offset by attracting people to be doctors who don't come from the most affluent backgrounds.
> but as I understand it, they are also leading investors in provider systems and in the malpractice insurance system.
You're completely wrong. There's actually the Stark law (https://en.wikipedia.org/wiki/Stark_Law) set up to prevent doctors from owning industry-related materia or self-referring to any entity with financial relationship. Not only that, but out of my network (100+ other physicians) very few are the 'leading investors' in provider systems, and zero have any skin in the malpractice insurance system. The MBAs run the numbers game, the MDs just work long hours.
When did that law go into effect? The provider network that my employer's insurance plan used for a while advertised on a billboard that it was "doctor owned." What I don't know is how the specific financial or legal relationship worked.
> But the earnings aren't all salaries either. As I understand it, doctors earn salaries from employers, but as I understand it, they are also leading investors in provider systems and in the malpractice insurance system.
Your understanding is very, very gravely mistaken. Most doctors do not have any of the kids of investment stakes you describe.
There's no single bogeyman behind rising medical costs but it's ridiculous to say that provider compensation has nothing to do with it. The single biggest driver, IMHO, is fee for service and medical supplies, but every aspect of the medical industry plays some role.
I'm convinced that it's the cost structure, implemented by many-to-many negotiation between providers and insurers, that drives the uniquely high cost of the US health care system. (Unique as in twice as much per capita as the rest of the industrialized world.) Japan's system is structurally very similar to ours - employer-provided private insurance - with one key difference. In Japan, pricing for all medical goods/services are set by a government agency, with an eye to keeping the industry functional/profitable while keeping costs under control. There are no "networks". Everyone knows what it's going to cost, everywhere.
> I'm convinced that it's the cost structure, implemented by many-to-many negotiation between providers and insurers, that drives the uniquely high cost of the US health care system. (Unique as in twice as much per capita as the rest of the industrialized world.) Japan's system is structurally very similar to ours - employer-provided private insurance - with one key difference. In Japan, pricing for all medical goods/services are set by a government agency, with an eye to keeping the industry functional/profitable while keeping costs under control. There are no "networks". Everyone knows what it's going to cost, everywhere.
In the US, Medicare pays for 40% of the market, and they set prices unilaterally. In addition to providers are legally required to charge private insurers more, Medicare has no mandate to keep the industry profitable, and in fact their reimbursement rates are about 7% lower than COGS. In other words, providers are (in the aggregate) losing money on Medicare patients on a per-patient basis, even before they account for overhead (building maintenance, staff wages, etc.).
Medicare knows this and admits as much - not just in their annual reports, but because they actually have a number of different stipend programs that provide extra money to providers who see a lot of Medicare patients, because otherwise they would literally go bankrupt and close their practices (ie, if they don't see enough privately-insured patients to be able to make up the gap, they will go out of business).
Medicare is, actually, the biggest beneficiary of price opacity in the American healthcare system today, but that opacity is not going anywhere.
So is Medicare paying more than similar systems in other countries, or less, or about the same? And if Medicare is paying more than, say, Japan, but it's still not enough to cover the costs in America, what is going on structurally with the other 60% of the medical system? Because there's something structurally broken here. It's not mere profiteering - it's more like a feedback loop. For-profit medicine works effectively and affordably in at least one other country with a cost of living otherwise on par with ours.
> So is Medicare paying more than similar systems in other countries, or less, or about the same?
You can't compare the raw dollar values because the economies aren't the same - $5 in New York doesn't mean the same as $5 in Tulsa, OK or $5 in London. That's why things like PPP comparisons exist (except you can't use a PPP comparison in a specific vertical like this to answer your question, because that is the very question you're asking in the first place; it'd be a tautology).
But there is an easy answer to the question, because Medicare is paying less than what would be necessary to sustain a medical practice, if you assumed that all doctors, nurses, secretaries, and janitors worked for free, and if you assumed that building and office space were free and required zero maintenance. We know that because we know they reimburse less than COGS, which is why we know their rates are nowhere near sustainable by any standards, let alone compared to other countries.
> It's not mere profiteering - it's more like a feedback loop.
Yes, that's exactly what's happening. It's a positive feedback look (in the literal sense; it's not a positive outcome for us).
The positive feedback loop comes from the fact that Medicare has neither a mandate nor an incentive to reimburse rates that are remotely sustainable, so it sets rates that are arbitrarily low. Providers are forced to accept these, and then pass them on to private health insurers. Private health insurers ultimately pass these costs on to patients in the form of higher premiums, but patients have no choice in the matter, because they can't choose providers based on how much the provider will overcharge their health insurer[0]. They can't choose providers based on price at all, because there's no price transparency in the system. And there's no price transparency in the system because that opacity is essentially mandated by law[1], and it's necessary for this system in which Medicare uses private insurers to essentially pad its own budget (by reducing its costs far below what would otherwise be sustainable if they were truly the only payer in the market).
