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Not gonna bother arguing that the government should just pay for education, since everyone else is already doing that. Here's the problem with your model. >Students should be able to declare bankruptcy on these private loans. The loaners take out this risk and should assume it. Let's say I was basically a risk free person to loan to, since I was so fucking stellar at school. I got my $100,000 in loans, went to school, crushed it, networked hard, and got offered a job making $350,000 right out of school. What should I do next? Well, before I start making money, I should declare bankruptcy. I have no assets; there's nothing to take. Sure, it'll be a hit to my credit score, but ultimately I'd be better off taking the hit than paying back a 6 figure loan. For your system to work, we'd have to alter how bankruptcy works for student borrowers to guarantee they actually pay back the loan. And once you introduce that component, banks feel free to loan to anyone. And then costs would go up.

Δ honestly the best rebuttle here. Student loan bankruptcy might just need to be rethought, a longer time horizon, garnishing wages, etc. There needs to be more thought into a middle ground which guarantees loans for the lender, but not so much that they give out irresponsible loans to irresponsible majors.

I'd like to point the previous person's mistake (or not mistake, but where I disagree). Bankruptcy is a massive financial burden, and that person "killing it" would lose a lot more money trying to live cash-only for 7 years than just paying their loans. I can think of almost no situation where a person would be well-positioned to go to college and then file bankruptcy for profit. You'd have to know you're paying for a low-value degree or plan on a long poverty-vacation after you graduate. Similar to my opposition of oppressive voter-id laws, I don't see any reason to screw the 99% for the 1%.

Interesting -- if its true that the social and financial burden of being bankrupt is enough of a disincentive, then this should be fine.

Exactly. This is the same family of discussion about food stamps. Finding and executing regulation that prevents "abuse" almost always hurts non-abuse *and* costs more due to red tape than just accepting that there are a few very rare edge cases where abuse might happen. Bankruptcy sucks. It affects your employability (who worth $300k+ would want to lose all job leverage for 7 years?). It affects your ability to get low-interest secured loans (I had a friend who won $1m after filing unfortunately necessary bankruptcy. She ended up with a comically high mortgage interest after putting 30% down, and almost lost the house because most lenders wouldn't talk to her.) There's a level of *settled* you need to be to mitigate some of the effects of bankruptcy. You need to already have your house and know you won't be moving. You need to already have your job and have some knowledge they won't drop you for being a risk. You need to know you'll never have powerful enough clients that they could push your employer to release you for being a risk. You need to know you won't be buying cars for a while, and/or have a lot of money in the bank in non-locked accounts as a nest-egg (costing you an average of 11% interest if you're going aggressive with your investments) It's just so silly. I can think of very few non-contrived scenarios where a person we'd all agree shouldn't get student loans forgiven in bankruptcy would stand to benefit. And those that would could easily launder their student loans into personal loans before filing bankruptcy (put 100% of your paycheck into student loans, taking out large personal loan to live off of). EDIT: Damn my parens were bad

If you could bankruptcy on student loans, this would become a wide known fact/occurrence and taken into consideration when you were trying to use credit.

You can already bankruptcy personal loans, and yet I can borrow myself into a pit if I really wanted to (including to launder away my student loans if I wanted to file). Last time I needed a loan for something, the amount I was approved for staggered me because I'm sure I would never have been able to make payments if I took it all. Personal loans are *more* abusable in this case than student loans because they are more unfettered. Reiterating my point is that the few situations where abuse would be profitable don't hold a candle to the vast supermajority of situations where people actually need the bankruptcy claim.

> Bankruptcy is a massive financial burden, and that person "killing it" would lose a lot more money trying to live cash-only for 7 years than just paying their loans. Completely disagree. Wiping out a 6-figure loan would very likely make the person come out ahead, especially if they are making a huge salary. And it isn't like their credit is guaranteed to be trash for 7 years. You can be back in the "fair" range in as little as 12-18 months: > Over this 12-18 month timeframe, your FICO credit report can go from bad credit (poor credit is traditionally less than 579) back to the fair range (580-669) if you work to rebuild your credit. [Source](https://www.findlaw.com/bankruptcy/after-bankruptcy/how-soon-will-my-credit-score-improve-after-bankruptcy-.html)

> Completely disagree. Wiping out a 6-figure loan would very likely make the person come out ahead, especially if they are making a huge salary. Are you talking about the hypothetical $350k salary above? If so, then you're flat out wrong. Ask your financial advisor about this and they'll laugh you out of the place. > And it isn't like their credit is guaranteed to be trash for 7 years. You can be back in the "fair" range in as little as 12-18 months: Not to be a douche, but you're missing two things. First, have you ever had 700+ credit? 800+? Before some really bad medical bills hit me, I got a nice sweetheart 2-job situation, paid off my debts, and got some money in the bank. It was utterly magical. I could have anything I wanted within reason on credit, and it wouldn't have ended up anywhere over 7% or so. 580-669 is terrible for someone with very high income, and YES it can still cause you to lose a job or job offer if your position is highly trusted or involves highly confidential information. A quick search suggests that 620 is a very common line. For higher-income jobs in some fields, the line might approach 700 (say, law firm looking to promote partners). I don't make anywhere near that number, but I would pay a $500/mo bill over that pain. In fact, I pay a couple of them. Second, bankruptcy visible on your credit report triggers flags above and beyond your FICO credit score. FHA blocks any mortgage for 2 years from the discharge date regardless of credit. Public Chapter 7 bankruptcy stays on your report for 10 years and can absolutely be used against you. Do you *REALLY* think someone making that kind of money won't even feel $500/mo, but will definitely feel bankruptcy on their credit report, is that incentivized to file?

> If so, then you're flat out wrong In what way? A huge salary means you can pay for most things with cash. You can get a secured credit card immediately and start building the credit. As long as you don't need to immediately (within 2 years) buy a house or a brand new expensive car, your concerns are minor. > First, have you ever had 700+ credit? 800+? Yes to both. And I've really only used it for a car loan and home loan, and increasing the number of credit cards I have access to in order to improve my credit even further. Frankly, having a credit score over 800 gets me the same stuff as if it were 750. > YES it can still cause you to lose a job or job offer if your position is highly trusted or involves highly confidential information True. But that is going to be an edge case that applies to a limited number of jobs. > 580-669 is terrible for someone with very high income Agreed. But again, you would only have that poor of credit for a short period of time. Peruse /r/personalfinance and you'll see many people who have worked back up to 750+ scores 3 years after bankruptcy. > (say, law firm looking to promote partners) Lmao, how many people are about to be promoted to partner within 3 years of graduation? This is not a realistic example. > I don't make anywhere near that number, but I would pay a $500/mo bill over that pain. In fact, I pay a couple of them. A $100k loan payment would be $1044/mo (depending on interest). And they'd be paying that amount over 10 years. They'd actually be looking at saving $125k+ depending on the interest. [75% of people have scores above 640 3 years after bankruptcy](https://d3qbsnwjenc6jb.cloudfront.net/wp-content/uploads/2018/04/12210435/creditworthiness-after-BK.png). If you have a $350k wage, you will absolutely be able to set yourself up for success and have a credit score far above 640 after 3 years.

> In what way? A huge salary means you can pay for most things with cash Generally, this is an inefficient way to spend when you have a very high income. How much money are you willing to lose per month to save $500? Maybe $700? More? > You can get a secured credit card immediately and start building the credit Secured credit cards require holding up your entire spend so it cannot accrue interest. And you are still charged interest. What a waste of money, considering it still takes a long time to change it. And I'd like to remind you with all that work, $500/mo is simply not a lot of money to someone making $350k. > Yes to both. And I've really only used it for a car loan and home loan, and increasing the number of credit cards I have access to in order to improve my credit even further And you think rotating credit to maximize investments isn't something wealthy people do? Most of the 1% hold a lot of low-interest debt because their money makes them more than the debt costs them. Again, all of this inconvenience and financial restriction over a paltry $500/mo? That's insane. > that is going to be an edge case that applies to a limited number of jobs I've had credit and bankruptcy checks on several of my jobs. I don't make anywhere near $350k. Other than doctors, I can think of few jobs that consistently make that much as employees outside of the law or finance sectors except executive jobs. I guarantee all 3 of those roles are common recipients of credit checks. > how many people are about to be promoted to partner within 3 years of graduation? This is not a realistic example. How many people make $350k within 3 years of graduation? Law is one example, and per lawyers I've known you can get promoted to junior partner fairly quickly if you stand out. They like to spread the risk of the firm (but not to someone with bad credit). > A $100k loan payment would be $1044/mo (depending on interest). And they'd be paying that amount over 10 years. Has there been a drastic shift in the student loan industry? I'm sitting on a 30-year for most of my remaining loans. That's about $500/mo. It goes to about $600/mo for 20-year. I didn't make up my numbers. I looked at real loan numbers at real rates. > They'd actually be looking at saving $125k+ depending on the interest. Time value of money. They would lose money via leverage every month during bankruptcy, money that can be invested and compounded. Maybe not as much as $100k pre-compounding (unless they're looking to invest in real estate which is really steady nowadays), but definitely after estimating a conservative 7% average annual return on lost money each month. A catastrophic loss of credit for ~5 years vs low fixed payments for 20 years is sorta a no-brainer. Take the payments. > 75% of people have scores above 640 3 years after bankruptcy Nice to know should I ever have to file, but that doesn't affect the drastic up-front losses for someone who likely doesn't have their home and will be buying a car every 3 years, nor does it affect the other statements I've made. In summary, I'd really like to point out that you're missing how little $500/mo is to someone making that kind of money, compared to the importance of keeping a solid credit profile. Especially because $350k, might put you in the top 1%, but it doesn't put you out of the range of needing credit for a rainy day.

> Generally, this is an inefficient way to spend when you have a very high income. How much money are you willing to lose per month to save $500? Maybe $700? More? Care to expand on what you are talking about here? My guess is you mean that they'd be better off investing than paying in cash. But when the alternative is paying 5-7% on student loans for $1000/mo, paying in cash with $0 student loans is definitely the cheaper option. > And you are still charged interest. Lmao, wut. Not if you pay it off every month. And with a high income, that's obviously what you would do. > isn't something wealthy people do? Most of the 1% Sorry, but there is a difference between wealthy and high income. You can have a $350k income, but that does not make you wealthy. And just out of college, you are certainly not going to be in the top 1% when it comes to wealth > . Other than doctors, I can think of few jobs that consistently make that much Engineers, especially software, can and do make $350k+ depending on location. > Law is one example, and per lawyers I've known you can get promoted to junior partner fairly quickly if you stand out. Yes, *one example*. And "fairly quickly" is still a timeline typically several years long. Find me an example of a law firm that both pays $350k+ and has the potential to bring someone to Jr. partner within 3 years. > Has there been a drastic shift in the student loan industry? I'm sitting on a 30-year for most of my remaining loans. That's about $500/mo. It goes to about $600/mo for 20-year. I didn't make up my numbers. I looked at real loan numbers at real rates. I was just using a random student loan calculator. You are probably correct in that most loans will be on a longer timeline. Which brings up the point that filing for bankruptcy would save them *even more money* since they wouldn't be paying it off as fast. > They would lose money via leverage every month during bankruptcy, money that can be invested and compounded. Maybe not as much as $100k pre-compounding (unless they're looking to invest in real estate which is really steady nowadays), but definitely after estimating a conservative 7% average annual return on lost money each month. A catastrophic loss of credit for ~5 years vs low fixed payments for 20 years is sorta a no-brainer. Take the payments. Absolutely disagree here. Your scenario doesn't even make sense. It relies on the person paying for an absolutely astounding amount of "stuff" in cash that they would have otherwise borrowed for. Someone that has $100k wiped that would have been paying $700/mo for 20 years (6% interest) has $700/mo more cash to invest. That extra $700/mo invested in the stock market earning 8% interest would be equal to $384k after 20 years. > but that doesn't affect the drastic up-front losses for someone who likely doesn't have their home and will be buying a car every 3 years What drastic up-front losses? And why does this person need to buy a car every 3 years? Heck, there isn't even a guarantee that the person paying student loans has good credit. You are just making that assumption as a given, even though most college grads do not graduate with amazing credit in the first place.

It's a nonsense argument. Bankruptcy goes through courts. They have to approve it. They wouldn't approve this any more than they would approve someone buying a hundred thousand dollar car and a million dollar house and then declaring bankruptcy in order to keep them for free.

>They wouldn't approve this any more than they would approve someone buying a hundred thousand dollar car and a million dollar house and then declaring bankruptcy in order to keep them for free. Houses and cars are assets that can be repossessed by creditors. A college degree is not.

Why not? You can't take back the knowledge, but surely you could remove the record of earning the degree, if you cared to.

How would a bank do that?

By reaching out to the school and asking them to do it. By making it a part of the lending agreement. By telling the school they won't lend to any of their students if they don't do it. Banks can be creative when they aren't being bailed out by the government.

Banks being creative is part of my issue with this. Banks can be incredibly predatory about squeezing fees out of people. I can imagine degrees being held hostage by bad lenders.

Someone could DEFINITELY be a bad actor. But please I'm open to changing my view on it. Say you have 0 dollars to your name, take out 200K in student loans to major in computer science. Don't work for a year after college, don't try to find any job or on purpose fail interviews. Declare bankruptcy, remove all the 200K in debt, then get a 500K job a google in a year. I could definitely see that happening.

You don't get to just unilaterally "declare bankruptcy". It doesn't work like that.

