If more students are forced to pay the market rate for a college loan, then I am certain that the "Education Bubble" will burst and tuition rates will begin to fall.
Absolutely right, Bob.
The real problem is not “student loans”, per se; it’s the higher education scam that’s being perpetrated by college professors and administrators.
They’re skinning American parents alive and laughing all the way to the bank. And the kids coming out with a bachelor’s degree have less education than your average public high school graduate in the 1950’s
Re-institute the draft and resurrect the GI Bill.
I’ve heard more than one commentator say, that one reason college tuitions and fees have risen far more than the rate of inflation in recent years, is precisely because these loans and loan subsidies are out there.
Maybe the education bubble will burst. Would that be a bad thing?
Young people and their parents should make rational decisions about college, and major fields of study. For example, studying accounting, or nursing, or one of the hard sciences, is more likely to lead to a good paying professional career, than majoring in women’s studies/black studies/English, etc.
And decisions made about these issues should determine whether it makes sense to take out student loans. Maybe it makes sense to take out loans if you plan to become a CPA. It definitely makes NO sense if you major in women’s studies. What career fields are opened up to you as a result of majoring in women’s studies? Is it worth it to go deeply into debt to have gotten such an education? These are the sorts of questions which families should consider when sending someone to college.
Students Paying More and Getting Less, Study Says
http://www.nytimes.com/2009/01/16/us/16college.html
Enrollment at America’s leading universities has been increasing dramatically, rising nearly 15 percent between 1993 and 2007. But unlike almost every other growing industry, higher education has not become more efficient. Instead, universities now have more administrative employees and spend more on administration to educate each student. In short, universities are suffering from “administrative bloat,” expanding the resources devoted to administration significantly faster than spending on instruction, research and service.
Between 1993 and 2007, the number of full-time administrators per 100 students at America’s leading universities grew by 39 percent, while the number of employees engaged in teaching, research or service only grew by 18 percent. Inflation-adjusted spending on administration per student increased by 61 percent during the same period, while instructional spending per student rose 39 percent. Arizona State University, for example, increased the number of administrators per 100 students by 94 percent during this period while actually reducing the number of employees engaged in instruction, research and service by 2 percent. Nearly half of all full-time employees at Arizona State University are administrators
A significant reason for the administrative bloat is that students pay only a small portion of administrative costs. The lion’s share of university resources comes from the federal and state governments, as well as private gifts and fees for non-educational services. The large and increasing rate of government subsidy for higher education facilitates administrative bloat by insulating students from the costs. Reducing government subsidies would do much to make universities more efficient.
For public universities the administrative bloat is much worse than at private colleges - administrative positions grew by 39% between 1993 and 2007, almost four times the 9.8% increase for instructional positions. At private universities, without access to the public largess, administrative and instructional positions increased at about the same rate.