Republicans & Conservatives Archives

Have you paid attention lately? What you supposed will happen under Obama has already happened under Bush and the Republicans.

Do you think that homeowners were the only folks gulled into paying for more than they could afford? The private companies freely encouraged colleges to get students pricy private loans over the government loans they could have qualified for.

I can also testify personally to something else: the shear, crushing weight of the debt. How many students are stuck in dead-end jobs, how many employers deprived of young talented people who can’t afford to work for less than what it takes to pay off their loans? What good does it do America to have it’s top talent perpetually in debt, one job loss away from bankruptcy?

But as for defaults? I think anybody who wants a college education should get one. You’re so interested in battling the evils and moral hazards of socialism that you’re willing to consign us to second place behind those willing to educate their students.

A mostly public system is not necessary in my view, but I don’t see the value of a secondary system that just serves to bankrupt those who take advantage of it.

Eh, I wouldn’t care seeing if it goes through. After all it will change the market. It is not even close to socialism, you have no clue what that is from what you said and wrote, but shrugs, you choose who you want to be as your article so carefully says.

Our education is far from top of the world, there are only a handful of university that are on top. At least we still have the most, but that is hardly saying something when you are one of the richest and biggest (in terms of physical size) countries in the world. Anyways, lets stop talking about the BS, both you and me, because we know none of that really matters.

Community college is cheap affordable and great. Why is that? They for the most part watch their costs more carefully, don’t go crazy with stadiums and other non academic things. Most University’s are like mini socialist utopia’s. You go there, get an education, but then get everything else and pay for everything else whether you want to or not. Personally I didn’t care about getting free tickets to all the sporting events in college. I would rather pay 1k less in tuition. I didn’t care for most of the organizations and clubs. Although a few, the ones that were more national clubs, you actually paid to join which I didn’t mind.

In short I think what needs to happen is the federal government needs to say we will not pay for extra clubs and other activities with student loan money. That wasn’t what it was made for. Then they should force colleges that want the money to separate the meat from the fat. If students want the fat, they can pay extra for it. All it does is force the market decide. If you are a republican you should be for this if you are against unions, because that is basically how it is acting. Sure you are not forced to go to that college, but then your only other choice is no education or out of country.

Stephen

It depends on what kids are studying and how much they are learning. It doesn’t make us more competitive to push kids to study literature in college when they might be more interested in and suited to learn boiler making in tech school or as apprentices.

BTW - despite what you may have heard, the U.S. remains one of the most competitive nations on earth.

You may also know that we send more kids to college than most other countries, maybe too many. Places like Germany train more kids in technical/apprentice training.

We also have a general problem with devaluation in college. Because we want to send so many kids to school, we have had to make lower standards available. And a lot of what we are teaching in college is actually HS level.

My daughter took an IB program in HS. It pretty much took care of her first year in college.

One more thing re “crushing debt”. There are lots of grants, scholarships and loans available and kids can work while going to school. Paying full tuition at a state school will cost around 40,000 for four years. That might seem like a lot of money, but it is manageable if spread over 20 years. They also have the option of community college in their first two years, which is a lot cheaper. Where we live it costs around $10,000 for the two years. Many people pay that much for a car. And the military has a wonderful scholarship program.

But you are right that college cost have risen too much. C&J paid for college by working and loans. They had debt, but it wasn’t “crushing” because university was cheaper back then.

I wonder why university eduction has become so much more expensive. Maybe because they can charge what they want?

Kudo

You don’t think that American universities are the best in the world? There are other good universities, but my experience tells me that America does very well.

I have lived in socialist countries. I know what it is. You didn’t notice the sentence about bothering people?

We just need to think more broadly about education, instead of just stuffing money into it. I think the community colleges are a good option and so is the military.

We have a 19 year old who has applied to the Northrup Grumman Apprentice School at Norfolk News. That’s the kind of program we need more of if we are going to actually be able to build these new nuclear and gas plants without importing significant amounts of skilled labor.

C&J
Must say your opposition to the BHO proposal smacks a good deal as reflexsive partisanship..the swan and the scorpion fable..I suppose. It is good you are willing to praise those socialist state schools, colleges and junior.
Some of the best trade schools we have are trade union apprentice programs. Apprentices also work and earn a fair amount while they attend formal trainning. Its a good deal,especially if the apprentice has a family to support. I imagine it might be rough to get in right now as the building industry is in the tank by all accounts. This will change at some point and then we will need lots of skilled people.

bills,

The issue is that if the government does as Obama has suggested, it will cost every taxpayer. The money does not come from ‘nowhere’, except in defecit spending which seems to be the way the two major parties want to keep their power.

If an individual runs up large student loans (government backed, not provided) at a specific rate and then doesn’t make enough to pay them back at the monthly rate agreed upon, who makes up the difference? The bank is not going to, because the bank is loaning the money to make money, they are not a charity. The bank will have to be paid the difference by taxes collected on the US citizens. And the misguided belief that one can just tax the rich and business, without accepting and understanding how they get passed to the middle class and poor in purchasing needed goods, will just make it worse on those struggling to get buy…

There are many people who understand what these ‘programs’ will result in. We are not fooled by the rhetoric, nor do we think that they are going to be paid by Obama cash….

We actually know where the money is coming from. As usual. From us.

