3115

You know what would be funny? If we somehow got educational degree attainment added to the list of federally protected classes under the Civil Rights Act so that employers couldn’t ask about it or discriminate based on it, but had to resort to asking about specific skills, training and/or experience.

3116

It’s not just MMT. Basic Keynesian economics says that a recessionary economy needs a money influx before it can start chugging again. And you can always offset direct money injection by raising taxes or paying down the national debt or tightening up banking regulation, all of which remove money from the economy.

3117

Because 20,30,40 years ago a college degree wasn’t mandatory to get a job above minimum wage.

Real life example. My father was a firefighter. When he started at his department, in 1985, none of the people on the department had a college degree of any kind. A few in the later years trickled in had one, but until 2000 or so it was all but unheard of.

However by 2005 or so, it was impossible to do so. In fact my dad had to take classes at the community college and get an associates degree in his 40’s, or he would be ineligible for promotion. In 20 years it went from no college required, to requiring college to get promoted above a certain level despite 20 years experience.

So, yeah, a college degree is fucking essential today for kids. It was when I graduated, and had only become more so since. This was not the case for boomers. While the necessity of car ownership has been more or less static. And car prices haven’t tracked above inflation like college costs. You aren’t required to buy a $40k SUV, and if you can’t afford it you simply don’t get it. Used cars still exist, and it is perfectly feasible to get a car for a few thousand dollars that is serviceable.

College, however, doesn’t have the equivalent of used car sales.

3118

Devil’s advocate position: you also aren’t required to get a $40k/yr education, and if you can’t afford it you simply don’t get it. State, vocational, and community colleges exist and it is perfectly feasible to get an education for a few thousand dollars that is serviceable. Even with today’s inflated prices, it’s still very possible to get a 4-year degree for around $20k tuition and fees. More expensive than a 10 year old used car, sure, but cheaper than most new cars.

3119

I’ve said this before myself, and agree that it is ridiculous. We ask people who have experienced next to nothing of life to make probably one of the two or three biggest financial decisions of their life while they are still literally in high school.

Placing crippling debt decisions on 18 year olds is ridiculous. Again, however, I believe the solution is not to just let them take whatever debt they feel like and forgive it, but to deal with the predatory institutions that charge 18 year olds $200-300,000 for a basic degree.

Another possible solution is restructuring of the bankruptcy laws, to make some student loan debt dischargeable under more available circumstances. Combined with getting the government out of the student loan market, this would have the effect of perhaps making lenders a little more cautious about loaning staggering amounts of money to kids, and thereby also have the side effect of knocking down tuition prices.

I do worry with that option that it would potentially exacerbate the haves and have nots though, with elite schools only being available to the hyper-rich who do not need to borrow money to go.

3120

Ok, but I wasn’t talking about previous generations.

About 10% of American households have no car. But this year, about 30% of high school graduates will not go to college.

It’s certainly true that having a college degree improves your job opportunities. But the same is true of owning a car.

And while it’s true that relatively inexpensive cars are readily available, the same is true of relatively inexpensive degrees. A two year degree costs much less than the average used car. Even if you follow it by two years of college, the total is typically less than the average new car. Which is not to say that either investment is cheap. But I question why we think one investment is more worthy of attention then the other.

(Oh, looks like @Matt_W beat me to the comparison and even more succinctly)

Finally, to address your earlier point, while student loans cannot be discharged, unlike auto loans they can be deferred if your income is low.

3121

I genuinely think the only solution to inequality is to tax the shit out of rich people. The top income tax bracket should be 90%. Estate tax should be 90%. Capital gains, corporate income and dividends should be taxed just like wage income. Go ahead and get your elite degree, but it’s only going to have marginal benefit over the schmo who goes to the state school.

3122

What is printing money if the money never enters circulation? Regardless, the proper phrasing is funding things, as it shifts the focus on results and shits on QE and UBI.

3123

Oh, some 2020 Presidential Election stuff:

3124

Any way we can get the excellent student loan discussion its own thread? How cool would that be, huh?

