Time to Rethink a Myth

Maybe parents might want to consider the effects of pushing their children to get a college education:

Cyndee Marcoux already was stretched thin, thanks to the $80,000 in student loans she racked up after getting divorced and going back to school a decade ago. Her breaking point came in 2010, when her daughter defaulted . . . → Read More: Time to Rethink a Myth

Cosmic Justice

In the realm of inter-generational warfare:

According to government data, compiled by the Treasury Department at the request of SmartMoney.com, the federal government is withholding money from a rapidly growing number of Social Security recipients who have fallen behind on federal student loans. From January through August 6, the government reduced the size of . . . → Read More: Cosmic Justice

It's Definitely a Bubble

Source That jump in the lower line is pretty much all student loans.  And whenever the government is loaning out money, you can bet that the direct recipients are in the middle of a big ol’ bubble.

Education Inflation

Paul Krugman is aghast at this chart, which shows how the Pell Grant has declined in relative cost coverage:

This is pretty much how inflation works. In the early stages, its effects are not very noticeable because an incentive has not yet taken place. As the incentive shift takes place—marking the beginning of a . . . → Read More: Education Inflation

At Least They’re Upfront About It

The University of California wants to enslave students:

The students’ proposal fits right in. Instead of paying tuition – currently at $12,192, not including mandatory fees, room, board or books – the “UC Student Investment Proposal” would require that students commit to paying 5 percent of their annual income for 20 years after graduating.

. . . → Read More: At Least They’re Upfront About It

An Alternative Explanation to the College Bubble

Direct and indirect federal subsidy is often offered as the primary reason for the occurrence of the current college bubble. Most effects of the college bubble are traced back to federal funding, in the forms of student grants and subsidized loans, not to mention research grants as well as general academic funding and diversity . . . → Read More: An Alternative Explanation to the College Bubble

Compelling Proof of the College Bubble

From the New York Review of Books:

In Academically Adrift, Arum and Roksa paint a chilling portrait of what the university curriculum has become. The central evidence that the authors deploy comes from the performance of 2,322 students on the Collegiate Learning Assessment, a standardized test administered to students in their first semester at . . . → Read More: Compelling Proof of the College Bubble

Signaling and the College Bubble

From Bryan Caplan:

Many educators sooth their consciences by insisting that “I teach my students how to think, not what to think.” But this platitude goes against a hundred years of educational psychology. Education is very narrow; students learn the material you specifically teach them… if you’re lucky.

Other educators claim they’re teaching . . . → Read More: Signaling and the College Bubble

Why Not Default

Seriously, what’s so difficult about allowing student loans to be discharged in bankruptcy?

Today, President Obama is effectively giving college students and their parents his middle finger. Whereas Jobs’ prank was harmless and symbolic, the President’s plan to bail out student loans will derail the  entrepreneurial dreams and financial security of countless young people. . . . → Read More: Why Not Default

In Case You Had Any Lingering Doubts

If you weren’t sure about the existence of a college bubble, here’s proof:

[Source]

When the number of psychology majors increase by 135% over25 years, you can be reasonably sure that there’s a college bubble because a) psychology is not a science, it’s a form of bovine fecal matter and b) economies don’t need . . . → Read More: In Case You Had Any Lingering Doubts