> For-profit medicine works effectively and affordably in at least one other country with a cost of living otherwise on par with ours
Which country are you referring to? Truthfully speaking, every country has a for-profit system in that their healthcare systems are still subject to a profit motive (yes, that includes government-run systems like the IHS and NHS). Most other countries with comparable development levels to the US use privately-run systems anyway, so I'm not sure I understand which one country would be relevant to single out.
[0] Which is a different question from how much they (the patient) will be charged
[1] Not directly, of course, but indirectly - that opacity is the natural outcome of this setup
For the country I'm singling out, it's Japan, because of the massive structural parity between the US and Japanese systems - both using private employer-driven insurance, private providers, and government subsidy for those who can't afford their own insurance. And both are modern first world countries with a first world standard of living and economic complexity.
Here's the thing that gets me... the US is the only first world country with either our costs (most are about half as much per capita) or our massive coverage gap (most provide universal coverage). This suggests to me that it's not so much there's a right way to do it, as there is a wrong way, because a wide variety of other approaches, from mostly-private (Japan) to mostly-socialized (Sweden) are all working just fine. It's only the US that is so broken.
> I hope this helps to decrease the costs of medical care in the US to some extent as it removes one pressure for doctors to earn extra money charging for things that might not need to be needed.
Physician earnings account for about 7% of total spending on healthcare. Of that 7%, the fraction due to student debt specifically is significant from the physician's perspective, but negligible from a systemic picture.
This is, of course, assuming that physicians are charging for services that are not be needed in order to boost their earnings, which happens in some cases, but is not as systemic or widespread as people often think, due to the shift away from fee-for-service payment models and towards capitated care, and the opacity of the payment model to the physician at the point-of-care in many care delivery situations.
That's a very strange way to consider salaries. 7% of the healthcare output is extraordinary. By any measure US doctors are obscenely overpaid for what is ultimately not very creative or challenging work. On average US doctors earn 2-5x more than doctors in other developed countries [1] -- while delivering significantly worse healthcare outcomes. Some estimates put this "excess income" at an extra $100 billion a year but I've seen estimates of a quarter trillion a year that gets sucked up by doctors -- again, for delivering worse care.
The priestly incomes that these NYU graduates will go on to earn is precisely why NYU can offer free tuition. Attracting the best medical talent, even if you pay for all their training (call it half a million dollars a pop), can probably still be profitable if this talent can be leveraged by NYU's network of private care facilities.
One caveat is that oftentimes you'll see higher numbers (in the range of 15-20%) cited, but that's usually because they're not distinguishing between doctors (MDs) and other clinical staff (nurses, physicians' assistants, etc.). In the aggregate, the latter account for about half, or in other words, roughly equal to what doctors in total pull in. As that article notes, this also doesn't mean that all of that money goes to the physicians themselves. Some portion is taken by the practices and groups that employ them, and a huge chunk of physicians' take-home pay is allocated towards business expenses[0].
For the context of the original article, only MDs are relevant, not what NPs, RNs, and so forth make.
[0] Unlike software developers, who generally have their business expenses covered by their employer, physicians are typically expected to cover all of theirs out-of-pocket, which means that the seemingly-high salaries that you often see listed aren't directly comparable to salaries in many other fields, where the out-of-pocket expense are much lower.
Not on that scale. But I know plenty of teachers who chose not to be administrators because they enjoyed what they do. I also know many first level software development managers who “self demoted” to become software developers and took a pay cut.
Other developers I know took a pay cut and contracted half the year. You can make those choices if you don’t have outrageous expenses- including student loans.
I think, and would hope, that medical school interviews would help to weed out those who are just in it for the money. Even in highly-paid specialties, you have to want to do the work you do.
Were there people in my class who were in it largely for the prestige, etc.? Sure. Those people tended to go into high-profile specialties like plastics. But they were the minority, and I think that schools recognize in general these types of students are bad for the profession.
It's not so much about how much you can make but more about how much you need to make to stay afloat. It's a very different story depending on whether you have $0k in debt or $300k in debt.
If the subsidies are private it would be a great way to solve the "free education" for everyone promise that is gaining traction (I'm assuming education will also be pitched as a right if it hasn't already).
But as long as health is not a free market, then the price isn't going to necessarily go up or down in response to costs. The price will continue to be function of political power and monopolistic practices as it is now.
Doctors have very little influence on the overall cost of care, especially where drugs are concerned.
Do you think that when Mylan raises the price of EpiPens from $50 to $500 that it's a market-based decision, for example? No; that's just an exercise of monopoly power.
