USNews: Financial Aid Blunders

Paying for College
41

<p>“But to put it in terms a very liberal former college president used, you’re asking taxpayers, millions of whom can’t afford to attend send their own children to college, and/or couldn’t afford it for themselves, to pay taxes to send you to school.” </p>

<p>The issue that liberal former college president missed (or avoided stating with clarity) is that under the current system those same millions still pay to send people to school. But the difference is since the move away from the grant model to corporate loans, is that tax money is filtered through corporation coffers. </p>

<p>The government provides sureties to the loan companies, the source for these guarantees is at its source, public money. So under certain provisions of this system, privatized companies can get government money, and collect from the student borrower at the same time. Even more public money is flowing as is evident by the ‘liquidity’ provided by the US government this spring to ‘save student loans’. And if that wasn’t enough, there are proposals being floated for a ‘bailing out’ of this industry, which could easily go into the trillions. If it does it’ll make the Fannie Mae Freddie Mac situation look cheap. Of course student borrowers who have been caught in an avowedly predatory system will get no help, but who cares about regular people? If they mattered they’d have lobbyists…</p>

<p>All under a system in which much of these resources could have gone directly to support education rather than provide billions for edudebt corporate coffers. That’s why many countries do not use the US system they perceive it as an inefficient and corrupt enrichment of middlemen. And realize in addition to it being immoral, it is a drag on the national economies. Insofar as people in their most productive years perhaps shouldn’t be subject to adverse and sometimes crushing debts resultant from their education. Efforts and money which could go to building up the national common economy. </p>

<p>Squiddy justifiably you are upset about entitlements going for the wrong cause. "Personally, I support improving access to college, for everyone. And I’m particularly incensed when I see how much money is wasted by the government in ‘entitlement’ programs where probably half of the takers aren’t “entitled.” </p>

<p>However corporate control and subsidizing within higher education by the federal government is so entrenched that many no longer perceive it as an entitlement program. In part because corporations and their lobbyists aren’t as easy to pinpoint as the legendary equivalent to the welfare mom with a Cadillac. </p>

<p>Or the legendary doctor who waltzes away from student loans. That little red herring was what was used to strip consumer rights away from student loans. However, statistically it never happened. And ironically if default rates were accurately assessed (and they’re not) the default rates have escalated since these sweetheart laws were passed. </p>

<p>Simply because the abusive debt laws which resulted make it impossible for student debtors to negotiate. And the corporate people make a killing driving loans into default, because of the incredible enhanced fees which they then can apply. Which is a tactic that CEO’s of these companies admit to in their stockholder reports. ([SLM</a> Corporation Q2 2008 Earnings Call Transcript - Seeking Alpha](<a href=“http://seekingalpha.com/article/86844-slm-corporation-q2-2008-earnings-call-transcript?page=1And]SLM”>http://seekingalpha.com/article/86844-slm-corporation-q2-2008-earnings-call-transcript?page=1And) </p>

<p>And they have the power of the state sticking along with their incredible collections subsidiaries to ensure the coercion continues. Never mind that Dr. Warren at Harvard Law has said these companies have been given power the mob would envy, and that students have committed suicide or dropped out from society or left the country…it’s all good if the annual report shows it is…</p>

<p>However since the rise of this entitlement system, for example, just one company SMC, has seen its stock prices rise some 2000% and fee revenue increase 220%. And it gets worse, NNC over billed the USDOE more than 200 million which the secretary of education let them keep without investigation. (largely by getting rid of the USDOE auditor who caught the over billing, he then explained the situation on On Point Radio). <a href=“http://www.newamerica.net/blogs/2006/11/predicted_outcome_on_student_loan_scandalNow[/url]”>http://www.newamerica.net/blogs/2006/11/predicted_outcome_on_student_loan_scandalNow&lt;/a&gt;&lt;/p&gt;

<p>That’s entitlement, but hey, it went to a good cause and not the 83,000 some students for which that money could have provided Pell grants. </p>

<p>If the billions the US government has provided indirectly or directly to corporate entities were redirected we could provide free education to most in this country, especially if state support is included in the equation. But a few million students don’t have the lobby power of a few well placed corporate suits, lurking the halls of congress and the USDOE.</p>

