Obama's student loan proposal

I'm sure colleges got more direct funding from states in the 90s when the economy was good then they do today. But I doubt if the increase in tuition is proportional to that. Anytime you have people (especially younger people) spending on credit/loans, you will have overenthusiasm for the borrowers ability to pay the loan back. Colleges know that you basically have to have a degree in order to get a good job, so they have a free hand to increase prices without a proportional increase in quality. I'm not sure what the answer is. I didn't click on this to rip Obama's proposal, or to praise it.

 

Quality and quality of results don't mean the same thing. If you are saying that colleges have a much easier time charging large amounts of money today then they did 20 or so years ago because the alternative to going to college is basically nonexistent, then I agree with you.

 

I am eligible for the current public service loan forgiveness program, but I have decided against entering the program. It could potentially save me a boatload of cash right now (about $350 a month), but the program is basically all or nothing. You *have* to complete 10 years of work in a public job or you don't see much benefit. I suppose there is an argument that you come out ahead paying less now if you're investing the $ you save in lower payments, but I doubt many people do that. If you work 6-7 years in a public job and enter the private sector, you're screwed. Heck, IIRC, you'd even be screwed if you got laid off from your public sector job and had to start waiting tables to make ends meet. You've been letting interest rack up while paying less each month. It'd be much more beneficial if they lowered the interest rate on student loans.

 

You're correct, the increase in tuition is not proportional. The point I was making was that it's very difficult to make a straight-up comparison. I was in college in the early 1980s, and by my reckoning, in real dollars my alma mater costs about a quarter to a third more for the student now than it did then. Now, my alma mater's prestige has increased substantially since then -- perhaps there's a link between that and my no longer being there? -- but I doubt it's worth that much more.

 

http://www.washingtonpost.com/blogs/wonkblog/wp/2013/05/09/how-colleges-are-wooing-the-rich-and-sticking-the-poor-with-the-bill/

The do-gooders aren't doing so good.

 

Colleges have to pay for fancy dorms, student centers, and other buildings. There isn't much of an incentive to cut tuition when free federal money is available. State legislators and governors know that when they cut state aid.

As for tuition increases, my grandfather paid $100 per year for tuition in 1950 (worth $1,000 today). Tuition at his alma mater is $30,000 per year now.

Tuition at my undergrad college has increased 50 percent in just the past few years. The only real change to campus is a few new buildings.