College Debt

I just finished reading this story about just plain stupid college debt.

I think the government should fully fund education through to BA/BS, with some requirement for a year or two of community service that could be accomplished in many ways. Graduate degrees could be funded with some additional service requirement: 5 yrs rural/at need practice for an MD/JD, teaching or some additional service for other graduate degrees. The catch is that this would only apply to state schools.

The woman in the story went to NYU. I lost most of my sympathy right there. I have very little pity for people who chose exorbitantly priced private universities in general, less if they finance through debt, and then get in trouble. I agree with the author that schools, like NYU, should help to keep their students out of this kind of trouble, but, really, NYU is priced for children of millionaires, with some token poorer students on a full ride to mix things up. Families in the middle are really quite screwed.

Hence public universities. They've gone up a whole bunch in cost as well the past couple decades, but a year at SUNY [city] is going to be half the cost or less of one at NYU. Because debt tends to finance the last bit, there is a good chance that half the cost would translate to a quarter or less of the debt.

There is also the complaint that she got this astounding debt while earning a religious and women's studies degree, which doesn't have the same earning potential as an engineering or science degree. That doesn't bother me too much as I don't think we should have differential pricing (or creditworthiness) based on major, and I do think that majors with lower earning potential are still valuable. Of course I also think we should pay teachers $100k/year and that banksters should have earnings well below that. So while it may be nice to live in my fantasy world it isn't real life.

In the real world some majors earn more than others. More importantly, some families can afford more than others. Higher education pricing is exacerbating that gap rather than reducing it. Making it easier to wipe out student loan debt may help. So too would limiting payments as a fraction of income. But any solution I would like would only apply to debt acquired at a public institution. It's all and good if some over proud high school student and his/her parents get all excited about Harvard, but hell if I think tax dollars should accommodate that education.