Part of this money could only have been raised by a free tuition program. But many top med schools have somehow accrued huge endowments without offering free tuition. So that part may not be enormous.
From my (limited) understanding, the high cost of malpractice insurance that doctors must pay is what drives up the cost of healthcare, more so than their student debt.
This has been conclusive disproven by comparing what happened in different states that enacted tort reform for medical malpractice. The cost of insurance dropped a bit, but there has been no effect the cost of healthcare provisioning.
I would argue that it hasn't been "conclusively" disproven. One key study "disproved" it in the aggregate across all insurance, but not on a specific specialty-by-specialty basis[1]. The malpractice costs of OB-GYN's for example are reflective of the potentially catastrophic tort liability exposure despite an overall low level of influence of tort reform on insurance costs generally.
However, this study: https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3536953/ demonstrated that tort reform resulted in a larger percentage of growth in the number of physicians which would indicate that tort reform does have an important effect on medical care provisioning simply because tort reform, according to that study, resulted in a larger number of practitioners, which would, necessarily increase access to care.
So while tort reform may not have reduced costs across all of insurance, it does have an effect on medical care supply and it could have an effect on costs on a specialty-by-specialty basis.
"An important consideration when interpreting our results is that our analysis provides evidence that the Texas reform had little influence on levels of health insurance losses, in the aggregate, across a variety of patient groups and provider specialties... As a result, if tort reform’s effects on provider behavior differ by the provider’s specialty type or the type of patient, then different analyses presented in the literature, utilizing different but relatively homogenous samples of provider or insured types, may yield conflicting results regarding the influence of malpractice exposure on healthcare cost and health insurance markets. Further research may consider how specific provider specialties and patient groups are influenced by changes in medical malpractice liability exposure."
That doesn't demonstrate any conclusions whatsoever about costs. What it demonstrates, however tenuously [1], should surprise no one: physicians have a preference to practice in areas where the costs of their malpractice are minimized. The notion that it brings costs down by increasing supply is a central tenet of the tort reform movement. However, this hypothesis has not been borne out by the evidence [2].
Moreover, as someone who worked in public health in Texas during the post-tort-reform era, particularly with hospitals in rural Texas, I can tell you anecdotally that the supply of physicians available outside major metropolitan areas declined when tort reform activists predicted an increase in supply.
results from high cost of malpractice. So instead of treating the symptom - insurance, one has to treat the original condition - malpractice. To continue the analogy - the trial lawyers in case of malpractice is just like the immune system. When infection (malpractice) happens you see the heavy effects of immune system acting like high fever, yet it would be a grave mistake to suppress immune system instead of dealing with the original cause - infection (malpractice).
Malpractice suits are brought over 3x as often in the US as in Canada, and malpractice insurance can cost more than an order of magnitude more.
However, in the US there is a much greater incentive to sue. About 21% of malpractice suits that pay out, pay out over $1,000,000. Something that elsewhere would merely net you enough to handle the medical fallout, in the US nets you a lottery jackpot. Because the money on the line is so high it incentives both layers and plaintiffs to aggressively maximize the payout. Like so many other aspects of the US health system, other countries do it better.
* All claims were the results of a few minutes of research on Google, I would be interested in learning of evidence that contradicts my claims.
Sometimes things happen. There are commercials on TV all of the time where lawyers are soliciting people to sue doctors for birth defects like cerebral palsy.
I’m glad that my parents spent my childhood focused on therapy, motivation, etc to help me deal with cerebral palsy than placing the blame on the doctor.
Yeah my case is relatively minor in the grand scheme of things.
This is awesome! So many medical students are kinda forced into more profitable healthcare practices than ones which people need more desperately (e.g. plastic surgery vs rheumatology).
I especially love that this was done with private fundraising over government funding. Philanthropy can be effective, often far more so than governments!
I predict this will have the opposite effect. This will increase the appeal of NYU leading to stronger students applying/accepting offers of admission who go on to get into higher paying specialties.
It's a bit similar to the test-optional trend in undergraduate admissions. The acceptance count (numerator) generally remains constant, while the application count (denominator) increases as more students see the appeal of omitted test scores. So, the acceptance rate decreases, which can craft a façade of prestige, among other things. Additionally, that increased applicant pool may include some higher-achieving students, likely applying for safety purposes, which can increase prestige if they accept; furthermore, their acceptance pushes otherwise-capable students to a lower priority in the pool.
All in all, in order to effectively analyze these occurrences (particularly in admissions), one must ask: how will the institution benefit? They wouldn't pass these changes otherwise.
Plus anything that can be done to juice the supply side of the healthcare curve is a big benefit. Cheaper school means more doctors means lower labor costs means cheaper healthcare.