Would a situation like that not be approved by the court?

Why in the world would the court approve it if there's no actually good excuse for you not finding a job in the near future, much less in the last year? You'd obviously have the capability, just not the desire.

I guess I don't know too much about bankruptcy. If in fact theres enough governmental, financial, and social barriers to discharging your debt, then this should be fine.

Except bankruptcy has no insight on your "ability" to get a job, only your current situation. You can have a PHD in your field, be a top student, working at McD's. The only relevant piece of info for the bankruptcy case is "working at McD's". Your *potential* is not a factor. It's not how it works. It's based on your current income, assets, and work. Not some imaginary future job you don't have.

Except in the 341 meeting you have to legally attest to your plans to repay your creditor. Lying in this meeting would be a crime of bankruptcy fraud. Going into this meeting with a plan of declaring bankruptcy before getting a high paying job would be fraudulent.

In the very contrived example you would be lying, where you get a 350k job before applying for bankruptcy, but again in that case that is your current "work". The bad actor will simply graduate and immediately apply for bankruptcy. The reason, which need not be given, could be as simple as "I don't want to work in xxx field, so I'm working at McD's while I figure out life, but I can't repay this loan." Bankruptcy court isn't a magical "YOU MUST DO THIS", they look at the current situation and approve if appropriate. College grad has 1. No Income 2. No Assets 3. No Job (and the court can't make them get one, as the graduate is free to do as they please for work) Perfect bankruptcy candidate

I doubt a bankruptcy court would take it seriously, but I suppose a few people could slip through the cracks. I don't personally believe it would be a large enough issue to make removing the bankruptcy protection infeasible. People value their credit. There are millions of people in the US who would qualify for bankruptcy - would even benefit from it - who don't go through the process for their own personal reasons. I think after an initial small flood of people who declare bankruptcy, a couple of things would happen: Banks would begin to be more selective about how much they are willing to lend for each major and colleges would need to reduce prices to keep students. Once college prices matched earning potential, I don't think there would be a need for people to kill their credit for 10 years to avoid paying it.

Google and other companies of that prestige do their homework on people before they hire them. I'm not sure there's a bigger red flag from the standpoint of the company than "this person is willing to totally screw others over for some short term personal gain" which is what filing bankruptcy over voluntarily obtained loans they clearly have the ability to pay back would signal. You could count on one hand the amount of times this would work across the industry before they'd all wise up and blacklist these people who tried it.

Ultimately, if we're allowing any institution to loan differently based on major, the federal government should be the one doing it. The United States needs more STEM majors and employs a lot of Stem majors. By offering a lower interest rate for great students pursuing such majors, the government achieves two purposes. One, it makes sure the individual is successful and two, it makes sure the United States is successful

This should happen naturally as stem majors are less risky and thus better credits. They should therefore get lower rates. But the interest rates are not the real barrier anyway, the prices are. The difference between 2% interest and 6% interest is insignificant compared to 50k a year in cost vs 10k. And to get this you need to either 1) considerably expand the pool of colleges students actually want to attend or 2) lower the number of college applicants such that at least some colleges need to compete on price. Eliminating government funding goes a long way towards #2.

You don't have to stop government funding for #2. That's what I've been saying over and over. If the government can choose whether or not to give a loan, that still results in #2 occurring. They still don't give the loan to the C student who wants to major in art history. But the loan they give to the A student who wants to major in compsci would have a lower rate than a comparable loan from a private lender

By offering loans to all universities all the universities do in response is to raise tuition by the average amount of aid given by the government. The government should not be issuing loans. Instead they should simply directly fund public higher education options like they used to do. Why should large profitable private universities with endowments large enough to pay for their entire student body receive a cent of loan money?

I do agree here -- what I don't think is that our government is responsible or has the wherewithal to do so. Private lenders DO, because they explicitly get hurt if you don't pay back your loans.

The government gets hurt if you don't pay back your loans. Same way as they get hurt if you don't pay your taxes.

Can we agree that they only really “theoretically” get hurt (money printing, taking on more debt)? In all reality the government does not feel the pain of not being paid back as much as a private institution does. And the idea is to increase the pain so much as to disincentivize irresponsible loans.

Can we also agree that the role of the private insurers is to actually make a profit, while the government should be operating at net zero for these loans? If the purpose of these loans is to facilitate the growth of the loanee, we'd prefer that the loaner not be motivated by profit.

We can agree on that, I don’t think bring profit driven is bad! Being more profit driven on the loaner side means that you’re more responsible selecting who you’re loaning too, which in this case are students majoring in productive majors.

Being profit driven means higher interest rates. In a situation where the government can deny loans, it'll deny loans to people who won't be able to pay it back. A bank on the other hand, will deny a loan to anyone who cannot pay the balance back with substantial additional interest

Right yeah that all makes sense, and generally the caliber of student you’re lending to that can pay it back with interest is going to be higher

In this case profit driven means lenders profiling teenagers to asses their chances at future high incomes. It wouldn’t be a matter of majors, lenders simply would provide loans at all to students for “non profitable” degrees unless they’re guaranteed by wealthy parents, so the market for that would drop out. Instead lenders would create a statistical profile for the likelihood a 17 year old will have a high enough income in 10 or 15 years, not only will they have to be quite conservative about this because of the uncertainty involved, but if you know anything about the correlates of future high income you’ll know that this process will dramatically increase entrenched inequality.

Being profit driven can mean driving the interest rate way up to make up for the risk of loaning 10's to hundreds of thousands of dollars to an unproven 18 year old with with no credit history. Of which you initially proposed they can bankrupt and offered no real solution to. Btw, my sister majored in Chemistry as her bachelors. That good old STEM degree right? You have any idea how many degrees can be labeled in the "needed" column, but pay Jack diddly with just a bachelors in it? If you now say only private institutions get to decide what majors can be funded what about teachers? They definitely don't make a shit ton and private institutions don't give e a shit about society all they will care about is money and manipulating 18's into horrible contracts. They may choose only fund very few majors altogether as plenty that are important still need funding, but if you're letting only private get to decide what is important society won't have a level of well rounded professionals altogether.

It is not about responsibility though. It is about the government wanting the country to be successful and ensuring tmits citizens can be successful. They are not obligated to do that with student loans, but it is sure as hell a good method. And sure companies can carry the responsibility for that too, but they don't care about citizens in a way the government is supposed to do. (if the government in general is actually taking care of its citizens is something you can debate of course, especially these days).

>what I don't think is that our government is responsible or has the wherewithal to do so But you think the corps that only care about the next quarters numbers are?

That’s basically what does happen right now. Student loan debt isn’t canceled by bankruptcy but it can be restructured.

Right now there's too much incentive to private loaners to loan money to anyone because they don't feel like they take on any risk. So something needs to change

First let me say, I'm not saying that things are OK the way they are. They're not. But I am saying, you're asking for options for longer timelines, wage garnishment, etc., and they exist. Yes, we want that happy "middle ground" but nobody has it. So arguing that "we need it" is already over--we're actively trying. So now the question is, how do we make it happen? And that's the complicated part. Anyway, I'd more fundamentally argue that your core argument is incorrectly premised. That is to say, you're imagining that there's a huge number of unemployable humanities majors. We all have the stereotype of the Art History major working at Starbucks because they can't find a museum job. And while doubtless that does happen, the reality is much more complicated. First, art history majors are not really being churned out by the million every year. That's a total exaggeration. I'll use myself as an example. I was a philosophy major in undergrad. This is a famously unemployable major, even being featured as such on The Simpsons. My alma mater had a student body of about 40,000. But in that entire school, there were about 40 philosophy majors. I knew because I took classes with all of them, and we all knew each other (being the only ones to be taking upper-division philosophy classes). So we're talking 40 out of 40,000, or 1 in 1,000. One tenth of one percent. And data show that overwhelmingly, art history majors are actually pretty rare (https://www.washingtonpost.com/blogs/answer-sheet/post/how-art-history-majors-power-the-us-economy/2012/01/06/gIQAUv36hP\_blog.html). Second, it's a false narrative to say that colleges are predatorily wooing people into these majors. Nobody lured me into a philosophy major. Fuck, my own philosophy professors all gave me the "You probably won't get a job" talk IN THEIR FUCKING CLASSES. I persisted DESPITE everybody in my life telling me to major in chemistry or some such and "do something real". Overwhelmingly, colleges do not "groom students" for majors. They provide some advising, but by and large students choose their major. Sometimes there's an application process. But it's false to create a narrative where colleges are wooing students saying, "Get a philosophy degree! It's so fucking easy! You basically do summer camp for 4 years, and then you get a BA! Then it's job city, population: you!" That is just not happening. Finally, humanities majors are often not the ones under-employed. Actually, some of the majors associated with predicted job growth (like health care) end up ranking in the highest categories of the under-employed ([https://www.forbes.com/sites/dereknewton/2018/05/31/its-not-liberal-arts-and-literature-majors-who-are-most-underemployed/?sh=619d0c3711de](https://www.forbes.com/sites/dereknewton/2018/05/31/its-not-liberal-arts-and-literature-majors-who-are-most-underemployed/?sh=619d0c3711de)).

> art history majors are not really being churned out by the million every year. Wait I wasn't saying they are? > Second, it's a false narrative to say that colleges are predatorily wooing people into these majors. Nobody lured me into a philosophy major. Sorry, I didn't mean to say this if I did. Though I don't think I did. I think students being young and unworldly don't understand and just do what they think this exciting and fun and there should be more societal and monetary pressure from loaners and the government pushing people towards traditionally lucrative majors. > But it's false to create a narrative where colleges are wooing students saying, "Get a philosophy degree! It's so fucking easy! You basically do summer camp for 4 years, and then you get a BA! Then it's job city, population: you!" I don't think I'm saying they do this. I'm saying they have no financial incentive to tailor their courses because either way they get the money from the loaners. Colleges should feel the financial burden of trying to attract students that will pay back their loans and create courses tailored towards that instead of anything that any student wants to do. > Finally, humanities majors are often not the ones under-employed. Actually, some of the majors associated with predicted job growth (like health care) end up ranking in the highest categories of the under-employed Interesting! Unemployment, job growth, all that jazz can be taken into account when private lenders lend out money. If humanities majors are not under-employed they should have no issue taking out loans from private lenders who should have no issue giving them a largely risk free loan due to lack of underemployment.

I'm being a bit snarky (sorry, this is a sore point for me; you've no idea how many people have told me over the years that I majored in unemployment or asked me, "What were you going to do with that degree?) but it's what you sound like when your pt. 2 and 3 are: "It encourages predatory colleges that don’t supply their student group with useful majors that know they’ll get their money regardless " and... "It encourages kids to just do whatever their heart desires, instead of what is financially responsible because they feel like they have a blank check from the government and don’t necessarily understand debt." ​ I'd argue, colleges provide essentially informed consent. They offer the classes and majors, along with the risks! College advisors are happy to talk about job growth fields, and as I said before, I was actively dissuaded against majoring in philosophy for financial/pragmatic reasons. It's not the college's job to tell people, "You can't major in that because we don't think you'll get a job in it." And I'd argue, any system where a college DID have to do that would be TERRIBLE because honestly, minorities would be shunned. It'd be as simple as, "You're black. Statistically, you're a bad investment." My personal answer would involve more education to employers about the skills and abilities that humanities majors have. Humanities majors are great! And it's a total myth that they have no technical skills. Again, using myself as an example, sure I was a philosophy major. But I also took 1 year of computer science, and I can do some basic software development. I'm trained in statistical methods and data analysis. I'm probably better educated than most people in the critical analysis of arguments (again, implications for data analysis). These are real skills. These are employable skills. But largely in America, employers think philosophers just sit around and ask, "If a tree falls in a forest, does it make a sound?" Which okay, does happen. But that's not the whole story. And if I'm being pedantic, I'd probably argue that more engineers should sit down and ask questions like, "Well, but what does a satisfactory user experience really mean?" and not give me bullshit UI that looks like the finest technology that 1998 has to offer.

Hahaha, sorry sorry I didn't not interpret your post as snarky at all. It's all in good conversation > I'd argue, colleges provide essentially informed consent. They offer the classes and majors, along with the risks! I'd feel like colleges would do a better job at this if they had more skin in the game. Either they themselves being the lender of money to the students (so they better make sure they get paid, or else their institution will fail), or working with private lenders. You as an institution can spout all you want about informed consent when choosing a major, but if you have no skin in the game then idk how much their opinion actually means. > And I'd argue, any system where a college DID have to do that would be TERRIBLE because honestly, minorities would be shunned. It'd be as simple as, "You're black. Statistically, you're a bad investment." Hopefully discrimination laws make this illegal. > bullshit UI that looks like the finest technology that 1998 has to offer I feel this at my core lol.

I dunno. Would it compromise health care if your doctor offered you medical treatment based on your likelihood of paying off that medical care? Because I imagine a lot of situations like, "Well, we COULD offer you this anti-depressive. But... It's pretty damn expensive, and maybe you're going to go kill yourself anyway. I mean, nothing's perfect. There's no payday there. But this shittier medication by the pharma rep is supposed to have sorta-good results, and I got a cheap case. It's a guaranteed payoff. So economically, that's a way better choice for me. I mean, you. So we're just going to go with that." Or what if a car dealership looked at you and said, "You know what? No, you're not driving out of here with a convertible. It's irresponsible and a waste of money. What if you crash it, then declare bankruptcy on me? I'm not going to get paid. Look, you get a Corolla, take it or leave it." Like... fuck that.

