The $555,000 Student-Loan Burden

[CaptMorgan68]

As Default Rates on Borrowing for Higher Education Rise, Some Borrowers See No Way Out; 'This Is Just Outrageous Now'
By MARY PILON

When Michelle Bisutti, a 41-year-old family practitioner in Columbus, Ohio, finished medical school in 2003, her student-loan debt amounted to roughly $250,000. Since then, it has ballooned to $555,000.

It is the result of her deferring loan payments while she completed her residency, default charges and relentlessly compounding interest rates. Among the charges: a single $53,870 fee for when her loan was turned over to a collection agency.

"Maybe half of it was my fault because I didn't look at the fine print," Dr. Bisutti says. "But this is just outrageous now."

To be sure, Dr. Bisutti's case is extreme, and lenders say student-loan terms are clear and that they try to work with borrowers who get in trouble.

But as tuitions rise, many people are borrowing heavily to pay their bills. Some no doubt view it as "good debt," because an education can lead to a higher salary. But in practice, student loans are one of the most toxic debts, requiring extreme consumer caution and, as Dr. Bisutti learned, responsibility.

Unlike other kinds of debt, student loans can be particularly hard to wriggle out of. Homeowners who can't make their mortgage payments can hand over the keys to their house to their lender. Credit-card and even gambling debts can be discharged in bankruptcy. But ditching a student loan is virtually impossible, especially once a collection agency gets involved. Although lenders may trim payments, getting fees or principals waived seldom happens.

Yet many former students are trying. There is an estimated $730 billion in outstanding federal and private student-loan debt, says Mark Kantrowitz of FinAid.org, a Web site that tracks financial-aid issues—and only 40% of that debt is actively being repaid. The rest is in default, or in deferment, which means that payments and interest are halted, or in "forbearance," which means payments are halted while interest accrues.

Although Dr. Bisutti's debt load is unusual, her experience having problems repaying isn't. Emmanuel Tellez's mother is a laid-off factory worker, and $120 from her $300 unemployment checks is garnished to pay the federal PLUS student loan she took out for her son.

By the time Mr. Tellez graduated in 2008, he had $50,000 of his own debt in loans issued by SLM Corp., known as Sallie Mae, the largest private student lender. In December, he was laid off from his $29,000-a-year job in Boston and defaulted. Mr. Tellez says that when he signed up, the loan wasn't explained to him well, though he concedes he missed the fine print.

Loan terms, including interest rates, are disclosed "multiple times and in multiple ways," says Martha Holler, a spokeswoman for Sallie Mae, who says the company can't comment on individual accounts. Repayment tools and account information are accessible on Sallie Mae's Web site as well, she says.

Many borrowers say they are experiencing difficulties working out repayment and modification terms on their loans. Ms. Holler says that Sallie Mae works with borrowers individually to revamp loans. Although the U.S. Department of Education has expanded programs like income-based repayment, which effectively caps repayments for some borrowers, others might not qualify.

Heather Ehmke of Oakland, Calif., renegotiated the terms of her subprime mortgage after her home was foreclosed. But even after filing for bankruptcy, she says she couldn't get Sallie Mae, one of her lenders, to adjust the terms on her student loan. After 14 years with patches of deferment and forbearance, the loan has increased from $28,000 to more than $90,000. Her monthly payments jumped from $230 to $816. Last month, her petition for undue hardship on the loans was dismissed.

Sallie Mae supports reforms that would allow student loans to be dischargeable in bankruptcy for those who have made a good-faith effort to repay them, says Ms. Holler.

Dr. Bisutti says she loves her work, but regrets taking out so many student loans. She admits that she made mistakes in missing payments, deferring her loans and not being completely thorough with some of the paperwork, but was surprised at how quickly the debt spiraled.

She says she knew when she started medical school in 1999 that she would have to borrow heavily. But she reasoned that her future income as a doctor would make paying off the loans easy. While in school, her loans racked up interest with variable rates ranging from 3% to 11%.

She maxed out on federal loans, borrowing $152,000 over four years, and sought private loans from Sallie Mae to help make up the difference. She also took out two loans from Wells Fargo & Co. for $20,000 each. Each had a $2,000 origination fee. The total amount she borrowed at the time: $250,000.

