I grew up lower middle class - not poor - took on a healthy amount of debt to get a CS degree from a crappy college in West Virginia.
Most of my classmates are doing quite well, and I'm working at Google - with a fellow classmate, literally in the 1% now (both of us, out of a class of only 8).
I know plenty of rich kids who went to Stanford and studied philosophy or underwater basket weaving, and they're killing it.
But that doesn't mean poor people have no opportunity. Sure, it's not equal. But it's far from hopeless.
I think there's a lot of people who look at the world and see how unfair it is and think: why even try?
The world is not fair, never has been, never will be even close to it. You just have to accept where you started from and try your best. And we can try to push for a fairer world, but don't hold your breath. If anything, inequality is skyrocketing and the world is becoming less fair.
As someone who grew up lower middle class and leapt many, many income deciles, what ideas do you have to decrease income inequality? For example, you say that you are in the top 1% now. Do you favour increasing your own personal tax burden to help offset income equality?
My marginal tax rate is ~48%. I think that's already high enough.
The idea that there is no wealth tax - and that the Fed arguably gives people a negative wealth tax - that seems a little off to me.
The median home owner has about 3:1 leverage on their house - with a home value that's 4x their income. The Fed has been pumping up house prices by a couple percent per year for 13 years.
.02x4x3=.24
The average home owner with a mortgage is getting an ~24% negative income tax. The median tax payer has a ~22% federal tax rate. Effectively, this is a -2% income / wealth tax.
This seems incredibly broken. We've created a society of haves and have nots. People willing to speculate on government handouts on their mortgage are wealthy. People not willing or unable have almost 0 wealth.
I'm in the 1%. Do I deserve to be? I don't know. But by definition, someone does. I make ~4x the median laborer after taxes and transfers. This doesn't seem broken. In my state, I make ~9x minimum wage after taxes and transfers. This also doesn't seem broken. Maybe others think differently?
Before taxes and transfers, the numbers seem much more extreme. That seems irrelevant to me.
The top 1% in wealth have ~100x the wealth of the median person in my state. That seems broken.
My view: If you really believe in reducing income inequality, there is no shortcut. You need to pay. How else can we fix this issue? Beg private corporations to give huge pay rises to medium- and low-skill people? (Don't wait for it!) We need a tax code that forces the 10%/5%/1%/0.1%/0.01%/etc. to pay geometrically increasing effective tax rates. I have never seen an alternative solution that will actually work. Yes, it is painful, but what kind of society and world do we want to create?
Why should it follow that people who break from a culture of poverty should be forced to support those who do not? It smacks of the “black tax” described in the article - a response that undermines the good that could otherwise follow from greater employment and productivity.
What happened to those who didn’t study CS? How are they doing?
We far too frequently look into our bubbles as if they reflected the world around us. They don’t.
The rich kids I knew are all doing way worse than their parents. Not surprising? It's hard and takes a lot of luck to be in the 0.1%.
All of my friends are doing quite well, almost all of them better then their parents.
Is this anecdata helpful? Did I self-select to be friends with successful people? I don't know...
Look, I'm not Joan of Arc - didn't claim to be. There's not a whole lot more else you can do...
~$300k after taxes isn't going to change the world.
Can't you just hack this by going to school for pretty much anything you're interested in and being able to work in an unrelated field?
> my next gripe with it is the seemingly insurmountable debt that said education brings
You've established that education is a good investment. So why not find an affordable college? It's not as important which college you go to or what major you select from your first paragraph. So find a cheap city or state school. Most of the debt comes from people going to private schools. I don't know where you live but NYC for instance is one of the most expensive cities in the world, but they even have a great city university (CUNY) which costs NY State residents around $7k a year, which is definitely reasonable.
My friend often comes to me and says, "Hey, man, how come you don't invest your money in <x>?" Because I'm living in poverty. People who live in poverty don't have money to invest.
> So why not find an affordable college?
So I did a quick calculation. Affordable, meaning junior college and public state college, would come out to roughly $23k for a bachelor. Maybe round it to $30k. When I was paying off my car, which only come out to about a little over $10k. Two years of having to work JUST to pay that off felt really, really uncomfortable. A college infused starting salary would probably only pay about 1 and 1/2 times more than what I was making then and the idea of having to do that for even longer without being able to absolve myself of it through bankruptcy is not something I want to do.
> Can't you just hack this by going to school for pretty much anything you're interested in and being able to work in an unrelated field?
That particular situation doesn't apply to every job. It seems like its mainly tech jobs I see that in and I'm not 100% certain I'd want to work to be forced into a tech job.
