[DanielBMarkham]

This is a difficult issue for a lot of reasons, hence my restating the context.

I'd venture that no matter what else an education provides, if it does not enable a graduate to repay their loan, it is non-sustainable. (Whether you want to use "good" or "bad" here is up to you)

Even the phrase "public education" is broad and fuzzy. With a tremendous amount of student loans publicly-financed, with public financing also intricately involved in the public university system via research grants, there's a distinction between secondary education and higher education, but I'm not sure how much the distinction matters for purposes of broadly-based public policy discussions.

[_delirium]

> if it does not enable a graduate to repay their loan

What a weirdly backwards way of phrasing it. Why should anyone take out a loan to get an education? Why would a public university charge tuition? My parents did not take out loans to get college degrees (in California, in the 1960s). But their generation got rich and now doesn't want to pay for the next generation to do the same. Should boomers who attended fully subsidized public education now really be let off the hook with their ridiculous claims that they're some kind of Randian superhero who worked their way up "on their own", and it would be "theft" to ask them to pay taxes so the same system they benefited from can continue?

It's certainly not impossible to do so, if people aren't so stingy. I moved out of the U.S. and now live in a country that has free public education. Not just free, but you get paid to attend university, up through a master's degree. (Not paid a lot, but a modest living stipend.) We have a lower unemployment rate than the U.S. does, too. And better transit and less bureaucratic healthcare.

[brudgers]

Repaying the loans is only one way the system might be corrected. Allowing student loans to be discharged via bankruptcy would be another, which has recently been outlawed. Thus prices for education are set in a marketplace which rewards bad loans by shifting all of the risk to the borrower.

[matwood]

Why shouldn't the borrower shoulder most of the risk? If we shift risk to the lender then they will simply stop lending. Then people will complain how they can't get a loan to go to college.

[fnordfnordfnord]

The borrower, the taxpayer, and anyone who holds dollars shoulder the risk to one degree or another. The "lender" has only to move paperwork in order to reap a profit. Can you not see that if the lender had to assume some risk, then the lender would probably lend more to high paying, high demand job skills, and less to skills in saturated market segments and unproductive skills.

[sokoloff]

I can also see that lenders might exert their influence in ways you'd find objectionable, making lending predicated on family assets/income, requiring co-signing from a parent with a 650+ credit score, not lending to liberal arts majors at all, refusing to lend at "black colleges", or preferentially lending at Ivys, etc.

Of course, they'd do it in the name of lending to high paying, high demand job skills and high likelihood of repayment. Under such a system, I'd have still gotten loans, but I'd rather see a system where some percent of people who make bad choices suffer from their choices, but where educational loans are widely available than a system where few are "allowed" to make bad choices, but loans are more narrowly available.

I don't want a world that's even more "rich get educated, poor don't" than today. If I look back at my family, my generation is much, much better off, primarily via education, than my grandparents who very literally mined coal and worked in a steel mill. They scrimped and saved so my parents could go to college to become teachers, who in turn ensured we did as well. That's no college to no-name college to top-name college in the span of two generations.

Of course that's only one data point, and if I read it in a paper, blog or on news.YC, I'd roll my eyes at the cherry-picking, too, because it'd be 1 story hand-selected from 100s of millions. In my case, it's 1 of 1, so I want to ensure we preserve the conditions that let my parents work hard to forge a better life for themselves and my siblings. Maybe in a world where college loans are hard to get (such as the world they lived in), this would all work out similarly, and easy college loans are in fact part of the problem, but I think there's been heaps of hidden benefits to having education being more widely available and more common that people overlook when they see Mr or Ms Bad Choices as an adult with untenable student loan debt.

[fnordfnordfnord]

I was responding specifically to the parent comment who appears to like the fact that the borrower assumes a high degree of risk, and the paper lending company assumes essentially none. I hadn't really meant to offer it as a final solution to all our problems.

>I can also see that lenders might exert their influence in ways you'd find objectionable,

If the gov't decides to use economic forces to manage the supply of college grads, I would hope that a large portion of funding would go into very productive areas. It should/would likely change over time to correct oversupply, changing demographics of society, etc.

