[OrangeMonkey]

By kids they mean “adults”.

By putting kids in debt the mean “allowing them to take out loans that will put them, statistically, in a higher income bracket than people who don’t go to college”

College is important - it’s why there is a cost to it.

I can argue - and I do in fact - that the federal guarantee that student loans not be dischargeable in bankruptcy led directly to the increased cost of education. This doesn’t mean someone else should pay your student loan bill. I’d be quite happy, though, taking away that provision letting students who got a raw deal discharge in bankruptcy. Let’s let lenders and colleges be required to make good investments again.

[adastra22]

How old are you? That’s how I felt when I was younger. Now that I’m approaching 40, I have a really hard time thinking of anyone under the age of 25 as an adult. We may legally treat them as such, although that’s mainly out of historical reasons having to do with war and reproductive biology. But in 18-year-old lacks the capability for mature thinking that we characterize as “adult.”

I think it is entirely fair to say that the college loan system is predatory on people who lack the life experience necessary to properly evaluate the burden they’re taking on themselves. If a bank makes predatory loans to the financially illiterate, the bank could get in massive trouble. But for student loans no such provisions are made, and to make matters worse they are not even dischargeable in bankruptcy.

[OrangeMonkey]

Since you asked, I am positive I am older than you are.

I absolutely believe an 18 year old is an adult and they have their own free will and capacity to make decisions. They are not a puppet worked by the heavens.

That said - I think we agree more than we disagree. Let students declare bankruptcy and force universities to once again have skin in the game.

[marcosdumay]

> although that’s mainly out of historical reasons having to do with war and reproductive biology

It's because whatever age we start treating people as adults, they will only actually become adults a few years later.

But I'm pretty sure a large share of the actual adults aren't able to evaluate non-dischargeable debit either.

[adastra22]

Physiologically we know the brain keeps developing until age 25. In particular, the prefrontal cortex which is responsible for decision making isn’t complete until then.

[dsfyu404ed]

These people lack the life experience to sniff out a potentially poor deal because people like you have removed opportunities to gain such experience in the name of protecting them.

The average 15-16 year old has the mental faculties to function as an adult least as well as a "below average but good enough" adult. We as a society fail to give them opportunities to hone those skills.

People cannot be functional adults without practice. If we keep nannying people until older and older ages they will not gain proficiency at adulting until even older ages.

[howeyc]

That's a cop out. I'm nearly 40 as well, and I know I was making coherent financial decisions at 15. Expecting individuals to think rationally at 18 is completely valid.

I will admit though, a lot of my peers at that age were making dumb decisions, but quite a few knew they were doing so at the time, and did it anyway. Their concerns were not for the future, and they readily admitted as much. Facing the consequences later in life is the result.

[acuozzo]

> Expecting individuals to think rationally at 18 is completely valid.

How do you account for my case? https://news.ycombinator.com/item?id=33318674

[howeyc]

You made a decision and are dealing with the results. I don't see the issue.

If you "didn't know" how to do math (I learned the math required in high school, perhaps you didn't), you could have spent an afternoon learning what you needed to make a decision affecting the rest of your life.

Here it is in 5 minutes:

30K per year, 4 year degree, 120K total.

Calculate payments of 120K loan with X% interest over term of Y years. Mortgage calculators all over the place will work as substitute if you can't do it yourself.

Decide if this is what you want to do.

[acuozzo]

> I don't see the issue.

I replied specifically to this: "Expecting individuals to think rationally at 18 is completely valid."

I quoted it within my reply to point out exactly what I was choosing to address; no larger issue, no hidden agenda requiring you to read between the lines.

I don't think it's valid to expect 18 year olds to think rationally about matters like this because it requires speculation.

18 year olds don't have 18 years of steady life experience to guide their predictions for the future. They don't have 18 years of clocking in and out at the same job. They have, instead, 18 turbulent years of childhood and adolescence, even in the best case.

With that out of the way…

If wall street can't time the market, then how can 18 year olds? Do you really expect them to sit down and accurately calculate projected inflation and the probability of various economic downturns?

What about the graduating class of 2022? Do you expect them to have accurately predicted a 40% drop in the value of the USD back in 2017-18?

What would be the value in their arithmetic if they hadn't?

[orwin]

You forgot about inflation, can you add it in 5 minutes?

[orwin]

You are ignoring the elephant in the room, and that's capital. Cultural capital.

I'm from a rural area. Luckily, i'm not in the US, so me and my peer don't have outstanding debt, but i was around when the "Revolving credit" (also called "credit revolver" in my country) came full force in my area. Well, actually, revolving credit were here for already ten years. The suicides came full force (hence "Revolver". Get it?).

All adults. Mostly women, but not only. I was 13 when the first one offed herself in my village. She was around forty, and i knew her kids. "It takes money to make money" and all this crap worked well until that time. They were rational: their parents contracted debt in the 50s and 60s to build their business/farm or build their houses. Why couldn't they do the same? But the inflation was 10 to 15% at the time. They had no financial education, and the only example they had was from a time where everybody indebted themselves and it worked well. We had shows talking about "lever effect" and praising how clever the company was to indebt itself.

Circa 2005, the procedure to bankrupt yourself in my country became way more accessible and nowadays the revolving credits are less predatory.

Still "Expecting individuals to think rationally at 18 is completely valid." have nothing to do with endebtment.

