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For example, when I left, which is about 10 years ago, my school was about 27k/year. Now it's close to 37k. And my school is nowhere near the top schools. Employment compensation (at least in my field) hardly increased.
No wonder students are running into trouble with student loans everywhere.

Well somebody is making some nice profits.  Must be nice to have tenure, a big comfy chair from which to ponder which Keurig flavor to brew while reading the NY Times as your TA teaches the class  ;D

Nobody in the media will call it out as the scam that it is.

Like most liberal causes, it is a myth. Neither the cost of college nor student loan burdens are increasing beyond inflation.

Liberal cause? Lol you are so fixated on politicizing every issue that you find political motivation in everything. I would say the hardest hit demographic is middle class or upper middle class, most of whom would vote republican.
You can bury your head as deep in the sand as you want, but the truth is tuition is on the rise everywhere. And the only people that can afford t hem are either the rich kids or the poor kids on aids and scholarships

The real question is why tuition and costs go up so much. Find the underlying reason. Teachers at Universities have not had their salaries go up that much. Other costs like maintenance and utilities have not gone up that much. So WHY is it costing so much more?

Those are the areas that need to be controlled.

While I do not agree with you that there is a macro problem with college costs or student loan costs, to the extent you believe there is a problem, you are looking at the wrong cause. The cause, like with healthcare, is the way it is funded--completely divorced from real market forces.

http://www.nytimes.com/2014/07/29/upshot/how-the-government-exaggerates-the-cost-of-college.html?_r=0
How the Government Exaggerates the Cost of College

* * *

But it turns out the government’s measure is deeply misleading.

For years, that measure was based on the list prices that colleges published in their brochures, rather than the actual amount students and their families paid. The government ignored financial-aid grants. Effectively, the measure tracked the price of college for rich families, many of whom were not eligible for scholarships, but exaggerated the price – and price increases – for everyone from the upper middle class to the poor.

* * *

Taking into account financial aid — some of which comes from the colleges themselves, some of which comes from the government — the average tuition and fees were $12,460 at private colleges last year and $3,120 for in-state students at public four-year colleges, according to the College Board. At those prices, college is an investment with an excellent return for the vast majority of students who graduate.

* * *

Fortunately, the government isn’t the only organization that collects data on college tuition over time. The College Board also does, and it publishes different indexes on published tuition and net-price tuition, separately for public and private colleges. (Only scholarship grants are considered in the net-price calculation. Loans, appropriately, are treated as part of the tuition that families are really paying.)

Net tuition and fees at private four-year colleges have risen 22 percent since 1992, the College Board says, and the increase has been 60 percent at public four-year colleges. Community-college tuition has declined, because aid grants have outpaced published tuition. These numbers are obviously quite different from the government’s index showing a 107 percent increase.

As I understand it, colleges have a hold on job acquisition (can't get a managerial position in many places without a college degree, no matter how intelligent or experienced you are; however, I'm not sure why they do, investigating this would reveal a lot about how colleges maintain such high tuition whilst offering minimal quality of education), and they get grants from the gov which they spend on things they can't afford like new buildings and statues and offices etc., both of which contribute to hikes in tuition.  Colleges must also adhere to a government standard in order to issue degrees that are acknowledged as legitimate (which is why there's so many problems transferring credits and whatnot, even between high schools for that matter not to mention universities); this makes it difficult for colleges to form to compete in the first place (why have two colleges in the same area doing the exact same thing?--i.e. lack of diversity), but also eliminates any competition that decides to not adhere to such a standard (since the degree you'll earn there is worth even less than the piece of paper you'll get from an approved college.)  IIRC, college a few decades ago was 1/4th the cost it is today, which means the cost of it is indeed outpacing inflation.