<p>And Olgita this was beautifully phrased “But wouldn’t they be able to afford school for their children as well if everyone paid more taxes that went toward the general education? I think it’s ridiculous that someone who is childless and is already past his/her college years (whether that person actually has a degree or not) would refuse to pay a general education tax because “it doesn’t affect” him/her. We are a society for a reason - because we take care of each other and sympathize with others’ problems. While a particular issue might not affect you, another that is sponsored by taxpayers surely does. Why don’t people realize that they can’t expect anything from a society to which they don’t contribute?”</p>

42

<p>“From each according to his ability… to each according to his need.” Believe me, it will never work.</p>

<p>I also wish people would stop saying how great it is in other countries. If you actually meet people from those countries, you will see that it is very difficult to break out of the class you were born into (or to get that “low cost” education). It is in this country that you have the best chance of improving yourself. If it is so great elsewhere - go there. Oh, I forgot, you can’t just show up at any of these countries and get all these benefits.</p>

<p>Just so you don’t think I am such a mean-o, I agree that politics is horribly corrupt and shameful in this country. The only solution would be to make people better. Got any ideas?</p>

43

<p>Big federal programs may sound nice, but what needs to happen is a greater encouragement for the public to contribute towards specific scholarships, rather than a big bulky programme that subsidises all students and encourages them to waste their opportunities. Government subsidies per credit hour might work.</p>

44

<p>I am not so concerned about the kids from upper or middle class families–even with immature money-handling skills, these kids will mostly come out all right. </p>

<p>It’s the kids from lower class, never-been-to-college families who have the most trouble. Some of them just aren’t getting the support from their families, who regard anything above a HS education as getting above themselves. They come from generations of non-aspirational families…where they just don’t see the value of saving for the future, when you can spend on cars, clothes, hair, nails, and bling today and be cool and popular. So cool and popular that they end up pregnant and dropping out.</p>

<p>And of course, the kids who try to make it but really do have to spend that money on shoes for little brother or sister because somewhere a parent isn’t doing his/her job.</p>

45

<p>^^ Thankfully, my parent doesn’t fall into that category, but after reading about so many stories where parents refuse to pay for <em>any</em> college, I wish it were legally possible to conduct lawsuits against negligent parents, especially non-custodial parents, for refusing to cooperate with financial aid. Would such a bill gather enough support?</p>

46

<p>"If you actually meet people from those countries, you will see that it is very difficult to break out of the class you were born into (or to get that “low cost” education). "</p>

<p>Really? I haven’t heard of anything like that happening to the kids in Germany, or Britain, or France.</p>

47

<p>Olgita, really yes, really emphatically, and really, you are unimformed. In Britain, of all places, class is (almost) everything. Ditto Germany. I just came back from France, and all I can say is “please.” I can assure you, that as the daughter of a man who worked in a meat locker, that in France, Germany or Britain, I would not have any education at all.</p>

<p>Meanwhile, back to budgeting.</p>

48

<p>I am British and I completely and really emphatically disagree with what you are saying anothermom. University is very much available to all classes in Britain. Perhaps somewhat less now that people do have to pay for it which they did not until a few years ago. Tuition is @ 3000 pounds whichever public university you go to. This does not include room and board etc so in reality overall costs are probably similar to State Us over here (instate costs - we don’t have the whole OOS thing).</p>

<p>

???Sorry but you are out of date. Maybe 50 years ago. My Mum’s cockney cab driver neigbor’s daughter went to the same university as my well off accountant friend’s daughter (who missed acceptance into Oxford University by a fraction of a score). My elderly Mum has a lady that comes to help clean the house - she and her husband did not go to university and are not upper class - both their daughters went to university. The ‘upper’ classes are a very small section of the British population. If they were the only ones to go to University most of the British universities would have to close down.</p>

<p>As far as breaking into a class - the only way to break into the Aristocracy (if one would want to) is to marry into it. But that has nothing to do with going to University.</p>

49

<p>Swimcatsmom, I have met other of your countrypersons who say that you can never get out of your “class”, even with an education. Good to know that other opinions exist. That said, and with all due respect, it is the US that is viewed as the land of opportunity for those of all countries, not Britain.</p>