>making lending predicated on family assets/income, requiring co-signing from a parent with a 650+ credit score,

An unfortunate but predictable outcome. Ideally, a parent with a 650+ credit score would be able to afford to support a child in college w/o much support. I have such a credit score, but probably won't be able to educate my kids based on my college instructor salary alone. Ironic, eh?

>not lending to liberal arts majors at all,

Funding the arts via loans is right out, obviously. Funding the arts is a problem that has spanned pretty much all of recorded history. No simple scheme such as mine can pretend to solve it today. Attempting to use economic/market forces in the normal manner to produce good art will only ever have comical results at best, and the nominal result will be crap. (I have an amusing idea. I'll tell it further down.)

> refusing to lend at "black colleges",

Grants? Be prepared to write off a lot of the "loans" to minority and impoverished areas. Since they are minorities, it will be cheap anyway. We could probably do away with race-based affirmative action, and simply make grants to students and institutions in impoverished places, and from impoverished families.

> or preferentially lending at Ivys, etc.

I'm also not sure how to effectively stop the well-connected wealthy from sponging off of everyone else. I could say "means testing" but we both know that these types of parasites are clever and quickly adapt to their environment. Hopefully if the rich use loans, the majority will repay them, and thus be a source of income rather than a drain. More likely, their parents will hire expensive accountants to help rid their heirs of this debt, justifying this thievery because it is "so unfair" to "tax success."

>Of course, they'd do it in the name of lending to high paying, high demand job skills and high likelihood of repayment.

Yeah, so, at least we agree that there may be a possibility for a pseudo-private-ish loan outfit to be somewhat profitable for some higher-ed funding.

> Under such a system, I'd have still gotten loans,

I could have gotten loans too, but I refused (for better or worse, I'm not sure). I had negative/neutral financial support from family, and eventually dropped out of Uni before completing my BS. meh.

but I'd rather see a system where some percent of people who make bad choices suffer from their choices, but where educational loans are widely available than a system where few are "allowed" to make bad choices, but loans are more narrowly available.

I don't want to see people suffer, but I don't think that's what you really meant. I think it would improve our economy, and the lives of many people if some of us were economically herded into productive industry. I know, it almost sounds like communist central planning, and it probably is. But letting high school seniors choose the economic direction of our country at their whim seems like a poor alternative.

I don't want a world that's even more "rich get educated, poor don't" than today.

Me neither.

If I look back at my family, my generation is much, much better off, primarily via education, than my grandparents who very literally mined coal and worked in a steel mill. They scrimped and saved so my parents could go to college to become teachers, who in turn ensured we did as well. That's no college to no-name college to top-name college in the span of two generations.

Yes, it's so obvious that it shouldn't need to be said. Education will improve everyone's life to a greater degree than pretty much anything else.

Of course that's only one data point, and if I read it in a paper, blog or on news.YC, I'd roll my eyes at the cherry-picking, too, because it'd be 1 story hand-selected from 100s of millions. In my case, it's 1 of 1, so I want to ensure we preserve the conditions that let my parents work hard to forge a better life for themselves and my siblings.

Let's call this a friendly chat over coffee, and overlook these misdemeanors.

* Maybe in a world where college loans are hard to get (such as the world they lived in), this would all work out similarly, *

I think it needs a systematic approach. The colleges themselves have to adopt ethics. It will be tough, you can't really outlaw meanness, wanton greed, stupidity.

and easy college loans are in fact part of the problem,

Greedy businessmen are sucking this money out of kids' pockets as fast as the kids can borrow it. I see it every semester. Students pay 2X, 3X, 10X, prices for books, computers, supplies, etc. because the campus store is integrated with the school and makes spending that money much easier than buying used texts from individuals, the internet, etc. The bookstore stocks lab items for my courses, but at a huge markup over retail. Next to every nasty decrepit warm-water fountain is a vending machine full of cold Dasani(TM), or better yet Coke!### Prices at the "food court" are another outrageous example. Privately financed campus housing? The same.