In 2005, the bill for the Wells Fargo loans came due. Representatives from the bank called her father, Michael Bisutti, every day for two months demanding payment. Mr. Bisutti, who had co-signed on the loans, finally decided to cover the $550 monthly payments for a year.

Wells Fargo says it will stop calling consumers if they request it, says senior vice president Glen Herrick, who adds that the bank no longer imposes origination fees on its private loans.

Sallie Mae, meanwhile, called Mr. Bisutti's neighbor. The neighbor told Mr. Bisutti about the call. "Now they know [my dad's] daughter the doctor defaulted on her loans," Dr. Bisutti says.

Ms. Holler, the Sallie Mae spokeswoman, says that the company may contact a neighbor to verify an individual's address. But in those cases, she says, the details of the debt obligation aren't discussed.

Dr. Bisutti declined to authorize Sallie Mae to comment specifically on her case. "The overwhelming majority of medical-school graduates successfully repay their student loans," Ms. Holler says.

After completing her fellowship in 2007, Dr. Bisutti juggled other debts, including her credit-card balance, and was having trouble making her $1,000-a-month student-loan payments. That year, she defaulted on both her federal and private loans. That is when the "collection cost" fee of $53,870 was added on to her private loan.

Meanwhile, the variable interest rates continue to compound on her balance and fees. She recently applied for income-based repayment, but she still isn't sure if she will qualify. She makes $550-a-month payments to Wells Fargo for the two loans she hasn't defaulted on. By the time she is done, she will have paid the bank $128,000—over three times the $36,000 she received.

She recently entered a rehabilitation agreement on her defaulted federal loans, which now carry an additional $31,942 collection cost. She makes monthly payments on those loans—now $209,399—for $990 a month, with only $100 of it going toward her original balance. The entire balance of her federal loans will be paid off in 351 months. Dr. Bisutti will be 70 years old.

The debt load keeps her up at night. Her damaged credit has prevented her from buying a home or a new car. She says she and her boyfriend of three years have put off marriage and having children because of the debt.

Dr. Bisutti told her 17-year-old niece the story of her debt as a cautionary tale "so the next generation of kids who want to get a higher education knows what they're getting into," she says. "I will likely have to deal with this debt for the rest of my life."

http://online.wsj.com/article/SB10001424052748703389004575033063806327030.html?mod=loomia&loomia_si=t0:a16:g2:r4:c0.0062199:b30715786

[HK in AK]

Get rid of the AMA's control on medical schools, increase the number of doctors, and allow debt forgiveness for education if they serve customers under medicare and medicaid reimbursement rates. This would do more in the long run to slow the cost curve of health care than anything Washington is proposing.

[Flagg]

The same systemic cheap credit problems that obliterated the US residential housing market, currently ravaging the US commercial property market, and ground the US private equity/venture capital market to a halt is the very same that is affecting the US higher education sector.

All that cheap credit available to everyone has resulted in an education system suffering from total heart failure.

If you think used car salesmen are dodgy, try University admissions offices.

The number of working class parents willing to sell their soul for their children to gain a degree is and always will be.........endless.

How can a parent say no to a child who wants to earn a university degree?

The problem is the choice is usually made when filled with emotion...the FIRST in the family to attend and hopefully graduate college.....nobody even bothers to ask how much since the school says no problem we've got the loan papers and the personal guarantee prepared....don't worry about how tuition has exploded by 300% in the last 20 years while average starting salaries have stagnated......just details......did you hear we have a rock-climbing wall and a sushi bar?

What SHOULD happen is the schools should be required to disclose the following with included parental/prospective student signatures:

What % of students actually graduate from this school? <----independantly verified

What is the average starting salary <-------independantly verified

What is the estimated cost of acquiring this degree based on historical inflation? <-----independantly verified

If only 60% of students graduate in an average of 5 years at an average of $30,000 a year in order to achieve an entry level graduate salary of an average of $35,000 does it make sense?

In my cocktail napkin calculation, I'd say no, here's why:

5 years x $30k / .60 grad = $250,000 invested = approx 10 years NET salary.......which is probably little more than what one could make without the degree, which often offers little to no tangible skillset....who the fcuk effectively BUYS

Granted, this horrible example doesn't apply to ALL degrees, but I would argue it does apply to MANY degrees from MOST universities.

