Cancel student loan debt?

[theprestige]

If the atmosphere of 2020 has any correlation, that would depend on their socioeconomic position. The poor should not be denied the opportunity to drown in debt for any educational or artistic endeavor, no matter it's value to their future earnings or society.

Conversely, the poor should not be denied access to lines of credit for the purpose of improving their situation and no longer being poor.

Unfortunately there's a correlation between being poor and being a bad credit risk. So either you don't give the poor lines of credit at all, or you give them lines of credit they won't be able to afford.

So we have the question of whether the education we're buying with these loans is actually worth the money.

And we have the question of whether such loans are actually the right way to buy education for the poor.

 

[JoeMorgue]

Well yeah like I said the internet becoming ubiquitous sort of killed the whole "Well I have a degree in something totally unrelated to my job, but the degree at least proves I'm an 'educated' person" thing that was, again my impression, a driving force behind a lot of the push to go to college.

The idea really seemed to be that simply going to college and getting a degree in anything proved that achieved some base level of "intelligence" that employers would look for. The obvious problem with this is even it's true an employer is obviously going to look at someone who went to college in the field they are in to be better.

 

[theprestige]

Honestly I kinda want to forgive all the federal student loan debt, just to see how the economic outcomes for people who were relieved of the debt burden compares to the outcomes for those who were not.

Like, you couldn't afford a college education, so you took out a loan. Now you've got the education, but for whatever reason you can't convert it into a career that pays enough to service your debt. Your loan gets forgiven, which leaves more money in your pocket for leisure, continuing education, better transportation, a move to follow a career opportunity, etc. You don't pay the loan back, but does that translate into you paying an equivalent amount of productivity forward into the economy?

Because that's really what these loans are all about, right? You're not only supposed to pay them back, you're supposed to become so productive that you become a net profit to society - even with the education debt you took on. Obviously in your case it's not working out that way. If we forgive the debt, write it off as a loss, does that change the rest of the calculus, for you?

 

[TragicMonkey]

Conversely, the poor should not be denied access to lines of credit for the purpose of improving their situation and no longer being poor.

Unfortunately there's a correlation between being poor and being a bad credit risk. So either you don't give the poor lines of credit at all, or you give them lines of credit they won't be able to afford.

So we have the question of whether the education we're buying with these loans is actually worth the money.

And we have the question of whether such loans are actually the right way to buy education for the poor.

Indeed. This sounds crazy, but if we've reached a point where in order to make a wage capable of supporting themselves the poor have to borrow money, and in order to make that possible the government has to guarantee the loans, and then write them off because they can't be paid back...it may actually be cheaper to simply institute a universal basic income! I really hope that's not the case, numbers-wise, because it would mean these defaulting loans have reached ridiculous levels...but it's conceivable that at some point that could actually happen. We'd have to do the math and, as a society, decide that perhaps we should pursue a course that seems counterintuitive and flatly contrary to what have been our basic cultural values simply because the math proves it's a superior course.

 

[JoeMorgue]

And again this is why talking about student loan forgiveness in a vacuum without talking about whether or not student loans should even be a thing in their current form is insane.

And again this is not a moral judgement in the abstract. And don't think about it as money, that just triggers people. It's a fundamental question of if we are using resources correctly.

 

[TragicMonkey]

Honestly I kinda want to forgive all the federal student loan debt, just to see how the economic outcomes for people who were relieved of the debt burden compares to the outcomes for those who were not.

Like, you couldn't afford a college education, so you took out a loan. Now you've got the education, but for whatever reason you can't convert it into a career that pays enough to service your debt. Your loan gets forgiven, which leaves more money in your pocket for leisure, continuing education, better transportation, a move to follow a career opportunity, etc. You don't pay the loan back, but does that translate into you paying an equivalent amount of productivity forward into the economy?

Because that's really what these loans are all about, right? You're not only supposed to pay them back, you're supposed to become so productive that you become a net profit to society - even with the education debt you took on. Obviously in your case it's not working out that way. If we forgive the debt, write it off as a loss, does that change the rest of the calculus, for you?

Sounds like something that could be done as an experiment, on a segment of the population. Outright forgive the debts for one group, do nothing for another, and try different amelioration programs on the others. Then tote up the data, analyze the results, and see what worked best.

 

[Meadmaker]

Well yeah like I said the internet becoming ubiquitous sort of killed the whole "Well I have a degree in something totally unrelated to my job, but the degree at least proves I'm an 'educated' person" thing that was, again my impression, a driving force behind a lot of the push to go to college.