So I'm trying to think of the best way to explain this because I feel like I'm going in different directions but it seems like there's two paths:
1) go to college, accrue debt to get a job then work at your job for 5-10 years to pay that debt off
Barring someone making sure I have the proper technical bonafides, I'm philosophically opposed to getting a piece of paper for a job that I could do just as easily without a college education as I could with one. I also feel really uncomfortable with debt in general, especially debt that I cannot choose to have absolved through bankruptcy.
2) live at the lowest possible means necessary and eke out a living as best you can
As it stands now, my current expenses are no more than $500 a month (including rent). My biggest challenge, currently, to maintaining that type of lifestyle is getting remote work that I can do on an ad-hoc basis that will allow me to stay under the income necessary for government subsidies.
You wrote below this line that your current expenses are $500/month. The poverty line is currently $12,880. Even if you are making one half of that (which is hard to believe: $6,440/year works out to $3.10/hour), you would still have $440/year to invest. You wrote elsewhere that you are in your late thirties; $36.67/month invested in the S&P 500 over the last 15 years (which has returned 8.4% over that time) would be worth $13,195.76 today. That is not a lot for folks above the poverty line, but by your own math that works out to over two years' living expenses. Over the course of forty years at the same long-term rate one could expect to have enough saved up for twenty-four years' expenses.
Or you could invest it in something with a greater than 8.4% return … such as a college education.
> I also feel really uncomfortable with debt in general, especially debt that I cannot choose to have absolved through bankruptcy.
Debt can be a problem, but it can also be a solution. Borrowing at X% and investing at Y% is a great idea when Y > X (of course, if Y or X is not constant, then there is a risk that Y < X at some point!). When Y >> X, as in the case of going to college for a marketable degree, it is an easy decision.
Also, people who come to college later in life tend to do better than average, because they want to be there, and have more maturity and discipline to do the work necessary.
I'm not saying college is the right choice for you, you do have important considerations that you're clearly weighing against each other. But, I am saying it may have more in the "pro" column than you credit it for, and there are also some non-loan subsidies that open up for students as well.
But yeah, student loans suck. A lot. For sure!
You have your time and energy to invest, and you can get an educational loan.
" then work at your job for 5-10 years to pay that debt off"
I don't think all of your money goes into paying off the debt during that time.
"I'm philosophically opposed to getting a piece of paper for a job that I could do just as easily without a college education as I could with one"
Well if you don't need it and don't want it, obviously don't get that degree.
" I also feel really uncomfortable with debt in general, especially debt that I cannot choose to have absolved through bankruptcy."
Since you have established you can earn as much without a degree, and it takes 5 years to pay off the costs, you could also work for 5 years and save money for the degree.
"Well if you don't need it and don't want it, obviously don't get that degree."
The concern is that, according to parent, and I believe parent, is that the system requires a useless piece of paper. The degree is more an economic hurdle than a proof of capacity. That merit is a social construct.
Apart from that, while the usefulness of some degrees can be questioned, there is a general concept called "signalling" which has actual value. That is you demonstrate certain qualities in a way that are difficult to fake (usually by doing something costly, like getting a degree, or carrying around a huge tail if you are a parrot).
This probably wasn't the situation prior to the USA population tripling over the last 70-80 years while tech/automation has acted as a limiting force to job growth. It's easy to say the cost of college has skyrocketed because of cheap non-discharable debt but it's pusdo-requirement has also caused demand to skyrocket too.
The two options here are that either all the businesses using college degrees as a signal are wrong and they could be saving a lot of money by hiring non college educated applicants for slightly less pay and building them up.
OR college education is a useful signal and so businesses are willing to pay a higher price for it.
If the prior were true, then I would assume a business would have developed already to take advantage of the arbitrage opportunity. It is not a novel or less known idea.
It would be better if we found ways to let young people get into white collar and middle class professions without spending $100K and four years of their lives. This used to be possible. I'm quite sure it could be done again, but collectively we're not going to go there. Yet, anyway.
Sure, but it answers the question of why a degree is “needed”, and that is given the supply and demand curves for labor, the suppliers of labor need it to compete with each other.
> It would be better if we found ways to let young people get into white collar and middle class professions without spending $100K and four years of their lives.
Really simple, remove all taxpayer funded (including guaranteed) education loans, and any special bankruptcy protection they might have.
And by all means, keep complaining and if you have some power, use it to fix the system. But don't incentive people to act in self-defeating ways.
There are certainly a lot of useless majors. But that doesn't imply all of them are useless.
"the fact that educational debt in America can never be voided through bankruptcy seems like a conscious systemic decision to create debt slaves."
I'm not in the US, but isn't the rationale for that construct to make people more credit worthy? Ultimately you have to convince somebody to give a random person a lot of money on the odd chance that they'll finish their education and earn the money back. I suppose if you don't like "educational debt", you could also try to convince somebody to give you another type of loan.
