$188K in college debt — and she can’t write

At 25, Katie Brotherton is working two jobs, but living in a parent’s basement, dependent on Mom (or Dad) for food, gas and health insurance. She owes $188,307.22 for two college degrees at private universities, she writes on Cincinnati.com. (She doesn’t specify her major or her occupation.) Sadly, Brotherton didn’t learn to write or think clearly — and she certainly didn’t learn to do the math.

My pursuit in excellent education is rooted in a value system that promotes progressive thought for the betterment of the individual as well as society. Education is a core tenet and vested interest of the functioning democratic society. Upon that basic assumption and principle, I am overwhelmingly incensed by the silent epidemic of crippling student debt.

. . . this particularly sensitive conversation is being ignored by our mainstream consciousness. Perhaps I should be ashamed for buying such an unaffordable education and internalize my debts as personal failures. Perhaps my mistakes warrant pained silence. But silence breeds apathy, and in regard to the welfare of the American economy, I want to humanize the numbers and give voice to this reprehensible problem.

Due to reckless neglect, student debt will be the financial ruin of my generation, and there is an incredible need for a public discourse addressing this reality and its grave consequences.

I want answers and clarity as to why this happened. How did I arrive at this position in life so financially handicapped and disenfranchised? I followed societal expectations, earned an education and am employed. I will gladly repay my debts within the comfortable reason of affordability.

. . . I am owed answers simply because I have the right to pursue happiness. And since I am not alone in this debilitating epidemic, my peers deserve their voice as well.

Overborrowing and underthinking will get a gal in trouble, writes Bryan Preston on PJ Tatler.

Millennials are “the screwed generation,” some argue. They were told to “invest in yourself” and take on “good debt” to win a guaranteed college premium, writes Megan McCardle on The Daily Beast. As tuition goes up and up, the college premium is eroding for humanities and social sciences majors. For marginal students, college is a bad bet.

 The price of a McDonald’s hamburger has risen from 85 cents in 1995 to about a dollar today. The average price of all goods and services has risen about 50 percent. But the price of a college education has nearly doubled in that time. Is the education that today’s students are getting twice as good? Are new workers twice as smart? Have they become somehow massively more expensive to educate?

College costs rose faster than inflation by 1 percent a year till the mid-1980s, says Ohio University economist Richard Vedder.

“Now I see them rising 3 to 4 percent a year over inflation. What has happened? The federal government has started dropping money out of airplanes.” Aid has increased, subsidized loans have become available, and “the universities have gotten the money.”

“Even with these high prices, you’re still finding a high return for individuals who are bright and motivated,” says Nobel Prize-winning economist James Heckman. On the other hand, “if you’re not college ready, then the answer is no, it’s not worth it.”

And don’t go to a non-elite private college unless the financial-aid deal brings the cost down to the state university level.

Correction: As a commenter notes, Brotherton earned one of her degrees at Miami of Ohio, which is a public university.

College pays — for good students

College is a good investment for good students, but not for everyone, an economist advises. About one third  of high school graduates have the academic skills, intelligence and motivation to succeed at a four-year college.  The rest are more likely to succeed in job training at a community college or  career college.

Also on Community College Spotlight:  As tuition rises, colleges and universities hire more administrators.

‘More college’ is no cure-all

‘More college’ won’t solve unemployment, editorializes the New York Times. While people with bachelor’s degree are more likely to be working, recent graduates aren’t doing very well.

Also on Community College Spotlight:  89 percent of recent college graduates say their two-year or four-year degree was worth the time and money, according to a survey.

The unknown college payoff

The college premium — the average difference in lifetime earnings of college graduates compared to high-school graduates — is a lot less than previous estimates, reports the Wall Street Journal. Often quoted at $1 million or $800,000 it’s more like $279,893, estimates Mark Schneider, a vice president of the American Institutes for Research, a nonprofit research organization. Even graduates of elite institutions don’t earn a $1 million premium, Schneider says.

(Estimates) don’t take into account deductions from income taxes or breaks in employment. Nor do they factor in debt, particularly student debt loads, which have ballooned for both public and private colleges in recent years.

The premium number is meaningless unless it’s broken down by field of study and student characteristics, responds Andrew J. Coulson at Cato @ Liberty.

What’s the premium difference, for instance, between workers who majored in engineering, chemistry, computer science, mathematics, economics, etc., compared to those who majored in communications, art history, social work, multicultural studies, etc.? A similar breakdown of interest would be by SAT score.

College costs have been growing faster than inflation year after year; salaries aren’t growing that fast in most careers. At some point, the premium for C+ students and “fuzzy studies” majors will reach zero.