Purdue was in the news for being one of the first: https://www.purdue.edu/dfa/types-of-aid/income-share-agreeme...

Planet Money had a nice podcast about how they work: https://www.npr.org/sections/money/2019/03/29/708152566/epis...

Would these plans result in the proliferation of odd compensation schemes to get around these repayment plans?

The one program that I looked into had a relatively low cap on it, like $60,000, so they only take a cut of the first 60k. Plus the majority of people (i.e., outside of engineering) don't get equity anyway.

Lots of very, very wealthy people have no "income" at all, which means they don't pay taxes.

The problem is that "income" is narrowly defined (for a reason) so things like someone owning a large corporation which triples in value over a year making them a billionaire on paper don't even show up on taxes because officially that person hasn't "made" that money until they sell the corporation. Even when they do, it's taxed at a lower rate than "income" because it's a different "kind" of money.

"You’ll repay 9% of your income above the repayment threshold – earn less and you won’t repay. Once you leave your course, you’ll only repay when your income is above the repayment threshold. The current UK threshold is £25,725 a year, £2,143 a month, or £494 a week." [0]

[0]: https://www.ucas.com/student-finance-england/repaying-your-s...

It’s not a cure-all: you can still default, and there are cases where you can end up repaying more than a traditional loan. Nevertheless, it should be the [/puts on sunglasses]...default option.

https://studentaid.ed.gov/sa/repay-loans/understand/plans/in...

If universities were getting paid directly based on income, that would create the right incentives.

https://studentaid.ed.gov/sa/repay-loans/understand/plans/in...

It's our culture that has turned education into some kind of "investment" in future job prospects. To put it simply, education was never intended to be that way, nor should it. It's as if studying the arts is some kind of luxury for those who are already financially well-off.

Education is supposed to be about learning just for the sake of learning, which benefits all of us. If there is not a place for people from certain fields of study, that's a failure of our economy and priorities. Yet it seems that too many have just accepted the current reality as "just the way things are".

The reality now is that education is more or less for everyone and most people, even at elite institutions, don't have a clear path to being a member of the elite without working super hard for specific career goals. It would be odd, then, for some of those students to continue to pretend that they have a clear path to being a member of the elite and learn the kinds of things that are disproportionately important for the members of the elite, when they have to accomplish a lot to get there. The world is simply far more competitive.

Historically, you certainly had a division between apprenticeships for the poor, university for the rather-rich and for middle class and talented and finishing school, philosophical speculation, tutoring by artists, etc for the idle wealthy.

The world where "everyone" was somewhat entitled to the basics of a university education was a product of WWII and the GI bill. Not that this was a bad thing but it's worth saying it's a somewhat recent thing. Moreover, while university education references "learning for learning's sake", I think the fundamental thing is more "the basic skills a citizen needs."

And even here, our society hasn't really integrated the exact use of twenty years of bureaucratic lecture classes. Going back to pure skill-oriented education isn't appealing but a broadening of the learning process is important.

That said, university education is now kind of the worst many world - purely job oriented but sort-of fantasy mid-level bureaucracy jobs that most students won't actually get.

But if you are going to look at history, then why not go all the way to the root of the modern Western academia - where the word itself originates?

https://en.wikipedia.org/wiki/Platonic_Academy

On one hand, it was indeed about learning just for the sake of learning. But on the other hand, it also didn't have degrees, positions, tenure, or any other attributes of a formal hierarchy.

And note that it was something that people did aside from gainful employment (or other source of income). Which means that it was closed to most, not even because they weren't welcome there, but because they didn't have the free time to devote to learning for the sake of learning.

Could we revive the Academy today, free for everybody? Sure, but I don't think this would solve any of the problems with "bullshit degrees".

The argument needs to address why learning for the sake of learning at a specific physical location with the price ticket of $40k'ish a year is drastically better.

The "education is about education" sentiment you mention is quite literally the brain-child of the ultra privileged.

I don't think the situation you describe has _ever_ been what education is "supposed" to be about. It's an noble goal, but it doesn't reflect reality. And a degree which cost over $100,000 to acquire, but doesn't yield any job prospects... if that isn't a "bullshit degree" then I don't know what is.

Does it?