50

<p>

I live in the US because I fell in love with and married an American and I do love it here. But, with all due respect to you, the vast majority of Europeans do **not **view the US as the land of opportunity. Far from it in fact. It is that sort of arrogant statement that, sadly, causes other countries to dislike Americans so much.</p>

51

<p>“I also wish people would stop saying how great it is in other countries. If you actually meet people from those countries, you will see that it is very difficult to break out of the class you were born into (or to get that “low cost” education). It is in this country that you have the best chance of improving yourself. If it is so great elsewhere - go there. Oh, I forgot, you can’t just show up at any of these countries and get all these benefits.”</p>

<p>The problem Anothermom is that the current US educational funding system is driving conditions to a very rigid class paradigm, one in which the less affluent simply will not be able to partake of higher education and all the opportunities that implies. A point is not too distant in coming wherein if the less affluent do enter American higher education they could be committing economic suicide. </p>

<p>And the cause is largely the for profit aspects of the student loan situation, the ridiculous fees enhancing those profits and the denial of basic consumer protections vis a vie this industry. An affluent family can deal with these rising costs, albeit with some trouble. (although given the AMA’s recent attempt to beg the Bush DOE to restore deferments and forgiveness doesn’t bode well for the presumably affluent) </p>

<p>But the less well off, essentially have a very small margin of resources to compensate for these costs, and are easier to drive into economic despair when they fall behind. And some schools which operate in these areas, prey upon these populations using these loans. As a result the default rate for students from these type of votechs and online schools is about 20%. And when the enhanced fees often of 30%+ are applied for ‘remediation’ these students will never get out of debt. And they simply do not have the type of jobs wherein a garnishment will allow them enough to live on, nor will their employers keep them. And their economic status precludes hiring legal aid to confirm the few consumer rights that have been left within this situation. </p>

<p>So it is rapidly reaching a point where access to higher education in this country for the less affluent will be greatly restricted or become a fools game. For example, I currently work at a institution which serves a large proportion of less privileged students. Many of whom know they cannot pursue their education beyond a certain point. And many fear the costs of their education as much as they aspire to better themselves. </p>

<p>In the US it was the period from the establishment of the GI Bill until the incursion of the subsidized/privatized student loans when the US could genuinely claim that its higher education was indeed egalitarian. But given recent developments, claiming such is a sham, although academia has no other choice but to promote a condition which no longer exists. </p>

<p>“It’s the kids from lower class, never-been-to-college families who have the most trouble. Some of them just aren’t getting the support from their families, who regard anything above a HS education as getting above themselves. They come from generations of non-aspirational families…where they just don’t see the value of saving for the future, when you can spend on cars, clothes, hair, nails, and bling today and be cool and popular. So cool and popular that they end up pregnant and dropping out.” </p>

<p>Mommusic in some cases these first generation college students do have trouble for the aforementioned reasons. But greater proportions have no savings because what little resources they do have, are sent to friends and family who need them. With the hope that when the time comes the aid will be reciprocated. On reservations, which are the poorest areas of this country, this generosity is literally a survival strategy. </p>

<p>Plus since US overall savings rates are the lowest in generations we can’t get too lofty in our assessments of the lower class. And anyway given Elizabeth Warren’s very astute assessment of the troubles of the middle class, our society is driving the middle classes into their very own unique definition of poor. The costs of what allow them to be middle class (including education) are reaching the point where paying these same costs is becoming a diminishing return.</p>

<p>“That said, and with all due respect, it is the US that is viewed as the land of opportunity for those of all countries, not Britain.” </p>

<p>Anothermom2, that’s a condition which is rapidly fading. An increasing proportion of the educated people of my generation have left or are planning to leave the US. And so many US citizens have applied for Canadian teaching jobs that many provinces are now specifically stating that these jobs have a preferential hiring for Canadian nationals. </p>

<p>In border states such as Montana there have even been proposals to deny drivers licenses to people who’ve gotten behind on their student loans. Independent of the idiocy inherent to making it impossible to work and pay back what is owed- Largely the reason actually behind these proposals is that Canada has become too appealing for many US citizens living in such states.
And with recent Canadian reforms in regards to student loans and debt, its very probable millions here in the US will be longing for Canada. </p>

