NY Times: Placing the Blame as Students Are Buried in Debt

[marmar]

Placing the Blame as Students Are Buried in Debt
By RON LIEBER

Published: May 28, 2010


Like many middle-class families, Cortney Munna and her mother began the college selection process with a grim determination. They would do whatever they could to get Cortney into the best possible college, and they maintained a blind faith that the investment would be worth it.

Today, however, Ms. Munna, a 26-year-old graduate of New York University, has nearly $100,000 in student loan debt from her four years in college, and affording the full monthly payments would be a struggle. For much of the time since her 2005 graduation, she’s been enrolled in night school, which allows her to defer loan payments.

This is not a long-term solution, because the interest on the loans continues to pile up. So in an eerie echo of the mortgage crisis, tens of thousands of people like Ms. Munna are facing a reckoning. They and their families made borrowing decisions based more on emotion than reason, much as subprime borrowers assumed the value of their houses would always go up.

Meanwhile, universities like N.Y.U. enrolled students without asking many questions about whether they could afford a $50,000 annual tuition bill. Then the colleges introduced the students to lenders who underwrote big loans without any idea of what the students might earn someday — just like the mortgage lenders who didn’t ask borrowers to verify their incomes. ..........(more)

The complete piece is at: http://www.nytimes.com/2010/05/29/your-money/student-loans/29money.html?adxnnl=1&ref=business&src=me&adxnnlx=1275141689-hA8p5c2Gk0gvujtqFc49mA

[Captain Hilts]

1. My parents made me go to the local university and live at home. nt

[NNN0LHI]

9. Thats what I told my daughter to do too. She wouldn't listen

She had to go "off" to college somewhere. Now she has a business degree along with a ton of school dept and hasn't been able to find a job in her field since she graduated a few years ago.

She mainly changes diapers for little kids now while watching other peoples kids. Makes good money doing it. Pays the bills. But I don't think changing diapers was what she had in mind after getting her degree.

Your parents probably did you a great favor.

Don

[dsc]

16. she must have learned something to make good money doing that

that is usually a very low paying job.

[NNN0LHI]

17. She learned it from my wife

My wife used to do the same thing when I would get laid off during the 1980's. She made good money doing it way back then. Kept us out of the poor house. I do know that.

Don

[marylanddem]

2. Colleges and universities are businesses that sell credentials

designer labels, NYU, etc - the mystique.

The older I get the more sense the old hippie days made! Tune in turn on & drop fucking OUT. ;-)

(edited to add: and yes I know that dropping out ain't what it used to be...still, one can dream....)

(p.s: articles about the perils of "making it" in capitalism & "succeeding" in the system never quite grab the sympathy they are intended to grab)

[smoogatz]

12. Yes and no.

The commodification of the college degree is aunfortunate development--it largely came about because of a 2002 study that concluded that those with college degrees earn $1.3 million more over the course of their working lives than those without degrees--although certainly the trend toward commodifying education and imposing the corporate model on university administration has been around longer than that. Ideally we actually edcate people, but I think we do so less and less, and to less and less effect. Higher education really is turning into a racket, like everything else in this country.

[aikoaiko]

3. It isn't until the end where you find out the information that makes me have little sympathy...

"She recently received a raise and now makes $22 an hour working for a photographer. It’s the highest salary she’s earned since graduating with an interdisciplinary degree in religious and women’s studies. After taxes, she takes home about $2,300 a month. Rent runs $750, and the full monthly payments on her student loans would be about $700 if they weren’t being deferred, which would not leave a lot left over."


She chose to go into debt to get a degree that is a niche in the employment arena. Moreover, It looks like Ms. Munna can make her monthly payments just fine. I hope Ms. Munna enjoys her education and all that she learned, enjoys living on a great but expensive city, and eats more ramon so that she can pay down her debt faster.

[marylanddem]

4. I think the best line is "would not leave a lot left over" n/t

[Raineyb]

19. Well considering how some people around here talk about the ability to save

one would think that having something left over at the end of the month is somewhat important.

[Celebration]

5. eighteen year old kids don't have any judgment on this

I blame the parents and the schools, and the economy. As a parent, I would not allow my kid to get into this situation (if possible!)

[aikoaiko]

7. Actually, it's my impression that most 18 years make better choices than this example

I say that as a professor who has been involved with a lot of students over the last 10 years.

This was phenomenally bad decisison making regarding debt and earning potential (even in a good economy).

Of course parents should advise against such decision, but ultimately it is the adults child's decision and responsibility.

But most importantly, Ms. Munna can make her payments and has enough to live on. Not a lot left over, not enough to party, not enough to get season tickets at the opera or 49ers, and not enough to hit all the great restaurants in SF, but she got her degree and she has to pay for it.

[ProgressiveProfessor]

11. It was her choice, specifically a boutique major with no commercial value

I fully believe that students should be able to take such classes and graduate with degrees in same, but only if they sign a no whining pledge. Its their choice and choice has consequences. If you get a degree in a field with no market value, that is your choice but please do not complain about your lack of employment opportunities and the debt you took on afterward.

