Opinion of Linking University Tuition to Future Salaries
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  Opinion of Linking University Tuition to Future Salaries
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Author Topic: Opinion of Linking University Tuition to Future Salaries  (Read 771 times)
DC Al Fine
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« on: July 16, 2013, 06:45:15 AM »

The Oregon Legislature is debating a plan to link tuition at state universities to students' future salary. Students would have the option of paying 3% of their wages for 20 years after graduation instead of paying tuition up front.

It's an interesting idea that would help reduce student debt to a manageable level. At 3% of wages, there won't be any issues with unemployable student crushed with crippling debt. However this could leave the university in the lurch as more people take programs with lower income potential or work less. The housewife with a $10k student loan would still have to pay under the old system but the university would be out money under the new one.

Honestly my main concern with the article is that the author has no notion of how interest rates and the time-value of money work. He claims that students would pay out $7k more on average than what tuition is now, but that actually works out to a fantastic interest rate when compared with most student loans Tongue
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opebo
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« Reply #1 on: July 16, 2013, 07:38:41 AM »

Its a reasonable idea, but a better way would be allowing only state universities with full government-granted tuition, keeping the rich out of university as much as possible and reserving it for the poor.
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Blue3
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« Reply #2 on: July 16, 2013, 03:07:28 PM »

The federal government already offers a Income-Based Repayment plan for their loans.
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Del Tachi
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« Reply #3 on: July 16, 2013, 05:06:38 PM »

Horrible idea.

The measure will encourage universities to de-emphasize programs that do not yield high income-earners, such as education and nursing.  
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barfbag
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« Reply #4 on: July 16, 2013, 05:20:48 PM »

Its a reasonable idea, but a better way would be allowing only state universities with full government-granted tuition, keeping the rich out of university as much as possible and reserving it for the poor.

So the rich don't have the right to go to college?
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All Along The Watchtower
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« Reply #5 on: July 16, 2013, 06:39:04 PM »

Its a reasonable idea, but a better way would be allowing only state universities with full government-granted tuition, keeping the rich out of university as much as possible and reserving it for the poor.

So the rich don't have the right to go to college?

learn 2 reed opebo posts plz
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Indy Texas
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« Reply #6 on: July 16, 2013, 08:15:38 PM »

For one thing, it does nothing to address room and board costs. At many state universities, this is more expensive than tuition. Students can sometimes save money by living off-campus, but most schools prohibit them from doing this for at least their first two years of college.

Second, will this encourage universities to eliminate programs that don't yield high-paying graduates? And won't students who are likely to be high-earners disproportionately opt for traditional student loans? If that happens, where does the money come from?

We of the Atlas Forum tend to forget that going away to college at age 18, living on or near campus for 4 years and then graduating is not the norm for anywhere near the majority of college students. Going to a community college and later transferring; going part time over a period of several years; living with parents or a spouse or partner and commuting - these are the things the majority of college students in America are doing.

I'm assuming the money you're paying back from getting your degree isn't getting earmarked for the specific school/department where your major was located. I'd imagine it would be no different than the inflow of money from tuition and tax dollars. If you're paying tuition for a BA in women's studies, your tuition isn't going directly to the women's studies department and staying there. It's going into a big fungible pot with everyone else's.

Under the current system, programs with low operating costs effectively subsidize programs with higher operating costs. Part of the reason so many universities opened law schools during the last decade was that in addition to greater demand for JDs, law schools are relatively cheap to operate. Your only costs are the faculty and classroom space. So when a JD student is paying that tuition, it's covering the cost of getting that degree and then some. The "and then some" is subsidizing high-cost activities like the research in the medical or engineering schools, which often require expensive equipment and large numbers of staff.

Under this system, the high-payoff programs (those whose graduates go on to earn high salaries) are subsidizing the low-payoff programs. That's not a bad thing. Teachers never make a lot of money (contrary to Krazen's delusions), but that doesn't mean they're not important and we should get rid of education majors.
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Torie
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« Reply #7 on: July 24, 2013, 04:29:21 PM »

Putting aside how the math works, and the details of the example provided, it is a great idea as a general concept to tie students paying back their loans based on income later earned, and that is exactly what the Tories did in Britain. I strongly support it.
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TNF
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« Reply #8 on: July 24, 2013, 04:34:40 PM »

Better idea would be just to abolish tuition and be done with it. But sure, it's better than what's going on now.
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opebo
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« Reply #9 on: July 24, 2013, 05:59:13 PM »

Its a reasonable idea, but a better way would be allowing only state universities with full government-granted tuition, keeping the rich out of university as much as possible and reserving it for the poor.

So the rich don't have the right to go to college?

No, barfbag, they don't.   They should be punished for their crimes.
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© tweed
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« Reply #10 on: July 24, 2013, 06:28:39 PM »

Better idea would be just to abolish tuition and be done with it. But sure, it's better than what's going on now.

no, it's ideologically disastrous.  the university experience should not be akin to the trade school experience.
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President Tyrion
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« Reply #11 on: August 01, 2013, 09:52:24 PM »

Its a reasonable idea, but a better way would be allowing only state universities with full government-granted tuition, keeping the rich out of university as much as possible and reserving it for the poor.

So the rich don't have the right to go to college?

No, barfbag, they don't.   They should be punished for their crimes.

What?


Anyway...

I think it's a good idea from a student perspective, but it's a poor idea unless your expressed goal is to try to get universities to cut low income majors and programs. In the long run, there will be an influx of former students expecting higher income (since universities will choose to channel them to those professions), and the income of those former students will be lower than expected. Perhaps you view it as good for society that doctors will one day make as much as an interpretive dance major, but that's not a system I would want to be a part of.

With that said, obviously I'm engaging in hyperbole. Those high income salaries will drop a bit in the short run, which would lower the income gap. A good thing? Not necessarily. I think this is one way that the income gap being lowered doesn't really improve the economy much. All that lost production goes nowhere.

I like the idea, but I don't think the execution would work.
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Vosem
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« Reply #12 on: August 01, 2013, 11:15:28 PM »

n00bz don't get opebo...hahaha but we love u bro
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