THE DARK SIDE OF U.S. UNIVERSITIES: AN OVERWHELMING STUDENT DEBT BURDEN
Disclaimer: Good Day, Readers. WealthBuildingPowers blog is a financial literacy/competency blog and does not provide specific investment recommendations.
THE U.S. UNIVERSITY SYSTEM IS FAILING OUR YOUTH!
I enrolled in North Caroline State University in 1976 at a time college was affordable. My daughter graduated from Temple University in 2013. I could afford her tuition and expenses because I started saving the year she was born. I utilized both the 529 and a stock/mutual funds investment account.
{Note: A 529 savings plan is a tax-advantaged investment account designed to encourage saving for future college education expenses. On the other hand, college savings plans are investment accounts that allow families to save and invest money that can later be withdrawn tax-free to pay for qualified higher education expenses, including tuition, fees, books, and room and board.}
From 1970 to 2020, college costs increased by 1,510% compared to wages increasing by 822%. Wages failed to keep up with new home prices and college tuition increases.
WAGES CANNOT KEEP UP WITH IRRATIONAL TUITION INCREASES!
| PRICE INCREASES FROM 1970 TO 2020 | APPROXIMATE PERCENTAGE | MULTIPLICATION FACTOR 1970 TO 2020 |
| Wages | 822% | Increased 9.22 times 1970 wages |
| Inflation | 766.5%. | Goods and services increased ~ 7.7 times 1970 cost |
| College Cost | 1,510% | Increased ~16 times 1970 cost |
| Student Loan | 2,704%. | Student Debt increased ~ 28 times 1970 loan amounts |
| NEW HOME | 1,452%. | Increased ~15.5 times 1970 prices |
STUDENT LOAN DEBT INCREASED 2,704% {1970 to 2020}.
College students today are borrowing up to six figures. And 39% of students who began college drop out without a degree yet are in debt!
“America’s Educational Superpower Is Fading – If U.S. universities and colleges are to revive and thrive, they need to rethink four fundamental principles.” By: Adrian Wooldridge {See Link Below}
EXCERPTS – America’s Educational Superpower Is Fading
- Prices continue to rise: A year at Cornell now costs nearly $90,000.
- Administrative bloat is out of control! Yale University has the equivalent of one administrator for every undergraduate student.
- Federal student debt has reached $1.6 trillion, 60% more than credit card debt
- Tuition Keeps Rising – Ballooning college costs are forcing students to take on more student debt
- Enrollment has fallen by 1.4 million since the pandemic began, with no end in sight with the waning of the pandemic. A majority of Americans now consider a college degree a questionable investment.
- The biggest U.S. strike last year was conducted by 48,000 workers at the University of California, the state’s third largest employer. The representation of these workers by the United Auto Workers union is symbolic as well as noteworthy: For America’s university sector increasingly looks like the country’s car industry in the 1970s, just before it was taken apart by the Japanese — hampered by a giant bureaucracy, contemptuous of many of its workers, and congenitally inward-looking.
- President Joe Biden wants the federal government to forgive billions of dollars in student debt in a one-off bonanza while also tweaking the rules for student financing to make the system more generous. But quite apart from the likelihood that this proposal will not survive a review by America’s conservative Supreme Court, it does nothing to address — and will probably exacerbate — the underlying problem of cost inflation.
- More Americans than ever before have been to university. a heavy cost not only in college debt but in the neglect of non-college paths to success.
- In Germany, practical-minded children have a clear road to success through technical colleges and apprenticeships. In America, they are increasingly left with nowhere to go. Thirty-nine million Americans drop out of college without finishing their degree, leaving them in the worst of both worlds — student debt without a sheepskin — and suggesting that college-for-all is an inherently foolish idea.
- Professors are chosen for their publication record rather than their teaching ability.
- Universities compete to build expensive sports complexes or hire star professors (who are always on sabbatical) to attract customers and boost their rankings. U.S. universities have also imported some of the worst qualities of mature companies: exorbitant CEO pay, a bloated middle-management, a habit of treating non-tenured faculty as precarious workers rather than candidates for membership of a learned society, and, to the chagrin of conservatives who naively imagined that marketization might tame the tenured radicals who dominate the faculties, all the expensive paraphernalia of the woke corporation.