Human instructed education is a limited resource. Unlike self-directed or automated education, it doesn't scale without educators. And there aren't an infinite supply of those.

Ergo, a price must be paid to be educated.

What should that price be? How should it be set? Who should pay it?

I'm honestly asking, regarding your assertion (I believe) that education shouldn't be driven by utility and future-ability-to-repay.

A liberal arts degree should not cost that much compared to the current tuition in the hundreds of thousands of dollars for many of these degrees.

It's an 'investment' because otherwise, it is a luxury for people that have money and don't need to work to pay back their loans.

Not just that. You can imagine additional benefits if the incentives of the parties involved are realigned. It would be in the interest of lenders to evaluate the readiness of students to attend college. This would potentially lead to better, less gamable testing.

It might make less sense, from a lender's perspective, for a student to go straight from high school to college. Instead perhaps they would want to see evidence from a couple of years of life outside of school that their loan would be repaid. The potential student would need to make a case to the lender and herself.

[0]: https://www.ed.gov/news/press-releases/national-federal-stud...

1: https://studentaid.ed.gov/sa/repay-loans/understand/plans/in...

If a bank had a 30% default rate on mortgages they’d immediately cease to be a bank.

I don't see any party here that needs rescuing by the government.

There are obviously holes in this narrative, but we like telling ourselves this can happen.

While there's not enough value in 17th century art history for the US to graduate 200k scholars per year and expect in-field employment, there is value to society in general to not losing our history and learning more. Letting the banks decide who gets loans will instantly mean those who can't pay cash cannot pursue that education or need to go on cheaper routes for college. They may or may not be viewed as a comparable education and quality candidate.

I'm not a fan of our current system, but a purely utilitarian system I see proposed seems likely to continue the spreading the social divides between the rich, middle class, and poor.

I'm an advocate for cutting a lot of the unnecessary fluff and expenses from college. Administrative overhead is excessive. Dorms are way nicer than they need to be. Alas, other colleges have nice dorms, so a single college choosing to go cheap on the dorms will probably decrease admissions and thereby revenue.

Drug abuse is less long-term priced in and likely also has higher aggregate risk as well.

In a sense the things you list are kind of like the broken windows fallacy. The increase in healthcare spending shows up in our GDP, but isn't an efficient use of the resources.

I also imagine that student loan debt could reduce local growth. If you have a graduate using most of their income on repaying loans, that's money that may have been spent locally and is instead sent to the bank. Of course the opposite is true before graduation, where inflated costs of education result in more money in the local economy. However due to interest it may be the case that the former outweighs the latter.

Suppose that someone invents a better version of ELIZA, and everyone in the psychotherapy business is suddenly out of work.

Or slightly less absurdly, suppose that Intuit and H&R Block mess up their next round of lobbying, and the IRS implements that one-click tax payment we've all been asking for. And the accountant industry shrinks by a few percent and wages go down for the ones that are left.

Either of those would be a significant shift in the job prospects of a large group of people, which could affect how many student loans actually get repaid.

I think it might also count as a risk if it suddenly became fashionable to get degrees in, say, underwater basket weaving. As in, incoming students aren't perfectly rational with perfect information about what degrees have what job prospects, and I'm assuming the college loan system might not react quickly if something caused an overall shift towards less economically useful degrees.

It does lack one "feature" that helps the bad mortgages cause problems, in that I don't think it would be self-reinforcing. From what I understand, subprime defaults were contagious in a way that I don't think this would be.

Contrary to public perception, there's no robust investment market for student debt. US government ends up purchasing most of it through Treasury. In theory it's a great deal, as it gets to borrow at low Treasury rates and originate at higher rates.

I don't have a link to the original source, but "In September 2018, the U.S. Treasury Department revealed in its annual report that student loans account for 36.8% of all U.S. government assets." https://www.investopedia.com/articles/personal-finance/08121...

Edit: here's a more updated analysis of the Treasury disclosures, which puts the figure at 51.2% as of September 2019 https://www.advisorperspectives.com/dshort/commentaries/2019...

Devaluing those assets (which Treasury marks to market) would significantly dampen (if not destroy) US government's borrowing ability as well as make some government entitlement programs [at least temporarily] insolvent.

Tuition for ETH Zurich around 800 francs per semester.