All these combined make colleges more expensive.  It is not a coincidence; there is a correlation between breadth of government reach and the price & quality of all that it touches (which, if you investigate further, you'll find is true nearly 100% of the time for everything else, incl. but not limited to healthcare, food, insurance, and so forth.)  It's not out of control, it's on a planned increase; colleges who are willing to "put out" enjoy the hike in tuition due to government intervention, of course, but it's a shame they're not worth attending anymore.  The local college in my area, UTA, is a pure shithole, which I understood upon my visiting there, having spoken with friends who attended, and of reviews on the web (I recall one commenter saying it was more akin to a system, where they get you in, take your money, and don't care what happens after); the only one that might be worth attending is far out of my price range and a two hour drive to boot.  I'll pass on college :-\ We got the internet, who needs it anymore but the foolish.

There can be only so many managers in a company. And the low paying jobs are being occupied by immigrant or illegal immigrant. What other option is left for the rest of the population?

In a capitalist state the real power is wielded by the 1% elite. The politicians is simply their pawns. The elite can dictate what they want, they control almost everything.

The driving force behind rising collegiate prices is the government guarantee of student loans. There's no free market mechanism determining who's worth the risk of the loans, what degree programs should have a cap on loans since they won't pay off or the market doesn't need those careers outside of a few and there's no incentives to cut costs/personnel/infrastructure.

At big universities w/ all their endowments, there should never be a need to ever increase tuition but that stuff is largely used beef up the accommodations to entice better athletes and the like to come there. And since these U's already have the name going for it, every tom, dick and harry want to come there so there isn't any shortage on demand and thus even in a market situation a rising price isn't much of a deterrent of entry. Those graduates (w/ loans), via alumni and university programs that place jobs, have the ability to pay off so it's no big deal.

At average colleges and universities where middle class kids by and large go, this is where the student loans more so come into play and these are the bulk of the collegiate schools that are passing out diplomas and the holders less than 50% of finding employment in their field. 6 months go by and now loan payments start up but these kids mostly have no experience but just a piece of paper that isn't really in demand for the current employment market as it was 10 years ago. We all know that most of the jobs 'coming back' are seasonal, part time and/or minimum wage. This is the likely starting platform for many of 50% that couldn't find field jobs and they reside at their parent's houses or continue their college rental setups w/ friends but it's hard to pay loans when you're in a setup like that. From there, very few w/o connections can make it into something of an upwardly mobile position unless something changes drastically in the job market. Then, less people are getting married/having kids or are putting it off for 5-10 years or more. Then there's that many less people being financially able to purchase the Baby Boomers' houses allowing them a stake for retirement if they can even consider it. I could go on but it's maddening.

I went to the University of Iowa 1977-1981. I ended up with only $2500 in student loans to pay back for my BGS degree. Tuition, room and board were only about $1000 a semester and I did get some grant aid that paid about 40% of it. My parents college fund for me paid the rest.

Now in most schools that $8000 in total cost would not even make it one semester.

2013-2014 RESIDENT school year costs at the U of I:$20,691 (From the U of I website)

this includes everything: dorm, meals, books, tuition, everything

http://www.collegecalc.org/colleges/...rsity-of-iowa/
this site says $18,525 for RESIDENT


There is no way in the world expenses should have gone up that much since then.

A water main burst at UCLA yesterday and flooded Pauley Pavillion, parking structures and closed down Sunset Blvd - for the 30 minutes I watched the report they reported about 9 times that it would interfere with basketball, volleyball and they expressed great concern about not ruining the athletic field for football practice.

30 minutes, 21 people taking in 9 clips about sports - not one person mentioned anything about classes or academics.

Look at this article in USA today: http://www.usatoday.com/story/sports/college/2014/07/29/ucla-flooding-pauley-pavilion-water-main-breaks/13341019/ (http://www.usatoday.com/story/sports/college/2014/07/29/ucla-flooding-pauley-pavilion-water-main-breaks/13341019/)

search for the word "class" and your will get no hit.

Tuition = money to "buy" better NCAA "stars".

I think that pretty much sums up academia in the US.

They went that much because the government started giving stupid cheap loans to anybody who wanted one. That meant colleges could raise tuition and people could get loans to pay them, so NOT raising tuition meant leaving money on the table.

Meanwhile the government also made it impossible to avoid paying back student loans. Persons with student loan debt are treated just as bad as deadbeat fathers in terms of how they're punished for their debt and their ability to get out from under their debt.

