The Great College Hoax

Forbes ^ | 2009-02-02

[rabscuttle385]

Higher education can be a financial disaster. Especially with the return on degrees down and student loan sharks on the prowl.

BY KATHY KRISTOF

As steadily as ivy creeps up the walls of its well-groomed campuses, the education industrial complex has cultivated the image of college as a sure-fire path to a life of social and economic privilege.

Joel Kellum says he's living proof that the claim is a lie. A 40-year-old Los Angeles resident, Kellum did everything he was supposed to do to get ahead in life. He worked hard as a high schooler, got into the University of Virginia and graduated with a bachelor's degree in history.

Accepted into the California Western School of Law, a private San Diego institution, Kellum couldn't swing the $36,000 in annual tuition with financial aid and part-time work. So he did what friends and professors said was the smart move and took out $60,000 in student loans.

Kellum's law school sweetheart, Jennifer Coultas, did much the same. By the time they graduated in 1995, the couple was $194,000 in debt. They eventually married and each landed a six-figure job. Yet even with Kellum moonlighting, they had to scrounge to come up with $145,000 in loan payments. With interest accruing at up to 12% a year, that whittled away only $21,000 in principal. Their remaining bill: $173,000 and counting.

Kellum and Coultas divorced last year. Each cites their struggle with law school debt as a major source of stress on their marriage. "Two people with this much debt just shouldn't be together," Kellum says.

[montag813]

$194,000 in law school debt

Harry Truman never graduated law school, yet became a judge and President.

[qam1]

Xer Ping

Ping list for the discussion of the politics and social (and sometimes nostalgic) aspects that directly effects Generation Reagan / Generation-X (Those born from 1965-1981) including all the spending previous generations are doing that Gen-X and Y will end up paying for.

Freep mail me to be added or dropped. See my home page for details and previous articles.

[montag813]

They eventually married and each landed a six-figure job.

Uh, so why didn't they pay off the $174,000 loan? they had no kids, could presumably live in a $2,000/month house or condo. I put their (rational) joint living expenses at a max of $40,000 annually, including 2 car loans. Assuming their combined in come was $250,000/yr, what was the problem? and what kind of assclown wants us to feel sorry for them?

[hudsonohio]

ROTFLMAO

[rabscuttle385]

12% a year? Since when are educational loans 12% a year?

Private bank-issues student loans.

[iopscusa]

2banana...you have it right about the way to view Higher Ed...BTW I checked your about page here and lloved the history lesson on the Right to Bear Arms and the Agincourt to American Revolution analysis.

[Troll_House_Cookies]

This article is merely an advertisement for the coming movement to abolish student loans and make college “FREE” (except to us taxpayers who already paid our own way of course).

[chris_bdba]

All I can say is that over the years working part time retail jobs almost everywhere I ever worked I was he only one without a college degree. A degree is no guaratee that you will find a decent job.

[weegee]

The return on investment can be lousy if you are in the tech world where the Bill Gates’ of the world are pushing for more HB-1 visas for foreign workers to come to America and undercut the job market (Microsoft competes against the modelling industry for HB-1 visas, they want Indian programmers and the fashion world wants Russian girlies).

Add to this equation offshoring of R&D (especially but not limited to product testing) and there is no job security. The corporations lobby the government to secure cheaper labor.

[woodbutcher1963]

“Why didn’t they take their fancy law degrees and move somewhere cheaper?”

Exactly, they could have lived in TN,AL,IN and many other places.
If I had to do it all over again, I would become an electrician.

[Doohickey]

...graduated with a bachelor's degree in history.

I love history. If I went to college, I'd probably study history. However, I'd probably not count on that history degree bolstering my income potential.

[achilles2000]

“Profitability may not be sufficient, but it is necessary” ;-)

[weegee]

There is no money in studying history, it will only change to conform to the latest politically correct talking point.

[LuxAerterna]

Education should be put through a cost versus benefits test just like anything else. Part of the problem with this couple is that they spent $36,000/yr apeice for 3 years of law school after already accruing large debts as undergraduates. They should have more carefully evaluated their options and considered going to a much less expensive law school, choosing a career that doesn't require 3 years of post-graduate school, choosing a post-graduate professional school (e.g. medical, dentist, optometrist) that is more likely to command a high salary or joining the Army or National Guard to take advantage of the G.I. Bill.

Just like a lot of today's over-leveraged homeowners, this couple's own decisions are partially or even mostly responsible for their financial problems.

[ReeseBN38416]

My brother-in-law was positively morose during Thanksgiving a couple of years ago. His son was a freshman in college and had decided to major in sociology. His reasoning was that it was the only degree program in the University that did not require college algebra.

The kid didn't want to take college algebra because *his girlfriend* told him it was hard!

[iopscusa]

Go to Forbes and read the article, there’s a lot more good data on this.

[WOBBLY BOB]

trade school is where it’s at.

[AustinBill]

Th[e] other half of the story is that every time the government offers guaranteed student loan programs the colleges factor the availability of loan money into what they ‘expect’ students can afford and jack up their rates.

Exactly correct. College tuition inflation has run way ahead of general inflation precisely because of the "student loan" racket which cranks out class after class of new "indentured servants" each year. Dry up the loans and few will be able to afford the overpriced product, so supply and demand will force tuition prices down.

[Grumpybutt]

I wholeheartedly agree. I have 3 sons in the military and one more who is a junior in high school and leaning toward military as well.

If any of the 4 of them were to say I want to learn to be a plumber or mechanic or grocery sacker for that matter, we’d be just as proud as long as they could support themselves and their families and are happy.

In my view, honest character and hard work can, in a lot of cases, be more of a reward for some than any college degree could give.

[Niuhuru]

“Kellum did everything he was supposed to do to get ahead in life.”

I take it he thinks he should be handed a job because he got a degree. Someone should have taken him aside and told him the real world isn’t like clockwork or high school. In the real world your life’s plans mean nothing to everyone else. They all have life’s plans of their own.