This is a hypothetical but classic example of how regulation is required to support a free market.

This comment is an example of how any amount of problems caused by government intervention can be framed as a need for more government intervention.

But, the cost of school has outpaced inflation for that period, making the situation worse. No question about that.

We'd probably all be better off if the government simply gave grants to students who meet some minimum threshold. Call it top 20% of class or thereabouts.

It's the cost of the administration. The cost of facilities. The extortion racket that are mandatory latest editions textbooks.

Universities are becoming less about teaching people and more about capturing grants and "selling the experience"

Some states are making efforts to curb the costs of textbooks and materials. I'm currently working on software to help CA schools roll out their ZTC programs.[1]

1 - https://www.insidehighered.com/digital-learning/article/2019...

And your comment is an example of assuming that government regulation is at best a necessary evil and something to be avoided if at all possible. Most of western Europe has has regulated university fees for decades, and by all accounts this works pretty well. Public opinion in the UK (even from a lot of the political right) is that the current 9k/year cap is too high if anything.

The role of government regulation is a separate question, but we're really jumping the shark when we can't even acknowledge basic cause and effect.

It's not surprising that government policy making tons of student loan money available led to more students being willing to take out bigger loans. This is like Markets 101.

It's tough to take opponents seriously when basic, predictable side effects of favored policies are ignored just to recommend heavier-handed policies of the same kind.

Totally agree with you on this.

> It's tough to take opponents seriously when basic, predictable side effects of favored policies are ignored just to recommend heavier-handed policies of the same kind.

It seems likely to me that the side effect wasn't ignored. Probably there was somebody proposing the "heavy handed" version of the legislation (which actually makes sense because it mitigates the side effect), but somebody else was opposing it because they don't like regulation. Thus, this problematic legislation emerged as a compromise.

Opposition to regulation often seems to be based on the idea that in practice regulation causes more problems than it solves. My observation is that regulation (esp. in the US) often does have this problem, but only because there is such opposition to regulation that it is almost impossible to enact the stronger and more sensible regulation that would actually work.

In short, it is often ideological opposition to regulation that causes it to fail, rather than the case that regulation in general doesn't work.

In what world do the regulated parties not oppose being regulated? If there’s no opposition to a regulation then it probably isn’t needed.

Perhaps it's just that corporate interests have captured governments. But that too seems like a symptom of distrust in government leading to it being hamstrung and underfunded. I guess it's circular.

I'm 100% in on getting the government out of the lending business and back into the "higher ed is a public good" business. I'd rather they just return the actual sticker price to what it was a generation ago, and make it realistic for people to work student jobs to earn the cost of their tuition.

We might not have the most tenured professors though, since those a drawn to centralize in institution with high prestige. But with the free flow of information today, this centralization of excellence becomes less important.

But anyway it probably isn't a problem with too much/too few government intervention and more of a problem of intervention being constructive or not. Bad intervention is probably worse than no intervention, I agree.

It's not surprising that by making a ton of student loan money available, that more students are more willing to spend more money, and thus prices rise.

There is no free market here.

Even without novel approaches students already get non-subsidized lines of credit so I don’t think it’s unheard of

https://en.m.wikipedia.org/wiki/Paradox_of_the_Court

On another note the idea rubs me as immoral in ways that loans don't for reasons I am not quite able to articulate. Like viscerally seeming too far too similar to indenteture.

I found a link but couldn't add it to my original comment. There is a 5% salary payment for 15 years once the student reaches $25k. Sandbagging is possible but it seems like students would start working against their own monetary self-interest pretty early (from a salary perspective at least; who knows, I'm sure there's other creative ways to game the system).

So if you have a huge loan but a small income, it's more like a 30-year graduate tax than a loan you expect to fully repay.

In the situation above, it acts more like an investment rather than a loan. (i.e., there's no upper bound on the payment, outside of the 5%/15 year cap, so the student may pay back more than they receive)

https://nationswell.com/venture-capital-college-student-debt...

Sort of like those radio ads that say they'll help you "not pay the greedy credit card companies that trapped you".

That's entirely the point. Tuition would have to come down so it's actually affordable, or there would be less people attending. Businesses might actually foot the bill for tuition to train their people, because there would be a shortage of qualified applicants.