Cheaper medical school tuition isn't going to lead to more doctors. The limiting factor is the number of available seats and residency positions, not the cost.
> Cheaper medical school tuition isn't going to lead to more doctors. The limiting factor is the number of available seats and residency positions, not the cost.
Bingo. Also, even if we somehow forced all doctors to work for free and magically ended up with the same quality of care, we'd still only reduce total spending by about 7%.
That's a hard upper bound on the effects that increasing the supply of physicians can have.
> Cheaper medical school tuition isn't going to lead to more doctors.
No, but it might mean more doctors in the kind of practices and specialties that are socially useful but not serving the wealthiest of private pay clients, because the necessity of chasing the maximum returns is reduced.
I would hardly say it shows the effectiveness of philanthropy - this is just one college and has very limited effects on the healthcare system as a whole. In Germany for instance higher education is free everywhere, I don't see how this could work with private fundraising.
As an European I always find the dichotomy "government vs people" strange. If the state pays for something, it's solidarity, not communism.
>In Germany for instance higher education is free everywhere, I don't see how this could work with private fundraising.
Germany isn't a good example. Germany stands because it can exploit its weaker neighbors, the east block out of their resources and force the companies to book profit and get taxed in Germany.
Germans see each others as bothers. Show me a few German companies where a foreigner is in the executive role?
The whole point of Germany is Germans first. Ofcourse, they can make education free in this setting.
Huge. I went private for my medical school education and came out of it with about $190K in debt. Fortunately I didn't have any undergrad debt.
But I liked family practice, and I like public health, and I'm proud to work in those fields. I definitely understand the push to go to higher-paid specialties with a burden like that, though.
> School officials worry that rising tuition and soaring loan balances are pushing new doctors into high-paying fields and contributing to a shortage of researchers and primary care physicians.
I think this is only partially true, because it misunderstands the motivations of many would-be doctors. Sure, the cost of medical education factors into specialty decisions, but as long as derm and ortho are regarded as more _prestigious_ than family med and general peds, you're going to see similar residency application numbers. There's still a social hierarchy within the medical profession, which the price of tuition doesn't immediately change.
Still, this is great for people set on primary care as a career. Interestingly enough, my general observation has been that students who need the money the _least_ (i.e. people whose families are paying for their educations) are the ones who are gunning for the highest paid (and typically most prestigious) specialties.
In my experience, the people who go for the extra money in derm and ortho don't need it from a wealth perspective, but often need it from a social and self-worth perspective.
Over time this dynamic translates into to the prestige gap.
Is anyone not going to med school because of debt? Not sure what problems this solves.
For the long commitment that doctors make and the debt they take on, they receive basically guaranteed highly paying employment for as long as they wish.
There's also a shortage of medical school spots, we can't create enough doctors.
I think this is probably an attempt to compete with other medical schools for top students. NYU is pretty well respected bit probably loses a lot of candidates to Harvard, Yale, etc.
Perhaps as a back of a line thing - not those about to enter it. It is already infamously grueling. Graduating and being six figures in debt could try the patience of many. "Staying in school in a high stress environment till near my thirties is bad enough without being in debt practically big enough for a house for years afterwards. I'll just go into banking after four years so I can actually enjoy the money while I am young." Whether you want doctors with such am attitude is another question.
Banking and tech aren't guaranteed the way medicine is. Other fields are result based, and it's often easy to get fired and be replaced.
A risk averse person would rather stick to what they know (student life, exams) for a guaranteed reward.
The debt isn't really that much. Probably the average is 200k. You can pay that off within about 1-2 years of residency, and interest rates tend to be low since they're low risk loans for banks to give out.
> The debt isn't really that much. Probably the average is 200k. You can pay that off within about 1-2 years of residency, and interest rates tend to be low since they're low risk loans for banks to give out.
Please try looking at the numbers again. Assuming you pay off undergraduate loans, a private medical school will cost $30-45k a year (not including living costs, so tack on another $30k a year), so assuming ($150-$300,000) will be total assumed debt (not including books, unexpected expenses, etc) during those 4 years. Residency salary is basically stuck at around $50k/yearly for 3-5 years (based on residency type), you can contribute back to loans but there's not a chance you're paying that off in residency. (source: current medical resident)
I mean 1-2 years after residency. Most people taking on debt for medical school don't really see it as a huge risk, it's basically a guaranteed investment.
The big downside of medicine is the time in my opinion. 7 years of prime time, but some of the med students I know are enjoying it. A former classmate said it's less work than undergrad.
Wow, you are so confident saying this when you are wrong.
More people want to go to medical school than there are spots open. If you create more spots, you get more doctors. Cost is not a barrier to medical school, loans for this profession are very easy to obtain.
