Slowly but Surely, the Media Catches On

The Seattle Post-Intelligencer has a story written about how college loan payments are eating further into graduates' current income. Obviously, the government isn't going to do anything about this, they're making way too much money off it and federal student loans are forever, you have to repay them, even if you're disabled and living off Social Security. Even if you go bankrupt, the government still gets paid back. Of course, that could never happen in the private sector, but the government is different, right?

So, looking into the crystal ball of sorts, what can we see? The first thing is that student-debt will continue to rise as the "myth" of the necessity of a college education continues with this generation. It will only be this generation's kids that will finally see that their parents got screwed over by higher education that they'll start to think over what their career plans should be.

However, in the meantime, students and employers alike will be duped into thinking that a piece of paper somehow makes a potential candidate a better worker, when in fact that link will be dubious at best. My experience has been that experience is much more important for entry into the workplace. 5 years of internships would've been much more beneficial to me than 5 years of higher education, and much cheaper for my parents and myself.

Which means, since demand for education is more or less perfectly elastic, colleges will continue to raise their price because of their monopoly status as purveyors of those sheets of paper. Furthermore, since most colleges are non-profit, their economic "goal" is to maximize revenues. So while there is absolutely no reason for it, colleges will continue to raise their prices until people realize that there are better alternatives. When that point occurs, I don't know.

I really should think about what I would tell the future generation about college education. What I really know right now is that college is a 4-year day care that costs between $10,000 and $45,000 a year to operate. That's especially true depending on what field you go into. Does a fine arts major actually learn something useful for their career? Hell, I didn't learn anything that's marketable in my four years an economics major. It makes it easy to explain to my girlfriend that she shouldn't carry debt on her credit card despite the urban legend that carrying debt makes your credit score higher. I didn't even learn that in school. So I learned pretty much jack squat in school and I left my year of graduate school with $18,000 in debt.

Eventually, as this generation continues to become more politically influencial, politicians will realize that people are both not saving for retirement and barely able to scrape by. This means that at the same time that Social Security will be needed, there won't be any money with which to fund it. How's that for a Catch-22?