Make no mistake, we regulated ourselves into this mess. Many people at the time predicted the current situation. More money chasing something drives up the price of that something. It's now pretty clear that we should have funded the schools instead of providing subsidized loans for the students.

Imagine if everyone in the United States who wanted to go on a cruise was guaranteed to be given a loan to go on a cruise, regardless of the cost of said cruise or their personal circumstances. In that scenario, obviously cruise companies would increase prices, since their clients will always get the money to pay for them, and like you yourself said - it's not their responsibility whether people can pay it back or not.

That's pretty much how higher education works.

Because education is not a luxury service that can be postponed or outright skipped, like lifestyle-tailored tourism, and education costs in the US have become a major societal and economical problem.

> In fact, with almost every purchase that involves a loan, the company offering the loan is different than the company offering the product / service.

That's a tautology, and entirely misses the point. The point is that student loans are a colossal problem for the US, not only economical but also societal, and the problem is caused by the disconnection between the vicious cycle that leads to hikes in cost and the consequences of complying with the requirements to have an education.

Complaining that universities should not feel any consequence for the need to take massive loans they force onto their student body is like complaining that petrochemical companies should not feel any consequence for the need to decontaminate the environment.

The real problem is voters want lower taxes, and some genius figured out a way to tout lower taxes and tax payer assistance to students, hence student loan debt.

And, inevitably, like all times that society is enabled to pass the buck onto future generations or ignore externalities, society will take and consume all it can until the breaking point. Same story with defined benefit pensions, student loans, environmental damage. We are simply starting to see the effects of pushing the costs into the future, now that the future is here.

The facts don't support this claim. U.S. government spending on tertiary education is 0.91% of GDP compared to Germany's 1.0% and Japan's 0.45% (source: https://data.oecd.org/eduresource/public-spending-on-educati...)

Rather, university education in the U.S., like healthcare, is insanely expensive compared to other countries. Why is that?

1. Non-selective. We admit 70% of high school graduates to University whereas in Germany they admit 1/3.

2. Too long/unfocused. University education can last 5-6 years in the US for a bachelors, whereas in Germany it is limited to 3 years. You don't get to drift around as "undecided" and change your major, you apply to the school with a specific major. You don't get a lot of choice as to your electives and follow a pre-planned course of study (for the most part).

3. Too many frills. European schools don't have massive sports stadiums, athletic departments, or other amenities similar to US universities.

4. Too much staff. Our universities are massively overstaffed with everything from diversity officers to football coaches to teams of counselors.

Put this all together, and you have a very expensive, inefficient, gold-plated system focused on catering to student whims rather than to taxpayer efficiency. Of course tax payers don't want to pay for it -- why should they? If you want European style funding of universities, you need European-style spending levels and rigor. If you want an experience that is half as selective, takes twice as long, and offers absurd amenities that have nothing to do with university education, then you are going to have to pay for that out of your own pocket rather than asking for taxpayers to provide this experience for you.

The good news is that you can find relatively inexpensive higher education in the U.S. if you are a good student and are willing to attend community college for the first two years and a local state school for the rest. If you are good enough to be admitted to University in Europe, then in the U.S. you should be able to get a scholarship. Of course most US university students would never be admitted to University in Europe in the first place -- so having an option to pay a lot to go might be better than not having an option at all. But I suspect that we would be better off adopting a German style trade school system to absorb 50% of high school graduates as well as a more rigorous high school system, but that would require adoption of tracking and letting most students know that they are not going to be on the university track. In that type of environment, sure, taxpayers would be willing to fund the enterprise since they would only be spending 10% more than they are spending now to match German-level of tertiary education spending.

In France 100% of high school graduates are (by definition) admitted to University, and more than half of them indeed decide to take that path.

"Typical" university education lasts 5 years. (Though I wouldn't be surprised if only a minority actually makes it.)

It's mostly free, students from poor families get grants, though there are limits on how many times you can retry university years while still getting a grant.

The result : in 2014, 45% of the 25-34 year old French had a university (or other superior education) degree, compared to 28% of the Germans. (OTOH I suspect that the quality of that education is not nearly as good ?)

