Student loans cannot be a bubble. The whole point of calling something a bubble is that it can pop and value can be lost.

Existing college educations are not suddenly going to lose value because new students stop coming along and investing in them.

The price of college is irrationally high. That is not the same thing as a bubble.

Tech stocks in the 90s were a bubble. Housing in the 2000s were a bubble.

 

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The term "bubble" is just easier than saying "spiraling upwards out of control with no basis in actual applied REAL value, in a typical course of action initiated by unscrupulous actors and propagated by those who are too ignorant or ideologically bound to failed concepts to admit that they're on the wrong course".


Further, I wonder how it will go when college loan debt starts to be sold into the private sector to help recoup the losses, and securities based on it are going through the roof and then suddenly there is some sort of debt forgiveness bill passed which suddenly makes all of that worthless...

 

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Again, real costs are not up all that much.


We have more student loan debt because anyone can now take out loans to attend a school, not because the real cost of the school is all THAT much higher.


Back in the day Harvard cost 20k in real costs for an upper-middle class dude and if you didn't have the money your only option was to try for a charity scholarship.


Now harvard costs 25k in inflation-adjusted real cost and if you don't have the money and can't get a charity scholarship you can borrow the money instead.


Price tags have gone up a lot but real cost has gone up much more modestly for middle class people. We have moved from a system where most people pay sticker price to a system where only rich people pay sticker price.

Yes, they are.

 

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Where does this talking point keep coming from in the Leftosphere over the last month?

It isn't true.

 

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It comes from using schools as an example which have used the model of differential pricing based on ability to pay, given certain qualifying factors aside from financial ability - i.e. if you can get into Harvard, you can go there, regardless of how much money you have.

Meanwhile, there are many many more colleges NOT using this model and that is where the debt balloon (since bubble is a verboten term I guess) is coming from.

 

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That is a bunch of emo tears. No one gives a shit what degree someone gets, it comes down to people not wanting to pay for your masters degree in clown shoe design.

 

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debt mountain of doom?

debt fkcking gaping chasm of death?

 

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Yeah I dunno dude, pick a term - I don't feel like mincing semantics about it lol!


I kind of prefer "balloon" because that implies there is a balloon knot which, when viewed end on, looks like what it is in this case - the stinking filthy orifice that will eventually spew a nasty mess all over...

 

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Those arn't real cost graphs, they're sticker price graphs. Sticker price makes for a better story.


Real costs are up modestly for established four year private colleges. Real costs are up a lot for state schools because states have cut funding, and real costs are up a lot for for-profit diploma mill schools because those schools didn't used to exist at all.


There are problems with the cost of college these days but it isn't a uniform across the board problem. The biggest problem is that state schools don't provide an affordable alternative any more because of budget cuts. The second biggest problem is that dumb people are going into debt to get degrees from worthless schools that don't help them with anything.


The idea that the problem is people getting humanities degrees at Harvard is silly. That isn't the problem at all.