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Originally posted by Evolutionsend
reply to post by ldyserenity
That will never happen. We can't do anything to a minority, but we can certainly stick it to the middle class people in this country, just a little bit more.
And borrowing for college is at record levels. The Federal Reserve Bank of New York says students and parents took out a record $100 billion last year and owe more on student loans - more than $1 trillion is outstanding - than on credit cards.
www.twincities.com...
The 90/10 rule is a regulation that limits nontraditional schools from receiving more than 90% of their funding from Title IV funds (Pell grants and Stafford loans). These nontraditional schools are more commonly known as career colleges or trade schools and operate on a for-profit basis.
So how does the 90/10 rule drive up the cost of a college education? The effect is achieved in 2 ways. First, there's the percentage of students that attend a school who receive Title IV aid. If most of the students who attend a school are financially able to pay their own way without receiving federal aid, the 90/10 rule doesn't come into play. When an increasing percentage of students start receiving federal aid, problems result. I'll explain in a moment. The second component that comes into play is when Congress increases the amount of Pell grant money or Stafford loan money that a student is eligible to receive. If a student can get more money then that edges the total funding closer and closer to 90% federal coverage.
Here's what happens. In either scenario, the school begins taking in a greater portion of its total funds as federal aid dollars. It doesn't matter whether that money is coming as a result of more students attending who choose to apply for federal money or whether the increase is coming from a higher funding eligibility as a result of congressional legislation. More federal dollars are coming in. If that amount gets uncomfortably close to 90% of the total funding the school has to do something to decrease that percentage. A school is not going to turn students away in order to address a 90/10 problem, so the alternative is to raise the tuition. By raising the tuition the federal money that students receive doesn't go quite as far. In order to attend the school the students will have to come up with more money out of pocket to cover the cost of their education. They typically come up with this money by taking out private loans or using personal credit cards.
In response to the increase in tuition by the schools, Congress reacts by increasing the student eligibility for Pell grants and Stafford loans. In response to the increased grant and loan money coming in, these schools increase their tuition in order to stay within the 90/10 regulations. It becomes a vicious cycle with the net result being that tuition continues to increase because it has to.
How does this affect traditional 4-year and 2-year colleges? As the career colleges and trade schools increase their tuitions and are able to pay their instructors better it drives up the salary expectations of the traditional schools. A rising tide lifts all ships and rising tuition spreads across the board.
Originally posted by miniatus
I agree with Paul on this .. and I see his point.. It's a system that costs the government a lot of money to provide, it has put maaany americans in debt that they will be spending large parts of their life trying to pay off, if they can even get work in the first place.. Federal student loans haven't been out there forever, we managed before they existed..
The education system itself is a joke.. as pointed out above, the cost of education is extreme.. it doesn't need to be!
The big problem is we've lost our ability to live within our means.. we're a society of borrowing and we need to break that habit.. we just need toedit on 23-10-2011 by miniatus because: (no reason given)
Originally posted by Strype
Yikes. If he thinks pulling student loans without drastically lowering admission prices will solve any problems, I believe he's in for a rude awakening. If students with wealthy parents are the only people graduating from college, getting advanced educations and taking the "good jobs," we'll be even deeper in crisis then we've ever been, minus our last paddle. Talk about 99% vs 1%...
Cheers,
Strypeedit on 24-10-2011 by Strype because: sp.
Originally posted by Brother Stormhammer
For once, I find myself agreeing with Mr. Paul, at least in the majority.
Someone early in this thread wailed "Why do I need to have an $80,000 degree to be an interior decorator?"...Good question. Why do you? As far as I know, there isn't an "American Interior Decorators' Association" that requires you to be licensed. If you're good at the job, go for it. The degree might make it easier, but it's not a requirement.
Too many people in the US have fallen victim to two major fallacies regarding a college education:
Originally posted by Strype
reply to post by bacci0909
Very good point. I did consider that. However, I don't see the colleges being too excited about losing such a large percentage of their income and student-base either. I imagine the balance wouldn't be a smooth, nor speedy process.
Strypeedit on 24-10-2011 by Strype because: (no reason given)