Student Debt Keeps Rising. Is There an ‘Education Bubble’?

[marmar]

from In These Times:




Student Debt Keeps Rising. Is There an ‘Education Bubble’?

Wednesday
Apr 20, 2011
10:55 am

By Akito Yoshikane


A college education has long been viewed as a wise investment, but nowadays it’s coming at a high cost. Last year marked a dubious milestone: student loan debt outpaced credit card debt in this country for the first time, and recent reports suggest the gap may widen this year as more students continue borrowing to finance their education.

Consumers owe $828 billion in credit card debt, and students topped that with $850 billion in outstanding loans, according to data from Mark Kantrowitz of FinAid.org and FastWeb.org, a website that publishes information about student aid.

Despite the intrinsic value of pursuing intellectual endeavors, institutions of higher learning are becoming less and less affordable. The New York Times reported last week that student loans may top a trillion dollars this year, and others have questioned whether education is the next “bubble” in a country still reeling from the housing bust.

Student debt has continued to grow. In 2008, two-thirds of students who earned a bachelor’s degree from a four-year college finished school with some debt. The average debt for graduating seniors was $23,186, according to FinAid.org. Last year, the average was $24,000 according to the Times. And FinAid.org data shows it’s even worse for graduate and professional students with debts ranging from $30,000 to as high as $120,000. .............(more)

The complete piece is at: http://www.inthesetimes.com/working/entry/7215/with_student_debt_rising_is_there_an_education_bubble/

[KansDem]

1. If you've got the connections or someone on the inside who can get you the job...

...go for it!

Otherwise, it may be prudent to at least consider occupations that don't require a college degree.

[Coyote_Bandit]

2. We have this misguided idea

that investing in a four year degree guarantees a good job. Ain't so. Even without the loans.

One needs skills to perform a job. Sometimes one also needs credentials. More often than not personal relationships (networking) will lead to employment opportunities. The formal educational system may or may not provide students with what is necessary for career success.

Nothing wrong with being educated in the broad sense - having critical thinking skills and being well read mind you. But a four year degree is not an indication that one is educated in that sense. Nor is it an indication that one is employable.

[FirstLight]

3. what about the jobs that require a degree?

I got 'vocational rehabilitation' thru the EDD and the Workforce Investment Act... certificate in HR Management.

ALL jobs that i have tried to go for ask for a minimum of 2 yrs experience AND a BA...

Needless to say I have lots of life experience and other related fields under my belt, but can't break into the HR gig because of that stupid BA.
It's partially the fault of employers who are still clinging to the idea that a 4 year degree = responsibility, etc...

add to that the fact that my financial aid office in early years of college convinced me that loans were the only way to help with survival when pell grants weren;t enough, and "you'll be making so much by the time you graduate, the payments will be no problem" I was 22, single parent and struggling to just complete my AA...took me 4 years.
So i have the debt, but not the BA...FML

[MedicalAdmin]

4. The bubble will burst when enough folks just stop paying.

If there is not way to pay your loans, you can't default, and they last a lifetime, then there is no incentive to participate in the white market economy. I forcast a rising tide of the black market economy with more and more folks working off the books and lying to the IRS so that they don't get their mininal money taken from them to pay for loans that are useless.

I will go back to school someday but not in the US. The costs here are ridiculous and a predictable outcome of 30 plus years of the defunding of state support for universities. Once the private companies got involved in education and research the costs skyrocketed.

[jwirr]

5. There is a bubble for every kind of debt. It is when the majority of

people can no longer pay that form of debt. Housing and credit cards were just the first.

[ParkieDem]

6. I have been saying this for years.

When I graduated from a liberal arts college many years go, I was very happy and thankful for the education I received there. I learned how to "think," and to value education simply for the sake of education.

However, there has to come a point where it's no longer worth it. It's just like health care. If higher education expenses and health care expenses were to keep growing at their current rates, it wouldn't be too long before our entire economy was higher education and health are. It doesn't take a rocket scientist to understand that this is not sustainable.

There is no doubt that higher education is truly valuable in this country. But how valuable? I have no qualms about a philosophy major asserting that his degree is "valuable." It no doubt has a value to society. But is that degree truly worth $150,000 in debt? I think not.

[bengalherder]

7. It's not just for 4-year degrees.

It is becoming nigh on impossible to do jobs that once allowed one to learn on the job in apprenticeship such as cooking and other trades without a certificate of some kind. People are racking up education debt to get into fields which almost never pay much more than $10-$12 an hour, certainly not enough to prevent the debt from being an onerous one.

These certificates are 'sold' as a way of moving up, and a guarantee of attainment of management positions, but they rarely work out that way.