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Samarda
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23 Sep 2011, 8:41 am

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Many young college students, hoping to further their education, are deluded into accepting loans that they believe be can be payed once studies are completed and have received their degrees. This documentary explains how we are molded into an expectation of going through the grades of school, attending college and landing the dream job. But the statistics show that student loan debt has now surpassed credit card debt in the U.S., with many of those loans unable to be paid back, proving this scam is yet another system of debt enslavement set up by the banking elite.


From the time an American child reaches the 6th grade, they’re taught that the key to success in life is to do well in high school so that they can get accepted to the best possible college. The better grades they get in high school, the better college they will have an opportunity to get into. They are taught that if they get into a great college and get their college degree, any type of job they desire in the field of their choice will be there waiting for them. After getting their dream job they will be able to buy any car and house they desire, start their own family and live the American dream.

Most Americans today have an expectation of future economic success, simply by obtaining a college degree. The entire purpose of elementary school is to prepare students for high school. And the entire purpose of high school is to prepare students for college. In fact, the U.S. now has hundreds of college preparatory high schools that, at a cost of $25,000 per year, are suppose to increase students chances of getting into a top tier college. Students are taught to believe that if they don’t get into college, they will be on a path to nowhere and will have no chance of building a successful career.

Government regulations like no child left behind, have left grade and high schools in shambles. Instead of teachers having the freedom to think outside the box and use creative techniques to prepare their students for the real world, they are taught to be narrow minded and teach worthless information that will never help their students have successful careers. Today, their are no high schools left in America that teach students the knowledge necessary to start their own business, invent their own products, or even how to use the internet and other free resources to become educated about things without attending college.

The annual cost to attend the average four year college in America today is $27,293, up 29% from 5 years ago during the 2005/2006 school year when the annual tuition cost $21,235. This does not include the price of text books, which have tripled over the past decade. Colleges are now charging $200 for each single text book that has no resale value because they put out new slightly revised versions with a new name each year. The text book publishers are even colluding with college book stores to make custom text books, so that students can’t save money by buying them online. Colleges are getting kickbacks from publishers in order to destroy the used textbook market, which by itself is proof enough that college administrators are only interested in lining their own pockets, and have no interest in helping their students.

College tuition has seen 5.15% annual price inflation over the past 5 years. This is despite the fact that U.S. real estate prices are down 26% from their peak in July of 2006. And the Dow Jones is down 18% from its peak in October of 2007. Even oil is down 38% from its peak in 2008. During the financial crisis of 2008 Americans lost 10.2 TRILLION DOLLARS in paper wealth. And college is the only thing in America, besides the cost of health care, that did not at least temporarily decline in price.

Over just a 2 year period from December of 2007 to December of 2009, 8,363,000 jobs were lost. or 6.1% of total jobs. One year later, in December of 2010, thanks to the Federal Reserve and the U.S. government spending 4.6 TRILLION dollars in bailouts, stimulus programs and other government spending, 1,124,000 jobs in America, or 0.9% of total jobs had been recovered. That is over $4,000,000 spent for each job created.

During an economic downturn when Americans are losing their jobs, their primary instinct is to seek higher education in order to make themselves more attractive to potential employers and better position themselves to receive a job. However, how are Americans supposed to spend $27,293 per year for college when they have no savings or income to pay for it?

The U.S. government, with the backing of the Federal Reserve, in the same way they created the real estate bubble by providing mortgages to all Americans through Fannie Mae and Freddie Mac, regardless of whether or not they had any capacity to pay the loans back, has been using the exact same easy lending practices to create one of the largest bubbles in U.S. history, the college bubble.

College students borrowed $106 Billion in total student loans for the 2009/10 school year, up from $96 Billion in 2008/09, $94 Billion in 07/08, $87 Billion in 06/07, and $83 Billion in 05/06.