Wow, you are so confident when you provide literally zero evidence to back up your claim either.
Though that's not what I was addressing. I was addressing the criticism of universal healthcare that we'll somehow run out of doctors. The issue is it costs money for a school to run a med school. Making the government pay for it enables more med schools to be built.
This is great! Now lets please do the same for nurses and social workers who pay exorbitant tuition rates, too, yet get paid peanuts to be on the frontline of health care.
> Now lets please do the same for nurses and social workers who pay exorbitant tuition rates, too, yet get paid peanuts to be on the frontline of health care.
I would not say nurses get paid "peanuts". Not many jobs would let you earn close to $100k in New York City with only a bachelor degree (or in some cases only a two-year associate degree)
Especially social workers. I have literally no idea why anyone would go to grad school for an MSW and take on the kind of debt required to do so, then enter a profession with the combination of low salaries and horrible work environment that social work has. The same goes to a slightly lesser extent for secondary and elementary school teachers.
They need warm bodies (residents are cheap labor) to run the hospital (the money machine that gets thousands of dollars per xray, per drug, etc). A steady supply of med students who are already situated in NYC saves them the cost of recruiting residents from afar. And who knows how much money they save by cutting the bureaucracy to administer tuition, loans, Sally Mae compliance, etc.
> They need warm bodies (residents are cheap labor) to run the hospital (the money machine that gets thousands of dollars per xray, per drug, etc). A steady supply of med students who are already situated in NYC saves them the cost of recruiting residents from afar. And who knows how much money they save by cutting the bureaucracy to administer tuition, loans, Sally Mae compliance, etc.
This is a rather elaborate conspiracy theory, and one that falls apart entirely once you think about the actual costs of residency programs, the mechanics of matching students, and the real ROI that they would make in the process. It's absurdly out of proportion with what would be needed to make this theory work.
> and one that falls apart entirely once you think about the actual costs of residency programs
What are the `actual` costs of residency program?
> the mechanics of matching students
As someone who has seen how the sausage is made ... the junior attendings (usually paid like shit because it's an academic institution) sort through a few thousand ERAS applications who narrow it down to a few dozen candidates. We hold a few interview dates and have a dinner at somewhat nice place. We have a meeting. We make a rank list. An algorithm matches our residents. That's it.
Consider that what the average applicant spends on traveling for interviews (I'd guess ~5-15k, more if couples matching or competitive specialty; many take out loans for this)... I don't feel bad for the programs holding a few interview dinners.
> real ROI that they would make in the process
What are you basing this on? Most teaching hospitals would fall over without cheap resident labor. In practice, my experience is that residents function like extremely cheap, slightly-more capable mid-level providers.
Full ride for all students is extraordinarily expensive. This project is probably not compatible with some ulterior plan to significantly increase class sizes. If anything, this will add pressure to shrink class sizes.
This is probably the other piece of the puzzle regarding the implementation of single payer healthcare.
Because who in their right mind wants to sacrifice 16 years of earning potential, take on 500K of debt only to become an MD with long work days and now prices that are fixed with no other form of negotiation leverage in sight.
Does anyone know if the single payer models we use in the US keep Dr. salaries on par? I've only heard of savings from negotiated drug prices, and insurance overhead; but, if Dr. salaries are also decreased, OP's got an interesting point.
From my understanding of Bernie's "Medicare For All" bill (S. 1804) [1] payment to providers would be fixed at the, well, Medicare rate. Medicare rates are about 40% lower than private insurance (about 56% of national healthcare spending is private), but it's also higher than Medicaid and obviously higher than what the uninsured pay. All-in-all, from the figures I've seen [2], this specific single-payer plan would lead to about a 10.6% [3] overall reduction in payment to providers (some of which will be ameliorated by a reduction in costs that maintain complicated insurance administration work at hospitals) but I imagine providers will generally take some percent hit to payments which would in turn affect physician salaries (albeit not drastically)
>Because who in their right mind wants to sacrifice 16 years of earning potential, take on 500K of debt only to become an MD with long work days and now prices that are fixed with no other form of negotiation leverage in sight.
Asians/Indians make most MDs in the US because being a doctor is valued a lot in their communities even if you've infinite debt, you still get respect.
Second, most doctors come from doctor families. They've already transversed the path once, and their kids can reuse the knowledge and connections.
So yea, my father is MD and he can easily support 16 years of MD education for me. If you don't have a family with similar resources, obviously either you can take debt which comes with enourmose stress/worries which decrease your chance to complete or not compete at all!
Individualistic people aren't going to find it easier to compete with community backed people.
Then the community does not value you untill you achieve success in the said profession. So it's very risky. Most guys don't choose it because then you've to hide in all family gatherings....
