Article: Escalating Educational Costs/Loans

[Pragma]

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Interesting read.

http://finance.yahoo.com/news/dear-class-13-ve-scammed-110139929.html?page=2

I especially liked the part where this journalist called out journalists.

As someone working at a University, I have to say that sometimes I really wonder where the money goes. I'm not at a place where faculty make ridiculous salaries or anything. Our tuition is actually reasonable (compared to alternatives). I am guessing most schools put a lot of money towards building fancy buildings or unnecessary luxuries (the theater example in the article was a good one). I know keeping technology up to date is another huge issue, but really - it can't cost as much as students are being charged for.

Interested in others' thoughts about the issues discussed in the article.

 

[MBellows]

I usually like to blame the fact that in many schools it seems the admin:student ratio is higher than the instructor:student ratio.

Also the highest paid public employees seem to be public college coaches.

 

[Pragma]

I usually like to blame the fact that in many schools it seems the admin:student ratio is higher than the instructor:student ratio.

Also the highest paid public employees seem to be public college coaches.

Yeah - although I would imagine that this is justified by the revenue they bring in. Presidents and Provosts also make a pretty solid chunk of change.

But I think your first point is the more salient one. Admin:student ratio can get out of control. I think that part of that could be helped in some settings if instructors were asked to do a little more on that end. But at least in my own experience, committee work really adds up and I can't imagine adding in more advising and administrative duties.

 

[Doctor Eliza]

At the same time, many universities are cutting corners by hiring non-tenure track, year to year instructors. I have multiple friends in multiple fields (maybe not psych, though) in this situation. This trend isn't good for students nor the instructors, but it cheaper for the university.

Dr. E

 

[MBellows]

Yeah - although I would imagine that this is justified by the revenue they bring in.

I'd argue that in some places it has more to do with culture. At one of the first universities I went to the coach was the highest paid employee and very few people really went to games (because the team sucked). Then again I also left that university because they blatantly let the coach violate 1st amendment rights of the student body.

Presidents and Provosts also make a pretty solid chunk of change.

I've never actually understood this but I think it plays into the major fallacy of management/government culture.

I think that part of that could be helped in some settings if instructors were asked to do a little more on that end. But at least in my own experience, committee work really adds up and I can't imagine adding in more advising and administrative duties.

I do think that more professors should share administration duties. I also think that if colleges focused more on their purpose (education and research) and less on fluff, we wouldn't have to have the absurd level of college management. I mean really, we have degrees specific to managing student affairs.

 

[Pragma]

At the same time, many universities are cutting corners by hiring non-tenure track, year to year instructors. I have multiple friends in multiple fields (maybe not psych, though) in this situation. This trend isn't good for students nor the instructors, but it cheaper for the university.

Dr. E

Yes the adjunct trend is terrible. But at the same time, even though many places hire adjuncts for so cheap - it isn't like they are reducing tuition.

I know that higher education can be complicated, but it doesn't need to be that complicated. You generate revenue based on enrollment, hire the appropriate number of faculty at reasonable salaries, hire some advising and administrative people, and boom - good to. Maintain your buildings and update technology as appropriate. No bells or whistles required.

I say that as someone who went to a large state school for undergrad. Tuition was reasonable, classes were big but that was to be expected, and no one was required to get an iPad as a freshman. Rubber flip flops for showers in an old dorm building. It was wonderful and fairly cheap.

One thing I have noticed is that I think some institutions are obsessed with growing for the sake of growing. Sometimes, you don't need to expand and build that new building or get bigger. Sometimes, it's just fine as it is (meaning, not necesssary to spend $ on).

 

[JeyRo]

One thing I have noticed is that I think some institutions are obsessed with growing for the sake of growing. Sometimes, you don't need to expand and build that new building or get bigger. Sometimes, it's just fine as it is (meaning, not necesssary to spend $ on).

I've interpreted that as a race for competitive advantage. Institution X sees it's immediate competitors institutions Y and Z building these massive facilities, offering professional Tai Chi classes for their students, and hiring ten vice-presidents of academic affairs (or whatnot), and figure that in order to stay competitive they need to do the same thing. The only way institutions Y and Z can do that is by charging up to the maximum amount of students that they can borrow on government loan programs, so institution X does so as well. In a nutshell, this is the story I tend to believe in terms of how government loan programs fuel hyperinflation of costs in higher ed.

 

[MBellows]

In a nutshell, this is the story I tend to believe in terms of how government loan programs fuel hyperinflation of costs in higher ed.