* but I think there's been heaps of hidden benefits to having education being more widely available and more common that people overlook when they see Mr or Ms Bad Choices as an adult with untenable student loan debt.*

Absolutely, but, I think that was probably true to a greater degree in the past, and that the [education funding] system for people in our cohort (middle-class-ish?) is tending more toward a sort of Hobson's choice of debt-slavery / indentured servitude vs. forgoing formal education.

## Arts funding should be fragmented from education funding. It should be as independent as possible from political influence. There could be divisions administered by appointees (appointed for life) who would primarily give block grants to institutions of their choosing. Funding divisions could be run in a variety of ways, but at least one should be required to only make funding decisions while under the influence of mind-altering drugs. Now that I think of it, the same arrangement might do well for science funding (especially Physics).

### Unless Pepsi has the vending "contract"

[sokoloff]

That was one of the most well reasoned wall of text, point-by-point replies that I've ever read. Well written and I suspect we agree far more than not. Thanks also for teaching me "Hobson's choice". Cheers!

[ChuckMcM]

Perhaps we don't see a similar level of difficulty.

"I'd venture that no matter what else an education provides, if it does not enable a graduate to repay their loan, it is non-sustainable. (Whether you want to use "good" or "bad" here is up to you)"

Your reasoning here doesn't make any sense to me, are you claiming that if a student takes out loans in order to pay for an education in basket weaving. Then fails to earn enough money by applying their acquired expertise in basket weaving to repay that loan. That they educational institution was at fault here?

There are many colleges which will train you in skills that will pay off the entire cost it takes to attend them in under 5 years. In California alone there are 23 campuses of the California State University system, with a median four year tuition of $25,000 for state residents which will train you in a STEM degree which is less than you would pay for a new car. There are community colleges which will do an Associates degree for even less.

But you are absolutely right there is a problem here, it just isn't with the colleges (although there may be grounds for accusing them of collusion).

Come at this from a different angle, how would you like to be able to conscript hundreds, thousands, maybe even a million people into a program where some fraction of everything they earn goes right into your pocket? Sell them a government guaranteed loan that they can't afford to pay back. It was a great scam in the Mortgage business for a while, the banks made billions on it, the tax payers took it in the shorts when the bottom fell out. And why did the bottom fall out? Because those damn suckers could declare bankruptcy and get out of paying the loan! Can you imagine. Well the banks have fixed that loop hole, you can't declare bankruptcy and get out of a student loan, no way no how, you're mine for life.

And guess what, the same people who were fleecing stupid people with bad mortgages are now fleecing people with student loans. In some cases literally, like when I heard from the same Wells Fargo loan officer who used to do mortgages and now wanted to talk to me about getting loans for my college age kids.

Its a problem *for schools" if they are over priced since they need students to survive. Guess what, if they can't justify their costs they go out of business or they get more efficient. As long as there are people willing to provide the same degree for less money, the system will continue to work and anyone who wants to be a doctor, or an engineer, or a lawyer, or a geologist or whatever can get their degree.

I implore you not to let the red herring story of 'students drowning in debt' convince you that college is broken, its not, student lending is broken and students are not be properly informed with respect to what "a degree" means versus what an "employable degree" means. Once we educate them and they start spreading out to the more affordable schools the private schools will have to fight harder for the top talent and will do so with scholarships so that their 'total cost' is the same as if they went to a state school but got their 'marquee' name.

Make students more discerning shoppers and the "problems" you decry go away.

[sp332]

"I'd venture that no matter what else an education provides, if it does not enable a graduate to repay their loan, it is non-sustainable. (Whether you want to use "good" or "bad" here is up to you)"

Your reasoning here doesn't make any sense to me, are you claiming that if a student takes out loans in order to pay for an education in basket weaving. Then fails to earn enough money by applying their acquired expertise in basket weaving to repay that loan. That they educational institution was at fault here?

Not at fault, just not sustainable. As in, if the students can't make enough money to pay the school, the school will go out of business. Less drastically, if a student knows they will have to take a job doing something else to pay off the basket-weaving-school loan, they will not pay thousands of dollars to learn something that can't make them that money back.