Sunday, October 9, 2011

Blame colleges not the banks for your debt.

Recent Events

Talk to any current or recent college student who does not have scholarships or Trust funds about what the scariest prospect of college is ... They'll tell you,  its the cost.  Sure there are other pressures, like grades and job hunting, but overall its the cost for those students that take out loans from $50, 000 to $250,000 that is on their mind the most.
Recently, one of the topics of protest at the Occupy Wall Street camp-in has been about tuition bills and loan debt after graduation. 

From the Huffington Post - "Earlier today, students from at least 100 college campuses around the country walked out of class in a show of solidarity and support for the Occupy Wall Street movement.  While the Occupy Wall Street movement has yet to present a coherent agenda or message, the college students who marched today in support of it were clear about their concerns. They banded together to make their voices heard, many citing the rising amount of student loan debt and the increasing cost of college, in addition to a dearth of decent jobs for recent graduates."

Misdirected Anger, banks don't hold your loan.

The blame typically goes to the bankers.  And why not, they own the loans right? They got the bailouts right?   Well they may have gotten the bailouts and they may be to blame for not lending, but they don't own your college loans.  No, the government saw to that on July 1st 2010. 
President Obama signed a bill March 30th, 2010 that ends a 45-year-old program under which banks and other private-sector lenders such as Sallie Mae receive a federal subsidy for making government-guaranteed college loans. 
Instead, the U.S. Department of Education - which already makes roughly a third of these loans through its direct-lending program - will make 100 percent of them starting July 1.
Yes thats 100%, in addition, banks no longer are allowed to offer student loans.  They can only service existing ones.  Existing loans are quickly being consolidated into the government direct loans at a cost of 7.9% interest.  What a scarey proposition to think you can only go to one place for a college loan now, the government.  I hope your political party isn't displayed on your facebook, otherwise they just might deny you a loan because "your not the right fit." or "your not our type."  Granted that would be illegal, right?  Yeah tell that to the Gibson Guitar folks who got raided at the factory because their owner is a republican contributor.
No the government would never play politics like that.
Gibson Story - Link

Its the colleges fault

Tuition should not be expensive.  We all know that to get ahead in this world, some sort of eduction is required.  Academic or trade.  By making education so expensive, it does two things ... Creates a debt society beholden to the creditor, now the government (Just what are they going to make us to do pay it off), and it also creates class warfare since only rich kids can get an education easily.

Why is college so expensive?

Great question.  Take a look at the following charts.  Notice the cost of college tuition going up over 4 times higher than the CPI index and over 1200 times more than the cost of homes (using index).
Those numbers are staggering and I can personally attest to the price crunch.  In 2004 I decided to go back to college to finish a degree I started back in 1987.
Back in 1987, college cost me $275 a credit, now at Pace University its $1000 a credit, plus fee's. Being an adult student, I don't get the privilege of a scholarship from the fed, nor the ability to get a loan.  (In this day and age I'll pay cash thank you.  No in-indebtedness for me.)

Do I really need to pay so much for college?

Flat out No.  The terrible thing about a college education today is that many folks have one.  A slip of paper saying "I graduated from So and So college."   They should put a dollar cost on those things so every time you look at it on your wall you know what it cost and you can calculate if it was all worth it.

Dont get me wrong, its better to have one than not.  But you don't need one if you have experience.  I am proof of that.  And if you decide to get one, unless its is from an ivy league school like Harvard or Yale or one of the many Ivy'ish colleges like N.Y.U. dont pay an arm and a leg for it.  A piece of paper that says Pace University ($12,000+/semester) on it is just as good as Brooklyn College ($5,300+/semester), and will get you the same job.

Do I need an expensive college degree to get a job?

Again NO.  Unless the company is searching for candidates from specific colleges, and some do, then any college will do.
Now if you are going for that job that is looking for someone with a Business degree and the employer see's two candidates with degrees, one from N.Y.U. school of business and one from Brooklyn College for Liberal Arts, you can guess which one will get some extra preference.  But in general you need more than a piece of paper these days to get a leg up on similar candidates.
My choice for hires has always been experience.  Show me someone with or without a degree that can do the job, you get the job.  I have hired more qualified people that way then fresh out of college folks.  My advice is to intern, and intern often and network while you intern.

Why do colleges charge so much?

Good question.  Ask you college for their budgetary breakdown of costs, liabilities and expenses.  Its public information if they accept federal grants and monies.  Chances are you will see pension funds out of control.  As an example, in my town, we fired (through elections) our schools superintendent who made $350,000 per year (while regular teachers go about $50, 000/yr) and her only job was to administer over 7 schools.  Well after we fired her we found out her contract gave her this salary for life after retirement.  She promptly retired.  Now there is a court battle.

Don't get wrong, teachers deserve their pay and plenty of it, but there needs to be a balance between what the schools cost and how much taxpayers get charged.

We can't start life after school $250,000 in debt like wage slaves from the 1900's.
"There Are Two Ways To Enslave A Country…. One Is By The Sword. The Other Is By Debt." — John Adams

Read about what a wage slave is free from Amazon on Kindle for PC (also free).

The Jungle - Upton Sinclair - Free Edition

"Socialism is a philosophy of failure, the creed of ignorance, and the gospel of envy, its inherent virtue is the equal sharing of misery."~Winston Churchill

College sympathizers protest tuition hikes
Occupy wall street is about getting free tuition
Obama Plans on Taking over Student Loans
Feds finally take over student loan program
Gibson Guitar gets Raided due to Politics?
The Jungle - Upton Sinclair - Free

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