|The summer of 2002 brought the nadir of the Dot.Com Meltdown. The autumn of 2006 opened the mortgage meltdown which revealed the bankruptcy of two automotive giants. |
Educational credentials are an asset when seeking employment. Even under rational circumstances, constant training and retraining is a consequence of a healthy, expanding economy. This time, however, so many thousands of automotive employees took "early retirement" that local colleges and universities here in southeast Michigan opened special programs just for them. Add to them millions of others sold on the idea that a college certificate or degree is the gateway to a job.
That no one is "training" entrepreneurs is a different problem, as well. They cannot be "trained" of course, but that aside, these colleges and universities are not intellectually capable of perceiving the problem. Therefore, they cannot solve it. And so no amount of training can get you a job that does not exist in the first place.
Those who advocate educational vouchers, should consider these facts. The horrific default rates at private schools are a direct consequence of their superior marketing, admittedly, to consumers who are not intellectually prepared to think through the marginal utilities and production possibilities. In other words, with an easy pipeline to money, the private schools sell pipedreams.
Public education being what it is, of course, the fact is that here in Washtenaw County (as in many other places) the community college is funded primarily by property taxes, voted on in open elections, which is how the board of trustees is chosen. The school is nominially inexpensive because the true costs are paid by others. Still and all, those costs are paid.
These so-called "government" loans are actually from private sources, banks, essentially. Sallie Mae is a private organization, a kind of reseller of loans.
Sallie Mae manages $182 billion in education loans and serves 10 million student and parent customers. ... Sallie Mae is listed on the Fortune 500 and is one of the Top Innovators in IT according to InformationWeek. http://www.salliemae.com/about/
Unpaid loans are direct losses. There are many government programs, but the general truth is that the government only guarantees the interest, not the principle. Stafford Loans are from government. Defaults are absorbed in the general budget.
(Edited by Michael E. Marotta on 7/14, 7:04am)