[readmoreoften]

21. Really? There are no photographers in the world? By the way, we also produce more teachers

than we can handle. There are no "practical majors." Last year it was nursing. Now we're hearing that nursing may not even be such a practical major.

[tammywammy]

22. She got an interdisciplinary degree in religious and women’s studies, not photography n/t

[ProgressiveProfessor]

25. Liberal arts are important for a well rounded education, that includes gender and ethnic studies

However, many liberal arts degrees have limited marketability. That does not mean that they should not be pursued, just that those who make that choice need to be accountable for their decisions, including any debt they incur in the process. In other words, choices have consequences and the young adults making them need to own up to that.

All of the graduating students that I advise have jobs waiting for them.

[Captain Hilts]

13. If you get a degree like that, you ought to minor in something more immediately useful. nt

[Celebration]

6. some colleges

Such as Rice University, limit the amount of indebtedness a kid has from attending the school--$10,000 is the limit there. But the school needs a big endowment, and needs to make a big commitment to ensure that.

I say, screw NYU and other similar colleges for letting their students get into this situation.

[ProgressiveProfessor]

8. Duplicate

http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=389&topic_id=8440121&mesg_id=8440121

[smoogatz]

10. Anybody that goes $100k in debt for a degree in women's studies

is a moron. The blame in this case is entirely on the student and her parents. She could have gotten the same useless degree at a SUNY school for a fraction of the price.

[Catherina]

14. I'll go futher. Anyone who sells their freedom for a paper degree

without comparing how other countries do it isn't qualified or smart enough to sign the dotted line. Intelligence requires pursuing answers to questions. If you don't ask yourself why you're signing for that much money, on credit, without figthing a system that sucks up so much of your earnings to kill other people than, sheesh, get a job at In & Out Burger.

By the voting age of 18, you should, you better be, asking questions in this country. The only reason we're in this sorry situation is because people just said "OK, that's the way it is" and kept signing for whatever debt the bankers thrust at them. Screw that. As long as you keep saying "Ok, that's just the way it is", well things will be the way those criminals want it.

Capitalism is just grand. A for-profit ponzi scheme. What else can one say?

[XanaDUer]

15. Here's a novel idea

instead of piling more blame on this young woman who wanted to follow her bliss, so to speak...

How about free, at least undergraduate degrees, based on academic achievement and financial need? I mean, this unending, bankrupting war we are in could have probably paid for 3/4 of Americans to go to college and get a master's on top, just for the hell of it.

I say this as someone who was very, very fortunate to have a family that could send me to a four-year, private university, and pay for half my master's, degree.

Very lucky.

[aikoaiko]

20. Public undergrad education is tuition free for any GA high school graduate with a 3.0

Its called the HOPE scholarship (thank you Zell) and it even kicks in $300 per semester for books. Room and board not covered though.

If GA can do it, any state can do it.

[WestSeattle2]

24. California had a similar program for years; though I seem to recall it

was limited to AA degrees or community college tuition. Those days are long over. Maintaining a bloated state bureaucracy is paramount to something as silly as educating the next generation.

[ProgressiveProfessor]

26. CA is still much cheaper than other states, including MD

Last I looked in state MD community college was more expensive out of state UC per unit. Note that it has been a few years since I looked at that.

[KitSileya]

18. Honestly, the price is astounding.

I still can't understand how American colleges can demand the equivalent of a median yearly income before taxes for a year's tuition. It's insane. How can one not understand that the math of that can't add up?

With a price like that, anyone paying such exorbitant sums for a college education should demand a 3 to 1 student-professor ratio in all their classes at the very least.

[tammywammy]

23. Agreed, the cost to attend NYU is quite large

Thankfully there are other colleges that are much more reasonable. She could have even chose to do two years at a community college and then transfer into NYU.

I saw this as a working adult going to school full time at a private university and taking out loans, but I won't end up with even half the debt she has.

[smoogatz]

27. $25,000/year isn't even close to top dollar.

Andover and other elite schools are over $40k for tuition/room/board, and some of the Ivies are pushing $50k/year. But unless you've got a fat trust fund you wouldn't pay that for a degree that wasn't eventually going to put you in a $200k job on Wall Street. It's all about doing the math, as you say.

[KitSileya]

28. I guess I'm comparing it to my degrees

I have a batchelor's and a master's - well, the old Norwegian equivalent, which is slightly more than that, a candidata magistera equaling years 2 to 5 of college in the US, (our last year of high school being considered the same as the first year of college in the US) and my candidata philologica adding another 2 years to that, as well as a year to get my candidata paedagogica or teacher's license. 7 years at Norwegian uni, and one year extra as exchange student at UofO during my Masters (on scholarship, so no tuition) and I paid about $1000 in registration fees etc. The student loans I got were for living expenses, as you're not supposed to work alongside school, since a uni education is a full-time job in and of itself. No one is supposed to be denied a higher education because of family background, only academic excellence is supposed to decide.

Either way, my student loans were less than my first full year's salary, and so it is for pretty much everyone who goes to college in Norway. That is the opposite extreme, but considering Norway has the cheapest academic labor in the world, it is appropriate (We don't get paid much more than an industrial worker, really.)