I would clearly exclude degrees that offer tangible skillsets....especially from ones that offer low or competitively prices tuition/co-op programs.

But social science degrees from expensive universities are the devil.

Buyer beware.....but while everyone thinks used car salesmen and door to door vacuum cleaner salesmen are the devil...no one thinks about the truly life destroying debt slavery burden acquired every September and January.

$250,000 investment in a degree/skillset that will result in a $250,000 salary is one thing, $100,000 to get a degree in underwater basket weaving that will result in one being overqualified to flip burgers is a life sentence as a debt leper.

I've been concerned for quite some time about all the islamic studies graduates in Saudi and in the other gulf states that lack any tangible skills to get a job, but the ability to think and reason their way into some serious mischief.

How does the west differ in having ridiculous numbers of university grads with no real tangible skills and a lifetime of debt slavery...debt that can't necessarily be wiped in bankruptcy.

If anyone thinks either scenario will end with sunshine and rainbows I have a Double Masters Degree in Islamic Insurgency Studies "How to Kill Infidels" and Media Studies "Why is American Idol bread and circus" to sell you...the Islamic Masters is free in our Saudi sister school......but the Media degree will cost $50k a year.

The value for dollar of higher education, the salary of a job you effectively purchase with a degree, the return on the education dollar invested is horrible.

Just as you should run, not walk, away from a proeprty "investment" returning -10 % a year you should run, not walk, away from an "education" that will be impossible for some to ever repay.

I honestly expect anti-WTO like large scale student protests maybe even some isolated riots.

I expect student activism of the 60's to return at some stage...largely based on the completely dysfunctional economics of higher education.

Just my 0.02c

[CMNot]

Debt peonage is the new black it would appear.

I thought HE was expensive here; ^^ those numbers are almost insane.

[Violet Fashion by Mindy]

What do you mean by "social science degree" Flagg?

I can't see why the US can't follow the Australian example. Entry to University is based on merit. Cost is paid by the government, then paid back by the student once they start earning more then a set amount (adjusted for inflation)

[NavyTimes]

Holy crap.

Here most students get student loans from the state, and an amount of that is converted to scholarship money based on how many exams you pass. The national student loan is a civil right, as long as you keep on track with the academic schedule. Also, there is a good debt insurance connected to the loan, so that if you die or are unable to work the loan gets deleted up to 100%.

Still ended up with 48.000 USD of student loan, even if I worked full time every vacation while i were studying. The monthly payout with 5% fixed interest amounts to about 5% of my current salary after working some years, so it was worth it.

[RSone]

I have some debt, caused by being young and stupid, not finishing my previous degree( turned 17 when i graduated from highschool)
best thing that happened to me in recent years is my dad telling me that if i wanted a college degree, i was on my own when tuition fees were concerned.

It can be quite motivational when it's your own money on the line. Luckily tuition fees here are set by the government, and are relatively low, and the student loans are low interest(2,5% i believe) there are ofcourse private institutions granting degrees, but they do not receive subsidies from the ministry( SAE, Nyenrode Business University)

even though it may be detrimental towards singular high levels of education(the ivy league dea)l , I am a proponent of european style handling of education. Education needs to be, by and large, under government control. What good is a degree from a prestigious school when it wracked you with debts? The combination of America's private higher education, lack of will to establish firm ( federal) oversight and control, and it's (perhaps former) credit driven society have spawned an entire industry based on ripp
ing well meaning students and their parents off. It only goes ( fairly ) well untill the eventual bust in the boom-bust cycles as these recent troubles illustrate.

[Nano]

What do you mean by "social science degree" Flagg?

I can't see why the US can't follow the Australian example. Entry to University is based on merit. Cost is paid by the government, then paid back by the student once they start earning more then a set amount (adjusted for inflation)


Holy crap.

Here most students get student loans from the state, and an amount of that is converted to scholarship money based on how many exams you pass. The national student loan is a civil right, as long as you keep on track with the academic schedule. Also, there is a good debt insurance connected to the loan, so that if you die or are unable to work the loan gets deleted up to 100%.