[bluedevil2k]

That’s one of the issues though, colleges have no skin in the loan game and don’t really care if the students made a good investment or not. They have no principal in the loan and therefore no risk. To them, every student is free money. If the kid drops out and can’t pay any more, they don’t care. If the kids graduates with some liberal arts degree, 6 figure debt, and no job prospects, they don’t care.

The real solution to soaring college costs HAS to include some provision where the university incurs some of the risk of repayment. Imagine how much more selective they’d be if they held 20% of every student loan. Or, imagine the guidance counselor resources that would suddenly appear when they have to care about what you do after you graduate.

[dsfyu404ed]

Colleges ACTIVELY game the system by enrolling people in programs they will drop out of. 500+ student freshman lectures turn a profit. 50 student capstones are a loss. So the universities don't mind it if people enroll in stuff they're not qualified for and drop out or transfer after a year or two.

[solardev]

Maybe as a society we shouldn't expect 18 year olds, fresh out of their parents' homes, to already know what the hell they want to do for the next twenty years of their lives. And then also to understand the market opportunities (or lack thereof) of their choice.

Many college degrees have a negative ROI or are oversaturated in the workforce or are completely unnecessary to their given career track. Our primary school system is pretty bad and we're not equipping 18 year olds, who are still emotionally and mentally immature, to make those kinds of decisions and take out a 5-figure loan, sight unseen, on dreams and naivete alone. It benefits only the lenders at the students' expense.

There are so many tweaks we could make. Encouraging real-world experience before starting college would be helpful. Putting trade schools up as an alternative would help many who struggle in the detached ivory towers of universities. Funding secondary ed, as many other countries do, would make sense as a continuation of primary school (especially in America, whose primary school systems are so quantitatively and qualitatively poor compared to the rest of the developed world). Revamping Common Core to meet more modern needs, and including extensive career & life planning for students of different backgrounds so they can see their options in the future instead of just learning from their parents and pop culture. Whatever, the possibilities abound, and many other countries do things better or worse in some way -- there are plenty of lessons to learn from.

Looking at the finances in a black box is missing the forest for the trees. It's not just about who pays. The whole system is antiquated and failing our children; in America you're basically born elite or you're doomed. There is no social mobility anymore, and that's not something that allowing student loan bankruptcies alone will solve.

[hn_throwaway_99]

> I’d be quite happy, though, taking away that provision letting students who got a raw deal discharge in bankruptcy.

Totally, 100% agree. All the incentives are currently there to have lenders load up students with as much debt as possible, because they know there is no way it will get discharged (or, otherwise, taxpayers will end up paying for it).

We need updates to bankruptcy laws that make lenders think twice about giving $100k in loans to someone going to cooking school.

[viscountchocula]

"College is important - it’s why there is a cost to it."

What a strange way to look at it. Elementary, middle and high school is important, no? Roads are important. And parks. And scientific research. So much of our civic infrastructure is important without having a direct charge.

A fair trade-off would seem to be higher income taxes and free college or trade school. Would provide more ladders up for the disadvantaged and a stable source of revenue to fund it.

[j_walter]

The problem is that people want college for free...for everyone. No country in the world provides free college to everyone. You have a lot of stipulations as to who qualifies as we don't need the person who barely graduated high school at the bottom of their class to go to college. That is a waste for society and that person...as they will end up failing out of college and have wasted years of their life.

[NickC25]

>* that the federal guarantee that student loans not be dischargeable in bankruptcy led directly to the increased cost of education*

Yes. However, there has been an arms race of sorts in the higher education world that is completely unnecessary. New dorms and high quality facilities aren't a bad thing at all (when built wisely and cost-effectively), but having tons of administrators is. Colleges do need to cut down on some unnecessary programs, but they also don't need to go spending tens of millions on football coaches or athlete-exclusive facilities either (which happened at my alma mater).

>* Let’s let lenders and colleges be required to make good investments again. *

Agreed. But let's not also forget that the lenders can make a huge profit on these loans....I've seen loans as high as 8%! If we're going to ask young adults to go into debt to get an education, we should make sure that bankers and other parasitic actors can't make huge profits on said loans. They should be capped at 1-2% interest at most.

[VincentEvans]

>>> College is important - it’s why there is a cost to it.

The cost of higher education does not have to be borne by the individual seeking it. It could be financed by society and offered to those who desire it free if charge. It could even encourage more people to enroll and promise those who do well in their studies a financial incentive in form of a stipend.

I know of some countries that do all that with the idea that people with higher educational achievements - deliver higher economic output over their lifetime that more than covers the costs borne by the society and give their country a competitive edge in a global economy.

But US doesn’t do that.

It does, however, attract people who received their education for free in other countries to immigrate and compete with those who took out massive loans in US to do the same.

[PubliusMI]

Is there even 1 society in the world which pasy for the university education of ALL who desire it?

[VincentEvans]

No idea.

In my own experience as the beneficiary of such a system of education - the barrier is having to pass admission exams that are meant to ensure that available spaces are offered to those academically inclined to succeed.

In my personal circle of acquaintances all who were interested in securing the spot were able to do so.

But in an event you fail, you have an option to work on your shortcomings and take the admission exams again.

[j_walter]

> College is important - it’s why there is a cost to it.

True...but the cost varies widely and people need to understand that going to an ivy league school for a degree that gets you into something like being a social worker is not ever going to be worth it...other than to have a news article written about you one day talking about the $300K in debt you are while having a $45K/year job.