The way that the Republican party is attempting to address this is absurd though. Rather than getting out of the market entirely they want to increase the interest rate to around 10%. Clearly, either none of those idiots have ever taken an economics class and don't understand price anchoring or they just blatantly want to make it harder for low SEC students to get an education, which remains the most clear way to move up the ladder.*


*Provided they major in something not stupid and attend a state or funded private institution that doesn't leave them further in debt with no job prospects.*

 

[JeyRo]

The way that the Republican party is attempting to address this is absurd though. Rather than getting out of the market entirely they want to increase the interest rate to around 10%. Clearly, either none of those idiots have ever taken an economics class and don't understand price anchoring or they just blatantly want to make it harder for low SEC students to get an education, which remains the most clear way to move up the ladder.*


*Provided they major in something not stupid and attend a state or funded private institution that doesn't leave them further in debt with no job prospects.*

The GOP establishment has taken to Austrian economics on a completely superficial level, pretty much adopting it as the latest fashion (exhibit #1 Paul Ryan). When it comes to actually understanding it's implications, they fall completely flat.

I have no idea what a "fair" interest rate for student loans is, given the massive intervention going on with our central banking system on one side and the nationalization of the student loan industry on another.

I agree the best solution is probably one that's akin to what Ron Paul proposed back in 2012 when he was running (a slow, eventual phaseout of federal loan programs and backing off of all of the current various interventions in the student loan market), but that's not happening any time soon. Instead we get proposals like this from the GOP - I don't think they're doing it out of spite or greed or corruption, I think they honestly feel this is an appropriate compromise between having the student loan program be a government entitlement / giveaway on the one hand, and completely privatizing it on the other.

 

[MBellows]

I think they honestly feel this is an appropriate compromise between having the student loan program be a government entitlement / giveaway on the one hand, and completely privatizing it on the other.

Last I checked the student loan program was still making the government money, I'm not sure how it can be considered a giveaway or entitlement. I would almost call it an earning for dealing with the idiotic way that the government has set up a ****ty compulsory education system that is generally poorly managed. That said, school districts are both extremely local governments and some of the worst examples of government overreach.

As far as what is fair, I would argue that what's good for the goose (banks) is good for the gander (students), and in the end only one of those two things actually contributes to the economy (students are people and can contribute, whereas banks are organizations and are merely a means for contribution).

If you want the government to get out of all loans (probably a good idea), I'm generally ok with that, but if the government is handing out free candy it has to be to everyone.

 

[Pragma]

If you want the government to get out of all loans (probably a good idea), I'm generally ok with that, but if the government is handing out free candy it has to be to everyone.

Free candy? Where?!

I have a feeling that the massive increase in borrowing over the past several years is going to make the federal loan business go in the red. I mean, the profits to this point are what - 50 billion on a trillion dollars worth of debt? I just don't see how that will be sustainable with more and more people borrowing.

 

[beingintherapy]

Vocational training is a cost of production. Moving the burden of that cost to students is simply capital avoiding its responsibility. Government, in the form of loans, has taken over the role of capital in training appropriate labor to meet the demands of shifting technology.

Taking away loans will kill our economy, and our middle class. You know, professionals. Someone who will do it cheaper, because they're more desperate, will always be around. It's the nature of competition.

I can see the time coming when education, under the for profit model, will be simple regurgitation into a computerized grading system. Oh, silly me, we're almost there already. One more push and a standardized series of tests disseminated from a central system, all students ranked according to their aptitude and demographic will be the norm. Workers easily defined and easily replaced in a world where indentured servitude through means of higher and higher loans is the norm as the cost of testing and the interest on loans skyrocket.

I don't think financial aid is ever going away. It's too necessary, and too tempting a tool to control production. The system is set up to benefit the objectivist and the wealthy. It's no surprise since they're the ones who made the decisions.

The admin:student ratio is an interesting anomaly, but I don't think it's the most important variable. Superrational outcome-based systems is the likely cause, meaning that given the same information two individuals will automatically come up with the same, approved answer. In other words, vocational training is killing education. Divergent analysis has always been the cornerstone of discovery, and strangely enough, has always been quasi-rational. So has entrepreneurship. Entrepreneurial discovery can't happen in an economy that doesn't allow great risk.

I think problems get solved by increasing the amount of ideas, not reducing them. I think the science bears that out. I also think that loans of any kind reduce the amount of ideas. Surely, it's scalar, though. Only the best ideas have the best chance of success. Not necessarily. Anybody remember the pet rock? Clearly a phenomenon that proves the average level of psychosis in the general population.

We need nutballs. We need them foaming at the mouth and wearing silly, tin-foil hats. We need them writing books. We need them in classrooms. Diversity isn't just something that contributes to our color scheme.

 

[erg923]

The system is set up to benefit the objectivist and the wealthy. It's no surprise since they're the ones who made the decisions..

Are you a vaccineer too? 🙄