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Path: utzoo!linus!decvax!mcnc!duke!ucf-cs!giles
From: giles@ucf-cs.UUCP (Bruce Giles)
Newsgroups: net.flame
Subject: Re: Student Loan FLAME
Message-ID: <1222@ucf-cs.UUCP>
Date: Mon, 2-Apr-84 21:19:46 EST
Article-I.D.: ucf-cs.1222
Posted: Mon Apr  2 21:19:46 1984
Date-Received: Thu, 5-Apr-84 01:21:08 EST
References: <6521@uiucdcs.UUCP>
Organization: University of Central Florida
Lines: 156


>>     I can understand that you wish the government was configured to help
>> students.  I can understand it if each group in this country wishes
>> that the government be configured to help them or their cause.  What I don't
>> understand is why all of these groups don't realise that the government can't
>> afford their pet project.


A college education is a `pet project', huh?. 

The single most important facet of our government is that all men (and women)
are equal in the eyes of the law.  In order to ensure this, the United States
has always at least attempted to provide universal eduation.

Sure, if you were the oldest of twelve kids during the depression, you would 
have probabily been forced economically to leave school in order to help 
support your family, but the schools were there for *everyone*.  [Sidenote:  
Yes, I realize that schools are run by cities and counties; but how long do 
you think one of them would be allowed to close its school system before the 
national government stepped in?]

During most of our history, the fact that most of our population never made
it into high school, let alone college, was not a serious problem.  After
all, we were a nation of first farmers, and later factory workers.

But today the United States' economy is dominated by the *service* sector,
not the manufacturing or agriculture sectors.  And, in case you never
stopped to think about it, it requires far more eduation to be a clerk
in the service sector than to be a line-worker in a factory or a farmer.

Not only must a service sector employee be literate, they must also be able
to work with machinery, perform minor repairs and maintenance, be able to
work independently, and finally know how to locate information that they
need.

At the lower levels of the service sector, a high school education will 
suffice.  After all, it is not *that* complicated to operate typewriters,
telephones, copiers, etc.

But at the higher levels, a college eduation is mandatory.  A person with
a straight high school education will not know where to find the infor-
mation they need, let alone know what to do with it, without the training
they would receive in college.  It would be nice if it could be provided 
in high school, but it will still be a number of years before that could
happen.

On top of this, those of us entering the job market in the 1980's will
remain in it until the 2030's.  With the demographic trends, we will all
be working until our mid-70's or even mid-80's.  But by then the largest
sector of the United States economy will be the *information* sector.  
This sector, but the way, is where everyone on the net is either working
or training to work.  [sidenote: that is due to a combination of people 
living longer and those of us on the down-side of the `Baby Boom' being 
required to help pay for the hugh surge in Social Security payments.]  

I feel that it is totally preposterous for anyone entering the work
force to enter a sector which will face attrition during their working 
life, if they have a choice.

The college *loan* program, which is being derided by several individuals,
provides such a choice.

It is true that it is possible to work your way through college without
assistance if (1) you are single with no dependents, (2) you have a 
healthy local economy, and (3) your disposable income leaves enough
to pay for tuition, books, etc.

But, that severally limits the number of people who could attend college.
Fact it, the statistics are that the childern of poor and lower-middle class
families would find it difficult to attend college given the above
restrictions.

I do not have the actual data, but I have no doubt that there is a higher
birth rate among the poor and lower-middle class.  Furthermore, it is
almost by definition a fact that they will not have a sufficiently healthy
local economy to make a good income and still leave time for studies.  Or
if they did still have time left after working, that they would still not
have enough for tuition.

And before you cry "Go to a State School,"  I attend a state-run
university.  The tuition, books, etc. work out to $100/month for tuition,
$50/month for tuition (technical books are EXPENSIVE), $10/month for
other school-mandated expenses.  The local pay rate for nearly any steady
job a student could hold is minimum wage ($3.35/hr).  That works out
to 48 hours a month.  Living expenses for the humblest hovel and lots
of peanut butter (no car, phone, dates,...) would be at least the same
($160/month), and for a reasonable life style (old car, roommate in 
half-decent apartment, meat occasionally) would be over twice as much,
or approximately 170 hours/month.  That is a full-time job.  Now, for
reasonable classes a student would only be able to take 8 semester hours
a term.  For the fictional 120 semester hour degree, he/she would be
required to attend 5 full years of college, no summers off.  More
reasonably with state univesities, it would take 6 years, as the courses
you need are never offered when you can take them.

Now, once again considering the poor and lower-middle class, the odds
are that the student will have gotten married and started a family by
this point.  After all, 18 years old + 6 years in college = 24 years old.
Of course, the student's spouse may be able to work full time to enable
the student to go full-time, but odds are that both of them are students.
And of course, once the first child arrives, they both will have a very
hard time continuing with their eduation.

Finally, sometimes the student may be able to augment their income with
seasonal work.  But realistically, if they already have to work full-time
and attend 8 semester hours of class year-round, how much snow can they
shovel or grass can they cut?

This is where student loans are a great assistance.  When I had my student
loans, they were equivalent to the income I had from my part-time job. So
together, I had an income comparable to that if I was working full-time,
but had the time to go to school full-time.  No ifs, ands, or buts, the
loans made it easier for me to attend classes, but my no means could
support me without me making an effort on my own.

I realize that the fact I have emphasized the poor and lower-middle class
in this article makes it sound like I am one of those `Social Engineers' 
from the Sixties.  I certainly am not!  But, I realize that the situation
with eduation is precariously close to the (mythical?) old French law,
with punishment for noblemen and peaseants alike, outlawing the thief of
a loaf of bread.  Sure, its a crime either way, but why would a nobleman
need to steal a loaf of bread?

This is the situation with eduation.  Without a fair student loan program,
only the children of upper and upper-middle families will make it through
college, and thus only they will be *able* to be the leaders of the next
generation.  The slim opportunities that the poor and lower-middle class 
have had historically will be closed.

Perhaps some people are unconcerned by this, but I certainly am not.
This could only lead to increased stratification of the American population
and that is diametrically opposed to the very principles this country
was founded on.  No, do not give away free lunches; instead help the 
needy pick themselves up and guide them until they can stand alone.

In closing, if student loans were non-defaultable, IT WOULD NOT COST A 
TAXPAYER A CENT for the student loans.  Yes, the government artifically
lowers the interest rate on the loans.  But at the same time, the former
student pays far more in income taxes than he would have otherwise.

The primary problem with the student loan program today is that there are
relatively rich students obtaining loans they do not need who then default
on them.  If the government stepped in and demanded that money back, along
with interest and even fines, the student loan program would become self-
sufficient overnight.

In the jargon of investors, student loans are "venture capital."  And as any
investor can tell you, verture capital loans can be risky, but they can
also be very rewarding.


ave discordia				going bump in the night ...
bruce giles

decvax!ucf-cs!giles			university of central florida
giles.ucf-cs@Rand-Relay			orlando, florida 32816