3125

In this specific case, you’re talking about providing a bunch of money to certain individuals with the goal of allowing them to pay for college which they currently have trouble paying for, right?

In that case, you’re specifically facilitating an increase in demand. That’s virtually guaranteed to raise the price of that commodity. You’re intentionally inflating demand for that commodity, which is virtually guaranteed to increase the price. There’s not really any way it wouldn’t.

This is essentially what happened with student loans themselves… by making it easier for those students to get money, you inflated the demand for college, which increased the price. There are of course other aspects of this which make it somewhat more complex, but this is a very fundamental element which cannot be ignored.

3126

Of course it would help people. What it wouldn’t do is retire student debt.

The interest on that average will be $2000-$3000 per year alone. I’m sure the $4k will help, but it won’t retire the debt anytime soon. Sure it’s possible to retire it in ~7 years, assuming the debtor has sufficient funds to make up the difference.

Or about the economic effects of food cost, or housing cost, or clothing cost, all of which are more than $4k per year. Maybe there’s a problem with that argument?

3127

Haha, I get where you’re coming from but it is a topic very much related to the 2020 election and different candidates have different plans to address the issue, so I think makes sense that it’s being discussed heavily here.

3128

Any speculation on why the Mercers would stop backing Trump now? I mean, they got their tax cuts, but surely there’s more opportunities to increase their wealth with this administration.

3129

I don’t think that’s right. Only one state has in-state tuition averages as low as $5k per year. That state is WV, btw.

https://trends.collegeboard.org/college-pricing/figures-tables/2018-19-state-tuition-and-fees-public-four-year-institutions-state-and-five-year-percentage

3130

But then the question becomes, is there slack in demand for college education that could conceivably be raised? We already appear to be at a point of college demand saturation.

And any problems with student loans more accessible to a broader subset of people is massively offset by the tremendous inequality of tightening access. Doing so would disproportionately impact low income students and minorities, which in turn would further exacerbate our already strained income mobility turning poor kids into a perpetual under class, more than they already are.

It’s a complex issue because there are no good market based answers. This requires strict and vigorous regulation, as all alternatives have massive problems. Less loan access would decrease demand, but largely by making college inaccessible to many poor kids. Those poor kids would be trapped in a perpetual poverty cycle then. While the current system instead gives them an out, but one with massive debt that will shackle them for decades, as well as the fact that there is no guarantee of a good job once completing college.

And let’s not forget those who get saddled with debt but don’t complete a degree, they get turbo fucked. Honestly for a pot kid any mistake would be financially ruinous, From which they would never recover.

Current outcomes for poor kid:
Take debt, get degree, get good job and maybe be ok by the time you are 40
Take debt, get degree, don’t get good job and be in debt for the rest of your life, and always be on the edge
Take debt, don’t get degree, just be permanently turbo fucked with no way out
Don’t go to college, always be working at poverty wages as there isn’t a ton of reasonable options for people without degrees (yes trades, but that only helps a percentage, a far larger percentage would be stuck working retail forever)
Get lucky and get a full ride scholarship. Only applies to a small percentage of either tremendous athletic skill or academic achievement. Not a realistic option for majority of students.

Where under tighter loans the outcomes are
Get a scholarship, which is only available to some and doesn’t come close to covering all who need it
Don’t go to college, and be stuck in poverty level wages forever

Neither situation is acceptable.

3131

Is this the right comparison? What percentage of high school graduates have cars and make car payments? Or, conversely, what percentage of households bear student debt? Apples and oranges, right?

3132

How do you figure? If you take a $40000 loan (more than the average student debt) at 5% (more than the average rate for undergraduate student debt) over six years, then your total interest paid over the full term is about $6300, with a maximum of $1700 of interest in the first year.

3133

Yes, that’s right. My bad.

3134

Because he’s a terrible puppet. They want someone who will do what he’s told reliably, without hassle, and without constant bad PR. Like Mitch, for instance.