Still ended up with 48.000 USD of student loan, even if I worked full time every vacation while i were studying. The monthly payout with 5% fixed interest amounts to about 5% of my current salary after working some years, so it was worth it.



There are a lot of nuances and problems with our K-12 educational system in the U.S to make that work out. The fact is that our higher educational system is actually government backed and because of the government guaranteed loans no one cares to shop for the best buck for your buck nor do Universities care to compete on price and service(quality of education). It benefits everyone, but the student/parent since they are being lead to believe that a Harvard/Yale BS in education has more "real" worth than one from a local state school and that price does not matter. It is quite similar in some respects to the real estate loan scam that has been going. The student and parent need to be properly educated as to what government subsidized loans truly are. Society has placed some entitlement mentality that everyone should/has/needs to be given a government paid/subsidized higher education while feeding only schools and what amounts to nothing more than a loan shark vicious cycle in the end.


The same systemic cheap credit problems that obliterated the US residential housing market, currently ravaging the US commercial property market, and ground the US private equity/venture capital market to a halt is the very same that is affecting the US higher education sector.......
........
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.....I honestly expect anti-WTO like large scale student protests maybe even some isolated riots.

I expect student activism of the 60's to return at some stage...largely based on the completely dysfunctional economics of higher education.

Just my 0.02c
I'm afraid though that the students/parents are not going to be protesting the higher cost of education, but rather the fact that they are not being given more money essentially "free" to cover the higher cost for it that only continues to feed higher school tuition/costs. It is a very vicious cycle and it perpetuates itself because like you said "dysfunctional economics".

[IDF_TANKER]

The standard pay in the universities and state colleges is about 2500$ a year. I had only to take a student loan for the last year (the rest paid from the money I saved working before the uni and a help I got as immigrant + some local municipal program to encourage students to learn in Jerusalem), and returned the loan in two months after I started working.

[RSone]

The standard pay in the universities and state colleges is about 2500$ a year. I had only to take a student loan for the last year (the rest paid from the money I saved working before the uni and a help I got as immigrant + some local municipal program to encourage students to learn in Jerusalem), and returned the loan in two months after I started working.

€1640,- here. Books for my courses are about 700-750 a year. I'd normally get €90 in basic government grant( every college/uni going student gets this, you get more when living on your own and can loan aditionally) but since I only have about 2,5 years of grant left, i've opted for a so-called zero loan, where i get no grantmoney, but keep the public transport pass( students here get free public trans during the week or weekend) which still adds €80 to my debt monthly. at least when i'm done, it'll be largely or hopefully wholly turned into a gift. My parents are paying insurance for me(exactly and maybe not coincidentally, €90)

[RSone]

EDIT: Double post, deleted. See the above post

[Kaplanr]

What do you mean by "social science degree" Flagg?

I can't see why the US can't follow the Australian example. Entry to University is based on merit. Cost is paid by the government, then paid back by the student once they start earning more then a set amount (adjusted for inflation)

While I happen to agree with you, can you imagine the true blue Yankee response from people who're calling Obama a Marxist now? Outside of the realm of finance, the first broken part of the US system is that everyone gets to go to college or uni. The followup is the disincentive to leave school if you decide it's not for you, AND if you're already hooked on borrowed money.

There's something wrong in a system where I can measure my standing right now, not by how much I've saved (not much,) but by how little I owe - relatively speaking.

[SkyUS]

Wow!!!!

Makes me happy to go to a CUNY school. It's about $2500 per semester plus something like $500 in books and $1k in commute. Of course I live with my parents, rather than pay 13k for 10 months of crappy dorm room.

This is crazy. Especially for people wanting to earn an undergraduate degree. I mean seriously to have any competitive edge over your peers, an undergrad degree won't help you. You need to get graduate degree. So what's the point in spending $20 to 30k a semester for undergraduate degree if you are not going to be competitive in the job market. There' s no point.

I am getting a BA in Pol Sci and BA in Economics. I realize that it's pretty much useless, so I am planing on going to law school. Then once I graduate with JD and get a decent job I can do MA or PHD for Pol Sci or Economics on the side.

[Flagg]

Wow!!!!

