College Dropouts Cost the Economy Billions(good.is)
good.is
College Dropouts Cost the Economy Billions
http://www.good.is/post/college-dropouts-cost-the-economy-billions/
3 comments
Article seems 1-dimensional to me. If defaults were really hurting the economy they wouldn't be giving out student loans so liberally. Obviously someone is making a profit from it, though it might not be trickling down.
That is one reason I didn't take the article at all seriously - you cannot default on student loans unless you end up permanently disabled. They will follow you through bankruptcy and continue accumulating interest and penalties for decades.
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> Without the earnings boost that comes from a college degree, these students are likely to struggle to pay back their student loan debt, setting themselves up for default—in turn, hurting our economy even more. And at a time when people without degrees have higher employment rates, college dropouts are more likely to need government-provided social services like food stamps.
Has it been shown that the multiplier effect of a total of random college degrees is larger than the multiplier effect of food stamps we've all heard about?
> Of course, the majority of students don't drop out because they're lazy and don't feel like going to class. Affordability is a huge factor—if you're working so many hours that you don't have time to study or go to class, quitting can seem like a good idea.
So students drop out because they can't afford school. Does this mean the loan amounts should be more? What about for degrees averaging higher incomes, thus graduates having a larger chance of paying off the loan in a reasonable amount of time?
Re: the actual billions figure... the PDF says they take their income estimates from the median income in each state of degree holders vs. non-degree holders and measure the differences, which range from about $8k-$12k. So while this is a decent indicator that "degree > no degree", it doesn't tell you what degree to get. Are the countless theology, english lit, and other "soft", "artsy" degrees really worth it? Or do corporations still frequently require any degree from anywhere to apply to be their drone, making such degrees possibly worthwhile for the income aspect? Would be interesting to compare the median incomes of different degrees to the median incomes of people with no degree.