Why should colleges be on the hook for student loan losses? Should they not be treated equally to other businesses [i.e. not subsidized].
Because they market their degrees as investment to make 2x, 10x, 20x more money in future earnings than a high school degree alone. They make exaggerated claims for job placement. They distort entering student test scores to make the school look more prodigious.
That false advertising, combined with student loan debt that is unethical, to the point of taking advantage of people. In no other situation is a no job, no experience, no money, no collateral 18 year old permitted to take a $50k to $180k loan. A loan which cannot be discharged in bankruptcy. Could you imagine such a 18-22yr old going to the bank to get a 1-5% loan for $180K to invest in a start up business he has no experience in? or invest in the market? hah!
I think that puts society in a catch-22:
If the student loans are dischargeable, then private investment would have 0 support for the market, which is bad for society and only encourages more foolish gov't meddling.
If the loans are not dischargeable, then the college doesn't care what degree a student gets. It incentivizes the wrong behavior on the college side. Especially when a degree is not market oriented, I fully agree that still doesn't make it worthless. For example, I think everyone here would accept history and archaeology as having significant academic, social, and intellectual value; the fact is it has limited market value. In these cases, such a degree should not be funded by large amounts of debt. Again, in the current situation, the college is incentivized to sell as many History degrees to as many as they can possibly pack into the stadium lecture hall, regardless of the students ability to repay, and regardless of the job prospects in the discipline of history.
What offends me here is the statement that things I study are somehow worthless. No they are not. I have actual experience of marketing the skills I learned in a successful way. The problem is not with liberal arts, it's with idiots that think degrees are magic.
Offended easily?
(just kidding)
So my point is that I don't care what worth your degree is. And you don't care what I think your degree is worth. But what matters is the market truth, whether a loan was used to actually develop your (or anyone's) latent talents into marketable skills and ability that someone is willing to pay for, while also screening out those with no talent.