Makes me happy to go to a CUNY school. It's about $2500 per semester plus something like $500 in books and $1k in commute. Of course I live with my parents, rather than pay 13k for 10 months of crappy dorm room.

This is crazy. Especially for people wanting to earn an undergraduate degree. I mean seriously to have any competitive edge over your peers, an undergrad degree won't help you. You need to get graduate degree. So what's the point in spending $20 to 30k a semester for undergraduate degree if you are not going to be competitive in the job market. There' s no point.

I am getting a BA in Pol Sci and BA in Economics. I realize that it's pretty much useless, so I am planing on going to law school. Then once I graduate with JD and get a decent job I can do MA or PHD for Pol Sci or Economics on the side.

Good stuff! I know a few folks that went through the SUNY system...sounds like pretty good bang for the buck there.

Good luck with grad school and hopefully you're able to avoid getting buried in student debt like so many of your peers who just don't "get" it yet.

[Flagg]

While I happen to agree with you, can you imagine the true blue Yankee response from people who're calling Obama a Marxist now? Outside of the realm of finance, the first broken part of the US system is that everyone gets to go to college or uni. The followup is the disincentive to leave school if you decide it's not for you, AND if you're already hooked on borrowed money.

There's something wrong in a system where I can measure my standing right now, not by how much I've saved (not much,) but by how little I owe - relatively speaking.

BULLSEYE!

I suspect at some stage this huge amount of student debt that simply cannot be repaid is going to become a significant political bargaining chip.

How long until politicians start using it as part of the campaign platform?

Since no one gets a free lunch for free, what will the government want in return for helping free people from unsupportable student debt?

[Flagg]

What do you mean by "social science degree" Flagg?

I can't see why the US can't follow the Australian example. Entry to University is based on merit. Cost is paid by the government, then paid back by the student once they start earning more then a set amount (adjusted for inflation)

By "social science" degree I mean degrees that provide no tangible skillsets that now cost 2-5 times as much as they did 20 years ago with the result being that the salary the degree "purchases" has been stagnant for the same 20 years.

Students are now paying 2-5 times as much for the SAME salary......unsupportable, unsustainable.

Australia is currently in roughly the same boat the US was 10-15 years ago....so the best way to describe it would be to say that Australia is following the US model...it's just lagging by a decade or two...instead of Australia "leading" as your post suggests.

Wait and see...the result will be much like our old arguments about Aussie auto manufacturing.....it's all come true....bye bye Mitsi, bye bye Falcon

US higher education, in my opinion, will need a couple hundred billion dollar bailout or risk a substantial collapse.

Right now, higher education has become fat, dumb, and lazy...it needs more Apollo Program and less Oprah.

I'd actually support a couple hundred billion dollar handout to universities if it targets the following:

1.) Engineering & manufacturing focused energy independance R & D

2.) Makes MATH & SCIENCE the centre of gravity for education

3.) Sets targets for education affordability & value......bye bye rock climbing walls, juice bars, and sushi bars

There's too many of you dirty monkeys on this rock...somebody's got to start figgerin' out how to get us off of it for a big fat profit.

And I'm not exactly going to be able to retire to the Moon and use my rocket boots and flying car promised to me since 1972 in Popular Mechanics unless you young morons start learning some math and science and make cool sh!t again.

[ex1cdo]

It is the result of her deferring loan payments while she completed her residency, default charges and relentlessly compounding interest rates. Among the charges: a single $53,870 fee for when her loan was turned over to a collection agency.

Is this not the essence of the problem?

Sure, a quarter million bucks in loans is a big problem, but inflating it by a factor of two due to your own inability to perform elementary arithmetic is your problem, not the fault of the lender, or society.

[RSone]

Wow!!!!

Makes me happy to go to a CUNY school. It's about $2500 per semester plus something like $500 in books and $1k in commute. Of course I live with my parents, rather than pay 13k for 10 months of crappy dorm room.

This is crazy. Especially for people wanting to earn an undergraduate degree. I mean seriously to have any competitive edge over your peers, an undergrad degree won't help you. You need to get graduate degree. So what's the point in spending $20 to 30k a semester for undergraduate degree if you are not going to be competitive in the job market. There' s no point.