Corporations are specifically designed be liability shields. That's the primary reason they exist as a legal institution.


But like I said, you're missing the point. The point being made here was that people can normally file for bankruptcy (just like a corporation), but student loan debt is immune from bankruptcy (which is why I compared it to child support).

the change in the law that makes it almost impossible to discharge student loan gave private lenders more incentive to throw money at student regardless of their earning or even employment potential. thus, everyone can now "afford" college. the vicious circle starts as a result, more people can afford college -> more people want to obtain a college education regardless of whether they need it or not (art history? "blah blah blah" studies?!)-> college education becomes more popular -> schools increase tuition -> more student loans are needed, and at the same time lenders wont hesitate to lend -> more people can afford college -> ...

Corporations are liability shields and the sky is blue. How does that keep the corporation, in se, from paying its debts?

As for bankruptcy, student loan debt is not immune (child support is though), it is just subject to a higher standard for discharge. Regardless, corporations do not owe child support or student loans, so there is no point to get because it's a pointless comparison. It is much harder and more expensive, though, for a corporation to get a discharge in bankruptcy than it is for an individual.

bachelor degrees are like dime a dozen these days, and people with the degree can't find jobs, even in fields where they keep predicting "there won't be enough workers in industry XYZ in so many years". the reason is because although they need people, these companies only hire the top, let's say 40% - and that is a very generous number - of their job applicants at any given time, yet college students keep graduating every 6 to 12 months. so the other 60% keep piling up years after years

on one hand, making it hard for borrowers to avoid paying back the loan is a good move to curb the student loan bubble. but at the same time the government didn't put any similar constraint on the lenders.
it is understandable that once you've obtained an education, unlike a house or a car, they can't foreclose or repossess it. so you need to pay them that money back. but what about the lenders? they ultimately approve and directly benefit from any investments, yet there's virtually no risk for them in case the student loan investment turns out to be bad.

Tuition & Fees isn't real. It's a sticker price. Most private schools have "discount rates" in the 40% range. They use financial aid as a bargaining ship to get better students and improve their ranking. Only the international students an kids who barely get admitted pay the full freight.

The article posted above about the government exaggerating the cost of college from the NYT is pretty spot on.

Above 95% of all student loans are government loans or government guaranteed loans. Truly private loans are a very small part of the market; so I am not sure I understand your argument.

Many of my friends work in higher ed in some way...professors, coaches, office work, etc.

If a college costs $45k and you get 30% off, it's still overpriced at $30k.

Oh oh but corporations pay more to get a discharge -- oh but corporations are also discharging 82 times more money.

Wait so you're telling me that you compared individual bankruptcy to corporate bankruptcy to illustrate that individuals can't get rid of certain kinds of debt? Well why would that matter? Corporations don't have those kinds of debt, so your point is moot

Corporations can get a discharge through chapter 11, but they have to effectively liquidate all of their property to do it. Whereas an individual in a chapter 11 just has to devote disposable income to a plan in order to get a discharge.

As for the debts comparison, I think you are actually agreeing with me, but again, I am having trouble understanding you.

The point at hand is that you can't tell the difference between analogy and synonymity. So if were to use the car analogy in reference to the economy, you would argue that the economy doesn't use internal combustion engines.

Reductio ad absurdum?

There is simply no comparing student loan debt and alimony or child support, which can only ever be consumer debts, with corporate debt such as bond, note or trade debt. Besides the fact that corporations cannot have those types of debt, there are also very clear public policy reasons why the debts are either nondischargeable or subject to a higher burden of proof for discharge. A better analogy (since you seem to only be capable of reason by comparison) would be employee wages or benefits, which receive one of the highest priorities in a corporate bankruptcy for obvious public policy reasons. Since priority and nondischargeability are two sides of the same coin--payment of priority debts being a precondition to discharge in a corporate bankruptcy--there really is no distinction.

Except that discharge of priority debts is not a required precondition to corporate bankruptcy. You're tap dancing around the simple fact that in corporate bankruptcy, 'priority' is determined by active petitioning and even then, it's far from unheard of for even something as sacrosanct as employee benefits to be unloaded onto the public, or simply abandoned altogether.