The idea really seemed to be that simply going to college and getting a degree in anything proved that achieved some base level of "intelligence" that employers would look for. The obvious problem with this is even it's true an employer is obviously going to look at someone who went to college in the field they are in to be better.

When colleges were somewhat elite, I think a potential employer can look at the existence of a college degree and say that the person was obviously smart enough to get into college, and hard working enough to get out of college, and so hiring college grads made some sense, even if their field of study had nothing to do with their job responsibilities.


That doesn't work when everyone can go to, and graduate from, college.

 

[Meadmaker]

Sounds like something that could be done as an experiment, on a segment of the population. Outright forgive the debts for one group, do nothing for another, and try different amelioration programs on the others. Then tote up the data, analyze the results, and see what worked best.

I feel sorry for the guy in that study who goes to buy a house and then finds out he was in the placebo group for debt forgiveness.

 

[TragicMonkey]

I feel sorry for the guy in that study who goes to buy a house and then finds out he was in the placebo group for debt forgiveness.

Heh. But obviously they'd know what group they were in, as the point of the experiment is to see what they do after their situation is changed (or not).

 

[theprestige]

And again this is why talking about student loan forgiveness in a vacuum without talking about whether or not student loans should even be a thing in their current form is insane.

And again this is not a moral judgement in the abstract. And don't think about it as money, that just triggers people. It's a fundamental question of if we are using resources correctly.

Exactly this. I agree 100%.

 

[rdwight]

Incapable, no. In a poor position to do so, yes. You list off all the other crap they are dealing with in that 12-18 month time-frame when they are making these decisions and yet you left out band practice, theater rehearsals, football two-a-days, travel for baseball games, studying for AP tests and navigating early sexual encounters while living with their parents.

So, this clearly focused teenager is making a life altering decision with the help of college admissions and financial aid professionals who have vast resources behind them to come up with misleading statistics that make their university sound like a great investment.

First to the hilite, I have yet to be provided any cites that dispute past studies that over the course of a working career college grads will earn significantly more than those with only a HS diploma. Well above the cost + interest of college. Besides overpriced diploma mills and people that don't complete college, I still haven't seen any disprove its overall value.

Second, the difficulties of the end of high school pale in comparison to general adult life, wouldn't you say? We shouldn't look at them as incapable of understanding loans, cost and career opportunities. If we allow them to place no value or understanding on those and more on your listed activities, we are definitely failing them.

 

[theprestige]

Sounds like something that could be done as an experiment, on a segment of the population. Outright forgive the debts for one group, do nothing for another, and try different amelioration programs on the others. Then tote up the data, analyze the results, and see what worked best.

I wish government were approached more on the basis of a scientific experiment. Legislation should be experimental. There should be a hypothesis, a way to measure the experimental results, and a commitment to back out the legislation if the hypothesis is falsified.

Student loans are supposed to benefit the student in question and society in general? Great, how can we measure that? Let's try it out, measure the results, and either keep the program or cancel it depending on what we measure.

 

[gnome]

I am noticing an unexamined assumption in these discussions, that a large part of the problem is students using these loans to get impractical degrees.

Is there any way we can look closer at that? Are graduates of theoretically more lucrative fields struggling in paying back their loans? If that is the case, focusing on choice of degree would be missing the target, I think.

 

[rdwight]

I meant to say that it should matter whether people graduating with these degrees, even if the education was high quality, are actually able to land jobs that are relevant.

If colleges are churning out 10x as many qualified workers in a niche field as there are job positions, clearly something is wrong and colleges are over admitting into these degree programs.

I'd like it if they took the opposite approach in community colleges. There are a number of programs that have limited spots each semester such as the nursing program. These force people into waiting lists which slows their progression to a career or worse yet encourages them to "take some courses" in the meantime that won't necessarily translate to anything valuable. I am sure there are a number of programs like this that could be more heavily invested in at community colleges, lowering the cost to students and giving a path to jobs that are in demand and have value.

 

[theprestige]

If colleges are churning out 10x as many qualified workers in a niche field as there are job positions, clearly something is wrong and colleges are over admitting into these degree programs.

What? No. There's nothing wrong with conferring a degree on someone who wants it and is willing to pay for it, regardless of whether there's an industry demand for that degree.

The problem is entirely with the people loaning money for the purposes of someone getting a degree that has no industry value.

If you want a degree in Critical Underwater Basketweaving Theory Studies, fine. Everyone should have a hobby. Follow your heart, live your joy. No shame in that, and no shame in some University conferring such a degree on you. Not even any shame in finding a doting aunt or wealthy sugar daddy who's willing to pay for it.

But taxpayers who are ostensibly investing in a stronger economy through an educated workforce should probably have nothing to do with your degree. And there's probably a lot of shame in a government that invests taxpayer money in your degree.