- The number of administrators has grown with a speed that would astonish even G.M.’s middle-managers of the 1970s: Stanford’s army of managerial and professional staff leapt from 8,984 in 2019 to 11,336 in 2021.
- Elite universities continue to favor the offspring of donors (actual or prospective) by providing preferential admissions for the children of alumni or practitioners of plutocratic sports such as fencing or lacrosse. At the same time, they favor certain ethnic groups through policies of “diversity, equity and inclusion.” Worryingly, a growing number of universities are making SAT tests, which were introduced in the 1930s in the name of meritocracy, optional while keeping legacy preferences intact.
How We Can Fix the Broken U.S. University System – EXCERPTS
- “Universities need to borrow some of the tougher techniques from the private sector….How about “downsizing” some of those middle managers, “re-engineering” some of those administrative processes, and focusing on “core competencies” like teaching?
- They also need to prevent the new administrative staff from taking over functions that should be reserved for academics, most importantly selecting students and staff and defining the ethos of the institution.
- SAT tests are a valuable way of discovering hidden talent in poorer children from non-academic backgrounds. True, elite parents can improve their children’s SAT scores through coaching. But you can address this problem by providing coaching for everyone or by using SAT tests to compare people from similar economic backgrounds. Giving more emphasis to more subjective measures such as academic grades, extracurricular activities and teachers’ reports invariably tilts the selection process in favor of richer students and favored ethnic or social groups. Jacques Steinberg’s classic study, The Gatekeepers: Inside the Admissions Process of a Premier College, paints a stomach-turning picture of admissions officers making life-changing decisions on the basis of raw prejudice and social snobbery. Without the back-up of universally administered objective tests. it will be harder to hold admissions officers to account for decisions which affect the spending of public money as well as the shaping of the future elite’s character.
- The most dangerous threat of all is to the principle of free speech. There is an uncomfortable number of examples of students shouting down invited speakers — most recently, law school students at Stanford University shouted down a Trump-appointed federal judge, Stuart Kyle Duncan, who had been invited to speak by the school’s Federalist Society chapter. The Foundation of Individual Rights and Expression (FIRE) calculates that there were 877 attempts from 2014 to 2022 to punish scholars for the expression of ideas that are protected by the First Amendment.”
Are you struggling with the current state of affairs? Check out next week’s blog post, where I discuss how Community Colleges and Trade Schools can provide an alternative and less expensive way forward.
WHAT SUBJECTS DO YOU WANT TO READ NEXT? WHAT QUESTIONS CAN I ANSWER? UNTIL NEXT TIME!
LET’S MAKE SOME MONEY! – CRYPTOCURRENCY, UP OR DOWN THIS WEEK?
YOUR GREATNESS IS NOT WHAT YOU HAVE; IT’S WHAT YOU GIVE! – CHARITIES I SUPPORT
TRUST ME – YOU WILL LIKE THE BELOW BLOGS!
ATTENDING TRADE SCHOOL IS OFTEN THE RIGHT CHOICE
MITCH DANIELS, PRESIDENT OF PURDUE UNIVERSITY, TIMELY COMMENCEMENT ADDRESS
PURDUE IS GOING ON EIGHT YEARS WITHOUT A TUITION INCREASE- PROVING IT IS ACHIEVABLE
NEW SERIES – CRITICAL THINKING – BY: DR. JAMES LEEMANN
USING CRITICAL THINKING IN PURSUIT OF POST-HIGH SCHOOL EDUCATION – CRITICAL THINKING SERIES – PART 2
CRITICAL THINKING – TOP TEN IN-DEMAND SKILLS FOR MANY EMPLOYERS! – CRITICAL THINKING PART 3: WHAT ARE THE UNIVERSAL STANDARDS OF THINKING?
CRITICAL THINKING – WHAT LEVEL OF THINKING ARE YOU? CRITICAL THINKING PART 4
THINKING IS DRIVEN BY QUESTIONS, NOT ANSWERS – PART 5 CRITICAL THINKING SERIES: WHAT QUESTIONS DO THE BEST CRITICAL THINKERS ASK?
