Nightmare On College Campuses

Are you willing to take a chance with your future or with the future of your children? Most people are not. And this explains why so many young people borrow tens of thousands of dollars to go to college and grad school and are willing to become debt slaves for many years.

Is getting a college education worth the effort? Or is this a giant scam that preys on young people?

 

Degrees And Dirty Work

At a minimum, most people want a job that’s reasonably challenging, pays a livable wage, and offers at least some benefits. Jobs in civil service, teaching, and the corporate world generally meet these criteria.

However, in order to get hired for any of these jobs, it’s necessary to have a college degree, and increasingly an MA is also required – even if the degree has nothing to do with the job they’re applying for. I have relatives in chinuch who told me they needed an MA in order to be hired – and that’s for working in chinuch. Imagine how difficult it is to get hired in a different field without an MA, and certainly without a college diploma.

The popular thinking is that getting a college (or higher) degree, while expensive, will pay for itself after graduation. However, very often this is simply not true. Not all graduates get great jobs, and these days many jobs don’t pay great salaries.

Mike Rowe, long-time host of Discovery Channel’s popular show Dirty Jobs and the CNN series Somebody’s Gotta Do It, says a college degree is not the be-all-and-end-all of someone’s life. In fact, he believes there’s a dangerous disconnect between the blue-collar work that needs to be done in America today and the way that society discourages people from doing jobs that get their hands dirty.

Some critics of the education system take the point even further, and one of those is Alan Collinge, founder of StudentLoanJustice.org. Collinge believes the lives of millions of Americans have been ruined by unconscionable practices of student loan lenders. Student loans have become a very big industry, he says, and usher in even bigger problems.

A Loan, But Not Alone

As of March 2018, 44.5 million student loan borrowers owed in excess of $1.5 trillion – triple the amount of 2007. Americans now owe more on their student debt loans than they do on their credit cards.

That’s a hefty burden for anyone to carry, and for young people in particular, because those fortunate enough to get hired are paid entry-level salaries. After deductions for tax and other essentials, very often there simply is not enough money left to make payments on student loans. This explains why 11.2 percent of these loans are now past due by 90 days or more.

 

You Get What You Pay For. Always?

There’s an expression that you get what you pay for. Does this apply to a college education too? There’s no question that it’s still possible to get a great education in college. But there’s also no question that it’s possible to earn a diploma and learn diddlysquat. And this seems to be a developing trend.

Lots of students entering college need to take remedial courses, and the reason why is because they haven’t learned certain basic skills normally taught in high school. And the reason they haven’t learned those in high school is because their elementary education did not prepare them adequately for high school classes.

Here’s how one lawyer described the situation: “The quality of education has deteriorated so dramatically that most college degrees are essentially worthless...but for many professions you still need that piece of paper to qualify for certain jobs.”

Okay, some students are taking remedial courses – but at least they are learning something. However, the same can’t be said about everything taught in colleges these days. Just consider courses such as the following:

What If Harry Potter Is Real?; Lady Gaga and the Sociology Of Fame; Invented Languages: Klingon and Beyond. Or how about some others, like Learning from You Tube, Arguing with Judge Judy, and Zombies in Popular Media.

These courses and others like them are real and being taught at top-ranked state universities and Ivy League schools like Columbia.

 

Stretching The Bubble

Certain blue-collar jobs such as plumber, electrician, and welder pay $100 or more an hour, and the demand for these jobs is so high they can’t be filled.

Yet the focus remains on getting a college education. “Why are we lending money that ostensibly we don’t have to kids who have no hope of paying it back to train them for jobs that clearly don’t exist?” asks Rowe.

Meanwhile, the noose on students is being tightened as colleges are raising their fees, the average student is spending more than four years in school, and on average now owes $37,000 upon graduation (estimates of this amount vary). The interest on these loans has recently increased from approximately 4.5 percent to just over 5 percent.

According to Collinge, there is another problem too. Student loans, unlike every other, “have been stripped of the most fundamental consumer protections you can imagine,” he says. “There are no bankruptcy protections...there are no statutes of limitations.” As a result, he believes that one quarter of all student-loan borrowers will default.

What happens if they do? There are very different opinions about how lenders will respond, and they range from debt forgiveness, partial debt forgiveness, better terms on the loans and cracking down on those who default on their debts.

The amount of student debt is a mind-boggling $1.5 trillion. What will happen to the markets if 25 percent of borrowers default on their loans, as some predict? What will happen to the credit ratings of all those people? And what will the ripple effects be?

When someone defaults on a student loan, “the entire balance of the loan is due and payable immediately,” says US News. Interest could be charged on the interest owed.

The option of paying out the balance slowly is no longer available in cases of default. But there is something new: collection costs, and those are not pleasant, to put it mildly. US News reports that debt collectors will demand payment now and tack on as much as 40 percent to the balance for their services. Any tax refund you are owed can be garnished, and this extends to wage garnishment too. This is not a pretty scenario but it is reality.

Is getting a college education worth the effort? This question needs to be asked of qualified counselors and financial advisors.

But one thing is clear: student loans should not be seen as a way to have a great time. To whatever extent possible, the amount borrowed should be held to the minimum, and the borrower should have a plan how to repay the loan.

Hopefully we will all be blessed with a healthy new year. And may we also be blessed with a large-enough parnasah so we never have to borrow money for any reason.

 Sources: nerdwallet.com; studentloanjustice.org; usnews.com; YouTube: Dirty Jobs’ Mike Rowe on the High Cost of College.

By Gerald Harris