Included in the list of perhaps not totally intended consequences: I think this may allow some MD students to think twice about practicing and take less traditional (potentially less secure) career routes. I may be biased, having effectively not practiced for a couple years now myself, but I think this could be a good thing to an extent.
I work with 3-4 MDs that chose not to practice who are now working on defining software/ML product feature requirements; their MD experience makes them solid product specialists for clinical solutions that hopefully will help a lot of people...not having to stare down the barrel on loan payments may help people make these kind of career moves that may ultimately progress the system.
All that being said, we (obviously) need good docs at the bedside.
I just wish there was a middle ground here. The problem is that tuition is too high, not that it exists at all. Lowering tuition would solve the problem just as effectively, and could be done for more students.
Lowering med school, law school, and undergrad tuition by 8% across the board doesn't quite get the publicity that eliminating med school tuition does, though.
It will be paid for in the form of reduced class size growth and its endowment funded by billionaire alums - maybe they are betting on future alum donations as well. Unclear if that's sustainable.
>"School officials worry that rising tuition and soaring loan balances are pushing new doctors into high-paying fields and contributing to a shortage of researchers and primary care physicians."
It's worth noting that NYU tuition for regular undergrad is $50K before room and board and $68K with room and board [1].
The cynic in me has to wonder if they share the same concern for the rest of the legion of debtors they are churning out every year.
I'm not doubting the importance of research and primary care physicians in our society. But six figure debt loads for university are commonplace in the US. And are likely causing skew in career choices in non-medial fields as well.
I also have to think that there's something in this arrangement for NYU and that there are motives outside of just societal altruism here. I just don't know what those are. Research money? 501(c)(3) maintenance? Something else?
I wonder if they will cover the tax if the irs decides to call it income to the student.
But good to see. Doctors have been getting squeezed pretty hard recently. Something has got to give. Radiology had around 80 unfilled residency spots a few years ago because of poor career outlook.
No. I think it was just a large drop in compensation along with increase in productivity targets making radiologists less likely to sell radiology to MED students.
Radiology job market improved since then, residency spots are not going Unfilled anymore.
ML may put radiologists out of a job, but it will take some time I think. Lots of changes will happen by then. Radiology is a nice place to be for hacker types in medicine. It’s actually a fun place to do ML research which I do also (radiologist / AI researcher)
Edit: Medicare has walked back some compensation cuts for medical imaging (for multiple procedures on the same day). My tin foil hat theory is the cost cutters got spooked by the prospect of no more us graduates in radiology.
for nyu to make tuition go away means that they are already having a large cost processing loans/grants/discounts along with the compliance costs for sallie mae,etc. NYU is a PRIVATE university as well so they can be super selective in whom they accept - and now they become even more selective - admitting those with legacy contacts, etc. Finally, the truth is that they need warm bodies to run the hospital and if the cost of living in NYC is so high that nobody wants to do residency there (training after med school), then how are they going to get PCPs? They'll need to pay an arm and a leg to get them (dark pun?) By having a steady supply of med students who are already situated in NYC, they assure a steady supply of residency candidates.
Glad to see my Alma Mater leading in things like this. Now NYU medical school will be an even more sought-after destination.
Still I look forward to a world where this scarcity of ivy league schools, news organizations, self-driving car software etc. is a thing of the past and everyone collaborates on a growing snowball of knowledge.
I believe universities will eventually turn into centers for labs, certification and socializing, while information delivery (the commodity) would be done entirely online and students would form their own groups. Then, school would be much cheaper - and we could even have free subsidized tuition for all!
I think the kicker here is...how many actual students do they accept? Usually when I see stuff like this I think that the amount of students they accept is very low.
NYU already has an endowment large enough to accomplish this ($3B). They are not $400M donations on the way to $600M before this can happen. They just want more money, and they want Alumni etc to pay for it.
I've been confused why so many large-endowment colleges still charge tuition. It seems pointless, gathering crumbs from students each year. It creates institutional obstructions to whole classes of student etc. Is it just tradition?
I suspect that NYU, like many universities, has separate endowments for its academic units. Thus, the med school endowment may indeed be too small to support their free tuition goal.
That's the idea behind lambda school. Interesting podcast interview from Indie Hackers[1]. They only collect if your salary is above $55k if I recall correctly and there is a max amount that they take in total.
I can't think of anyone who needs free tuition less than medical students. When they finish their residency they enter a highly protected, highly paid workforce and can easily pay back their loans. Yeah it sucks until you're a doctor but NYU could fund only the interest so that graduates could start paying back their loans when they're 35 or so.
That's an amazing news! Being aware that education costs a lot is important, but being able to afford education is paramount.
