Peter Thiel: We’re in a Bubble and It’s Not the Internet. It’s Higher Education.

[mahatmakanejeeves]

Peter Thiel: We’re in a Bubble and It’s Not the Internet. It’s Higher Education.

Sarah Lacy
April 10, 2011

....
Like the housing bubble, the education bubble is about security and insurance against the future. Both whisper a seductive promise into the ears of worried Americans: Do this and you will be safe. The excesses of both were always excused by a core national belief that no matter what happens in the world, these were the best investments you could make. Housing prices would always go up, and you will always make more money if you are college educated.

Like any good bubble, this belief– while rooted in truth– gets pushed to unhealthy levels. {Peter Thiel, co-founder of PayPal} talks about consumption masquerading as investment during the housing bubble, as people would take out speculative interest-only loans to get a bigger house with a pool and tell themselves they were being frugal and saving for retirement. Similarly, the idea that attending Harvard is all about learning? Yeah. No one pays a quarter of a million dollars just to read Chaucer. The implicit promise is that you work hard to get there, and then you are set for life. It can lead to an unhealthy sense of entitlement. “It’s what you’ve been told all your life, and it’s how schools rationalize a quarter of a million dollars in debt,” Thiel says.
....

Making matters worse was a 2005 President George W. Bush decree that student loan debt is the one thing you can’t wriggle away from by declaring personal bankruptcy, says Thiel. “It’s actually worse than a bad mortgage,” he says. “You have to get rid of the future you wanted to pay off all the debt from the fancy school that was supposed to give you that future.”

Why does "God Save the Queen" - the Sex Pistols version - keep running in my head?

Don't be told what you want
Don't be told what you need
There's no future, no future,
No future for you

[dana_b]

1. I've been hearing this from a few sources

even Randi Rhodes was talking about it last week. Scary stuff and it is absolutely horrible that young people who are just starting out have this shit to deal with. No wonder my daughter's community college is full, full, full!

[SoCalDem]

5. There's another scam involving endowments

Most chi-chi schools have large endowment funds. A woman was on Cspan a while back talking about her investigation/book about this. Apparently most people who endow universities/colleges do so to help STUDENTS pay for their educations, but MOST of the endowment money sits there, and some is used for "investments", and the schools play "my endowment is bigger than YOUR endowment" with each other, as they try to NOT use it for students..

Many schools lost money in the Madoff shindig, because they preferred gambling for bigger bucks more than giving aid to students.. This pushes students into the willing arms of "lenders" who happily prey on them..

[Uben]

2. Get a loan, get an education, get a job! What's the problem?

Aint no friggin jobs!

[TomClash]

3. Other lyrics are relevant too

God Save the Queen
Fascist regime
Made you a moron
A potential H-Bomb!

Oh God save history
God save the mad parade
Lord God have mercy
All crimes are paid!

[exboyfil]

4. Yes but should the federal government

be put on the hook for your $30K/yr education? Actually I am alarmed at the easy out forgiveness that currently exists. For those going into public sector employment, it does not matter whether you borrow $30K or $100K - the amount of the payback will be the same.

The sticker price at Harvard is not what is paid. If your family is low income and you can get the grades to get into Harvard, they will work with you the actual cost.

Families up to $60K - 0 contribution
Families from $60K-$180K - 10% of their income
If the 10% number is correct, it would actually be cheaper to go to Harvard than our state school for my kids (and that is only tuition).

[Volaris]

6. when i finally got to the point where

I wouldn't just be wasting my time there (i.e., I know what my short and long term goals for my education are) I started paying for tuition out of my own pocket.
A small re-alignment of incoming resources, and I will finish my education with NO OUTSTANDING DEBT. =)
It will take a bit longer, but the mid length plan is that my first house will be paid for CASH. (because I will NOT pay 250,000$ for a 100,000$ home, -compound interest, I did the math- thats just stupid.)
Fuck the Vultures, they can look elsewhere.
Peace,
=)

[Freddie Stubbs]

7. The author of this article needs to get her facts straight

There was no "decree" by Bush prohibiting discharging educational debts through bankruptcy.

This was a provision of the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005. If it were only a "decree," President Obama could simply reverse it with another "decree."

[Kingofalldems]

8. Defend repubs at all cost

No matter what.

[Freddie Stubbs]

9. Facts are nonpartisan

Would you prefer Democrats to be misinformed about issues?