I am getting a BA in Pol Sci and BA in Economics. I realize that it's pretty much useless, so I am planing on going to law school. Then once I graduate with JD and get a decent job I can do MA or PHD for Pol Sci or Economics on the side.

BBA here. In Entertainment Management, which in plain english means i'll be the guy making sure your movies, tv-shows and what have you will be done efficiently, on-time and hopefully within budget. You start out somewhere in the assistant-producer-production assistant range(there is some discrepancy between the US and European job titles and responsibilities) and should, accordingly to the professors teaching here, expect to reach producer within 5 years if you know what you're doing.
It's not exactly a field that warrants getting a masters degree, but we'll see....Promotion in the industry seems to be based on experience and success rate(number of your projects that did well commercially or organisationally) rather than on a piece of paper.

Just heard that the dropout rate for our second year is somewhere in the neighbourhood of 60%....

[SkyUS]

Good stuff! I know a few folks that went through the SUNY system...sounds like pretty good bang for the buck there.

Good luck with grad school and hopefully you're able to avoid getting buried in student debt like so many of your peers who just don't "get" it yet.

Yup. I go to Hunter College. Most of my Pol Sic professors are ivy league educated or ex faculty from there, so it's quite good.
Thanks Flagg, yup, working construction during the summer helps to keep the debt pretty manageable.


BBA here. In Entertainment Management, which in plain english means i'll be the guy making sure your movies, tv-shows and what have you will be done efficiently, on-time and hopefully within budget. You start out somewhere in the assistant-producer-production assistant range(there is some discrepancy between the US and European job titles and responsibilities) and should, accordingly to the professors teaching here, expect to reach producer within 5 years if you know what you're doing.
It's not exactly a field that warrants getting a masters degree, but we'll see....Promotion in the industry seems to be based on experience and success rate(number of your projects that did well commercially or organisationally) rather than on a piece of paper.

Just heard that the dropout rate for our second year is somewhere in the neighbourhood of 60%....

Nice. Sounds good. i was in process of transferring to a business school so i could get BBA or Finance, but they pretty much accepted only 1/3 of my credits, so I figured that if I have 3 more classes left to finish pol sci degree, there's no point in going thorough the transfer if I was to lose all of those credits.

Which brings me to another point, this whole business of transferring is such a scam, especially in CUNY ( public city college system). Going to a sister CUNY school shouldn't make one student lose 3/4 of his credits. Just another way of milking the students off their money.

I have always been interested in being a lawyer. On the side though I am trying to start up a photography business. Will see what's gonna happen with that.

[RSone]

Yup. I go to Hunter College. Most of my Pol Sic professors are ivy league educated or ex faculty from there, so it's quite good.
Thanks Flagg, yup, working construction during the summer helps to keep the debt pretty manageable.



Nice. Sounds good. i was in process of transferring to a business school so i could get BBA or Finance, but they pretty much accepted only 1/3 of my credits, so I figured that if I have 3 more classes left to finish pol sci degree, there's no point in going thorough the transfer if I was to lose all of those credits.

Which brings me to another point, this whole business of transferring is such a scam, especially in CUNY ( public city college system). Going to a sister CUNY school shouldn't make one student lose 3/4 of his credits. Just another way of milking the students off their money.

I have always been interested in being a lawyer. On the side though I am trying to start up a photography business. Will see what's gonna happen with that.

Dad's a Professor in Constitutional Law and Administrative Law(thus implying he's a Ph.D, or Doctor as we call it, as well since it's necessary)
I'm from a fairly traditional frisian-dutch family, and importance is placed on being at least as succesfull as the previous generation. The eldest sons in my branch of the family went from farmers (my great granddad) to headmaster(granddad) to professor(my dad) in three generations. My problem is that academically, I can't do much better than my dad. My path so far has been academic, but garnishing acclaim as a producer will bring 'honour' (which is basically what the whole 'each generation gets better' is about) to my family as well.
I've done law school at a undergrad level. The first thing they tell you is that only about 10-20 percent of the people you're in the room with will eventually make it to be a lawyer. I had/have a talent for it, but i didn't like the field enough to truly pursue it. Especially considering you may pay through the nose in order to reach your masters and pass the bar, it is extremely important you ask yourself if it's something you really want.