It's not so much a critique of the majors but rather the professional requirements of the job listing. For jobs that don't have an innate technical (technical in the loosest sense of the term) requirement, they only want a certain class of person working there and college degrees are just how they do that.
> I'm not in the US, but isn't the rationale for that construct to make people more credit worthy? Ultimately you have to convince somebody to give a random person a lot of money on the odd chance that they'll finish their education and earn the money back. I suppose if you don't like "educational debt", you could also try to convince somebody to give you another type of loan.
One rationale that I heard that seems reasonable at face value is since you can't give back your education, that's the justification for not being able to declare bankruptcy.
I mean, I could put it on credit cards or take a personal loan, but that just increases the financial burden (via the interest rate), and if I'm not going to do that for the explicit purpose of purposely declaring bankruptcy, it seems unnecessary.
It goes a little further than that. It doesn't really matter that you can't give back the education. It's that the loan is entirely unsecured - there's no collateral, but also the people who get student loans typically don't have any assets. So it would cost nothing to take out student loans, study, and then declare bankruptcy.
> why wouldn't that apply to credit card debt?
So I'll just leave an answer here. Credit cards, when they are issued to college-aged kids with little to no income or assets, are typically issued with very small credit lines (i.e. we're talking much smaller amounts than students loans) and/or require a co-signer, like a parent with an established credit history.
At face value, yes, but in the real world if you're not earning enough after 10 years to pay it down, it was a bad investment. Allowing bankruptcy after the passing of a few year's time is a way of notifying lenders, who should be the more sophisticated party to the transaction, that if the career investment fails to pan out, they take a loss.
That would work, except that politics become involved, so it doesn't.
You also need a method is deemed legally acceptable. Throwing out all the resumes of women, for example, could land you in some legal hot water. Degrees are one of the few filters that is deemed legally acceptable. It's there to keep the lawyers happy and little else.
I'd go further and suggest that many of these jobs only really exist to save face for the underperforming children of the upper-middle classes.
In the U.S., this is due to the fact that employers practically may not use proficiency exams; since they are prevented from testing for actual proficiency, they must use a proxy, and a college degree is a decent proxy for 'reasonably educated enough, exposed to enough general knowledge, knows how to function in a group.'
I don't think that class really enters into it.
> the fact that educational debt in America can never be voided through bankruptcy seems like a conscious systemic decision to create debt slaves.
More that without the inability to discharge it in bankruptcy interest rates for student loans would need to be sky-high: the smart move for anyone graduating at 22 would be to immediately declare bankruptcy when all he would have is debt and no assets.
What do you mean here?
I'm a life-long US resident and I've never heard such a thing. I've also taken exams when applying to jobs. There is also the civil service exam which is a prerequisite for many government jobs. Jobs like the police and military have exams, both written and physical. I can't square my experience and your statement.
More likely, employers do not want to pay for additional exams as part of the hiring process and use college-degrees as a proxy. But there's nothing preventing them from using exams if they wanted.
Griggs v. Duke Power held that if a test has a disparate impact on ethnic minorities, then the burden of proof is on employers to demonstrate that the test is reasonably related to the job. The practical effect is that private employers are highly unlikely to use these tests, since doing so opens themselves up to liability, particularly since due to socioeconomic factors any fair test will have a disparate impact. For example, the tests in the particular case were a general IQ test and a mechanical aptitude test.
> I can't square my experience and your statement.
Every particular instance you gave was of a public employer, but I was careful to note that employers practically may not use proficiency exams. It's not directly illegal, and some employers might use them because either they do not realise how much liability they are exposed to, or because they have been very careful to justify them.
It actually held that for any employer-imposed hiring requirement (not merely a test), and later cases have made it clear that applies pretty much to any element of the hiring, advancement, retention, or disciplinary process.
> The practical effect is that private employers are highly unlikely to use these tests
No, its not. The practical effect is that employers doing cargo cult HR (which is quite common) are highly unlikely to use the specific tests that have been at issue in superficially well-known cases like Griggs (e.g., specifically due to Griggs, IQ tests) even when they could easily meet the test laid out Griggs but simultaneously using many employer-imposed job requirements for which they could not meet the test.
OTOH, employers that have decent legal advice regularly use tests of even the specific types that have been problematic in other cases, but make sure that there is a job rationale supported by evidence for both tests and other requirements in case they are challenged, because that’s the thing that actually matters.
Proficiency exams are exceedingly common (heck, when I did clerical temporary work for a while, it was pretty much the entirety of the hiring and placement process.)
Tell us you grew up in an middle-upper class environment without telling us you grew up middle-upper class.
A solid 31% of college graduates have no loans, and current graduates with loans average something like $30k in debt. With this in mind, it's perhaps worth pausing to consider why the sample that is your social circle suffers from decades of crushing debt. Perhaps your sample is not representative?
