It seems like every month or so Senator Elizabeth Warren (D-MA) feels compelled to call for the forgiveness of student loan debt.
Sounds like a good idea to me. By the way, while you’re at it, Senator, how about forgiving mortgage loan debt as well? And then, could you add consumer credit card debt to the list, too?
Who wants to owe money to anyone? I know I don’t.
That’s probably why I try not to “live large” on borrowed money. No brand-new car every couple of years, no boats, no fancy clothes, no Harley, and no $100 cigars. Living within your means is the prudent way to go about life.
Nobody forces anyone to attend a pricey university. It is a choice that can come with a long-term commitment to pay back a huge amount of borrowed money. Graduates from elite universities, like the Ivy League schools, have whopping student loan debt, perhaps a much as ten times that owed by graduates of State colleges. Should we, as a Nation, forgive the education cost of these future lawyers, doctors, MBA’s, and politicians who are going to earn a lot of money very fast when they go to work? Actually, these high achievers can afford those loans.
A more economical choice would be going the junior college route, then finishing up your Bachelor’s Degree at a relatively inexpensive State school.
Or getting an online education.
Or foregoing college all together.
Lots of successful people don’t have pricey college degrees. Among them: Steve Jobs (Apple), Mark Zuckerberg (Facebook), Bill Gates (Microsoft), Tiger Woods (Golf), Henry Ford (Ford Motor Company), Brad Pitt (Actor), Jack Dorsey (Twitter), Ellen Degeneres (TV host), Ralph Lauren (Polo), Rachel Ray (Culinary Arts), Steven Spielberg (Movie Director), David Neeleman (JetBlue), Harry S. Truman (President), Dave Thomas (Wendy’s), Paul Allen (Microsoft), Frank Lloyd Wright (Architect), Lady Gaga (Entertainer), Michael Dell (Computers), Kim Kardashian (Lifestyle), R. Buckminster Fuller (Architect), Ted Turner (Media Mogul), Anna Wintour (Vogue), Larry Ellison (Oracle), Russell Simmons (Def Jam Recordings), David Geffen (DreamWorks), and John D. Rockefeller (Standard Oil).
As a matter of fact, none of those successful people graduated from any college. Business Insider reported recently that nearly one-third of the world’s billionaires in 2016 didn’t graduate from college.
Heck, Abraham Lincoln had less than 12 months of formal education. However, he absorbed a lot of life education which translated into wisdom.
The bottom line is that one doesn’t need to borrow-and-buy success through an expensive college education. If you’re eager to learn, work hard, and take advantage of opportunities that come your way, good things will happen. (And, having good ideas helps, too.)
A very bad idea, I think, is borrowing heavily to attend a prestigious 4-year university “on the come”, figuring that your pricey degree will pay for itself and then some. For one thing, only 41.2 percent of college enrollees actually graduate, so you might not get that prestigious sheepskin even after sinking a lot of money into the quest. Secondly, in 2019, the median annual income for bachelor’s degree holders was $44,000, while it was $30,000 for high school graduates. Over the long haul, yes, the college graduate is going to make somewhere between $500,000 and $900,000 more during his working career. But, in the short term, making only $14,000 per year “extra”, life would be difficult if the graduate was burdened by student loans.
This is probably what has been happening in recent decades as college education costs have skyrocketed. Those who chose to attend expensive universities on borrowed money are struggling, particularly with the Covid-19 pandemic barely in our rearview mirror.
Should we help them out of their self-induced economic hardship? Uh, why should we? They chose to go this route, they used “other people’s money” to finance their extravagant education, and they have an obligation to reimburse their lenders. Is it any different from Joe Sixpack who can’t afford decent clothes for his children but has a big, shiny speedboat parked in the driveway? Should we forgive his boat loan when he loses his job or gets bored waterskiing?
Nah.
Sometimes I think that, as a country, we’re looking at this “problem” from the wrong angle. Education “is” the future. However, pricey higher education is THE problem. If educational costs were cut way back, then there would be fewer student loan defaults.
There is no reason that higher education can’t be accomplished remotely. Sure, there would be no football games, no fraternities, no living in dorms and getting shitfaced on weekends, etc. However, for those who want to learn, the sky’s the limit when it comes to online opportunities: you get what you put into it. Perhaps there could be an online United States University, offering college courses for free? As recent events have demonstrated, we need more smart people in America.
Back when I was younger, junior college and even State college education was affordable to all in California. I’m sure my 4-year degree from Cal State Los Angeles cost me somewhere between $5,000 and $10,000. I paid as I went, working part-time for $1.25 per hour. Sure, times have changed and costs have gone up, but shouldn’t it be a goal of society to educate our children as fully as we can?
As a Nation, we can afford to give other countries billions of dollars in foreign aid, so why can’t we afford to subsidize higher education in this country? Young men and women who have the brains and desire to learn should be encouraged to take that ambition as far as they can. “Higher education” in this sense includes all levels of learning beyond public school. If someone aspires to be a chef, or a carpenter, or a diesel mechanic, or a computer repair guy, the education should be paid for by society, which will then be repaid in economic vitality.
Our Federal budget includes $714 billion for Defense, which is more than the next-ranking seven countries combined. China, for example, spends about one-third that of the U.S. Our per capita spending on defense is around $2,000 per year for every man, woman, and child in America.
At the same time, we have about 1 million students going to college each year, paying their way or borrowing money to do so. (And, probably another million young people attending tech schools to learn a trade.)
If we lowered our Defense budget by $10 billion (less than 1.5 percent), and put that money toward higher education, each of those students would be entitled to $5,000 in education credit.
It would be the second-coming of the G.I. Bill. That Federal program created “The Greatest Generation” and put men on the Moon.
So, do we need more submarines in this country or do we need more smart people?
I’d go with the latter.