Why College Is So Expensive In America (2019)

They didn't mention how the loans themselves have ballooned college costs. Many federal and even private loans offer to pay the full cost of tuition. 18 year olds often have no idea what that really means or how much that is. Schools just charge whatever they want because they basically have a blank check. These are unsecured debts with little to no solid risk assessment. Go ask a mortgage lender to give your 18 year old with no income or credit history for a $50k loan for a house. Even with the house as collateral they'll laugh in your face. But schools have this blank check, get all this money and then, and particularly at "non-profits", they'll piss it away on bullshit. The school I work at has its own private jet. It has these elaborate parties and events for celebrities and industry leaders. They spend around $200k/year on the "wow moment" at graduation. But we can barely get them to pay us back for supplies for students or reimburse us for business travel. They don't even give that much in scholarships, instead demanding that faculty donate for scholarships. Its even worse at other schools. If you wanna get pissed off look up "Paula Wallace income."

What is going to help is more rigorous risk assessment and more stringent lending criteria on the part of lenders, particularly the government. Schools ought to have to provide lists of graduates so that lenders can survey them 10 years down the road and get an idea of what kind of income they're looking at. They should also have to justify costs. If a school is pissing away money, but have graduates averaging $40k 10 years after graduating in certain majors, sorry those majors get a lending cap.

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