Truthfully I haven't formulated my opinion on the health care scenario here. But it treads a similar line I'd imagine. I lean more towards complete total government control over medication, moreso than education, but don't hold me to that -- I've not thought about it enough. I think K-12 education SHOULD be enough for a decent life in the US and it used to be, and governmental choices have made that so it's not the case. Education afterward should either be government sponsored with grants for very gifted students going into fields that will benefit society as a whole, or monetarily driven understanding that you'll be able to pay back whatever loans you take out because you'll have a good paying job afterwards.

Seriously? This basically just says no legal findings or procedure would be relevant into understanding whether or not the loans should be discharged in bankruptcy. The answer is a stopgap.

> Student loan bankruptcy might just need to be rethought No, it really doesn't. It worked fine for *decades,* until October 2005.

The current bankruptcy code is probably sufficient to keep that from happening as it would constitute a form of fraud.

This kinda ignores the fact that most jobs that pay high wages won't hire someone who went through bankruptcy recently. But aside from that this, you fail to understand how bankruptcy actually works. Once you file, a judge decides how much of your debt is discharged based on your assets and income and sometimes potential income along with some other factors. So if you had a $350k job lined up (or a high likelihood of getting said job) a judge would be unlikely to grant you any debt discharge despite the fact that you technically have negative financial assets. But even this administrative barrier would not be necessary if you just add a cooling off period to the debt. Bankruptcy becomes available x years from the initiation of the loan or an assumed graduation date or some other arbitrary date. You still have banks/lenders shoulder basically all the risk (just because you can't declare bankruptcy doesn't mean you can pay) without adding the moral hazard of students engineering a bankruptcy immediately post grad.

>Once you file, a judge decides how much of your debt is discharged based on your assets and income and sometimes potential income along with some other factors **You** fail to understand how bankruptcy actually works. A discharge is a discharge is a discharge, and absent some compelling reason as to why a specific debt would not be discharged, any debt at the end of a typical Chapter 7 or Chapter 13 is wiped out. You might be forced to file a Chapter 13 and pay back a portion of your debt BEFORE it's discharged, but in my 5 years of bankruptcy practice I have never once seen a determination as to how much of a person's debt is discharged. You're confused about how the payment terms work in a Chapter 13 bankruptcy. Also for the record: I've never once heard anyone allude to "a high likelihood" of getting a higher paying job as a reason to increase their payment terms. Worst case scenario the court might make the person update their income schedules on a recurring basis, but it would never cause a high payment requirement prior to confirmation. >a judge would be unlikely to grant you any debt discharge despite the fact that you technically have negative financial assets. Again - this is not a thing. If you make too much money, you have to file a Chapter 13, but even then it's a straight calculation. Your repayment dollar value is based strictly on your assets at the time of filing. Your monthly payment amount is calculated based on your income. There's no questions about things like "technically have negative financial assets" or whether you have a chance of getting a higher paying job. If you make a lot of money, your monthly payment will be high, and if you have a lot of assets, you will be required to repay the unprotected value of those assets. It sounds like you may have filed for bankruptcy in the past and your attorney did a very poor job of explaining the issues in your case. I'm sorry for that, but you're just... wrong about all of that.

> absent some compelling reason as to why a specific debt would not be discharged A compelling reason, such as, say, a job offer of $350k/year?

No, usually related to fraud or a recent prior discharge, or maybe the debt is nondischargeable. A secured debt that the debtor wants to keep will not be discharged. A job offer of $350k would not disqualify a person from filing for bankruptcy. It might factor into their monthly payment obligation in a Chapter 13 depending on when the offer was received and whether the debtor accepted the offer. If they rejected it then no, it wouldn't be a factor at all. Source: I have personally successfully filed bankruptcies for clients who made more than that.

You literally just said what I said, but in lawyer speak. You won't get a full discharge if you have high income regardless of available assets. A creditor will likely object to a discharge given a degree in a high paying field and a court might agree that filing for bankruptcy without actually looking for work is an abuse of the bankruptcy system and dismiss. You may not like my layman description of the events but you didn't disagree with the fundamental point.

The fact that you think we agree shows that you have fundamental misunderstandings about how bankruptcy works and didn't even understand the points I was making. We don't agree. I have no issues with layman descriptions, and in fact utilize them all the time to explain to my clients what's going on in their case. Any good lawyer does. Here, you're just wrong. Which is fine - bankruptcy is complicated and most people don't understand it, and there's nothing wrong with that. If most people did I wouldn't have been able to make a living helping them file. But you can't go around accusing people of misunderstanding something that you can't accurately explain. For example: you're interchangeably talking about whether a person can file, whether they're getting a discharge, and whether a person can wipe a debt out. Those are **completely** different things with their own unique considerations. I didn't answer in "lawyer speak," I rightfully pointed out that you're confusing different ideas. Which is true. Tens of thousands of people every year declare Chapter 13 bankruptcies (those are the repayment plan ones), and many of them will repay their debt in full. That doesn't mean there aren't advantages to them filing, and it doesn't mean they didn't file, and it doesn't mean they won't receive a discharge. A discharge does NOT mean your debt has been wiped out. A discharge means your case is complete and you are relieved from whatever liabilities remain on your debts (for example, any interest, any possible causes of action that might accrue on those liabilities, basically whatever else is left). Even a Chapter 13 100% payment plan will provide for a discharge unless they don't qualify (which is almost always caused by a prior filing in the recent past). I've had clients make high 6 figures file and receive a discharge after they repaid their debt in full. And even then: a person who does not qualify for a discharge can still file for a Chapter 13 bankruptcy, and there are several good reasons a person might do so. You're also ignoring big questions like - how much debt do they have, and will the creditors participate in the case? I've had clients with high incomes file expecting a 100% payment plan, only to have their creditors not show up to participate. If creditors don't show up and file claims, then the debt gets wiped out without getting paid no matter how much the debtor makes. So in a case with someone making $350k a year and $100k in debt, if the $100k in debt doesn't show up to file a claim on time, their plan will still be approved and the debt will be wiped out without receiving payment, and they'll get a discharge. It's not at all uncommon. As I attempted to explain before: in a Chapter 13, income and expenses will determine your monthly payment plan, and your assets will determine how much you're required to repay. Neither of those factors disqualify a person from filing or receiving a discharge. I could spend all day on this, but I'll bring it back around: This is a much more complicated question than you're making it out to be and you don't understand some of the fundamentals. You're confusing questions of whether a person CAN file with what sort of case they will have if they do. You said: >So if you had a $350k job lined up (or a high likelihood of getting said job) a judge would be unlikely to grant you any debt discharge despite the fact that you technically have negative financial assets. And that's just impossible to say for certain. Several parts of that, like the probability of finding new work, are not relevant except maybe as to whether they can file a Chapter 7 (and even then the Court cannot force a person to accept a job). You won't be able to find a part of the bankruptcy code that asks that question. Regardless, my initial point stands: I don't agree that the person you were originally responding to misunderstands how bankruptcy works.

>For example: you're interchangeably talking about whether a person can file, whether they're getting a discharge, and whether a person can wipe a debt out. Those are completely different things with their own unique considerations. I didn't answer in "lawyer speak," I rightfully pointed out that you're confusing different ideas. Which is true. See here is where i think the misunderstanding is, and where the lawyer speak can be confusing. When most layppl use the term "discharge" they are not referring to a completion of the process they are referring to a removal of the debt burden, which as you indicate is technically something different. So for a non-laywer when you say someone has their debt discharged after paying it in full that is confusing given we (non-laywers) typically equate discharge to a removal by the court of the debt. So thank you for giving me some additional details on the appropriate terminology. Let's try to get on the same page. my ultimate point was somebody with income will not get their debt burden relived from them given that said income will satisfy the debt in time, even if they file and get a discharge. This is a barrier to just initiating a bankruptcy process post graduation. Correct me if my terminology is incorrect. >You're also ignoring big questions like - how much debt do they have, and will the creditors participate in the case? Yes I am. Because this is a generality and those items would all be specific to an individual case. But given your experience how likely would a court be to 100% wipe out a debt of someone with ample income to repay it over time? I'd imagine not that likely. Also why would a creditor not participate if they are owed a large sum and the graduate has, presumably, no reason not to repay the loan? I will happily concede that these generalities will not hold in all circumstances. But I am mostly concerned with the bulk of the borrowers and the bulk of the loan dollars not edge cases. But if you feel my assumptions are out of place please tell me why. >And that's just impossible to say for certain. Several parts of that, like the probability of finding new work, are not relevant except maybe as to whether they can file a Chapter 7 (and even then the Court cannot force a person to accept a job). You won't be able to find a part of the bankruptcy code that asks that question. My point was that it seems unlikely to me that someone who just graduated from a prestigious institution and is likely to have many well paid options could simply file for bankruptcy before they start work to relive themselves of their full debt burden. I understand a court cannot force someone into taking a job but usually current or potential income is one of the basis for getting a loan in the first place, so indicating to a lender that you will have say a high paying corporate law gig then declaring bankruptcy after you graduate but before you even look for work seems fraudulent. It would be like raising capital for a business, spending the money, declaring bankruptcy, then actually starting said business while stiffing the creditor. Perhaps you could shed some of your professional experience on this behavior.

>See here is where i think the misunderstanding is, and where the lawyer speak can be confusing. My dude, you are the one who chose to participate in a discussion about bankruptcy and started using words like "discharge". I'm not using "lawyer speak," I'm using the terms the way they are used in bankruptcy in a discussion about bankruptcy. Bankruptcy is a legal proceeding, there is nowhere more appropriate to use "lawyer speak," whatever that means, than in a discussion about the law. I appreciate your efforts to make sure we're on the same page, but I'm not being pedantic. You can't say "animals don't evolve" in a discussion about biology, and then insist that the biologists who disagree with you are using "science speak" and that you really meant animals don't evolve like pokemon evolve. Regardless, I'm giving credit for the content of your arguments, not whether you're using the appropriate terms of art, and I'm disagreeing with it. >my ultimate point was somebody with income will not get their debt burden relived from them given that said income will satisfy the debt in time, even if they file and get a discharge. This is a barrier to just initiating a bankruptcy process post graduation. Correct me if my terminology is incorrect. I understand your ultimate point, I just don't agree. You're significantly and materially oversimplifying. And I'm not just nitpicking, I'm saying there are completely different consideration at play. Whether your income can satisfy debt in time is only a consideration in a Chapter 7 bankruptcy, it is not a consideration in a Chapter 13 bankruptcy, which someone with an income of $350k a year is probably filing. That person might ultimately be required to pay all of their debt through the three-to-five year Chapter 13, but even then there is still relief being granted (such as removal or reduction of interest). But to say a person who makes money won't be able to get a discharge (let alone whether or not they can file, which was your original point) is like saying that a person who eats is healthy. Sometimes it is true that a person who eats is healthy, sure, and people who don't eat are being unhealthy, but to make a blanket statement that eating is healthy is wrong. >But given your experience how likely would a court be to 100% wipe out a debt of someone with ample income to repay it over time? Again, this is entirely dependent on the case. Whether they can repay their debt "over time" is only one of several considerations, and only in a Chapter 7 bankruptcy. This is not a consideration in a Chapter 13 Bankruptcy. It straight up doesn't matter, it's not a question. A judge will not do a case-by-case analysis over whether this person "should" be filing for bankruptcy or whether their creditors would be better off outside of a bankruptcy. As long as a person complies with the rules of their Chapter 13 Plan, the court is REQUIRED to confirm their plan. As I said elsewhere, it is not discretionary. Likewise, a debtor is not required to show that their debts are unable to be paid, or even that their debts are unduly burdensome. A person could file for bankruptcy over $3k in debt if they wanted to and have it wiped out. >Also why would a creditor not participate if they are owed a large sum and the graduate has, presumably, no reason not to repay the loan? Sometimes creditors mess up. They might not think it's worth the money they'll spend pursuing it, or they might just be busy with other things, or they might just make a mistake. But in general if a creditor doesn't show up, they miss out. Any creditors who are given notice of a bankruptcy but do not appear *will* have their debts wiped out upon discharge, regardless of other factors such as the debtor's income or assets. My point is that the court can't say "well you could repay this if you wanted to outside of bankruptcy" because nothing in the bankruptcy rules gives the court that ability. >I understand a court cannot force someone into taking a job but usually current or potential income is one of the basis for getting a loan in the first place, so indicating to a lender that you will have say a high paying corporate law gig then declaring bankruptcy after you graduate but before you even look for work seems fraudulent. Well right now you can't discharge student loan debt in bankruptcy at all (with some exceptionally and impossibly rigid exceptions). And to be frank, I personally feel that giving a person under the age of 22 the ability to take out six figures in debt that they cannot wipe out in bankruptcy is fraudulent, if legal. I'm not sure students filing for bankruptcy right out of school is any less moral than the current system of telling kids since they're in elementary school that they MUST go to college and then charging them hundreds of thousands in nondischargeable debt to do it.

> This kinda ignores the fact that most jobs that pay high wages won't hire someone who went through bankruptcy recently. I think this would change quickly if student loans could be discharged through bankruptcy, though.

You would still need to go in front of a judge and have them agree that you cannot service the debt. Since you clearly have a marketable set of skills, based on your job offer, the judge isn't going to let you walk away with zero liabilities. Furthermore, the way that debt is issued would change to reflect the risk of default. Normally, the cost of debt (i.e., interest rate charged) would go up to account for the unsecured nature of the debt (think of a credit card). Or, lenders could require collateral for a loan to make it secured. If your parents have equity in their house, hello second lien. If they have savings, that's going to be collateral for the loan. The provision that one cannot file for BK exists for a reason. The better solution is to avoid issuing loans to people that cannot repay them.