This option is not available for individuals, as there are not personal equivalents to dissolution and reincorporation, outside of death or fleeing the country.

My state contributes less than 7% to the budget of the University of Oregon. 30 years ago it was 30%.

That's a number, but is that a cause? Did the proportion the state contributes to the University's budget decrease because of cuts in contributions or because the budget drastically increased while the contribution, adjusted for inflation, held relatively constant?

I am not sure what you mean by "discharge of priority debts is not a required precondition to corporate bankruptcy." I think you are confusing two opposites. A discharged debt is debt that goes away forever, without full payment. By contrast, a priority debt MUST be paid for a corporation to get a discharge. This is unlike an individual bankruptcy, where individuals can get a discharge without paying some priority debts.

Priority of employee wages and benefits is not determined by active petitioning--it's right there in the law. A corporation simply cannot get a discharge without paying them.

As for dissolution and reincorporation, sure, that's an option, but it does not give the company a discharge. Nor is it easy or automatic--in most states it takes years. Moreover, the new corporation cannot have the same assets or business as the old corporation without assuming its liabilities.

It's because the state has been continually cutting funding to the institution .My state has more people and less funding per capital for education of all forms.

There are parallels between increases in medical care costs and college costs.  Both are due to governmental meddling in the free market, creating a managed market with social goals. 

It'd be interesting to know the extent of increased costs due to government requirements on universities for various programs and issues... but that wouldn't be the whole story.  There's also the palatial gyms, gourmet food and other niceties which seem to be taken for the norm in the university environment.

Ivy league tuition is going up because of the competition to get in and it is the preferred destination for rich families to send their children (thus they'll sign the dotted line no matter if the tuition is $3K or $100K per semester).

Contrary to belief - even education is affordable in the US.  If you are a state resident then most states in the US have subsidized universities for people born in the state and the tuition costs rival countries like Britain / Canada or are even cheaper.

As well there's always the option to do your first two years at a community college near home to cut down on living expenses. 

No.

The difference is that pre 1985, a person could work and put themselves through college with minimal debt.

Now, it's massive debt.  And that's debt owed to the US Government.  And they like that.  First, rig the situation where you need college, then rig the prices where you need debt, then print money and supply the debt.

Beats trying to sell Tbills.  Certainly a nice income producer along with Tbills.  Big difference in income, though.

I just explained to you something called in state tuition (which is heavily subsidized and even near-free in certain US states).  $200 textbooks aren't landing people into debt, either.  It's the interest payments from the student loans people take to cover the COL.

Pre-1985 the reason people back then didn't take loans was because summer jobs (after adjusting for inflation) paid way more than today.  We saw the deindustrialization of the United States in the 1990s which removed a lot of those good paying summer jobs

In-state tuition and fees at the University of Oregon are less than $10,000 per year and more than half of the student body receives aid grants, averaging about $7,000 per year. I don't see how that's a problem.

The outcome for higher Ed is the much higher chance to land a job in a higher pay bracket than you (probably) could with just a high school diploma.

At this point in time paying tons and getting in debt for a qualification is a bad decision imo.  The internet has changed everything - education is free.  Importantly, the trend of employers employing people biased on diverse recruitment strategies and non mainstream recognizable qualifications must be hugely on the up no?  

If you want to work in public sector then yeah maybe you have to go usual route still

Unless it's for some degree that nobody cares about. Maybe those people are considered for Starbucks management roles more often?

The corporation has to schedule the debt, and in 99.9% of cases they do. If they knowingly fail to schedule the debt, there are criminal and civil penalties and the officers of the corporation are on the hook. Plus, the officers and directors are on the hook for priority taxes related to employee wages ("trust fund" taxes), so they want it all paid. If the corporation dissolves, then it does not get a discharge, so we are talking about a completely different set of circumstances.

Yep and again, if no one advocates for a debt, it doesn't get paid. You're saying companies are compelled to cover certain debts, yet that implies every situation is one in which the company in question has enough in assets to take care of some if not all their debts. This is not always the case.

