Tags: college | tuition | skyrocketing costs | student loan | debt

College Costs Spring Eternal — Here's How to Curb Them

Image: College Costs Spring Eternal — Here's How to Curb Them
Trees bloom on the campus of Yale University April 16, 2008, in New Haven, Connecticut. (Christopher Capozziello/Getty Images)

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Friday, 05 May 2017 02:07 PM Current | Bio | Archive

Ahh….spring. The time of year for renewal, flowers, baseball games — and sheer panic for many parents.

Why? Because May is college-decision month.

Sadly, instead of marveling about the possibilities that lay ahead, parents are left fretting about their children’s future — and their own.

College has always been sold as a path to success, but its staggering costs have resulted in a far different reality. Truth is, the current system has outlived its usefulness, being directly responsible for increasing despair, destroying the earning capital of young people, and demoralizing an entire generation of college graduates living in their parents' basements because of insurmountable debt, their liberty and dignity stripped away.

The numbers bear out the crisis:

- Student loan debt stands at nearly $1.5 trillion. By the end of the next decade, it will be $3.5 trillion.

- The average debt of 2016 graduates exceeds $37,000. And that’s not including graduate/law/medical school debts, which can easily be six figures.

- The default rate is skyrocketing, with the balance defaulted on exceeding $137 billion — for which taxpayers are responsible, since the federal government subsidizes many of those loans.  

The majority no longer believe college is worth the investment, yet parents and students continue taking the plunge. To what end?

All their lives, children are told that they can achieve the American dream. But for many, the truth crashes down hard after graduation, with massive debts and mediocre job prospects crushing hopes, often for decades.

It happens like this: graduate with a boatload of debt; discover you need an advanced degree, incurring more debt; realize that your expensive MBA landed you a job at a 1990’s salary level; get married, but no kids until you move out of the 700-square-foot apartment; spend years paying down the debt, then several more building up equity for a house; be cash-poor for years thereafter; and end up having just one child despite wanting more, all while watching your marriage dangle precariously from the cliff (if not already divorced) because of the stress trying to make ends meet.

Welcome to the generation with the dubious distinction of not doing better than their parents.

Consider these solutions:

1) The more something is subsidized, the more its price increases. Therefore, until the federal government’s gushing student loan spigot is turned down, colleges have no incentive to hold the line. Since 1978, college tuition costs have risen more than 1,200 percent, compared with just 250 percent for food. Time to break universities’ addition to the federal trough by restricting how much is loaned.

2) Colleges’ lavish endowments should lose tax-free status unless two provisions are met: A) tuition does not increase by more than two percent per year, and B) the endowment does not grow by more than six percent in a given year. If either requirement is not met for that specific year, they would pay taxes on all gains and income, thereby creating an incentive to use such funds to control costs.

3) Collusion prevents colleges from banding together to lower tuition. Time to revisit that law so that collusion doesn’t apply to price reductions.

Without that reform, almost no school will reduce tuition for fear of being labeled “inferior.” How ironic.  Despite our anger about college costs, we would feel that a lower-priced college wouldn’t be up to snuff. Don’t believe it? Gauge people’s reactions to the lowest-priced Mercedes: many sneer, viewing it as a diluted product.

4) More college-level courses, both online and in high schools, should be offered, and colleges should be pressured to more readily accept the results. Yes, many high schools offer AP courses, but colleges, fully aware that they reduce a student’s tuition, often create needless obstacles to gain credit. And colleges should offer more competency tests so that freshmen can “test out” of courses not related to their field, such as math for English majors. Striving for well-roundedness is one thing, but mandating pointless standards as a thinly-disguised money grab is unacceptable.

5) Make highly-compensated professors teach more than just a few hours per week. Their classroom absence is salt in the wound for parents paying $45,000 per year.

6) No federal loan should be used for a university’s lavish, and often unnecessary, capital projects. Making colleges improve with non-federal money would generate a heretofore nonexistent accountability.

7) Tax breaks should be offered to companies sponsoring students; in turn, students would commit to working for that company. Everyone wins: company, university, economy, and most of all, student.

Congress has thus far earned an “F” reining in exorbitant college tuitions. If our children are going to have any shot at realizing the American dream, reforms must be implemented. And you don’t need a college degree to understand that.

Chris Freind is an independent columnist, television commentator, and investigative reporter who operates his own news bureau, Freindly Fire Zone Media. Read more reports from Chris Freind — Click Here Now.

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Ahh….spring. The time of year for renewal, flowers, baseball games — and sheer panic for many parents. Why? Because May is college-decision month.
college, tuition, skyrocketing costs, student loan, debt
817
2017-07-05
Friday, 05 May 2017 02:07 PM
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