So these are the kinds of trade offs to make -- e.g. what percent of your labor force do you need to have a college degree? This is going to be a characteristic of your economy and providing college degrees to more people than this is going to create a skills mismatch.

A lot of people think the reverse is true -- e.g. that if you train a lot of people to build bridges, then you will have a bridge building economy. But I am of the opinion that knowledge is activity specific, so if you want to have a lot of people who are bridge builders, then you need to actually build bridges, and the university diplomas you need will follow as people scramble to learn how to build bridges to get the good bridge building jobs they see in the economy.

So why does Germany have a more skilled economy even though fewer attend university? Because it's an export monster, that swells the number of high skilled jobs needed to much more than would be the case if they were producing only for their own market.

China is in a similar position -- they want a hundred million engineers, and if that means building a bridge across every river in Africa then that's what they will do. The Belt and Road Initiative is nothing more than an attempt to export infrastructure because they've already covered their own country with empty apartment buildings, unnecessary airports, and so they need to build infrastructure elsewhere. Curiously only 5% of the population attend university in China, and yet they are an economic powerhouse by doing -- and learning by doing -- rather than academic diplomas.

India is an example where they overtrain lots of people in IT relative to domestic demand, and of course what happens is that people emigrate to where the jobs are. Again, you don't transform your economy with university education, anymore than you can transform your car by washing it. You transform your economy by cultivating productive ecosystems and then making sure there is demand for their output.

Whereas we in the US think that we can shut down manufacturing, outsource jobs, and yet have a high skilled economy if everyone goes to university. It's not the case, we have a much lower skilled labor force than Europe and the university graduates have a hard time finding good jobs and repaying their student loans.

So bottom line, the goal should not be to send everyone to college, but to send those people who need to go to college, and if you want more people to need to go, than work on cultivating more high skilled employment in your economy rather than building more universities.

And in a lot of jobs, you don't need much more than some core knowledge, and being independent enough that you can learn on your own - you can't teach a specific job at the university, that's what internships are for. Teaching jobs, (outside of technical schools), is the responsibility of the companies.

Note that the overwhelming majority of engineers, especially bridge ones in France don't come from the University system - but rather the élite ingénieur schools - maybe a bit like the US Ivy League ? (There's the super-élite school literally called "Bridges and Roads") Those get a disproportionate amount of funding, but aren't that relevant to the discussion, since they only teach a tiny minority of students (~5%).

I recently came upon an interview with Oliver Faron, administrator of one of these élite schools, which has a specific focus on education of people returning to superior education. They also have an especially good record with 20 times better results with technical (="low-quality") high school graduates than universities.

(I guess that extra funding and the self-selection of the most motivated students might have something to do with that ?)

And his dream is to have a mandatory year of university to replace the long-gone mandatory military service, so that the different social classes get to "live together" again ! (More than one year would probably make for diminishing results?) : https://www.franceculture.fr/emissions/la-conversation-scien... (fr)

I sympathize with this view. When I was young (and foolish), I was really upset at how university education was being commoditized to teach job skills when really it should (in my opinion) follow the Classical Greek model of education designed to better a person -- the word for school also means "leisure". I also bemoaned the lack of intellectual curiosity and anti-intellectual atmosphere in universities, even elite universities.

But over time, I realized that this model of a university where you go and find yourself or discover the truth or become an enlightened person was fundamentally impossible as a method of national policy.

It is an indulgence for the elite which doesn't scale to 70% of the population, most of whom have zero desire to become intellectuals and are going to school so that they can have job skills. They need job skills. Why would we make them take out huge loans or waste a key portion of their lives role playing as intellectuals?

Moreover, it's really hard to teach young people insight about life because most of us are complete fools when we are young and all we get is the feeling of having deep insight into things, we don't really get that insight except by _doing_, whether that means engaging directly with the world via travel or talking to people outside our bubble, reading things that challenge us, experience life by having kids or watching a relative die, or whether that means doing on the job -- secluding yourself into a dream world on a walled off campus with a strictly controlled idealized environment is an indulgence that does not actually make you a more knowledgeable person.

In terms of an elite school offering superior results, that is always easy to do if you are selective. It's trivial to create a high school with much superior results than the average high school if you can pick out good students. The hard thing to do is to scale that to a national policy for everyone.

