Sunday, July 25, 2010

Tuition Bubble Makes Housing Bubble Look Weak

The cost of a college education today is more expensive than it has ever been, in both real and nominal terms. The high cost leaves graduates saddled with tens of thousands of dollars of debt, on average $21,000. Our theoretical best and brightest are debt slaves before they've even started their first real job.

Federally backed loans offer better interest rates than private loans, but carry restrictions if you declare bankruptcy. You can't get rid of a federal loan so easily.

It's a cultural failing, if you ask me. Surely we can do better than this. Maybe if the government stopped inflating the tuition bubble with federally subsidized loans, we would find a better way to pay for college.

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