One of the reasons student debt is so high is the high tuition rates. The government caused a distorting in the economy by making the student loan money readily available. It used to be treated as a normal loan would. But now the government taken on the approval and collection of the debt - guaranteeing the money. Naturally the colleges and universities have raised their prices because more people are capable of paying for a degree. Simple supply and demand. And thats why higher education costs have soared at a rate much faster than the economy has grown. Wages have not increased enough for the students to retire the debt that they owe simply because of degree inflation. If everyone had a BA or BS degree suddenly its value falls. It becomes expected of a prospective candidate. Then a MA, MS or MBA is required for the same job that years before a Bachelors degree would have worked. The student seeks that degree incurring even greater debt. Now do you see what has happened? Higher education has become big business and is federally subsidized through alone guarantees to students.
Posted on: Sun, 19 Oct 2014 10:13:31 +0000
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