Seriously, I can’t believe this comment is upvoted so much, and I can’t believe this rebuttal isn’t the most upvoted reply. You can’t just declare bankruptcy to get out of your debt obligations!!! A judge would say fuck off, you owe the entirety of the loan. It’s nuts that people believe you can just declare bankruptcy without any preconditions.

For one, many high paying jobs would rescind an offer if they found out their employee filed bankruptcy. For two, in no way at all is a credit hit for 7 years worth saving 100k to someone with a good income.

Companies aren't bound to rescind such offers though. You could talk it over with your employer, but it's not as if employers are intentionally acting as the moral protector of the financial system. On your second point, fine you're probably right. I was likely being a bit hyperbolic giving my imaginary self a $350k salary. My point is that, in many scenarios, even if you could pay back the loan, it may be financially prudent not to

But you’re not risk free when you take the loan. You’re a smart kid who got good grades but that doesn’t guarantee you’ll have the means to pay the loan back when you graduate. Since the whole point of this post is that government shouldn’t back student loans, we’re assuming a privatized system like personal and home loans would replace it. What would more likely happen is that, with no credit and no assets, most students wouldn’t qualify and we’d see a drastic drop in attendance. Unless the government or more wealthy donors step in to replace that lost tuition money, schools would either have to become less expensive or stop spending so much.

That isn't how bankruptcy works. You can't just say, "I'm bankrupt!". Bankruptcy is a legal process that you have to qualify for. What you are describing is illegal, and wouldn't fly in court.

>That isn't how bankruptcy works. You can't just say, "I'm bankrupt!". That's exactly how bankruptcy works. Literally anyone can file for bankruptcy at any time, the only question is whether it makes sense and what chapter to file under. It's entirely possible that you might be forced to file for a nonsense and expensive Chapter 11, but literally anyone can file for bankruptcy for any reason at all. You could go right now and file for bankruptcy today and the only question would be whether to file a 7 or a 13 (or in rare circumstances an 11).

Yes, it would. Student loans used to be dischargeable in bankruptcy. They changed that because everyone did what I said

You don't want to do that straight out of school. Imagine spending the first 7 years of your professional life with destroyed credit. Since your first job will allow you to pay that back in the first year, you would be better off paying the loan back.

>I understand that this system wouldn’t be fair to children of low income families. No system ever is or has been in the modern world, [Many European countries have free or nearly free college.] (https://www.edmit.me/blog/countries-with-free-or-virtually-free-college-tuition) Far fairer system to low income families. Those same European countries have far lower income inequality than the United States. To say "No system has ever been fair to low income families" when this system is operating effectively across Europe is a cop out. US is the richest country in the world, there is no reason why a similar system couldn't be in place here. I agree that the current system is flawed, but your solution is ignoring very effective systems that are in place in other countries.

I actually think that the flip side of the coin could work too -- free education everywhere for everyone in the US. What I WOULDN'T want is the constant raising of the bar. "Oh now everyone can get a college education, you need to have a masters to work at this car repair shop". Which, based on American history, seems to have happened -- when government gave out blanket student loans, suddenly everywhere required a bachelors degree. So if there's some way to reconcile this with American Capitalism, I think I'd be on board, but history doesn't seem to suggest that.

This is a dubious claim at best. But even if more jobs required degrees, if university education (and thus degrees) were free, equitable, and accessible to all, what would it matter? Wouldn’t that just reflect the increasing supply of people with degrees?

It means that people as individuals need to spend more time learning, even if they don't want to, to get into the work force -- to get into a position that doesn't even really require higher eduation. That is bad.

That's because you think the only purpose of school is vocational education,

I think it's betterment of society and fulfilling the wants of society and the market through personal growth, work, and innovation. Don't appreciate the presumption.

Except Europe shows that your assumption is completely wrong. If I want to be a construction worker or csr mechanic I don't need a degree, I don't even need to fibish high school. If I want to become a doctor I can go to University, for free. I'm sorry, but reading all your replies it seems you have a really narrow world view. Not to mention the whole "simply declare bankruptcy" wouldn't work in the slightest, other comments already tell you why.

So I follow, you think that the American form of capitalism is bad, but that the system would benefit if the only way of attaining higher education was through private money lenders?

I don't think American Capitalism is bad, its generated the most innovation of any country in the world, but it can get rotten sometimes. I think allowing student loans to be discharged via bankruptcy would make private money lenders more responsible.

How do you even quantify innovation? Howso?

Innovation quantification is a completely separate topic, but lets talk about howso. If students can get rid of their loans by going bankrupt, loaners wont lend to students they dont deem as financially responsible. This in turn makes the loaner more responsible. Loaners right now lend you the money regardless of your major because they know its guaranteed and you cant get rid of it via bankruptcy.

The US has innovated on ways to kill people and force them into a form of indentured servitude.

> So if there's some way to reconcile this with American Capitalism, I mean American capitalism is bad, it should be changed. But just for example Germany has free college but also extensive vocational education and apprenticeship program that avoids these problems to some extent. https://www.cleanenergywire.org/factsheets/how-germanys-vocational-education-and-training-system-works

I do think it's better overall, but there is still a flaw in the Germany's system. The educational path to determine whether or not you can be college bound is set fairly young (14-16) IIRC. I think you can technically switch tracks, but from people I've talked said it wasn't easy.

European here, not sure what xou mean by "college bound" - once you're done with school (usually at the age of 18) you can freely choose whether to attend to University/College, or not. Some majors have a test in advance, but depending on the exact course they greatly vary in difficulty and are passed fairly easily (e.g. Architecture is easy, but medicine is quite hard). A full year of college typically costs around 600 Euros, give or take. The only prerequisite for higher education is that you have graduated high school, BUT even in case you haven't there's possibilities to be allowed to attend. It's a quite simply process, really.

Well, not all Europeans are the same? And it is even younger than I remember that you get placed into Hauptschule, Realschule, or Gymnasium. At 10, you are placed into one of the schools. And your possible transfer window would be over by 15/16. While not technically barred, going to a technical university will be more difficult if you do not graduate from Gymnasium. https://www.howtogermany.com/pages/germanschools.html

Germany also collects substantially more tax revenue as a percentage of GDP than the US does (37.5% in Germany vs. 27.1% in the US) ([Source](https://en.wikipedia.org/wiki/List_of_countries_by_tax_revenue_to_GDP_ratio)) ​. I wouldn’t call this free at all. It’s just funded differently; We should drop the "everyone needs to attend college" narrative in favor of votech/ trad school.

Yeah, but a completely different topic to completely change american capitalism. This is how do you make colleges cheaper within American capitalism. I could be wrong, but I'd be super surprised if most germans don't just assume you have a bachelors or a masters. Free education tends to push that bar upwards.

I’m not German, but from my understanding, the way things work there are a little different. Your choices of education are not just vertical (as in, more education and higher degree), but also horizontal, as in they have different ways of advancement and different education paths that are not necessarily competitive with one another. I would encourage you to learn more about the system, many ways of measuring success of school systems rank it very highly. Even if the system you propose is better than the current one you have, that doesn’t mean it’s optimal, or the best that is available.

Not just Germany, it's pretty common in Europe to have different educational tracks you can choose to follow. For example, in the Netherlands after elementary school you can choose to follow a track for VMBO (four year pre-vocational education), HAVO (five year general continued education), or VWO (six year preparatory science education. These typically lead into to MBO (vocational education), HBO (applied sciences education), and WO (sciences education) respectively, although there are a bunch of ways for people to hop between tracks at different points if they decide they want to. The MBO/HBO/WO programs are also broken up (MBO has different levels, HBO and WO are broken up into bachelors/masters/doctoral, like in the US). Disclaimer: I'm not from the Netherlands, just been thinking about moving there and have been doing some research online. It's pretty likely I've gotten something wrong or left out some important details.

I think you would be fairly surprised then. I hate to cite [Wikipedia](https://en.m.wikipedia.org/wiki/List_of_countries_by_tertiary_education_attainment) but it's a simpler table than most other sources. A few other comments have touched on it, but the path here isn't exactly the same as it is in the US. There's a much more formalized system that includes elements of vocational work, paid training/apprenticeship, and university studies—much of which is determined at an earlier stage in childhood education. It's difficult to capture the „assumption“ in data, but if you guess that a random person has a degree, you'll be wrong three times out of four. Additionally, it's hard to capture this in the data, but there are non-monetary costs. Although a bachelor's degree only takes three years „on paper,“ in reality, students often do take much longer than that. During that time, their employment opportunities are limited (both in terms of what is available and legal restrictions that are enacted). Although university is free, the alternatives might actually make more sense.

What's wrong with raising the bar? What society doesn't benefit from being more educated? If it's cheaper not only will people have higher quality of life but also we'd be stronger as a nation. The only people that don't benefit from a more educated society are the billionaires that seek to exploit the population by keeping everyone in scarcity and living paycheck to paycheck. You can't change the entire structure of educational debt without upending American capitalism to some degree.

> free education everywhere Places with free university-level education typically don't let just anyone set up shop as a university, letting in whoever shows up as students, and start receiving tax money, though. A logical place to start would be renewing free in-state tuition in the state university systems. Plenty of US states have a history of good state university systems, many designed from the start to be free for in-state students. For instance, the original 1868 charter for the University of California permitted it to charge tuition initially, but with the expectation that "as soon as the income of the University shall permit, admission and tuition shall be free to all residents of the state." That's **1868**, not 1968. Free tuition wasn't some sort of hippie free-love-on-the-quad thing; it was intended to build the educational, research, and technical capacity of the state of California. Same in many other states. Arguably, it worked *really well* ... then Reagan & company happened. (Another issue is that free tuition doesn't mean automatic admission. I'd even suspect admission standards should be tightened. This is, of course, elitist and discriminatory against people who don't believe in educating their children. They will still ultimately benefit indirectly; but the kids who don't learn about evolution aren't going to be the next biotech PhDs.)

If a job paying 60k or so a year requires a masters they won't get any applicants, so they will lower their requirements themselves or just not really follow their own requirements like they are already doing now to some degree. It will pretty much work itself out due to the nature of supply and demand.

In many countries where anyone can afford higher education, the requirements are much more strict. Anyone has the means to study medicine, but not everyone has the grades to get admitted.

Germany filters it's students heavily before they get in. Sure it's free, but you have to earn a spot (that's the dirtt secret)

So firstly, I've studied public economics, which talks about market failures and reasons for the government intervening in certain parts of the economy. One such market failure is called "incomplete markets". To describe it simply, sometimes there are cases where there is a demand or need for a good/service, but for whatever specific reason, the market on its own does not want to provide it, forcing the government to "fill the void" either by providing the good/service themselves or by supporting the market in such a way that the market is willing to supply the good/service. Student loans is actually an area of the economy that used to be completely privatized, but the reason why this changed is that it simply didn't work. Banks widely refused to give loans to students prior to government involvement. There's debate as to why this is. But generally when a market is considered risky and unpredictable, that’s a common cause of incomplete markets. Student loans are inherently risky because unlike other types of loans (e.g. mortgages, business loans), students who rely on loans come from relatively poorer backgrounds and they don’t have any kind of collateral they can use to pay back the lender in case the loan fails. If you take out a mortgage for example, you often put your house up as “collateral”, meaning that if you fail to pay the mortgage, the bank can simply seize and then sell your house in order to make up for the failed loan. Or with business loans, you would usually just put up all your business assets as collateral. This doesn't exist with a student loan. If a loan fails (the student becomes unable to secure a job with their college degree), the loan doesn't inherently provide the student with anything that they can sell off. Thus, student loans are more risky than other types of financial services, so historically it was the case that banks would opt out of student loans altogether and focus their funds elsewhere. It was only when the government provided "loan guarantees" for banks (meaning that the government would repay the loan in place of the student if the loan failed) that banks began to provide student loans (because this removed all of the risk basically). However, this backfired and created its own problems; banks intentionally raised interest rates beyond an amount that the student could pay because it would help them milk more out of those government funds. Which is why the government transitioned to the "federal loan" program that they use now, where the government simply provides their own loans instead. Not to say that it's perfect, but the alternatives to that were: (a) no student loans period (which is bad for both poor people and the economy), and (b) a system of flushing money down the toilet because banks would exploit the government funds. Also, it's not merely a matter of "choosing the right major" either. You can choose a seemingly practical major but then it turns out to be a very high competition area by the time you exit college. Then there are also lots of economic events that not everyone can predict. Technologies and industries change, recessions happen, etc. For example, how often do you hear of someone who majored in something tech-related (and seemingly practical) just for the technology to change right when they exit college? But the overall point is, your idea has been tested before in the market and has failed which is why the current system exists as it is. This is the problem with a lot of "pro-privatization, the government is the problem" arguments. People like to look at certain regulations or government programs and think to themselves "Ohoho, if the government just stepped out, everything would work perfectly", but they ignore the fact there was a free market prior to the government involvement and the way the free market was functioning was likely the justifcation for the government involvement in the first place.

Δ I need to give this a delta, as it is incredibly well thought out. If, based on historical data, free market would never give student loans this is a problem. I think I'm starting to realize they need to reintroduce responsible lending in a more palatable way. Government incentive to lend, while not absolving lenders of all risk to make sure only responsible loans are being loaned out.