So if this secluded campus model of the university doesn't promote your intellectual life and it doesn't give you job skills, then why are we doing it?

There is a reason why the original schools were basically theological training institutions and later became finishing schools for the wealthy. That model of university education was always a type of bubble, but at least in the past, people were sent to the bubble because they were going to live in that bubble for the rest of their lives so the university was preparing them for their future life, either in a monastery or in elite circles where employment was considered a dirty word.

You wouldn't, like you weren't paying to do your military service.

> engaging directly with the world via travel or talking to people outside our bubble

A mandatory year mixing all social classes is, by definition, "bubble-popping". In fact this still happens today, when young people are forced to leave their home town they lived all their life in in order to go to the university.

Also, nothing is preventing a university from having some practical workshops... (I know a lot of people that got their truck-driving license during their military service) and a big university should be able to have some much more expensive training machinery than a small school.

P.S.: Oliv(i)er Faron is far from being young and foolish...

Who do you think pays for military service if not the people? Martians? What is the difference between generation X paying for generation X+1's education, spending g% more than what was paid for their own education, and generation X taking out a loan to pay for their education at a rate of r? The only thing that matters is whether r > g, the growth rate of the price of education. If r > g, then a direct transfer is slightly more efficient. If r < g, then a loan is more efficient. In this case, g is astronomically high. Yet you favor the more inefficient approach, because it hides the fact that most money spent on tertiary education is a waste, and you want this waste transferred to the old rather than kept by the young.

> engaging directly with the world via travel or talking to people outside our bubble A mandatory year mixing all social classes is, by definition, "bubble-popping".

Ahh, yes, those isolated campuses with safe spaces and psychological violence counselors -- a true bubble popping experience.

P.S.

You can also be old and foolish.

> Ahh, yes, those isolated campuses with safe spaces and psychological violence counselors -- a true bubble popping experience.

Again, this is very American-centric.

> You can also be old and foolish.

Considering his credentials, it seems unlikely.

US voters aren’t comparing taxes with Japan and Germany. They’re voting between politician A who says they will lower taxes, and does it by removing funding for higher education or politician B, who does provide higher education and hence has to collect higher taxes and politician A. Politician A can get away with this by claiming they still support students by providing government loans or government guaranteed private loans or whatever, but they don’t have to account for it in the same way politician B does.

I agree with all of your points, and I far prefer the German model too. But American voters seem to love debt, and low taxes, and rarely is a thought given to the future.

I think they are correct.

Reforming higher education means cutting spending first and foremost.

Shut down half the universities, lay off 1/3 of the staff in the rest, seize the endowments, close all the sports stadiums, fire most of the admins, force students to finish in 3 years, and then take the pile of money we are already spending on education and make that be the full tuition.

Voters concerned about high taxes would benefit from this, as would the top 50% of students. The bottom 50% of University students should be diverted to 2 year long trade schools, which can be built on the ruins of the shutdown universities, but staffed with craftsmen rather than professors. Industry can pay for 1/3 of it, students can pay for 1/3, and taxpayers can pay for the other third of the trade schools.

The tone is draconian because you have a whole class of people ripping students off, ripping taxpayers off, providing very little value, and yet being extremely sanctimonious about why more spending is needed. The hypocrisy and amorality of the higher education industry in the US is stunning, so a draconian approach is called for.

Any limit to university education in the US butts up with class (read: race) and inequality issues. I would love to close all of the over-priced and educationally dubious for-profit institutions. But any semblance that we are limiting educational attainment to the educational-haves is unacceptable.

The market for what HNers regard as an education (4-year degrees from established public or private universities) is really only like half of the post-secondary education market.

If you offer Johnny $20,000 to attend Purdue, you have to give everyone $20,000, regardless of their school-choice, aptitude, likelihood to graduate, or future income projections. To do so otherwise puts society in the unfortunate position of deciding who gets to pursue the American Dream.

This has already occurred and continues to be cut further. What also happened however, is the legislature promised lenders that taxpayers would pay for all student loans. Of course this doesn’t get accounted in cash flow, because you can just assume more people will pay back their loans than actually will.

So now you have a situation where a lender can make a loan of unlimited amount of money with no risk to the lender, a borrower who knows nothing about money but has infinite ability to borrow, and a seller (schools) that get less money from taxpayers, but now can fight for the gobs of money that the students (who know nothing) have control of spending.