You're misunderstanding the issue. Companies are eligible for only two types of bankruptcy: chapter 7 and chapter 11. Chapter 7 is a complete liquidation of the company and its assets, and the company never gets a discharge. But whatever assets are sold and whatever money is left or is raised goes to pay priority creditors first. And employees wages and benefits are essentially first in line to be paid. The upshot is that if anyone is getting paid anything, it is the former employees.

Chapter 11, on the other hand, is a reorganization. Chapter 11 is the only way for a company to get a discharge of its debts. But in order to be eligible for the discharge and exit chapter 11, a company must pay--in full--the claims of its employees, former and current. To be clear, a company cannot go through a chapter 11 without paying these claims.

Companies are required by law to file schedules of all of their debts. The schedules are verified under penalty of perjury by an officer of the company. Lying on the schedules, or failing to schedule known debts, is a bankruptcy crime. Even "honest" mistakes are often harshly punished.

Can individuals do the same thing with their debts? That was the original question or point of contention. Individuals, it appears, do not have the ability to dissolve. Individuals can go to jail, but companies can't--you were told they are liability shelters, which is funny because that's exactly what they are in this context.

Individuals can do better than corporations. They can go through a chapter 7 bankruptcy and get a nearly complete discharge. And it's very immediate and thorough. Plus, individuals have exempt property that they keep (corporations don't). For example, you can keep a car, your retirement accounts, furniture, personal effects, and more. In many states, you can keep your house if you don't have mortgage on it.

Individuals can also go through a chapter 13 where you can keep paying your mortgage and keep your house and you get a "super discharge" which gets rid of even tax debts (except trust fund taxes).

Chapter 11 is also open to individuals, but it's very expensive so most don't use it. If they do, they have to contribute all of their disposable income for 5 years to paying their creditors. When 5 years are done, anything they couldn't pay is discharged forever.

You've identified employee related obligations as a 'must pay' for companies, citing jail time for individuals. Aside from the apparent absurdity, when the individual that went to jail for company debt gets out, does he have to service that debt?

It's not jail time for not paying debts; it's jail time for lying about the debts or failing to disclose them. Remember, the schedules are required to list all known debts and be signed under penalty of perjury. This is a separate issue from wether the debt gets paid. But assuming that the debt is one that moves from the company to the officer, like trust fund taxes do, then the answer is yes, he would have to service the debt. Trust fund taxes are never dischargeable, not even in bankruptcy. The only way to get rid of them is to pay them or settle with the taxing authority.

Does the company? Not unless it's Phoenix Inc.. And all those other debts, the ones that didn't get priority over employee related obligations...who pays for them? It's not Flo from Progressive.

It depends on the relative solvency of the company. Some bankruptcies are just financial restructurings using the bankruptcy law for certain very specific reasons. In a lot of those cases, everyone gets paid in full. Or everyone agrees to take a certain haircut on the amount they are owed. Well, not everyone, usually just the big, sophisticated banks and hedge funds. The "rank and file" creditors--employees, trade creditors, suppliers, etc.--all get paid in full, often with interest.

If the company is in really bad shape, then only priority and secured debts will get paid in full. Other creditors will get some percentage on the dollar--sometimes a penny or two, sometimes closer to the full amount they are owed.

Some creditors have risk insurance or other relationships (like factoring) that step in if they do not get paid in full. Other creditors sell their claims early in the case to claims traders. Some creditors wait it out and get what they get.

Again...can an individual, short of lead poisoning, do the same thing as a company with their debts?

The short answer is yes: they can both get discharges, and it's easier for a individual to get a discharge than a corporation.

The problem with college costs is that anyone is able to get a student loan, with virtually no requirements. Even if the student is pursuing a degree with no earnings potential they will still qualify. The result of this is that students do not take price into consideration when choosing a school as they can certainly borrow money in order to attend. Another issue is the fact that colleges are pressured to be "diverse" so they offer scholarships to students who are part of a "minority" even though they are not deserving of them. This also increases the pressure of the price of tuition. 

The problem with student loan costs is that the sole provider of student loans is the US Government.  They print money, then "loan it" out.  This is a great deal for them, compared to printing money and getting almost no return on it as Treasury bills.