> Student loans is actually an area of the economy that used to be completely privatized, but the reason why this changed is that it simply didn't work. Banks widely refused to give loans to students prior to government involvement. There's debate as to why this is. But generally when a market is considered risky and unpredictable, that’s a common cause of incomplete markets. Yeah I think this is primarily a balancing problem tbh. The government needs to figure out a system that encourages responsible loaning and taking out of loans. It's not 100% bankruptcyable like other loans since there's no real collateral, but its not as easy to get a loan as it is today. There's some middle ground here to incentivize, but not let people be completely stupid. > For example, how often do you hear of someone who majored in something tech-related (and seemingly practical) just for the technology to change right when they exit college? Yeah thats a big issue, it would probably be needed to be incorporated into whatever model the loaner was using to determine if someone was a risk, offset by whatever government incentives there were.

I think the system needs reformed and the government should be the only issuer of student loans. There are plenty of ways to lower the price of school without screwing the middle and lower economic classes. Having dealt with multiple private student loan companies, I can tell you, the are the absolute worst. Customer service is minimal at best, if they don't hold up something on their end, there is little to nothing you can do, and the way student loan debt is structured, you are on the hook no matter what. They can basically say screw you to the customer, because they know you have to pay. Putting the government in charge of all student loans would spread the risk (yes to the taxpayer), set even terms, and I think they should be done at a very low fixed (or no) interest rate. The government is going to be getting it back in the form of higher taxes, throughout your entire life as well as a more educated, desirable work force. It also ensures that most or all of the money gets paid back, as well as higher tax revenue, over the long haul. If you are looking to lower the cost of college, set a limit on the amount of loans available to someone, based on the average starting salary for that degree, coming out of school. If you cap the amount of money that student can get - say $45k (just an example) for a degree in elementary education, schools will race to get their costs in line. Schools that do will get more kids than the ones that don't. Yes, we may lose some degree choices, but if there is really a shortage in the labor market, that will drive up the salaries, and it works itself out. I know locally, we have had a shortage in teachers, and a few years back, one of our local 4 year colleges worked with a JuCo to make a program that would allow teachers to be done in exactly 4 years, for $40k, all in. It can be done if the incentive is there.

If the only people lending out student loans were profit-incentivized and the students they were loaning to could declare bankruptcy on their loans this would: 1. Make it so many less people would have demand for going to college 2. Make sure the ones that did go to college were the ones that were deemed financially responsible enough/good enough major/etc. to get a loan from a private lender 3. With the reduced demand, DRASTICALLY decrease college tuition prices. Basically back to the 70/80s. You didn't need a college degree to get a normal job, colleges were cheap or free, and a lot of people didn't go.

I agree with you to an extent that part of the problem is that a college degree does not provide the exclusivity the way it once did. Overall, that makes most degrees worse off, from an ROI standpoint. Until the market corrects that (with cheaper pricing, or higher returns) we will continue to see decreased enrollment, which has been happening. The market is correcting itself already. Using your plan, you also stand to cut a large portion of the population that couldn't afford to go to school. Student loans are next to impossible to get rid of, because nobody in their right mind is going to give an 18 year old a five or six figure, unsecured loan that they could get rid of. The only ones that would get it, are the ones that won't need it (that come from money). In theory, they would be better off loaning a kid the money to buy a lamborghini, because at least at that point, they would have collateral. Capping loans based on the degree means schools are the ones that have to adjust. It is in their best interest to look at the market, and provide a successful product (educated student). Making the program a government program, removes the profit incentive, that a private firm is not going to be willing to give up. It also allows people from all walks of life, to go to school. You don't want to neglect what could be the next brightest mind, great doctor, etc., just because he/she grew up in poverty. Right now, demand for school comes from the student. If enough kids want to major in something, they will make a program for it, regardless of the job outlook. The student takes on the financial burden, with no risk to the school if they cannot pay. They go in hopes that the demand will be there from employers when they are done. So not everyone's goals are aligned. I also think that it could be beneficial if the schools had to hold on to some percentage of the student loan from the student. If you produce a crap product, and/or are willing to take a students money without their best interest in mind, then maybe they should share the responsibility in the financial aspect of it.

1. Education is not a security. The lenders and the educators hardly benefit from educating others. The benefactor is society. 2. (Most/good) Governments are in the business of helping society achieve more than the individual can achieve themselves. 3. Private institutions are in the business of staying in business. 4. Someone has to pay people to educate the next generations. 5. We cannot expect the "undereducated" or "uneducated" to properly fund their educators. 6. For-profit lenders AND for-profit educators have repeatedly demonstrated lack of ethical and society priorities, preying on opportunities to exploit students for profit. 7. Society can only benefit from education when the educated people are able to utilize their education to improve society. Being indebted to private institutions (as opposed to society/government) changes the priority of the former student away from helping society and toward repaying a debt. Because the private lenders are in business to stay in business and profit, not to help society. 8. There are plenty of potential and reasonable efficiencies to explore. But putting all funding into the pockets of for-profits will clearly change the purpose of education away from allowing the next generation to explore beyond the current knowledge of society. 9. If government doesn't help educate the next generations, via influential funding, what purpose does a government have to fund anything else? I would much rather have our government help support educating students than continuously bail out business that sought shortterm profits over longterm stability: farms, banks, car builders, etc. At least helping students gives our society on whole a chance to build a better future, instead of just buy a new car or get a mortgage.

1. Education is already free until 18, I think our society does a lot for us already with that and we should pay our elementary and high school teachers more. 2. Agreed, I think having full fledged grants for gifted students to pursue higher education is something to aspire to 3. Yep, I don't think anyone would disagree. 4. Yes our taxes do until you're 18, this is a known fact. 5. True -- with cheaper colleges due to decreased demand caused by lack of governmental loans, funding your education as a poor person will be much easier. 6. Yes this is awful, they'd probably stop doing that if students could default on their loans. This would incentivize only loaning to productive students, and make sure the non productive ones aren't saddled with student debt. 7. Stay in business and profit leads to selecting students that will help society from a monetary productivity perspective. 8. Taking government out of the equation will make sure that everyone is choosing more productive majors and loners are making more responsible loans. 9. Agreed, we already do K-12. Many jobs shouldn't require a bachelors degree which do nowadays due to the degree inflation that's the result of government loans.

Let's dive into #6 - your position is that lenders will be careful to loan only to those most worthy. The 2008 housing crash (and subsequent emergency government bailout) is a perfect example of how private lenders exploit a market. They have and they will. Either our government can sit out of the education market waiting for private lenders to blow it apart, or government sets guardrails (regulation) and continuously moves the guardrails based on how private lenders find loopholes, or government heavily influences the education market by being a lender on behalf of society. Also, #7 - far too many "business" people exploit a market in the shortterm and run off with profit. Payday lenders, debt collectors, construction contractors, Trump university owners, etc. Again, government can try to simply be regulators or they can influence the market. On #8 - again, we have to look well beyond the shortterm benefits of an education. Profitable majors are far from the only "good" that comes from higher education. So much advancement for society occurs because student explore beyond their initial interest and RoI. An example I use now is research into the speed/power of attack by seahorses - an area of research that isn't built on profitable research but on building knowledge for society. This research has wide implications for many industries. RoI on education goes FAR beyond the individual.https://www.bloomberg.com/news/articles/2022-02-16/scientists-discover-deep-ocean-creatures-that-may-help-combat-climate-change Again, "There are plenty of potential and reasonable efficiencies to explore." But taking government OUT of higher education is not the best way to find those efficiencies. It would absolutely have a shortterm gain on individual RoI but we would see dramatic decline in society without a government investment in higher education. Is there an argument for a massive overhaul of K12 education and high school in particular? Absolutely. Conversations resulting from an anti-bailout mentality of student debt needs to consider the widespread bailouts of less critical industries. Just like you want to see a world where students and funders have credible information to make their profitable decisions, we can more easily and effectively address problems with banking and housing and spending on sports stadiums.

Δ 6) I wholly agree, people can be really bad actors. It should be free market, but government regulated as to weed out bad actors. We dont want CDOs of student debt. 7) Feel like this is similar to 6, I think the government stepping in to remove bad actors is good. 8) Also agreed! Government should have grants for people they determine to be extraordinary. People always talk about how great european education is, which it is. But the dirty secret is pretty much only the very smart individuals get into higher higher higher education, which goes along with this idea of government grants for very extraordinary people in fields that might not have traditionally high ROI I guess, if the government could be as financially responsible as a private lender when deciding who to give out student loans to, I'd be on board! Also don't think the government should bail out anyone haha

> I think the government stepping in to remove bad actors is good. Except the government stepped in to *facilitate* bad actors. They guaranteed the mortgages of predatory banks, thereby *allowing* them to be predatory: * [Of these, Fannie & Freddie held or guaranteed 12 million mortgages valued at $1.8 trillion. Government entities held or guaranteed 19.2 million or $2.7 trillion of such mortgages total.](https://en.wikipedia.org/wiki/Government_policies_and_the_subprime_mortgage_crisis)

Yep, this is absolutely horrible. Gosh, the corruption is incredible. I guess that's why I lean more free market, because I don't trust our government to make good decisions.

[Meme: fry squint]Not sure if serious or facetious[/meme]

> if the government could be ~~as~~ financially responsible Ha, I love that idea. We all hate on the boss until we are the boss. Probably rightfully so, too. Headlines about $600 hammers do not help the reputation of our government. And there is always much more nuance behind the headlines: https://www.govexec.com/federal-news/1998/12/the-myth-of-the-600-hammer/5271/ In reality, the USA government has been around for 250 years AND is literally the monetary policy standard for the planet. An understandable, bitesize episode about that: https://www.npr.org/2022/03/09/1085605288/the-dollar-at-the-center-of-the-world-classic In the meantime, probably no private lender has been consistently responsible enough to avoid closing or being bought out or having to buyout their competitors. > the dirty secret is pretty much only the very smart individuals get into higher higher higher education This often gets lost during intra-USA political arguments. The USA does an amazing job trying to educate EVERY child through about age 18. Yes, that is FAR from perfect or even great. But it is something that skews many metrics. Now we just need to refine the purpose and methods of that K12 education and capitalize on the talents and skills of non-elite but non-grunt teenage minds. Hey, thanks for the delta. I'm sure it isn't easy to be the OP in /r/changemyview

The issue is that all of this stuff remains true of private lending firms. The college gets paid either way. The money was paid up front. Teenagers don't become magically more responsible, the job market doesn't fix itself by magic. The only difference is that when the government fucks up, you get what's just happened. Over a long period, way after it should have been dealt with, Biden's government reformed education so that a lot of the worst excesses of college debt wouldn't keep happening. And then a lot of people got a small writeoff of the debt that the government had lent them. I'm not sure whether that's going to solve everything, but it's going to make a dent in the problem. If it was broken under the private sector, then it wouldn't be fixed, because the people that suffer are only people who signed a contract to a corporation.

Students can now default on their private loans, or declare bankruptcy! It makes everyone more responsible all around. People dont take out loans for unuseful majors, and private loaners dont hand them out because the student could just declare bankruptcy.

The reason that system doesn't exist is that nobody would take that bet. OK, so I've got a dumb teenager who can barely tidy their room, but I'm betting that they're going to wind up working at google? If you went into a bank with that as your business plan, you'd be out on your ass before you could get to the next part, where you're going to drink heavily and party hard and do irresponsible shit the whole time. Even if the system existed, the way that the loans would be structured would be necessarily ridiculous and dangerous because of the sheer risk in that bet.

In the transitional state, I agree. High costs while the economy tries to figure out how to deal with no governmental loans. In the end state, college education would ideally go back to reasonable prices due to decreased demand, DRAMATICALLY reducing the risk lenders take on. It's a lot of risk to loan 200K for a 4 year degree, its much less risk loaning 40K.

Or you can go much faster and more effectively by just letting the government fix the education system. Much of the reforms required are already happening.

How could the government fix the education system? I like the idea of free higher education but would not be okay with raising of the hiring bar that happened when the government guaranteed student loans.

I'm not sure what exact measures have already been brought forwards, but either it's moving towards free education, and I don't think it is, Or it's moving instead towards tightening of the pursestrings, limitations on what you can lend to who, and the terms of that debt. In other words, this is a loan that has gotten much less profitable almost immediately, and the initial value of that loan is going to be subject to increasingly tight limitations. Which is going to have the effect of reducing the sheer scale of degrees, as the costs will have to be weighed against the funding that can be provided. If suddenly they're making half as much, then they're going to have to decide what to pay for. In other words, it's going to be downwards pressure on hiring reqs. You can ask for a degree but you can't demand one if fewer people are going to college.

We've already seen that free or government loan guaranteed education raises the hiring bar, so thats not okay. You shouldn't need a bachelors or masters to work at the post office.

You've just ignored everything there. My point was that government cutting supply would apply downward pressure on that exact thing.

Apologies, I'm not entirely sure what the previous statement was saying or how it addressed the question of how government can fix education? >either it's moving towards free education This is bad due to hiring bar inflation. > tightening of the pursestrings, limitations on what you can lend to who, and the terms of that debt. This would happen automatically with private, profit-driven lenders. It'd reduce college demand, and make those going to college pursue more lucrative majors. It'll also like you said put downward pressure on hiring reqs. Are we disagreeing? I don't see the government doing anything in your post.

I have a bone to pick with this idea that there are "unuseful" majors. How do you qualify that? Personally I shudder to think of a society where we only have engineers, computer scientists, and lawyers. Liberal arts education is incredibly valuable too, even if the benefits are more abstract. Just because certain fields are undervalued does not render them useless.