<p>And alas propaganda notwithstanding the US is losing any ability to soapbox about how wonderful we are, and how Horatio Alger lives on every street corner. Economic stratification in the US is now almost as marked as it was during the 30’s and god help us its becoming relatively equivalent to what it was back to the gilded age. The preeminent difference is although the common may have better shoes, they owe much more dues (debts). </p>

<p>And our elite, could arguably have even less moral credibility than such people as Rockefeller, Harriman, Brunel or Henry Ford. As nasty and cutthroat as these men where, they did produce wealth and actual systems which were productive and in some manner eventually benefited the country as a whole. </p>

<p>But elites such as the Enron crew, or Bear Stearns people cannot be defended on the same basis. Their ‘production’ was largely a transfer of wealth, which produced no lasting systems benefiting society. In that regard for every one Bill Gates (Who would be closest to our eras Rockefeller or Ford), we seem to have hundreds of Ken Lays, Albert Lords and Jimmie Caynes’s…</p>

52

<p>Sorry, you will never convince me. BTW, a belief in the greatness of one’s country, and the ability to say so is one of the great privileges of being an American citizen (or just present on these shores for that matter). If you view that as arrogance, that’s your opinion. It doesn’t bother me. Sorry my opinion offends you.</p>

53

<p>Well its not necessarily a need for any in this discourse to convince the other of their interpretations. </p>

<p>And we do have a tendency and a right to express our opinions about our country or any other country. </p>

<p>The problem from a systemic view is when a society or it’s leadership loses the ability to respond to and remedy problems or respond to justified criticisms because of a belief that their system has been superior. The Spanish grandees and the Ottoman Sultan’s had such attitudes in the 19th century and the end result was their systems have long since failed. </p>

<p>And in the history of education a like model in regards to reform does apply. For example, the Prussian/German system began advocating practical applications for higher education and encouraged the education of the young beginning in the latter part of the 19th century. The British were caught unprepared, and soon there was a substantial debate whether academic studies should be more than what was then the classical curriculum. As a related phenomenon John Ruskin was advocating that elements of the liberal arts be taught to the common people. Between the two movements, the British managed to establish a educational system which allowed them to compete with the Prussians and later Germany. </p>

<p>A like ability to respond to criticism and address problems especially those dealing with inclusion issues-is what had made US education functional in the 20th century. When John Dewey first advocated using education as a means to socialize diverse populations, that was controversial for two reasons. First was the reaction against cost, the other was resistance as to if the lower orders (including immigrants) should be educated or could be educated. However these objections were overcome. And the Brown vs Topeka case addressed other related issues with finality. </p>

<p>If the US had not been able to receive justified criticism and make efforts to address these educational issues what could have occurred is hard to conjecture…but educational failures might have contributed to rigid social stratification with the attendant possibility of movements as Fascism or Marxism gaining substantial followings. We did have very close runs with these philosophies as is very evident from the attempted fascist coup that General Butler was instrumental in stopping back in the early thirties. That attempted coup had some support amongst the elites, but little amongst the common people (as is very evident from Butler acting against them) </p>

<p>And when the GI Bill was signed there was some resistance from the hidebound elitists about having these new populations in academia. But the GI bill and the grant education models of the 1960’s did permit large numbers of new populations to attend college. And in the long term this was essential to the economic boom of the time, and was instrumental in providing some social stability during the difficult adjustments of the post war era. </p>

<p>With the current debate about educational costs, the student loan problem, once again at the social core of the issue is access. But this time its about affluence, who can go to college? </p>

<p>If trends develop as they seem to be going, what will occur will be fiat accompli winnowing out of the lower economic classes from academia and a reduction of the members of the middle classes who can attend college. Now some SL corporations might benefit in the short term, but socially this trend would be incredibly dangerous. </p>

<p>Insofar as one of the social functions of higher education in the US has been to provide the perception that one could break into the elite classes. And if the costs of college, and attendant corporate profiteering break that perception, it could be very, very dangerous for the stability of this country…be that politically or economically.</p>