They would like more and more and more student loans.  And more house loans, since they are basically the only people doing that too.

They like debt slaves.

The US government is likely to actually lose money on student loans due to defaults and debt forgiveness after a certain number of on-time payments. It is an illusion that they are making money (as is reported in the current budget).

The annual increase of the OP numbers.
(37 / 27) ^ (1/10) --> 1.03201, or 3.2% annual increase.

Cost of a certain house in Austin, TX
(265 / 154) ^ (1/10) --> 1.05578, or 5.6% annual increase.


In addition, tuition is only a portion of the cost that a student pays.  Tuition itself is not rising as fast as tuition. 
Pay to a certain faculty, past 8 years.
(44.5 / 40.5) ^ (1/8) --> 1.01184, or 1.1% annual increase.

No.  When you print money and then make loans, you always make money. 

What are some instances where a student loan can be discharged?

A lot of people who go to university in western countries wouldn't be accepted in Switzerland, which caps out graduate student positions relative to the job openings in those fields.

Switzerland must be doing something right as it has one of the world's lowest unemployment rates due to an apprenticeship model which pairs students with available positions (although it's less democratic as you might get assigned a career you might not particularly like).

An individual can only shield so much wealth.  I think the amount is $28,000.  Beyond that, individuals also must liquidate.

There actually are more safeguards than that.  The default rate of the institution is considered.  Institutions with high default rates lose their ability to receive funds. 

Because it appears that colleges and universities have taken economic theory and applied it. Colleges are businesses selling to student consumers. The colleges are often making a good profit, which of course is used to build buildings, to hire assistant deans and other administrators, while hiring fewer full time professors and more adjuncts. I can't help but wonder if the consumers are getting their monies worth, or simply a degree along with debt.

That is a very good question.  There are existing numbers to answer it.

One process is as follows:

1.  Find the average income in the US of, say, a 30 year old white male with different levels of education, e.g., high school diploma and bachelor's degree.
2.  Find the prime lending rate, from public sources.
3.  Factor in the unemployment rate and the mortality rate, again from public sources.
4.  Assume that people retire at the standard retirement age.
5.  Find the income tax burden for each of the incomes.


From these numbers, you can estimate:

1.  How much additional income a college degree will yield.
2.  How much additional income tax revenue a college degree will yield.

There's some interesting statistics about adjuncts out there (a lot are being forced to do it for life and to juggle 3-7 courses).  If you have a PhD nowadays, you are almost better off becoming a high school teacher in most countries as they get a guaranteed middle class income and a pension.  Versus the Adjunct who gets paid per course, has no union nor pension.

This process is flawed. Someone who is a smart motivated individual is much more likely to finish college than someone who isn't. That doesn't mean that this individual who finished college couldn't have accomplished the same things if he had not gone to college.

A self-selected group that chooses not to go to college cannot act as a control to another self-selected group who chooses to go to college. To have a better comparison, you'd need to actually intervene and randomly select people who will go to college and have a control group that is not allowed to go to college.

For example, someone born with rich parents and doesn't have a high school diploma makes on average more money per year than someone who was born into a poor family, but finished college. This actually says that it's more important to have rich parents than to go to college.

They need to keep people debt-slave, then create dependent people that will be coward and think they NEED  the degree, and so on, so they will charge more.

More to pay = more time to pay = more dependency

Not a surprise

The salary on professors, dean and president are pretty much out of hand given the economic condition US in right now.

The money has to come from somewhere, and the easiest path is via tuition increase.

In ancient China they had a bureaucracy exam lasting days and would put toilets under the test takers so they could crap whilst simultaneously writing their examination.

That's what credentialism is becoming in the west, in a nutshell.  In 20 years you'll need a PhD just to work at McDonalds.
  

Tuition is very high for some reason or other and keeps increasing the load on students.
This leads to increasing debt and a possible financial bubble in the future so lowering costs and finding ways to increase their cost efficiency by getting students cheap but good content textbooks and not changing them so often seems to be the thing universities need to do or perhaps MOOC.