Having to sacrifice 10 years of first jobs savings to reimburse the student loan is just insane. Especially considered tuition is skyrocketing without any meaningful reason: education is not better in that proportion than 10/15 years ago.
Why medical school and not, say, engineering or economics or math? I value having good physicians (my father is one), but medicine is not the only worthwhile human endeavor.
Edit: Also, at least in my state (Michigan) there seems to be no shortage of medical students (we went from 4 med schools to 7 earlier in the decade). The real bottleneck is residency programs.
Upon graduation, these free tuition doctors will be taking jobs in a competitive market. Some doctors they compete against will have debt, some won't. But it really isn't like the amount they charge for services will decline. This just means that some doctors will get a little bit richer...
That is NYU's intent and it's been up front about that. Primary care physicians don't earn as much as other physicians do. This program creates economic incentives for students to pursue the field.
Finally someone putting education before money; maybe these kids can get educated without having to worry about taking crap jobs outside of their career taking up their time to pay for loans that will tank them otherwise instead of looking for a job in their career or ramping up as an intern.
I feel like all the collage should be free people are not thinking far enough ahead to what that actually means.
1) A free collage will end up being more like extended high school.
2) At some point new institutes of for pay higher education will pop up. They just won't be called colleges. People who can afford them will clearly have a advantage and top companies will start to seek out people who attended these organizations.
3) The quality of the education will drop. It already has at a lot of schools with the introduction of loan for everybody gig.
While this will reset thing for a while. Maybe even a generation of two. We will end up again with people wanting the next level of education free.
EDIT: now that I am not trying to type on a tiny phone.
The problem with free is it will then need to cater to the LCD. Right now we we have a filter on the LCD because there is some effort and risk required by the person going to school. There is something special about buying something, and owning it. You tend to tend for it better, give it the attention it needs and ensure it last a long time. If we bypass this step we will end up with masses going to school doing the same thing they do in high school today. This might be hard to visualize as the HN crowd is a fairly smart crowd and probably took advantage of the offerings of their high school, and likely were not aware of those who did not.
This won't be as big of an issue for those who are "gifted" as they will be sheltered in their special classes slotted away with like minded ilk. But for the less "gifted" student the expense will be dragged down to the LCD. So if you are not lucky, smart enough, or had the right coaching from parents to get into those gifted classes you will be left with a much worse education.
If you look at the UK, which has in recent years gone from free to firstly low tuition fees and more recently exorbitant tuition fees, the reverse seems to be true.
In making university a £9k a year proposition universities seem to have significantly increased student expectations along the lines of "I paid for this, I expect top marks", along with vast increases in appeals etc. It does not seem to have increased educational expectations - just transactional. This seems to be particularly prevalent with overseas students who pay even higher fees.
Universities have, in the main, happily adopted the profit mentality by providing and offering less and increasing class sizes.
My conclusion is by adopting a high fee model we have significantly weakened further education in the UK.
Yeah, I don't think high fees are the answer either. Costly and free are both extreme and probably won't do what we want them to do.
We need something just right, something that both the schools, and students still have some skin in the game so they are obligated / motivated to perform their best.
I think a free market mostly can cover do this, and it seemed to work out fine for many many years in the US until we started giving crazy loans out to everybody.
And don't get me started, on the bs that we need free school because low income kids won't be able to go. Harvard has a fund for low income students that goes untapped every year, they even make a effort to get low income kids (from my understanding mostly underprivileged minorities) to take advantage of the funding available, but yet, hardly anybody does.
I think you're right. In the UK context, the first incarnation of fees appeared to work OK and not bring the negatives that are becoming clear after the introduction of high fees. Even the overseas students paying higher fees seemed to bring less expectation and entitlement to a first whilst standard fees were only £3k, which I can't explain.
Of course the other aspect when fees were first introduced was the policy to significantly increase numbers attending university. This brought its own set of problems including harming standards (unavoidable of course) and vocational institutions, and no end of colleges remaking themselves as universities.
To an extent, this is what's already happened. If you actually look at a lot of college curricula - including at the top schools, but especially at the rest - a lot of that is dedicated to making up for the failings of K-12 education, particularly high school.
To a degree, expecting college education of people is really just filtering for the baseline that we would like a high school degree to guarantee, but which it isn't.
I don't think anyone is suggesting all private institutions should be tuition free. NYU chose to do it for medical school, however the progressives in USA just want public college to be tuition free.
I doubt those outcomes will come to pass. Tuition used to be basically free in the USA, and it already is in many European nations, and we didn't/don't see those outcomes that you worry about.
I did not have time, write this when I made my original post.