54

<p>Maybe if the lower incomed students stopped playing the entitlement card and started aplying to schools they can afford, society would just fine. I am tired of hearing and reading sob stories about the poor feeling they are entitled to a free education…that they are entitled to attend the top tiered schools…that their parents should be willing to accept a tremendous amount of debt just so they can attend their DREAM school. I grew up poor…my parents couldn’t have even afforded the local community college. I don’t complain about it…instead, I took ownership of my situation and weighed my options. In my particular situation it was better ot postpone college untl I could afford the loans that would be necessary. I also opted to forego attending widely known colleges and attend lesser known institutions that resulted in much lower tuition rates.</p>

<p>And I do understand the plights of the poor…I am still classified as poor..family of 4 with less than 30k gross income per year. My oldest daughter is starting her search for colleges, she’s currently a sophomore in HS. She REALLY REALLY wants to atend Duke…at 50k per year. I have alreayd informed her…if she doesn’t have sufficient grants/scholarships to cover 100% of the cost, Duke is OUT OF THE QUESTION. As there is NO WAY she can achieve this type of feat…50k in grants/scholarships…Duke has come of the list permanently. We are now focusing on schools that are less than 10k per year. If she can’t compromise on this, she’ll be attending my school, where she will be forever answering…and where is XYZ University?</p>

55

<p>NikkiL–I fail to see what advantage college gave you if your family income is less than 30K a year…gross. You didn’t say what your major was or what you do now, but there are areas a person can go to work in without a college degree (or with only a two-year degree or vocational training) and earn more than you do. </p>

<p>I guess I am asking if the degree is “worth it” for everyone.</p>

56

<p>Independent of the students who desire to attend a elite school beyond their means, the unfortunate reality is for many, any college is rapidly becoming a receding possibility. </p>

<p>Nikkl you mentioned the need to postpone college and a financial situation which made college attendance difficult. To shift that context slightly forward-given the 6% yearly increase for tuitions and the decreased grant funds and increased emphasis on SL’s (including the SL companies notorious enhanced fees)-how probable will it be that the next generation of the poor will be able to do what you managed to achieve? </p>

<p>A few might, but its improbable that most will be able to beat this rigged situation. Especially given our very poor economy and the very troubling toll that is exacting on the working and lower middle classes. So it’s not a matter of the poor wanting status beyond their means, but a matter of their means no longer even providing enough to maintain even their past condition. </p>

<p>And the general tendency to condemn the poor for wanting to extend beyond their station, is disturbing. Yes, pragmatism is always a limit, but to criticize the ambitious and intelligent for desiring to improve their lot or for their desire to use their talents for bettering society is disturbing on several planes. One is the expectations it sets that ‘yes you belong in your class and should not desire to leave’. The other is the simple and unfortunate fact that we are conditioned to even think in such a manner. And finally many the schools which are now beyond their ambitions are largely sustained with public money. </p>

<p>And its very damning to our society that we have not derived a proper educational funding system which can assist our intelligent and ambitious towards their ends including the betterment of the common-without condemning them to increasingly impossible and inequitable debts . </p>

<p>Essentially by turning our educational funding system over to profiteers our society is denying possibilities to the very people we need to improve our common lot. Because our educational system has been so co-opted its no longer a matter of the content of a man’s character but the depth of his purse which defines educational opportunity. And increasingly that paradigm applies to even the schools intended to serve common populations, because costs are too high. Be that from tuitions or from the debts incurred thereof. </p>

<p>And if that is to be so, when it need not be, than our society has failed in keeping trust with all our platitudes about equality and opportunity. And more specifically for those of us in academia, how much longer do we have the right to claim our system genuinely exists for the common good? Corporate loan sharks do not teach, do not research, and certainly do not provide all the accessory services necessary for academia. But by allowing them to take over the student funding via their loans (which are often have as their source public money), they have gained control over academia and resultantly over the future of students well beyond that of academia itself. </p>

<pre><code>And its not just a necessary compromise or deluded students wanting to attend Harvard or etc. This unfortunate problem of escalating tuitions and ascending loan debts has already reached into the state Universities and CC’s. And the populations they serve, especially the CC’s are incredibly vulnerable to these pressures. So what Emily Griffith and John Ruskin started for the lower orders, will die a century later from the coins in falling into the coffers of companies who do little but skim from a system which they do no direct service.