 

[TurkeysGhost]

What? No. There's nothing wrong with conferring a degree on someone who wants it and is willing to pay for it, regardless of whether there's an industry demand for that degree.

The problem is entirely with the people loaning money for the purposes of someone getting a degree that has no industry value.

If you want a degree in Critical Underwater Basketweaving Theory Studies, fine. Everyone should have a hobby. Follow your heart, live your joy. No shame in that, and no shame in some University conferring such a degree on you. Not even any shame in finding a doting aunt or wealthy sugar daddy who's willing to pay for it.

But taxpayers who are ostensibly investing in a stronger economy through an educated workforce should probably have nothing to do with your degree. And there's probably a lot of shame in a government that invests taxpayer money in your degree.

We are in agreement here. I was speaking imprecisely. colleges could continue to offer enrollment, but if the government or private loans are actually taking repayment prospects into account, the money for these programs would likely dry up. In practice, such conditioning of loans would inevitably lead to tremendous reduction of the enrollment numbers in these programs except by those willing to pay or those at elite enough levels of academia that such programs still lead to gainful employment. Nobody would directly force these colleges to discontinue such poor value programs, but the indirect outcome would likely be just that.

Entire schools might fold up overnight, others would just see changes in enrollment distribution among the various programs.

A lot could be done to make this loan system better, though I still think that general funding for these schools is probably the best approach. Tuition shouldn't be such a large portion of these school's funding as it is now.

 

[acbytesla]

But you persevered. Good on you!

I may have. But then again, I could have easily failed. It took me 6 and a half years to get a 4 year degree. The discouragement I felt at times was overwhelming. I lived in my car for 6 months during that period. I understand very well why some preople quit school. It's not they are necessarily incapable, they just are unable to overcome obstacles that many even most of their fellow students do not face.

 

[TurkeysGhost]

I may have. But then again, I could have easily failed. It took me 6 and a half years to get a 4 year degree. The discouragement I felt at times was overwhelming. I lived in my car for 6 months during that period. I understand very well why some preople quit school. It's not they are necessarily incapable, they just are unable to overcome obstacles that many even most of their fellow students do not face.

Of course, the question becomes is such a hardship actually useful in any way. Is society served well by putting otherwise good students into situations where they are more likely to fail for purely financial reasons? Is it a good thing that someone less dedicated than you were would not have made it? Is a student failing out because they can't balance their studies and a full time job a useful culling of the student population?

Struggle for the sake of struggle has no societal value, but our puritanical nation loves it.

 

[theprestige]

We are in agreement here. I was speaking imprecisely. colleges could continue to offer enrollment, but if the government or private loans are actually taking repayment prospects into account, the money for these programs would likely dry up. In practice, such conditioning of loans would inevitably lead to tremendous reduction of the enrollment numbers in these programs except by those willing to pay or those at elite enough levels of academia that such programs still lead to gainful employment. Nobody would directly force these colleges to discontinue such poor value programs, but the indirect outcome would likely be just that.

Entire schools might fold up overnight, others would just see changes in enrollment distribution among the various programs.

A lot could be done to make this loan system better, though I still think that general funding for these schools is probably the best approach. Tuition shouldn't be such a large portion of these school's funding as it is now.

Ah, gotcha. Yes, we're in agreement.

 

[Dr. Keith]

In my experience coming through high school in the late 2000's, this mentality from those in guidance positions (teachers, admins, guidance counselors) was still quite dominant.

Yes, I got the feeling that high school guidance counselors were bonuses based on the pedigree of schools their graduates were accepted into. Our kids were qualified to go to more prestigious schools than they wanted to go to and the counselors wanted to list those auto-admits instead of the actual schools my kids were going to on any listing of schools for the graduating class. My kids called their BS and were able to prevail.

There is a very strong current of go to the best school you can get into and don't worry about cost.

First to the hilite, I have yet to be provided any cites that dispute past studies that over the course of a working career college grads will earn significantly more than those with only a HS diploma. Well above the cost + interest of college. Besides overpriced diploma mills and people that don't complete college, I still haven't seen any disprove its overall value.

In the aggregate that is likely true. But is it still true on a school by school basis? What about the departments at particular school? What if you drill down to the degree program level? That is the data a student needs before borrowing tons of cash.

Second, the difficulties of the end of high school pale in comparison to general adult life, wouldn't you say? We shouldn't look at them as incapable of understanding loans, cost and career opportunities. If we allow them to place no value or understanding on those and more on your listed activities, we are definitely failing them.

And yet Honda won't give them a fairly well secured loan to buy a Civic. Why?