WHAT {DO YOU, AS A} CRITICAL THINKER, DO TO LEARN? – PART 6A – CRITICAL THINKING SERIES
WHAT DO YOU AS A CRITICAL THINKER DO TO LEARN – PART 6B – CRITICAL THINKING SERIES
WHAT HABITS DO CRITICAL THINKERS USE WHEN READING AND WRITING? PART 7A – CRITICAL THINKING SERIES
PART 7B: SUBSTANTIVE WRITING: WHAT HABITS DO CRITICAL THINKERS USE WHEN READING AND WRITING? – CRITICAL THINKING SERIES
WHAT DOES IT MEAN TO BE A FAIR-MINDED CRITICAL THINKER? – CRITICAL THINKING SERIES – PART 8
WHAT DOES IT TAKE TO DEAL WITH YOUR IRRATIONAL MIND? – CRITICAL THINKING SERIES – PART NINE (9)
WHAT STAGE ARE YOU IN CRITICAL THINKING DEVELOPMENT? – FINAL CRITICAL THINKING SERIES – PART 10
TO CHANGE THE WORLD, BILL GATES SAYS TO READ A LOT! – A RAINBOW OF ROLE MODELS {WEDNESDAY SERIES}
Self-Made Billionaires Train Themselves to be Smarter – BY -THOMAS OPPONG
MY FAVORITE ANNUAL LETTER – BERKSHIRE HATHAWAY INC. 2021 SHAREHOLDER’S LETTER
Jamie Dimon, Chairman and CEO JP Morgan Chase and Company, 2021 Letter to Shareholders
BUILDING FINANCIAL FREEDOM/LEGACY TEN DOLLARS AT A TIME!
BUILDING FINANCIAL FREEDOM/LEGACY TEN DOLLARS AT A TIME!
FINANCIAL LITERACY IS JUST NOT THAT COMPLICATED – TRUST ME!
https://wealthbuildingpowers.com/2019/04/01/financial-literacy-is-just-not-that-complicated-trust-me/
COMPOUND INTEREST IS THE EASIEST WAY TO DOUBLE OR TRIPLE YOUR MONEY
COMPOUND INTEREST IS THE EASIEST WAY TO DOUBLE OR TRIPLE YOUR MONEY
WARREN BUFFETT UTILIZED COMPOUND INTEREST TO BECOME THE 3RD RICHEST MAN ON THE PLANET!
WARREN BUFFETT UTILIZED COMPOUND INTEREST TO BECOME THE 3RD RICHEST MAN ON THE PLANET!
TURNING YOUR STIMULUS CHECK INTO MILLIONS $$$$!
https://wealthbuildingpowers.com/2021/03/22/turning-your-stimulus-check-into-financial-freedom/
INVESTING IN STOCKS IS COLOR BLIND – WHAT IS STOPPING YOU?
INVESTING IN STOCKS IS COLOR BLIND – WHAT IS STOPPING YOU?
To Join Wealth Building Powers BLOG:
PLEASE SIGN UP TO FOLLOW ME BY PROVIDING YOUR E-MAIL IN THE WORDPRESS BLOG PAGE SUBSCRIBE BOX!
Thank you to my followers and readers for your likes and comments. All comments, recommendations, and feedback are welcomed and utilized to improve this blog.
ABOUT ME
I am a proud nerd (as my beautiful wife and daughter have told me) investment and finance blogger with an N.C. State, Chemical Engineering, University Rutgers, MBA and Harvard University, Advanced Management education.
I left a corporate career because I desired to make a difference as a speaker and writer. I was blessed to be coached and mentored by strong women and men in my family and professional life. It is my time to serve and give back.
DISCLAIMER
I started my first business at ~13 years of age (a small but brilliantly created plant nursery). I am a successful investor in stocks, options, real estate and am happy to share my finance and investment lessons. I am NOT a licensed financial advisor. Please do not construe my suggestions on this blog as recommendations for your situation. As an investor, you must establish your risk/loss tolerance. Investment in any asset involves risk, including complete loss.
Please seek your licensed CPA or fiduciary financial advisors for individual financial advice.
I write this weekly blog to make an impact by reaching an audience and demonstrating the need for Financial Literacy. I will help you get there.
To follow my daily posts on Instagram, CLICK BELOW:
http://instagram.com/wealth_building_powers