And Nikkil the economic conditions and income you are personally experiencing are very much within the paradigm that Dr. Warren has so eloquently warned us about. And Mommusics question “I guess I am asking if the degree is “worth it” for everyone.” is very much defining the core of the problem.
</code></pre>

<p>Increasing tuition costs and the closely associated problems arising from the student loan industry will drive conditions to the point where a college degree is ‘worth it’ for no one except some elites. Who ironically do not need a college education to preserve or elevate their status.</p>

57

<p>

anothermom - I don’t view a belief in the greatness of one’s country as arrogance at all. In fact it is one of the things I love and admire about America and Americans. I love that I go to sports events and people sing the national anthem with a tear in their eye and salute the flag and mean it. I love that people are proud of their country. But there is a vast difference between thinking your country is great and saying that every other country is inferior. *That *is arrogance. You saying America is wonderful does not offend me at all. I admire that. I think America is wonderful too. You saying America is better than Britain offends me. You saying America is superior to France or Germany or Italy or Sweden or Australia offends the people of those countries - and saying that America is “viewed as the land of opportunity for those of all countries” implies that everywhere in the world is inferior - that is arrogant and is also incorrect. Yes there are people in those countries that would love to come and live in America. But the vast majority of them love their own countries and have no desire to come to live in America just as the vast majority of Americans have no desire to leave America. (though are many Americans who live in those countries and love them.). </p>

<p>You love America. That is great. I love America too. As someone who loves their own country would *you *not be offended if other people run your country down or say their country is vastly superior to yours? Would you not regard them as arrogant? So put yourself in that persons shoes - they feel the same when you say or imply that America is superior or that they are inferior. No one has a problem with you loving your country. They do have a problem when you are detrimental about their country.</p>

58

<p>Side note: it seems almost everyone posting in this thread is a mother of some kind. Almost no men. :-p But it occurs to me that if one has taken a long break to raise children, then has to start working again because of divorce, one would face some rather large obstacles to regain a previous level of income. My mother has to do both an engineer’s and architect’s work but is paid a draftman’s salary. There aren’t many single moms in construction in my state, never mind shipbuilding.</p>

59

<p>Actually there are several men posting, including myself. The Atana name is a historical reference. </p>

<p>About the concept of national identity and patriotism, that also links to the concerns about educational costs, and access. </p>

<p>As college costs increase, and the attendant debt loads drive more of the lower classes out of higher education, our ability to define or defend our societies ideals will correspondingly decrease. </p>

<p>What we will get is a situation where the sound bite and the trivial slogan could control and define our culture even more so than they do today. Simply because the ability to effectively refer to the moral core of our nations foundation, will be denied to increasing numbers of people. And as such, an elite with immoral motivations, could have a much easier time of pursuing a malevolent agenda. </p>

<p>Because those voices from the common people, could be silenced because of excessive educational costs. And if this does happen the ideas and eloquence necessary to defend their rights or the ideas upon which those rights rest, could be lost. And there are already disturbing harbingers of such things to come. Here in Colorado, in a dispute about educational funding, community colleges were recently referred to as educational ghettos. The disturbing implication and attitude being that if class of people cannot afford a flagship school or a substantial debt, they have no right to any better status. </p>

<p>The increasing costs of education, and the corresponding limited access to education for an increasing number of the common people, could ensure that we do not get a Dr. King when our country needs such men and women to step forward. </p>

<p>This problem is what W.E.B. DuBois and John Dewey were addressing when they advocated that the common man attend college, and learn the words and ideas of the great thinkers. They knew this was power, and a means to protect the rights of the common man. </p>

<p>But, if rising college costs and debts continue, what Dewey and DeBois advocated will disappear. And at best, all that situation will contribute to is a permanent demarcation of an underclass. Who might be a good market for junk food, malt liquor and cigarettes, but able to be little else. </p>

<p>The core of the problem is whether and how our nation choses to make access to higher education possible and equitable. If we chose to limit that access as a correlative factor to ensuring profits for corporate powers and attendant academic agendas then we have failed. And all our lofty words about freedom, opportunity and mobility will mean little. </p>

<p>And we do have to remember that denying access to the ideas in books, however that may be done, is just as effective as burning them.</p>

60

<p>

</p>

<p>Actually it’s quite humanly possible. I can’t recall of Duke gives a full ride, but I recall somewhere about Amherst doing such.</p>