College Loan Breakdown
09-10 $106 Billion
08-09 $96 Billion
07-08 $94 Billion
06-07 $87 Billion
05-06 $83 Billion

Total student loan debt in the U.S. currently stands at $830 Billion and now exceeds credit card debt.

The U.S government has been trying for decades to make college more affordable, but its actions have accomplished the complete opposite effect. College is now impossible for most students to afford without getting deeply into debt to do so. All across the country Americans are graduating college, with mortgages before they even buy a house.

Back in the 1970s, the average college student was able to afford their college tuition without any student loans or help from their parents. They were able to pay for college by working a part time job year round or by simply working full time during the summer when they were off from school. Now only that, but they were also able to afford their own car payments and possibly a small apartment. The U.S. government destroyed this by providing easy student loans to anybody that applied for them without any credit requirements. Over the past decade, any 18 year old has had the ability to take out large student loans without even being asked if they have a job or what their high school grades were, what they intend to major in, or any other information that would help determine their future ability to pay back the loan.

Today two-thirds of students are graduating college with an average student loan debt of $24,000. And, the government is now making the situation many times worse by completely taking over the student load business. Hidden inside the recently past health care bill, the government passed a complete student loan overhaul, where they removed commercial banks from providing student loans to the students. Now, all students will receive their loans directly from the government at artificially low interest rates.

With all the modern technological advances the world has been experiencing in recent years, the cost of a quality education in America should be getting cheaper. It is now cheaper to purchase a plasma television or laptop computer than years ago because the government doesn’t subsidize purchases of these products. If there was a true free market in college education, colleges would be figuring out more cost efficient ways to educate students using modern technology in order to bring tuition down and compete against each other for the enrollment of students. By guaranteeing student loans and providing too much financial aid to students, the U.S. government destroyed the free market in college education.

One NIA member who is 50% owner of a private vocational school, tells us he is legally forced to raise tuition every time the government raises financial aid to students. The government’s 90/10 rule mandates that at least 10% of a private for-profit college’s income comes from non-federal government sources. Therefore private for-profit colleges must keep raising tuition to stay within the 90/10 rule. The government needs to get out of the education business completely and allow private banks to reenter the market and compete against each other in order to offer loans at reasonable interest rates to students who have the best ability to pay them back. The reality is, the majority of the students who qualify for loans today from the government would no longer qualify. But this will force colleges to either bring down their expenses in order to charge affordable tuition, or close their doors for good.

Colleges in America spent $10.7 Billion dollars on construction projects in 2009, down from an average $14.7 Billion spent per year from 2005 to 2007, but still very excessive. Colleges have recklessly spent to build new libraries, gyms, sports arenas, housing units, etc all for the purpose of impressing potential students and their families. None of these projects have added anything to the quality of education in the U.S. Many colleges have very large levels of debt they undertook to build new construction, with most college endowment funds being crushed in recent years due to collapsing real estate and stock market prices, many colleges have very poor balance sheets that won’t be able to withstand the slightest drop in enrollments.

Jocks. Grown up jocks. Excuse me, coaches now, ‘hey coach’, making millions of dollars. Well what does this have to due with education? What a waste. Two bit universities building baseball teams, football teams, basketball teams. For what? To entertain the kids? Yeah you can do this if you’re a very rich society and you have the money to waste. But not during a great recession, and not as the median household income of the country continues to decline. And not as you’re sending all of these kids to get degrees in worthlessness, because that’s what these universities degrees are, a lot of them. It’s a waste of money. It’s a waste of energy, and it’s an affront to anyone who really wants to think seriously about an education, because it has nothing to do with the NCAA.
-NIA



Comp_Geek_573
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29 Sep 2011, 2:10 am

Makes me almost glad I got mediocre grades in high school, meaning I couldn't get into a "top-tier" (and top-expense) school. I'm at a much cheaper state school that, I've read a while back, actually gives as good an education as an Ivy-League school. Now I think the likes of Harvard are a waste of money.