Hence unnecessary stadiums, recreational centers, buildings, admin, etc.

A student who is unable to repay their private loans before death leaves the lender without the money I think.

This may have changed in the past few years.

We would also need to remove the social stigma that has plagued the trades for the last 30+ years.

Federal: $75.6 billion

State: $72.7 billion

Local: $9.2 billion

Although the funding between State and Federal are similar, the way those funds are spent may be different:

"The federal government mostly provides financial assistance to individual students and funds specific research projects, while states typically fund the general operations of public institutions, with smaller amounts appropriated for research and financial aid."

https://www.pewtrusts.org/~/media/assets/2015/06/federal_sta...

But to respond to your point directly, degrees such as gender studies, art history, and English literature are certainly a luxury service that can be postponed or outright skipped.

I'm asking out of curiosity and not trying to make a point or win any argument: Why do you draw your line there?

I wouldn't combine "free" and "partially required" though, as I don't see the need to conflate them. Where I live Masters and PhDs are free, but your required education is completed at age 15. Everything after that is completely optional, but free.

as in no tuition, but there are some administrative fees and books you need to buy, etc.

I guess I shouldn't have assumed that government would necessarily regulate college like they do high school. Some European countries are examples of that. However in those countries there are a lack of people who are qualified to work in highly educated fields and a surplus of blue collar workers. In the US the situation is reversed. There is not enough work for many liberal arts majors, but a lack of workers for blue collar jobs. Spending tax dollars educating people from jobs that lack workers to jobs that have a surplus is not good usage of the money. Furthermore, a person who is not fit for even free college (probably has a lower income) now has to pay taxes for college students (who probably will have a higher income [unless they can't find a job]) while not benefiting from it.

I'll also add that this: "However in those countries there are a lack of people who are qualified to work in highly educated fields and a surplus of blue collar workers." is absolutely not the case in the European country where I live. When you talk about the state of "those countries", what countries are you talking about and what are you basing that statement on?

Yes, I make assumptions based on what I hear and who I see. I don't have the time to make a doctorate thesis on of my assumptions. Had I spent years researching how to identify people who college would help, and people who it would not help then I would use a stronger word than "assumption". With regard to countries offering free college education there are countries such as Germany, France and Brazil that offer free college education. They also have very low rates of attendance. Image how much lower it would be if the students had to pay for it.

This was already known, but since simply providing taxpayer funded education results in increases of government expenses and hence higher taxes, we of course went with the Byzantine route of indebting people who don’t even know what amortization is to the tune of tens and hundreds of thousands of dollars.

It really shouldn't be, but here we are. The proof is in the pudding. Their high school education has failed them, parental and job market pressures to have a degree has failed them.

Just standing around and going "well they should have known" isn't going to solve anything. Eventually they're going to be a big enough voting bloc to pass something like debt relief (example: old people and unsustainable pensions) and who's going to be stuck holding the bag? Better to solve the problem as early as possible instead of just standing around blaming them and not fixing anything.

> state schools start around 15k/year and provide bachelors degrees.

Problem 1: School is expensive

15k*4 = 60k (assuming you do 4 years and not the average time of 6 years). So we're pretty close to $100k of debt. That is just in-state tuition! But that's not the total cost of school. Berkeley[0] estimates about $30k/yr for a student. So that's 120k-180k of debt for a bachelors. Now double that if you're out of state.

Problem 2: School is getting more expensive

But there's another problem that's happening. Cost of tuition is skyrocketing. Let's look at Berkeley from 2003-2012[1]. In 2003 the cost was $4336 (adjusting for inflation today that's ~$6050). In 2012 the cost was $12,834 ($14,340 2019 dollars). Today it is $14,184. So in 20 years the price has about increased ~2.5x. This means that those cases of $100k+ debt are increasing not just in total number (because population increase) but as a percent of graduating students (we'll say Gaussian curve of debt distribution).