Or, more insidiously, perhaps debt levels tend to reflect class and class aspirations? Someone who attends a community college likely has little to no debts. Someone attending a local tier two or three public university probably has some modest debt, often below their yearly income after graduation. Someone who goes through a private post-grad program likely has six figures worth.
> Finally, that in of itself, ya know, maybe that's like the licks you gotta take when you're trying to rise up in the world, but the fact that educational debt in America can never be voided through bankruptcy seems like a conscious systemic decision to create debt slaves.
What do you imagine the outcome might be if student loans were voidable through bankruptcy? How do you think fresh graduates with loans and no assets would handle things?
The inability to be voided through bankruptcy, as I understand it, was setup so that educational loans would not wind up with insane interest rates. Given that they are unsecured (there's nothing for the lender to repossess if the borrower fails to pay), there is much greater risk to the lender. Being unable to discharge the load in bankruptcy is one way to mitigate this. Raising interest rates on everyone taking such loans (so the people that do pay subsidize the people that don't) is another. Presumably, it was decided that the former was a better option than the later.
Most loans issued before 2010 are guaranteed by the US government. So while they are technically unsecured, the government will cover the lender if the borrower doesn't pay.
Since 2010, student loans are actually owned by the government, that is, students are borrowing money directly from the US federal government.
So, in most cases, if a student loan were discharged in bankruptcy, it would be the federal government that would eat the cost of the loan.
Federal student loans are owned by the government. Private student loans, of which there are many and more every day, are owned by private (generally for-profit) companies. They're also not covered by the student loan relief efforts of recent times (CARES), if I understand correctly.
While there is no doubt an entertainment benefit to be gained, that is not likely the best choice for someone without the means to take on nearly a million dollars of opportunity cost.
I went to college mostly as a means to get some distance from my horrible family, and I advise anyone coming from a rough family to go to college just so you don't need to do with your family as much. You don't need to go to a good one, even with a GED. You can always go down to community college a few cities over.
That can more than be enough.
>Now, obviously, that's not the case with all education, but my next gripe with it is the seemingly insurmountable debt that said education brings. Literally, all of my friends that have gone to college are no where near paying their debt off and I'm in my late 30s.
I will say this generation is all about complaining and less about hard work. It's about going on Twitter to complain about how hard it is to find a job, instead of going on LinkedIn to actually find one.
I can make a single phone call and pay off all my student loan debt today, I just feel no need to since some politician is going to eventually forgive it some of it.
I also use having a degree as a filter for who I associate with. In my current city, except for a single person I've never gone out with anyone not either pursuing, or currently holding at least a four year degree.
If you tell me your 24 or something and you've never gone to college and you've never worked, I know you can bring harm to me. I'm from a very bad background full of these freaks who don't want to do anything except cause chaos.
Hold high standards for both yourself, and anyone else you surround yourself with. For example, on the Tinder TOS thread, I saw a minor debate over if it's okay to exclude people who don't have jobs from your dating pool.
I wasn't going to argue with anyone directly, but if you tell me your unemployed and you're still spending all day on match or Tinder, I don't want to be around you. Where I'm from, if someone doesn't have a job particularly they aren't even trying to find one, bad things tend to happen.
What major did you choose?
How did you manage to find an apartment and the means to pay for independently one at 18?
Add in loans and it wasn't really hard. This is why I'm actually a defender of student loans, used correctly their the best thing ever.
At 18 you can do dozens of life destroying stupid things. You can have a kid you can't afford, drive drunk , etc. Taking out a loan for school isn't going to hurt even if it doesn't work out
Let's not forget that government-backed loans will require information regarding parental income and assets unless you file as "Independent", a status with its own restrictions on well may apply.
I was also working full time too, a good chunk of the time anyway, so that helped. You could seriously figure it out 10 years ago
That's because (starting in high school) teachers are "assigned" a subject. If they change subjects, they essentially have to restart their career, there is a great personal cost (mostly going back to part-time teaching) for doing that. Plus for a whole bunch of things, from sick days to yard supervision there's a "pecking order". Changing subjects means you go to the back of the pecking order.
So if a biology teacher gets hired to emergency fill a math teacher's position, if they're smart they will never give up that math position.
Now, obviously, that's not the case with all education, but my next gripe with it is the seemingly insurmountable debt that said education brings. Literally, all of my friends that have gone to college are no where near paying their debt off and I'm in my late 30s.
Finally, that in of itself, ya know, maybe that's like the licks you gotta take when you're trying to rise up in the world, but the fact that educational debt in America can never be voided through bankruptcy seems like a conscious systemic decision to create debt slaves.
And, while my parents, have been relatively ambivalent about education, almost everyone else in my family has gone out of their way to emphasize the importance of education. I just can't get over the previously mentioned hurdles.