Just because I don't agree with free does not mean I am for the inverse which is crazy high tuitions. In my opinion the crazy high tuitions is a result of guaranteeing people loans. Demand went up on a near fixed supply thus cost went up. Then when people who probably should have not been going to school started dropping out the schools saw that as a loss of revenue and fixed the problem by lowering the bar to make sure they did not have as many dropouts thus keeping their revenue up. Nobody ever likes to see a drop in revenue even if the spike was caused by artificial means.
Free market really only works if you don't have people messing around with it. It's not a free market for schools if everybody can get a loan.
If financial risk really encouraged effort and perseverance, we would expect university dropout rates in countries like France or Germany to be far higher than in the US or UK. Is that actually the case?
France Germany both have something like a 50% drop out rate, much like the US according to my recent searches. The UK has ~7% but has been rising over the past 3 years.
As far as I can tell you still pay in the UK but tuition is fully covered in both Germany and France, expect France has already started the thing I said they would with a second more elite school. And you better bet a grad from a free university vs the elite university competing for the same job the guy who paid is going to probably win more often than not.
For what it's worth free and or guaranteed loan is the same, and I would expect the same outcomes in the long run. At least with the loan part we might wise up and stop demanding every kid goes and gets a higher education.
Note, I am not coming from somebody who was able to pay, or took loans out to go to school. I did the math, and I simply could not afford to go to any university, not even the cheap ones that were local. I tried, and saw the deb increasing while working for $8 a hr.
What did I do? I quit, and focused on my job, and spent every free second learning a skill that I could make money with. That just so happens to be computers/programming/and data centers. For a while there my friends and peers that went to school looked like they were going to pass me up, but by the the time they got out of school loaded with deb I had already double the income they would be able to start out with. Today I know very few people who went to school who make more than me, and those that do still have massive amounts of debt. Now I maybe lucky, but I know to many people like me, and meet to many people who have taken the same path as I did to put it all on the notion that I was just lucky.
Economics says that things are designed to work this way. You have felt the economic indicators and made changes accordingly.
The economy(you, your friends, your community, the world) benefits when you make profit. If your prior path was burdened with massive debt with little way to repay it, it sounds like a bad decision.
I cant imagine too many situations where doing something that pays significantly worse and puts you in more debt is better for society.
I didn’t say massive debt. I said it was a part of my decision. And I was able to repay it, eventually. Your assumptions show you are biased in how you read my comment.
Also, I think you’re missing some variables. Or, as they might be called in economics, externalities.
The less money we spend on prisons the better for state and federal coffers, in the short run. The less a company pays a prison guard for their services, the better for the share holders. But what about everything that happens on the day an inmate is released back into society? Are their neighbors happy they were incarcerated by near minimum wage persons with little guidance or oversight and perhaps a bit too much enthusiasm? Are their employers happy they were not given access to higher education or the ability to learn a trade?
Or let’s talk about educators. Or defense attorneys for the indigent. I’ll leave the remaining examples to be worked by the student.
Seriously though, as someone that graduated with dual degrees in political science and economics, worked for a couple years in local government, then went to Manhattan to work in the financial markets for 5 years, and is now working a “tech” job. Sorry I don’t have patience for this.
As another user commented, the total cost per year is around ~$34 million which is roughly 5% of the total $600 million they're looking to raise. That 600 million will be invested to target some annual return and as long as that return is expected to be a couple of percentage points over 5% (which is not an unreasonable expectation) then they should be able to more than cover the cost every year, without even touching the principal amount. Looks like they're raising the total amount via donations
Not sure about the down votes, I didn't mean to ask a rhetorical question. But someone has to pay if not students. Or is that not how it works in this case?
Disclaimer: I couldn't read the whole article because I don't have a login to the website.
That's $300 million/year in growth, not counting donations.
Their medical school apparently has 679 students. At $50k/year each, that's $34 million a year. Or approximately 10% of the appreciation in their endowment.
Maybe they purchased real estate in NYC and are charging companies to rent space there. Historically that's how the Cooper Union has been tuition free (since they own the space under the Chrysler Building) [0].
The article says they believe they can fund the programme in perpetuity with 600 million dollars to invest. The article says they've raised three quarters of that. They have that money by asking people to give it to them.
While I’m glad that billionaires are donating, why should colleges be dependent on the largess of private benefactors to ensure that our healthcare system is sustainable?
I didnt mean to imply that the donors were doing anything wrong, but that the government should do more to make sure that there are enough qualified general practitioners and obstetricians. There is far more of a need for those specialties than higher paying plastic surgeons.
On my phone I literally just post it to my facebook under "only me" privacy and then click it from there. On my laptop i've got a chrome extension that I made a rule to add that header whenever i'm on certain sites.
Don't get me wrong, this is fantastic on an atomic level, and the levels of debt required to get an MD these days is insane (have a lot of family in the field). Also, it's not like this is a unique structural disadvantage, just a new one.