Problem 3: In-State isn't always the best option

Let's say we live in Washington (state) and want to go to school for computer science. The field is fairly competitive so the higher ranked school we go to yields likely a better education (one up to date with modern techniques, funding, and equipment) and more network connections. So we'll say that we want to get into a top 100 school. That actually only leaves us 2 schools: UW(#6) and WSU(#75). We graduated pretty well with a 3.9 and a 1400 on our SAT. That might not get us into UW ([3] says 33% chance we don't get in) because it is a (inter)nationally competitive school and we don't have really any extra curricular activities. So what do we do? Our scores are high enough to get into a top 20, worst case top 50. Do we go to WSU or go to a school with more resources and a higher chance of earning more in the future? And if you think this is a fictitious scenario, play around with the other school acceptances (website uses same naming pattern as usnews: e.g. University-Of-California--Berkeley), UW is one of the least competitive schools in the top 20. There's plenty of states with even larger gaps. There's plenty of states where we're more competitive than the top instate school. There's plenty of other reasons a student might want to go out of state, and plenty of reasons that might be the best option for them.

Problem 4: Age

We're also talking about 18 year olds, which aren't known for making the best decisions. I don't know about you, but when I was 18 I was an idiot. I'm still pretty dumb but I've learned a lot since then. And if you don't think you were an idiot at 18, I'm calling bs or that you're under 23 and just don't know it yet.

[0] https://admissions.berkeley.edu/cost

[1] https://4.bp.blogspot.com/-wswpT9L7QXs/UMjqxuIbttI/AAAAAAAAA...

[2] https://www.usnews.com/best-graduate-schools/top-science-sch...

[3] https://www.prepscholar.com/sat/s/colleges/University-of-Was...

Some countries do, some don't. I know several people with two free master's degrees, and some people basically collect them and PhDs as a hobby through their lifetimes -- a very small minority obviously, as most are quite done after the first.

I suspect this isn't true. Amazon puts up some pretty intrusive financing offers on all kinds of products. Jewelry is commonly purchased with vendor financing. Electronics are commonly purchased with vendor financing. Cars are usually purchased with vendor financing.

It's true that such vendor financing may be technically offered through a separate corporate form, but I don't think a company created by a retailer in order to offer financing specifically and exclusively on that retailer's products really counts as a "different company" in any real sense.

Ally came from GMAC, which GM created to finance automobiles.

Lenders are no longer on the hook defaulting student loans. These loans are not dischargeable in bankruptcy, and it reflects on the sheer amount of loans given to sub-prime borrowers.

Aside from the other points, this isn't an honest of the overall situation of industries and credit. For example, The real estate industry and the car industry are highly focused on the buyer's ability to pay. The company might not be legally responsible for a buyer who defaults and it may a different company making the loan but the entire industry has to take a hit and they avoid taking those hits when they can (periodic easy-credit situations can distort this but still).

Which is to say that the government giving student guaranteed credit for school certainly distorts things relative to other industries (even compared to housing, where the government is also involved heavily).

Apparently the Department of Education chooses the loan service for borrowers, thus enabling a de-facto monopoly for Navient [0]. Now, if we had a functioning market people could choose better solutions, and better standards would prevail. Also data could be made public enabling students to choose a college that showed better performance for graduates careers [1].

[0]: https://www.youtube.com/watch?v=RjWWTTMj0xw [1]: https://www.theguardian.com/money/2017/sep/06/us-student-deb...

Education should be done for educations sake. Actual bullshit degrees come from universities seeking profit over education and even if you removed government loans from the equation they would still exist.

The idea that everything would somehow be fixed if loans were removed is a delusional one as long as there is a profit motivation for universities. Because it's easy to create McDegrees and sell them.

I suspect that Labours ideas of scraping it will just lead to higher taxes for all ie poorer non graduates subsidising middle calss kids, or they will ration degree places

An potential extra tax burden can be allocated from wherever the government sees fit. Like a digital services tax or closing loopholes that are conveniently left open for global corporations.

Do you worry that the healthy poor people are subsidising the middle class sick ones through the NHS? Or that poor careful drivers are subsidising the cost of accidents for the middle class careless ones via their insurance company?

The moral hazard is non graduates (including pensioners) subsiding graduates.

Educated people design infrastructure, products, services, (public and private) that affects every aspect of everyone's life.

Now California contributes roughly 30% to the cost of a student, and the costs themselves has risen (better accommodations, increased admin staff etc etc.)