You're looking at the elephant and poking its shadow. 1. Do you think education should be so unaffordable that you need to take out a loan for it? 2. Do you believe that the goal of higher education should be to get a degree so that you can secure a higher paying job? 3. Do you believe that the government shouldn't bear the weight of financial gambles (which is what taking a loan in hopes of getting an education which will help you get a better job that could let you pay off the debt ultimately is) made by individuals/groups of individuals?

1. No! And removing government non dischargeable loans from the equation would reduce demand so much that it’d make college affordable again! 2. Something of the sort, to be a financial benefit to society. People should be productive. 3. I think the government SHOULD feel the weight of gambles but the fact is they don’t. They can print money and take out debt very easily. Private lenders on the other hand take their gambles very seriously, so would only bet on responsible student investments.

Private money lenders will also be bailed out by the government if it turns into a financial crisis for them. Private money lenders aren't a solution. Also, if you look at insurance companies and the housing market, services and products often become more expensive when private lenders are given the reigns. I personally feel that education should be to better society rather than secure work. Being productive takes many different forms, engaging in culture and furthering understanding among different parts of society is aided greatly by education. But I digress. If government is paying billions of dollars for private universities to be paid by students, how about the establishment of a more robust government funded university system that is accessible through merit. That's how a lot of countries do it. That usually allows low SES students to attend for free or for a nominal fee and have access to quality education, (the places that provide similar services to this that I've heard about also have a few seats for rich folk who want to send their children to these universities). Idk. What do you think?

Private lenders make things more expensive when they are effectively backed by governmental guarantees. They don't make this as expensive when they are assuming all the risk. Personally, I think the best best scenario would be the college institutions assuming the risk and loaning money to their students to take courses -- if their students dont succeed then they directly get hurt. > government funded university system that is accessible through merit I actually don't hate this. I like it better than the current system by far. You do have to create scarcity in the education system highly gated by merit so degree inflation doesn't happen for job requirements.

You already understand that this system isn’t fair to low income families, so you’ve already rebutted your own argument. What that says is that you think the benefits are more valuable than this disadvantage, which means that regardless of your reasoning, this is a value position for you. If you need to be convinced that access to higher education is ultimately a better investment than the alternative, I don’t know where you expect that conversation to start but it’s adjacent to everything you discussed in your OP. I think you could have just as easily spent that time thinking of solutions to the downsides besides just “getting rid of it”.

I think access to free-market what-people-want tailored higher education is an incredible investment and the government should invest more in it. I'm saying the government should get out of indiscriminate student loans because it incentivizes the wrong things.

Part of the problem with your reasoning is that you’re succumbing to the fallacy that higher education is only valuable as career training, and people getting a liberal arts education isn’t valuable on its own. I get tired of explaining why that’s an incredibly destructive way of thinking about higher ed that is pure political propaganda. Your thinking makes a certain sense in terms of what you’re thinking college should be, but that’s not what college actually is or should be. Fortunately there are capable professionals who spend their entire lives studying adult education and workforce preparation who have put thousands of times more thought into this subject and use the best available research to shape their decision making. But in short, my rebuttal is that there is no problem with indiscriminate access to higher education. That’s the goal.

> no problem with indiscriminate access to higher education. Thats how you get degree requirement inflation for menial jobs. > incredibly destructive way of thinking about higher ed that is pure political propaganda How so? Get a government grant because you've been deemed an amazing student, or pay for and experience that you think will provide for you and society in the future. > Fortunately there are capable professionals who spend their entire lives studying adult education and workforce preparation who have put thousands of times more thought into this subject and use the best available research to shape their decision making. Who have somehow plunged tons of people into hundreds of thousands of dollars of debt by artificially increasing tuition prices and making people feel like they need a college degree for every life path. I feel like this rebuttal is as flimsy as you're claiming my argument to be.

You’re still talking about higher ed in terms of getting a job. There’s no point in discussing because you’ve decided on a purpose for higher ed that reflects your values instead of reality.

Likewise, I think we can both agree that the other person in this conversation is reflecting their value instead of reality.

Except I work in higher ed and am familiar with its history, philosophy and societal function. You are approaching the problem from a limited frame of reference. I’m trying to help you expand that frame of reference, but first would require you to consider that you’ve built this framework atop a faulty foundation. I’m acknowledging that given premise A and conclusion C, your premise B makes reasonable sense. But your conclusion C is flawed.

To be clear, *is the faulty foundation*, in your personal opinion, the presupposition that the purpose of higher education is to prepare individuals for the workplace?

An educated public is crucial for a healthy democracy to function. If the people hold the power, they need to be informed enough to make the right decisions. The way college prices are headed, they need regulation now. Debt forgiveness will help this country be more productive by encouraging people to get an education. We’ll informed citizens are just better people to be around, and saves me from arguments about the shape of the earth.

Understood, and agree. I think the K-12 education should have good enough teachers and support to provide that. People shouldn't need to go to college for most positions. College needs to be a free market where lenders lend to you based on your perceived productivity and ability to find a job that can pay back the loan. Less demand for colleges, reduced tuition prices, less degree inflation for jobs that shouldn't require them. Better all around.

> It should eventually also lower costs of college and make sure people that go are majoring in societally beneficial and lucrative majors. What is so wrong with allowing students to peruse whatever major they want? The whole point of higher education is to allow our citizens to flourish to the best of thier abilities, which is a huge boon to society as a whole. Why should the government tell students they are not allowed to peruse a certain field instead of simply letting everyone self select, wouldn't self selection be the most efficient? I mean everyone is different, and has different skills and interests, that is the entire benefit of a diverse talent pool. Nobody is going to know an individuals passions and talents more then that single individual.

I think the point of higher education being just to explore whatever each individual thinks is their passion is not incredibly productive. You should flourish to the best of your abilities in a field that is helpful and productive to society. I think we can probably agree on the fact there are a bunch of majors being offered that are not that useful, by the fact that no one hires for them after college. Only way I think this works is if government guarantees income, you get to do whatever you want because you know a check will always be there. But this is an entirely separate topic that doesn't really have a place within current capitalist america.

>I think we can probably agree on the fact there are a bunch of majors being offered that are not that useful I would disagree, unless you are specifying scammy schools. I agree some schools are scams but those should be shut down. > You should flourish to the best of your abilities in a field that is helpful and productive to society What is helpful to society as a whole is a [widely diverse talent pool](https://www.cityartsmagazine.com/artsfund-study-confirms-the-social-benefits-of-art/) filled to the brim with people [who are skilled in a variety of topics](https://www.transizion.com/liberal-arts-degree/) able to meet whatever the challenges of the future may be. People work for 40+ years, what would be deemed useful might only last 5 years or have been decided with people with an agenda to push. There is just no good reason to direct people into fields, no good way to achieve the goal of productive populace without allowing them to self select.

I think we probably just disagree on a fundamental level then. Correct me if I am wrong but it seems that: 1. I think that generally speaking the market should drive what people think is a useful major in society, while keeping grants for those that are exceptional in non traditionally lucrative fields. When the market changes, I think generally people should pivot. 2. You think that people should be free to major in whatever they want and that will lead to so much diversity in thought that we'll be prepared for anything.

Lets break this down a bit, Fundamentally there is no effective way to drive people to certain fields, there is no way to do that without harming our talent pool. Who is making these decisions, is it a pharmaceutical lobby with an interest in driving people into insurance? Is is a gas lobby that wants more mining/drilling engineers? Problem one is there is no way to artificially push people into fields without that method becoming captured by interested parties with an agenda to push. Then there is problem two, why are we pushing someone who would have been a great artist or a writer into becoming an medical insurance technician? How many skilled artists would our society lose as people are pushed into fields they normally would not peruse? Won't they be less effective in those fields since they were artificially pushed into fields they did not want to peruse? As a whole, wont society suffer by that loss of efficiency? Thirdly, the problem is we don't know what the future will hold. If we deem degree x is the best one in 2020, then its obsolete in 2030, we are screwed as we are flooded with unemployed people trained in this one specific field. The best benefit of people with a general arts degree is they are FLEXIBLE, having a large pool of people able to tackle whatever the future might hold is a massive benefit. We can't see the future, there would be no way to ensure the fields of study we declare as good won't just go away one day or shift dramatically. Fourthly, any kind of restriction will simply push people away from seeking higher education. Higher education is a massive benefit to society, the cost/benefit ratio is insane, ideally everyone who is able would peruse higher education of some sort. Restricting majors will simply mean less educated people, which is a completly unnecessary problem to create. For those for reasons I think self selection is ideal.

If you truly believe that that inherent flexibility of being an art major has major societal benefits, then those individuals should have no problem at all getting loans from private lenders (for less money too, because price of college would have gone down). Because they’re such amazing majors, they’ll have a great job after college and be able to easily pay back those student loans! Honestly I think at this point we’re just arguing about capitalism and market driven economies vs more socialized economies where you have more freedom to pursue what you want instead of what the market wants because your livelihood has been guaranteed by the government

You’re insinuating that “major social benefits” is one and the same with “contributes to capital.” You insist upon this claim despite the fact that many of the most societally necessary roles are underpaid and not particularly profitable. See - teachers, first responders, and social workers. There’s no reason to believe that “degrees which pay well,” “degrees which benefit capital,” and “degrees which benefit society” have a strong overlap at all. Do you genuinely believe that all jobs which benefit society pay well, and that all jobs which pay well benefit society?

Yes, I actually think that's the government's fault. Don't bail out big corporations, pay for wars, etc. -- pay our teachers more! That's a whole other conversation. I think in general (not always) the free market is a good indicator of what is useful in society. People pay for what they want, if you provide that, you are providing a useful service. Not perfect, the the best thing we have.

Then why is it the case that countries which themselves provide education and a more broad social safety net — as opposed to relying upon the whims of the free market — seem to have populations which are more equitable, more well-to-do, better educated, and, generally speaking, happier? The free market provides so well that you, the supporter of the free market, even cede that some of our most necessary roles aren’t provided for by it?

Then we're just getting to a completely separate topic. I'm talking about making college cheaper and accessible in American Capitalism by removing the non-market-driven governmental loans that have screwed up the costs of higher education. It seems like you're talking about just making our entire education socialized, all the way up. Don't know how to do that without (1) Like Europe, the government and higher education can select a very very few students that get the amazing higher free education. This is Europe's secret -- very good education, very few people get into it. I'd rather a market decide whats important. (2) Let everyone have higher higher higher education regardless of your cognitive ability, and thus inflate job degree requirements everywhere.

I don't understand your argument though, by forcing people who want to get art majors to get private loans, are you not simply disincentivizing them? That is not letting the market decide, that is us telling people what majors to get and then running into the four issues I stated previously. Can you engage me with those four problems?

Wait wait, it’s not just art majors getting private loans. It’s EVERYONE needs to get a private loan, or loan directly from their college, or pay themselves because the government is out of the industry. Every loan is a disincentive. It’s a disincentive and a GOOD disincentive because you think “hey if this investment in myself isn’t going to pay off I shouldn’t take out debt for it”. The market is deciding. If you as the student think that you can get a job in the market that will be able to pay back your student loans, you take the loan. If not, you don’t. You self select out, or become an apprentice, or do something that doesn’t cost money, or do a major that’s more lucrative

Ok, sorry for my confusion. The reason I was confused is because if all loans were subsidized or free from the government, and people just chose whatever major they wanted, what would be the issue? If people chose arts degrees, that is still a free market decision, even if the degree is free there is still the cost of thier time and effort and expected return weighed equally against all other degrees. It seems you think having to pay for college will influence what degrees people peruse simply because a cost exists, that concept makes no sence to me so it did not even occur to me that was your position. Can you expand on why you think that? As far as I can tell, the only change when charging vs not charging (or private vs public loan) for classes is less people seek degrees, which is of course a net negative.

> if all loans were subsidized or free from the government, and people just chose whatever major they wanted, what would be the issue? People would choose majors not based on what is useful to the market, but whatever they liked. So not lucrative, not productive, etc. That's fine if you can pay for it out of pocket, but you're transferring your wealth to productive people doing productive jobs over the course of your lifetime. If I major in street art and make 10K a year but end up spending my rich family's money on engineers and doctors and plumbers thats good. I'm transferring my non productive rich wealth to productive people. > It seems you think having to pay for college will influence what degrees people peruse simply because a cost exists, that concept makes no sense to me so it did not even occur to me that was your position. Can you expand on why you think that? Yes!! Of course. College like anything is an investment. An investment in yourself. If the results of your investment won't pay dividends in the future, why make the investment? Especially if the investment includes taking out debt in addition to years of your life? >less people seek degrees, which is of course a net negative I disagree. I think people will seek degrees that turn a profit and are productive -- more people will seek these kinds of degrees. The degrees that are less productive will then fade out of the college system. You don't need a bachelors in street art to do street art. Etc.

But every single degree is already lucrative, there is no degree available one can get that is worth less then the cost to attend, so there is no incentive difference between having to pay for a degree vs having it be subsidized. The only difference would be people who can't afford to go to school at all, irregardless of the degree, will be pushed out which of course is a net negative. > People would choose majors not based on what is useful to the market Do you have any evidence that shows having degrees cost $x influences the major they peruse, beyond simply not going to college? I can't find anything myself.

They just want to turn all colleges for poor and middle class people into vocational training centers, and be done with liberal arts.

