Looks Like People Still Care!!

[Kevin Gallagher]

  The link is to an article about the man that paid off an entire graduating class's student loans. Just amazing and wonderful IMHO.

https://www.ctpost.com/news/education/ctpost/article/Graduation-speaker-pledges-to-pay-class-of-2019-13857376.php#item-85307-tbla-5

[RSL]

It's a great gesture, Kevin, but how about next year's graduating class? Is he going to do it again? Problem is, it doesn't solve the problem, probably makes it worse. You'll now have kids hoping somebody will pay off their debts as they buy a round for the whole establishment to the cheers of the group. What we need most desperately is less government subsidization of universities, which dependable surveys again and again show simply increases the costs to students as the universities raise their charges. It's a giant racket and it needs to come to a screeching halt.

[Kevin Gallagher]

 Hi Russ, I hear and completely understand what you are saying. To me, it's still a hell of a  gesture on Robert Smith's part.

[RSL]

Yes. He's looking very virtuous.

[amolitor]

There are many competing, well argued, ideas on why the cost of higher education is rising in the USA and in many other countries. As a former academic I have my own theories.

The one thing we can be certain of is that the reason is not one simple thing that we can just fix.

[RSL]

Frankly, Kevin, I think that if his real concern was to relieve the unreasonable financial burden put on these kids by government interference with the market he'd have done this anonymously.

[Alan Klein]

It's a great gesture, Kevin, but how about next year's graduating class? Is he going to do it again? Problem is, it doesn't solve the problem, probably makes it worse. You'll now have kids hoping somebody will pay off their debts as they buy a round for the whole establishment to the cheers of the group. What we need most desperately is less government subsidization of universities, which dependable surveys again and again show simply increases the costs to students as the universities raise their charges. It's a giant racket and it needs to come to a screeching halt.

+1

If you think universities overcharge now that government finances whatever loans kids apply for, can you imagine what schools will charge when "progressives" get "free" higher education?  No wonder educators "push" for more government subsidies and loans.  It goes straight to their pockets. 

[Slobodan Blagojevic]

Virtue signaling.

[RSL]

Exactly, Slobodan. I hesitated to use that term, but. . .

[RSL]

But I just ran across this: "Bernie Sanders Criticizes Billionaire For Giving Money To Students Instead Of The Needy Federal Government." Of course this was coming from the Babylon Bee, but it sounds as if it's not "fake news."

[Slobodan Blagojevic]

This amounts to going to a starving African village and giving everyone a McDonalds. Solves the problem for a day, for that village. And is nice PR.

[amolitor]

This amounts to going to a starving African village and giving everyone a McDonalds. Solves the problem for a day, for that village. And is nice PR.

Nonesense.

In the first case, the beneficiaries receive no long term benefit, and in the other case the beneficiaries do receive a long term benefit. in some abstract Chicago School Model with cute graphs and charts proving nothing whatever except a spectacular disregard for humanity perhaps these two cases are indistinguishable, but ultimately, who cares?

[Slobodan Blagojevic]

... In the first case, the beneficiaries receive no long term benefit, and in the other case the beneficiaries do receive a long term benefit...

Same difference. It is a benefit. Neither addresses the underlying issue for the whole affected group.

We can also debate the psychological impact (from a behavioral economics standpoint) of a windfall effect. Typically, windfall gains are quickly forgotten and soon taken for granted.

[amolitor]

To equate one the one hand the staving off the (presumably inevitable, in your scenario?) starvation of a village by 48 hours, with on the other hand a permanent economic step-up for an roughly similar sized population is absurd.

I make no further claims, and have no particular opinions about what the long term effects, if any, of this will be. It is worth noting that other people are rather interested in converting this in to a long term study, though. Does it work out like a lottery win, or does the structure of windfall (debt relief, rather than cash in hand) change the outcome measurably? And so on, and so forth.

About glib forum predictions the only thing we can be reasonably sure is that they are wrong. These things are simply not that predictable.

[fdisilvestro]

While I understand that this gesture would make a world of difference for anybody struggling with the financial burden, there might be also those who really didn’t need it. I wonder if any of the latter answered with “Thanks, but no thanks”.

In any case I’m more inclined to agree with Slobodan and Russ. One time donations and gifts are good for temporary issues like accidents or natural catastrophes, but don’t help much with structural problems.

[Slobodan Blagojevic]

If you decide to pursue a MFA in French medival music and accumulate $200K along the way (a real-life example, btw), student loan debt can be a bit of a problem.

If all you can afford is a Yugo, but the government will give you a loan to buy a Ferrari, don’t blame society for your debt.

Choose your degree wisely and the amount and type of debt to finance it, and student loan shouldn’t be a problem.

If, by some miracle, education becomes free, it will result in many more deciding to go to college. Maybe twice as many as currently. There are about 4,000 univerities in the U.S. there is no way that would jump to 8,000 anytime soon. What is going to happen is the tuition would go up. The more affordable you strive it to be, the less affordable it will. Given the limited capacity, and given that the government would be paying the piper, the access would be then rationed by the government.

[JoeKitchen]

I think my biggest surprise with this topic is there are still people on this forum who take Slobo's obviously satirical comparisons seriously to the point of developing arguments against them.   

Anyway, I tend to agree with Russ and Slobo, college costs have gotten so out of hand because the government has made it so easy to get loans for it.  It also seems that governments, and we as a society, have degraded the trades to the point where most look down on those jobs.  (So of course more kids want to go to college, even if they ultimately end up in a job that did not require a college degree.) 

Plumbing is a great example.  I can always remember being told that plumbing was for the idiots who don't study and don't end up going to college.  "Do you want to be a plumber when you grow up?"  Well, I just bought a 100 year old house and needed to have the stack, sanitary T and entire kitchen drain line replaced, three radiator lines, two water lines and a gas line moved, and a new water line, kitchen sink, dishwasher and radiator installed.  $7K for three days of work; supplies were no more then $500 (not including the radiator, sink or dishwasher that I bought of course.)  Does not sound too bad. 

We should be talking about skilled trades with the same level of respect as college professions too. 

BTW, new radiators are damn expensive.  Flirted with the idea of replacing all my radiators until I priced them out, and opted for just a new kitchen one this time around. 

[amolitor]

Prices rise for complex reasons.

Indeed, the entire point of a "free market" is that it is the only known way to calculate pricing for things in an economy of non-trivial scale. The problem is literally too large to be calculated, which is basically why planned economies don't work. And yet we have people saying "well, the prices went up because..."

[JoeKitchen]

Prices rise for complex reasons.

Indeed, the entire point of a "free market" is that it is the only known way to calculate pricing for things in an economy of non-trivial scale. The problem is literally too large to be calculated, which is basically why planned economies don't work. And yet we have people saying "well, the prices went up because..."

So what you are saying is that since planned economies fail, we should ignore the attempt at all of the planning in our economy at trying to make college loans plentiful and easy to get by our government planners, because, well ... pointing it out would be planning?   

[amolitor]

No!