I've been toying with the idea of making a documentary someday about the stresses the american educational system puts on people for a while now. I find the concept of internally(e.g. privately, financially) suffering from your achieved external excellence very interesting.

I'm at INHolland's School of Media, Music and Communications in Haarlem. There's all sorts of people here. I was in a class with a girl(who quit due to personal issues) who did a year of TIO, a private school for hotel and event management and worked for Heineken and presented items on radio and podcasts, then there are the 17 year old girls who never had a spot of economics in their lives and just want 'to organize a cool party' and the guys who's main focous is doing sets in Paradiso or Melkweg
It is a management Bachelor as much as it's about creative concepting and projects. Corporate and management Strategy are combined with writing television formats. Nevertheless, freshmen number around 700 this year, where we normally only have about 200. I figure around 60-70 percent will eventually drop out over four years. That's a lot of people that just wasted 2 years of their grant money. Schools here mislead and misinform just as much as overseas, but the results are lessened by stricter governmental control on the system. The core of the problem everywhere, IMO, is that kids(which you basically are until probably your mid 20's) are very much unprepared for higher education. No real concept of what they want to do after 'school' in the vast majority of the cases

[Violet Fashion by Mindy]

By "social science" degree I mean degrees that provide no tangible skillsets that now cost 2-5 times as much as they did 20 years ago with the result being that the salary the degree "purchases" has been stagnant for the same 20 years.

Problem is that most employers require a university degree now even for an entry level position. Without such a degree employment is not guarenteed. What we need to do is have more "apprenticeships" Make it possible to become an engineer by doing an apprenticeship instead of a degree. IMO whilst these occupations are skill intensive the training to become an engineer is not really what university is about.

Students are now paying 2-5 times as much for the SAME salary......unsupportable, unsustainable.

Australia is currently in roughly the same boat the US was 10-15 years ago....so the best way to describe it would be to say that Australia is following the US model...it's just lagging by a decade or two...instead of Australia "leading" as your post suggests.

Australia doesn't have expensive student loans that cause a person to become bankrupt. My degree in Fine Art for example costs roughly 500 bucks a subject. That's deffered until at such a point I start earning above a certain amount. Then it payed back at an additional 3% income tax. It's not going to bankrupt me and I could end up still earning a decent income before even having to pay it back since the threshold is actually quite high. In a nutshell our system allows you to get established into a career before you need to worry about paying off your tuition.

Wait and see...the result will be much like our old arguments about Aussie auto manufacturing.....it's all come true....bye bye Mitsi, bye bye Falcon

US higher education, in my opinion, will need a couple hundred billion dollar bailout or risk a substantial collapse.

Right now, higher education has become fat, dumb, and lazy...it needs more Apollo Program and less Oprah.

I'd actually support a couple hundred billion dollar handout to universities if it targets the following:

1.) Engineering & manufacturing focused energy independance R & D

I agree with the need for further research into these areas but not at the expense of the more traditional acadamia.

2.) Makes MATH & SCIENCE the centre of gravity for education

They always have been and always will be at the centre of an academic instition.

3.) Sets targets for education affordability & value......bye bye rock climbing walls, juice bars, and sushi bars

There's too many of you dirty monkeys on this rock...somebody's got to start figgerin' out how to get us off of it for a big fat profit.

And I'm not exactly going to be able to retire to the Moon and use my rocket boots and flying car promised to me since 1972 in Popular Mechanics unless you young morons start learning some math and science and make cool sh!t again.

As I said. Higher education has lost it's way. There used to be a time when only Maths, Science, Health and the arts were studied at a university. Now we have economics (Ha and look where that's gotten us), business and engineering to name a few.

Universities need to go back to the classics and become centres of research, arts and philosophy as they used to be.

Employment standards also need to be lowered. It's absurd that a 30k a year job requires a degree to answer phones and suck ****.

Engineers need to be trained on the job like all other tradesman and trades based occupations

[pekka elo]

This crap makes me thankful for free education :)

[SkyUS]

This crap makes me thankful for free education :)

Well it's not really free. People's taxes pay for it. Kind of free lol