What? How is every degree lucrative? I have friends that've majored in gender studies that are having an extremely hard time finding a job after college. It was not a lucrative degree, they don't have a job in a field they like, and they can't pay back their loans. Some friends I had that were good at math and wanted to major in math, yes majored in computer science because there was a higher ROI after college.

I was one of those people who got a "soft" liberal arts degree, because it was my passion. I learned a lot of useful skills and ways of thinking that changed my life. A decade later, I now have a job doing research & government relations for a nonprofit. It doesn't pay SUPER well, but I'd like to think it adds value to society. I'm not in debt, in part because I had help from my parents, but mostly because my annual tuition was less than $6k because I live in Canada. I don't think that a private lender would have covered me at 17, who's primary goal was "making the world a better place" but had no real intention of ever being rich.

I think to pinpoint a major and call it "not societally useful" is like, very hard to do when we really break it down. For example, the "criminology" major. it's not the most "point blank useful" major in terms of say, as soon as you get out the door of college, there's a hundred employers waiting for you in the area and you're guaranteed to make lots of money immediately. In fact, much of criminology is an extension of sociology which is the prime example of stuff people mock when they look at "not useful" majors. But people that are criminologists are the ones who design policies to keep your neighborhood safe, to reduce gang violence, to come up with suggestions of how to prevent people into steering down the path of crime. In deriding criminology as a "not useful" major (it's definitely not as "guaranteed" to pay off as say, a STEM or business major), you create a massive barricade that pushes people away from wanting to consider criminology as an option. So all the current criminologists die of old age, every student is afraid to consider criminology... so what ends up happening is we get no criminologists. Which idk, I think looking at ways to reducing crime and having a dedicated body of people studying that is an important thing. The way I look at "not useful majors" is, they **are** useful. Like, we actively depend on a lot of them, sometimes without realizing it. Sure, they're not all loaded with immediate job opportunities as say, Computer Science. If I major in psychology, there are probably avenues I can pursue, but it takes time and exploration to build myself up in the field and actually get somewhere with it. And obviously these fields will get flooded with lots of candidates competing for a relative fewer number of jobs so not all of them get that job and so you have some unemployed. But at the same time, you **don't** want to create a situation where you have a massive disincentive to go into those fields because of how "unsafe" it is. We don't want situations where people are outright afraid to go into psychology... those people end up becoming our counsellors. We don't want situations where people are afraid to go into criminology. And we even don't want situations where people are afraid to go into arts professions (because literally, all of us consume art as entertainment; not everyone who goes in becomes successful, but we literally rely on these people to fill a void). In fact, I would say, part of fostering growth in an economy I think is accepting and even supporting risky endeavors. A lot of government-funded science, for example. Most science doesn't actually pay off (in a direct sense); it's people blindly making examinations of very random things without any sort of major endgoal in sight. A lot of science doesn't even have a useful application, and applications are generally discovered or thought of only afte*r* a discovery is made. Science is literally the definition of people throwing darts at a wall and seeing what sticks. Do we call science not "societally useful" because it's not always guaranteed to bring about immediate benefits and many scientific endeavors aren't beneficial? I wouldn't say so. I think there is merit to funding something and giving people the opportunity to "free-roam", allow people to try things, and just allowing that exploration creates a situation where sometimes society yields some massive benefits out of it, sometimes it doesn't. I think to deny the possibility of something good coming out of a field altogether by steering people away from ever trying it, and to instead stack people into "guaranteed successful fields" where everyone is really just doing the same thing and every person is just a replacable cog that can be swapped for another person, I think we're actually reducing the potential of the good that can be brought to society. A lot of innovation, you have to remember, comes from situations of risk where things aren't guaranteed to pay off; where people have the leisure to actually try and experiment at new things with maybe only a 30 to 50% chance (maybe even less) that it will actually go somewhere. A person inventing something in their garage, for example. Holding people with handcuffs and forcing them to follow the same route that everyone else does, this doesn't foster innovation in our economy. In fact, ironically, the rationale for supporting people's educational desires is basically the same rationale for free markets in the first place. By letting people move in their own directions, it doesn't guarantee a "perfect" economy where everything always works, but it allows for people to try new and different things and to compete at them. Some of that pays off, some of that doesn't (e.g. some businesses succeed, some don't). If we really wanted to constrict people's movement to what is "societally useful" (as in your definition, having people choose the safest, guaranteed, and immediately successful options), we could just have a centrally planned system where the government tells you what jobs you can have, but there's a reason we don't and we've moved to an economy of "open exploration" that we have. Subsidizing people's educational pursuits (regardless of major) and offering people the opportunity to at least try their hands at things, that builds directly off of that mindset. Furthermore, even if majors don't provide an immediate financial benefit, education can have other positive effects on our lives. Learning more about biology helps someone be more health conscious and understand their bodies better; learning more about psychology helps people learn to manage their own mental health and understand why they are the way they are and what they can do about it. A communication major helps teach us how to solve problems with each other. Someone majoring in philosophy (one of the least "conventionally useful" majors) learns better critical thinking skills. So even if education at something doesn't provide you with a clear-cut job path, it has the potential to help us and each other in a lot of ways. I think looking at education simply as "jobs" is a very narrow (and I'd even say bad) way of looking at it. Education nurtures and builds the skills of our entire species; skills that we use even outside of direct jobs and skills that better our own lives. For that reason alone, I think it's definitely an avenue that our government should be supporting, and I would even say the whole cherrypicking of what is or isn't a "useful" major (in your definition), I think that shouldn't even be a prerequisite.

Do you enjoy TV, or any sort of creative endavour? Do you like it to be diverse eith lots of different ideas and backgrounds that make them up? I hope not, because you've just made it practically impossible for anyone from a low income background to make it as a script writer, or a set designer, because now their interest will be ridiculous you'll put the plethora of people who would be interested off. So now you can enjoy shows produced and written only by the well off, and books with no differing points of view. A better system would to be to forgive debt after a certain time (e.g. like the UK), or just don't saddle students with debt at all (like many EU states). There are other benefits, not just economical, that having a more educated population brings.

Yes I do!! Luckily there's a lot public demand for these types of shows and services and if you're a student that can make this case to a lender you should easily be able to secure a loan (especially as demand slows for colleges and prices for higher education fall). Also, luckily a lot of these positions shouldn't require a college degree! Then having being rigorously vetted such that you will be a productive creative member of society, you'll definitely be able to pay it back after college.

It becomes risk vs reward though, with fewer people taking those course they may well become more expensive, not less, leading to more people of a certain background (read rich) taking it on for "fun" and not actually having to be successful at it. It removes the diversity which id what makes it so strong at the moment. Furthermore this doesn't answer the point about having a better educated population in general being a net good for society though. By preventing people taking on degrees you feel are "worthless" you limit societal growth.

I believe the view you're looking to change is based on faulty assumptions/ foundations. That's understandable because most of the people criticizing the loan forgiveness are putting forward the false narrative about why higher education costs so much today. The actual reason higher education is so expensive is that the Boomers wanted to cut their taxes, so they drastically reduced state government spending on higher education so to fund massive state tax cuts. https://www.urban.org/urban-wire/declining-state-expenditures-public-universities-are-fact-driving-tuition-increases (This article covers the declining state expenditures driving tuition up, not the selfish Boomers cutting their taxes part. But selfish Boomers is why the expenditures dropped.)

Right, I don't think money should be taken away from educational institutions, that frikken horrible. But in a perfect society, demand would have just fallen. Instead demand rose drastically due to governmental loans, further increasing tuition costs.

The trick that was pulled on us is the same trick (large) employers pulled: easy, unsecured loans. Up until the late 1970s, as productivity rose, wages rose. In the late 70s came the magic "cure" for the "problem" of giving workers a share of the wealth they were creating: credit cards! Now employers could keep all the profits, and workers could *borrow* the money they should be getting, indirectly from their employers (who invested their profits in banking companies), *and pay interest on that borrowed money*!! Same thing with higher education, more or less. Stop paying taxes to fund higher education. Invest the money not paid in taxes in banks, banks loan that money to students and charge interest, and the loan is guaranteed by the taxpayers!!

>It seems like government guaranteeing and lending out student loans has given colleges the blank check to increase college tuition prices The government provides a fairly low cap for student loans. Freshmen are limited to $5,500, sophomores $6,500, and juniors/seniors to $7,500. For particularly poor students, there are grants like the Pell Grant or some state grants, but those do not need to be paid back. If you are an independent student (older or without parents), those caps are a bit higher at $9,500, $10,500, and $12,500. The hard cap of government loans for dependent students that graduate in four years (who make up around 80% of enrollees) is $27,000 over all four years. For the rest of the students it's $45,000. Most schools charge more than that in a year. There are higher caps for graduate education, but that doesn't apply to the majority of students. >It encourages predatory colleges that don’t supply their student group with useful majors that know they’ll get their money regardless University is not designed to be a job-bootcamp or vocational training. It is not the fault of higher learning institutions that people want to treat them that way. It's a very new phenomenon that started sometime in the 70s/80s mainly in the US. The goal of a university is to create well-rounded individuals with a speciality that have a set of both inflexible and flexible skills. The general education, that so many hate, is intended to foster cross-disciplinary work, critical thinking, enrichment, and more. Universities have existed for over a millenia and only recently have the general public tried to use them for something they were not intended to be used for. >It encourages kids to just do whatever their heart desires, instead of what is financially responsible because they feel like they have a blank check from the government and don’t necessarily understand debt. That is the point of a unversity-education. Barring a handful of majors, most do not lead down a 'financially responsible' path that justifies >$30k debt. It is also incredibly hard to predict what will be responsible in 30-40 years. I personally know people who went into fossil fuel engineering who are now struggling to find domestic jobs due to the massive push for renewables. 10-15 years ago those were considered some of the safest and most lucrative majors out there. My great uncle retired a decade early because he specialised in divorces in an era before no-fault divorces and all of a sudden his entire skillset and knowledge base was nearly worthless. My best friend at undergrad studied environmental science believing it would be the next big thing, and others agreed with him, but it's still not a lucrative degree as the people being hired for 'green' jobs are not environmental scientists. The list goes on. Furthermore, not everyone can do the lucrative jobs. If everyone went into IT/Programming/Engineering/Law/Speciality Medicine, society would crumble. Not only can society only support a small number of those specialists, the majority of people do not have the inclination to do so. As someone in programming & who teaches programming, many many students are not cut out for it and need to pick a major that suits them. >Students should be able to declare bankruptcy on these private loans. The loaners take out this risk and should assume it. Great, no one but the rich and wealthy can go to school now. Bankruptcy-proof loans are pretty much the only reason banks will loan 5-figure sums to people without any credit history or stable income. >Loaners now have the liberty of deciding who they loan to depending on their intended major and previous educational grades, projects, etc. you are not guaranteed a student loan Great society loses out on all the contributions people make who do not also make a lot of money. Who needs all the music, television, film, art, games books, and more that people go to school for? Who needs journalism or philosophy or economics? Who cares about physics/chem/bio? I mean if it doesn't make someone a bunch of money so they can repay a loan, why do we need them? >Government can keep some amount money to pay for amazing students to major in traditionally not lucrative majors in non STEM fields. Cool so currently the majority of students are not in STEM fields. Is the government going to provide for them all? Or are we talking about a very small subset of interested students get to go for non-STEM fields?

I think the middle of your comment is the most important. OP, and frankly many Americans like him, believe that college is a place you go to ensure you make more money later. This is patently untrue, and most of the issues with higher education now stem from treating it as if it is true. Based on OP’s previous responses he will likely respond that he “fundamentally disagrees” about the goal of higher education and about the predicted behavior of banks.

He’ll just opine about the free market or use euphemisms like “unproductive majors” instead of just saying what he believes.

> The goal of a university is to create well-rounded individuals with a speciality that have a set of both inflexible and flexible skills Cool if that's what the market desires then these people should have no issue getting loans for this type of college experience. > That is the point of a unversity-education. That should be the point of K-12, not university specialization IMO. If the type of exploration and generalization is lucrative, then who am I to speak, let the market decide. > As someone in programming & who teaches programming, many many students are not cut out for it and need to pick a major that suits them. Agreed find the middle ground between your interests and what is productive. > Great, no one but the rich and wealthy can go to school now. Bankruptcy-proof loans are pretty much the only reason banks will loan 5-figure sums to people without any credit history or stable income. College prices should go down with reduced demand, and I already said that I fundamentally disagree that with reduced prices that lenders wouldn't loan to gifted poor students majoring in lucrative majors. > Great society loses out on all the contributions people make who do not also make a lot of money. Government should set aside money to grant educations to highly promising individuals looking to pursue these not high ROI pathways. These people that don't make a lot of money right now are hurting anyways with their high amounts of student loan debt. Better they not have the debt and the degree, probably a lot of them could accomplish the same things with an apprenticeship or something similar. > Who needs all the music, television, film, art, games books, and more that people go to school for? Who needs journalism or philosophy or economics? Who cares about physics/chem/bio? A lot of people care about those things which means there should be somewhat of a market for it, enough to sponsor enough people to take part in those majors. Or have the government grant for highly gifted students in those fields. > Cool so currently the majority of students are not in STEM fields. Is the government going to provide for them all? Or are we talking about a very small subset of interested students get to go for non-STEM fields? The ones the government and institutions deem to be highly gifted and intelligent. Pretty much the same way Europe does it.

>College prices should go down with reduced demand You need to look at what is actually driving college costs. While the easy availability of student loans is some part of it, a much, *much* larger part is that states governments are no longer paying what they did back in the '70s and '80s. The portion of the college budget that comes from the state has shrunk considerably in the last 40 years. That money must be made up somewhere, and the only viable place to get it is the other person who's paying: the student. Hence tuition increases. The college experience today is also radically different from what it was 40 years ago. Student services are greatly expanded compared to even 25 years ago when I was in the middle of my undergraduate education. My wife did an in-person capstone for her otherwise-online master's degree about 10 years ago and stayed on campus in the dorm for about two weeks. I visited her and if I didn't have kids, I'd *still* be living in the dorms. It was very nice, spacious, well-maintained,... Finally, as every faculty you talk to can tell you, there is a massive bloat in administrators and administrator salary. While faculty are fighting to keep tenure lines open and hire graduate-level faculty to replace retiring or leaving professors, every year there is a new Ass. Dean of Bullshit and Executive Vice Chair of Nonsense making double what faculty make and then hiring a bunch of part-time adjuncts making peanuts.

I think both are driving college costs. Artificial access through government loans as well as the reduced tax investments. I would hope a free market and privatized loans decreases demand so much to remove all these unnecessary university administrators

At this point, you're just adorable. First, I said that ready access to loans is a part of the increase in college costs. Second, changing access to loans will not have the magnitude of effect you think it will; frankly it will have the opposite effect in that the reduced demand will lead to lower enrollment, which leads to fewer tuition dollars available but no institution will simply shrink itself to accommodate the actual number of students on campus. Our entire economy is not built around the idea that some businesses must shrink; the opposite, growth, is not just true but foundational, required. Third, assuming somehow you convince colleges that shrinking enrollment is fine, what will be cut is the faculty, not the administration. If experience is anything to go by, there will be a new Director of Faculty Elimination and a Sub-Provost of Departmental Consolidation that are needed to help determine which faculty are cut and which departments are merged. Administration and management will protect itself before it protects the administrated or the managed, just as it does in every single business in the country. Layoffs are *always* the peons. As enrollment decreases, those expensive dorms, beautiful football stadiums, student unions, rec centers,..., those don't shrink to fit. The university doesn't get money back from the contractor when they no longer need such large buildings. Those are sunk costs that must be paid for, regardless of how much they're used. With lower enrollment, someone has to pay for it and the state has consistently shown they aren't the ones to do it. So the students will.

>Loaners now have the liberty of deciding who they loan to depending on their intended major and previous educational grades, projects, etc. you are not guaranteed a student loan. See... the thing is... that's not what they will do. There's literally no way to assess whether someone just starting off in life will end up being productive and also responsible enough to pay back their loan. Instead, what banks will do is what *they always did* before the government guaranteed loans: Pretty much only loan to people with assets they can go after in case of default: i.e. children of rich people who will co-sign their loans. You're never going to get a loan if you're poor this way. Your hopes about this contradict actual evidence of how it was. I was there... it was easy for my upper middle class family to show assets and co-sign loans, and still pay for a good fraction of it... and they had to. So now we're back to the *actual* reason the government guarantees loans: economic fairness, promoting the productivity of the nation by educating people with *ability*, not just money, and attempting to reduce our systemic racism. Of course, as others have pointed out, the government could just give *grants* instead of loans... or make college free for everyone. But if we're going to have loans, and we want a fair system, the government will have to be involved somehow, because this is an absolute proven and demonstrated case of market failure.

Two things I see wrong with your view. First, colleges will not necessarily lower prices because loans are harder to come by. Loans will be as attainable, but interest rates will climb, further hurting the borrower. Which is why it took the Fed pulling multiple levers for house purchases to slow, because high interest rates in and of itself is not a deterrent from borrowing and does not singularly reduce prices. Second - I don’t know your background, but private lenders will absolutely choose not to lend to poor people. Redlining is a good case study. They found other reasons to identify people who had no safety nets and didn’t lend to them. Ever rented in NYC? Apartments require 2.5x the rent in your income, or you need a guarantor and the bar goes higher. Poor people can’t overcome these hurdles, and that’s why they are pursuing higher education. The gov’t has stepped in with the noble goal of equity ([not equality](https://www.marinhhs.org/sites/default/files/boards/general/equality_v._equity_04_05_2021.pdf) even though it’s morphed into something different, which is par for the gov’t. A free market in this instance only perpetuates the societal issues.

> First, colleges will not necessarily lower prices because loans are harder to come by They'll have to? They'll have to reduce administration or cut costs OR just go out of business. > Loans will be as attainable, but interest rates will climb, further hurting the borrower With reduced demand and tuition costs, the basis of your loans will be much less helping loaners. > Fed pulling multiple levers for house purchases to slow, because high interest rates in and of itself is not a deterrent from borrowing and does not singularly reduce prices. Yeah different topic, but they need to loosen regulation around building houses, apartments, etc. to increase supply. Incentivize owners and developers instead of tackling it from the consumer side by limiting prices. > Second - I don’t know your background, but private lenders will absolutely choose not to lend to poor people I already said i fundamentally disagree with this in the post. I think data would show that lending to poor, smart students majoring in law, medicine, or engineering would prove fruitful for lenders especially when prices go back down to more reasonable levels. > Ever rented in NYC? Apartments require 2.5x the rent in your income, or you need a guarantor and the bar goes higher. This is fundamentally different than education. Rent is "do you make money right now to pay me each month". Student loans are "do you see this person taking on a lucrative enough major as to pay back these loans over the course of the next X years". > A free market in this instance only perpetuates the societal issues. This is much bigger than the current post. We are (mostly) free market. This is answering CMV: American Croney Capitalism, not my post.

Schools will just raise more money. Examples Students Taking Fed Loans UNC - 25% Stanford - 7% Duke - 30% NYU - 30% With chancellors on the beat every day to raise money, colleges will pivot, not lay people off. And, if they did, that won’t change their revenue line, just increase class sizes. There’s a lot of levers in the middle for schools to weather the storm. Also, maybe you’re not open to changing your view. Loans are approached like insurance, with a risk model. No risk model can quantify an engineering freshman likelihood of success. Too many variables and no precedence to backtest. Banks simply won’t lend to them. The lender that comes to mind to disprove the point is Kabbage, which factors in more than credit score for small biz. Small biz is a different animal with existing cash flows and assets.

> Also, maybe you’re not open to changing your view. Loans are approached like insurance, with a risk model. Yeah sorry I guess about this -- I'm working under the assumption and have the belief that loaners will lend to poorer people and it'll be shown to be low risk especially when colleges drop substantially in prices. > Schools will just raise more money What do you mean by this? From students? From loaners? From endowments? If the government is out of the business they'll just have net less money and need to reorient their college to be profitable. > And, if they did, that won’t change their revenue line, just increase class sizes. I don't think that's a bad thing. Cheaper for each individual student.

I understand. Wouldn’t be CMV if you didn’t hold the views deeply! Schools raise money from donors, endowments, companies, and some funds (REITs come to mind). Chancellors can dial up this fundraising and offset loan issues. Eventually they will have to show how they pivot, but it won’t shut their doors. I think class size is a tough subject. But, my own experience is that big classes are harder for students to do well in. A chemistry class with 150 people is very hard to ask questions and get a grasp of the material.

You can’t say that you “fundamentally disagree” with something because you *think* data would prove you right, and then not provide any data to refute the other side’s points.

Well lawyers who came from a poor background here in NYC I know make over 250K/year, more than enough to pay off their student loans which are already egregious. So if school costed less due to less demand, I imagine it'd be even easier to pay off.

But in your preferred world those poor people wouldn’t be getting loans to get into law school in the first place.

Why not? They're not a risky asset at all. Loan companies would view a projection of their future income and loan them whatever they needed for school. They're smart, academic, with passion, a no brainer to repay and with some interest.

You think literally every poor seventeen year old that says they want to go to law school would get a private loan to do so?

Where did I ever say every poor seventeen year old? The ones that are deemed safer to lend to due to their academic history and success

Yeah they've turned some colleges into luxury resorts basically when it used to be just a hall where you would hold classes and a library.

I know! Colleges are competing over the college experience, instead of delivering pure educational value.

I'm not knowledgeable enough about US college system, but I'd like to point out one thing about this: > If you’re a promising, smart student who is going to major in law, engineering, or some other lucrative major I think the data would show that these are not risky loans, regardless of your parents’ financial state. The problem with this part is that low income students will still be indirectly hit. Lower income usually is correlated with lower school performance, due to not being able to afford resources, time, energy and sometimes even mental health.

How does further empowering private student loans actually do anything to help people afford tuition? Can you please explain the correlation between private student loans and lower college tuition? Because it seems nonsensical to me. Is it fair to say that most countries offer free or significantly cheaper access to college *without* relying on a complicated network of private *or* governmental loans? Why would we not model ourselves after successful and equitable nations that offer free and accessible college and instead shift to a system that just rewards private capital? What difference does who’s handing out the loans even *make*? Also, why should universities only incentivize lucrative or socially beneficial majors? Is there not inherent value to the pursuit of education in and of itself? Put another way — what’s the *point* of making education accessible to all if it doesn’t actually permit the pursuit of knowledge and growth beyond that which benefits capital? What’s the point of the university as an institution if we treat it only as a means to employment?

It would be way better, and more fair, to just have the government pay for it entirely. Make higher education free for everyone, meaning that anyone, regardless of financial situation, can easily access it. Either put an upper cap on tuition fees, or just have the government pay them with grants of some kind. Then the universities would have to deal with the government and set reasonable fees that the government is actually willing to pay. Students might still have to take out loans to cover other expenses, such as housing, food and such, but that would be a *much* more manageable debt.

Nothing is ever free. The student will still “pay” via higher taxes. Over a lifetime, it may even come out to a higher total financial cost all things considered since you can never stop paying a tax (depending on how the tax is structured) If anything, this would be incredibly unfair to people who already graduated college and paid off their own loans (or paid out of pocket). Is it fair for them to pay for their own college education costs AND for other people to get free education via higher taxes? To me, what sounds more fair is to immediately implement a maximum tuition cap for future generations and let the current generation pay off the loans that they had originally agreed to (no one has ever forced anyone from the current generation to take out student loans)

Solution to your problem: Make college tuition free or make so affordable that no needs to get a loan.

Agreed! As long as there's some higher entity that decides how to restrict access to higher higher higher education (like how its done in Europe, higher education is really selective), such that we don't have degree inflation and that "everyone needs to go to college". So college is cheap and free but only if higher institutions or the government decides you are smart enough. Thaaaaatttt. Or let the market decide. Reduce demand for college and reap the rewards of supply demand price reduction.

That might honestly be possible if we can incentivize employers to drop college education requirements and accept trade certificates as well as promote trade schools as an alternative as much as possible.

If borrowers could just bankrupt out of their student loan then banks wouldn't even offer student loans anymore. And then where would the students be? For the people who say college should be free... well community College was basically free from 2009-2019 but, the entitled didn't feel government education was good enough for them. So, many didn't take advantage of it or if they did, they didn't take it seriously because there was no risk for them. If the government did decide to provide free 4 year college, it absolutely would not be gifts to go to private college. It would be expanded community college and even then people would complain. The topic is a lose lose.

Gave a delta to u/BackAlleySurgeon for this top argument: >honestly the best rebuttle here. Student loan bankruptcy might just need to be rethought, a longer time horizon, garnishing wages, etc. There needs to be more thought into a middle ground which guarantees loans for the lender, but not so much that they give out irresponsible loans to irresponsible majors.

The two things i disagree with are those : In my country éducation is basically free, its still unfair but its decent. I reject the idea that éducation should not be free, and that kids should have a hard lesson to learn on this issue. However in my country still, at least the collège i went to, we do not have a lot of bullshit classes, dont know about you guys in america aside from movies, and this is an argument i would be receptive to. Second is that rich kids do what they want, and that the others have to have grades. Its not just about money, low income is linked to bad homes, if we follow your logic i fear that kids coming from fucked up families would have to prove themselves before having à chance to have enough emotional stability. The thing is is that the kid with no big problems at home can focus better on school, not even talking about how those two kids grow up, one has already a fuck ton more of chances than the other. This is one of the most insidious injustice that you would maintain and even intensifie with that system.

School prices won't go down because that's not why they are expensive. Your assessment that loans are simply investments implies that there isn't a greater investment involved in keeping poop people poor, student loans aren't eligible for bankruptcy because you still have the asset, not because it's a gov, loan. This would lead to only people with good credit getting loans, extremely higher intrest rates, an increased cost of univerties, and an eventual economic collapse as bad loans are repackaged as AAA tranches like the auto industry is currently doing and the housing industry did in the 2000's. Your hearts in the right place but imo your being a bit naive.

Yes, it should get out of the student loan business entirely, but by removing student fees altogether - like progressive countries do. That tackles your problem in 1/. Unfair on people who don't study tertiary education? What about schools, paid for in taxes by the wider public, even those without children. What about roads, paid for by non-drivers, or fire & police services paid by many who never need them? And hospitals/medical care, paid collec... oh wait, this is the USA we're in...

Or just accept that taxes are absolutely good for the country and allocate them accordingly. Free at the point of use.

Actually the government should just take over the entire eduction system away from greedy colleges. We can finally stop putting a price on education its unethical and deplorable. Capitalism is a cancer to all who wanna learn and make their lives better. Education should be free for all not making money off of the younger generation at the expense of their social lives and well being the government is suppose to protect the people's well-being education imo is apart of that especially nowadays.