C&J,
I agree that a college degree is nowhere necessary to be successful. Hollywood, major sports,and many bluecollar industries offer opportunities to excel without degrees. Even the personal service sector is a breeding ground for success sans degree. In away, I think this issue demonstrates the atrocious nature of economic education in the K-12 system.

I look at some of the majors that come out of school and wonder if the student looked at employment opportunities first to see if the extra cost per unit is worth the expense in light of the entry level pay scale.

On a different note anmectdotally, my next door neighbor is a school administrator and she is in contact with military recruiters. Guess what, this economy means that the military is seeing a glut of people and they are even turning college degrees away.

Finally, I am older and wiser now and I am finding that I don’t care if our total population is the smartest in the world. I do care that our population is the most productive in the world. We have as evidenced by this computer and internet, more opportunities for extra-curricular learning than ever before. And as industries continue to specialize, and advance, it is going to be up to them to provide the necessary education for their people. (this is usually professional developement) I would think that this is truly an example where business should take the lead in funding schools from where they get their people.

RH
Can’t say I have been following this closely. I do know that we,as a nation,decided long ago that education is in our long term interest.
I recall Clinton tried to get the banks less involved and make the loans directly from the government…yes,that coercive government that has all sorts of ways to collect the money back. Banks have a place in the economy. They make money by essentially taking calculated risk. All fair and good but in the case of tax payer insured lending they are not taking a risk. This yet another subsidy. The money we invest in these loans would go much farthur without the banks involved at all.

I agree with C & J for once. Too many people are directed to college and it is not fiscally responsible to make defaulting easier for those who shouldn’t go to begin with.

Christine,

Did I hear right that you may have gone to a state school, and that your son went to a community college?

Your family chose to attend government supported schools. Your family did not pay for their own education, they had help.

Did you by any chance attend public elementary and high school? Those are social programs.

Oh, yeah, and no - your personal experience living abroad in “socialist” countries doesn’t matter, because performance is tracked globally, and Americans are behind.

There is a global workforce now. Your already grown kids may be the last generation that will not have to compete globally for jobs. The best leg up any of us can give the new generation is a good education.

Oh, yeah, and that military option? Who do you think pays the college tuition money the military provides? Sounds like your son has been in and out of socialist programs his whole life.

Christine and John,

However, well intended, your argument has principled hole in it one could fly NASA’s Shuttle Craft through.

Our national security is of such vital importance to our nation’s continued integrity and success, that it would be preposterous to leave the funding of it to voluntary contributions at either the individual or State levels.

The very same principle that applies to the physical defense of our nation’s future, applies to education in America, since, EVERYTHING that happens in America in both the private and public sector depends DIRECTLY upon the quality of education of every person occupying space in this nation.

Our government, our democratic process and elections, our private corporations and small businesses, our charitable organizations, and indeed, our liabilities toward our fellow citizens unable for a host of reasons to provide for themselves, depend directly upon the quality and length of education of our citizenry. To leave education to the States or individual contributions is a mistake our nation has been making for centuries, though there have been significant improvements beginning with universal legally mandated public K-12 education for all Americans.

But, that was just a down payment on an improved future America. The balance is now due. America needs a federal investment in a nationally standardized essential quality of education which covers 2 years of junior college or vocational training school. Leaving education up to the whims of the economy, individual financial capacity, and Wall St. fluctuations is no different than leaving the funding of our military up to volunteerism by those who own their own weapons.

Your argument is well intended, but, fundamentally flawed in addressing the nation’s stake and obligation to its future integrity and efficacy in education.

Max,

What an impressive insightful and well analyzed response. The biases we hide from ourselves in order to maintain our ideology with minimal cognitive dissonance is truly remarkable, and you demonstrated very effectively how that works by unraveling it in Christine’s point of view.

Christine-
Let’s drop this “most competitive” notion right here and now. However true it may be in today’s terms, The dynamic that naturally comes from this is one of laziness and decadence.

We’ve become utterly scared of any kind of social planning, of depending on anything else but individual achievement and emergent results of people interacting with one another.

I won’t say central planning from the top always works, that we can safely ignore moral hazards and other emergent effects of policy. But what we shouldn’t be doing is assuming that we can just depend on emergent order to satisfactorally manage our society.

Any successful system will have to be a hybrid because societies do indeed naturally, emergently drift into problematic behaviors. The Wisdom of the crowds is not infallible.

I speak of debts from bitter experience. Some people have the grades and the ambitions to go to the best schools, but aren’t poor enough, excellent enough, or athletic enough to have their tuition handled so much by grants, scholarships, or other more gentle forms of educational financing.

And many of those people, thanks to the economic turmoil and dysfunction of the last couple decades are in a position where it’s hard to find the work to pay back the loans. And given the terrible deals that the industry and school financial officers often got people into, those economic burdens are great, and not to be belittled as a problem for the rest of society.

You Republicans talk about passing burdens on to the next generation, but the trouble is, those burdens have been passed on already, and it’s taking a huge chunk out of people’s ability to pay anybody else but the big financial companies. And if they don’t pay? Well, that’s another problem for the financial companies.

This is part of a larger problem here, where finanical companies try to squeeze blood out of a stone, and those they’re squeezing are seeing their options considerably curtailed by the economic burdens put upon them.

Obama’s plan, while it may not let them recover all their money, could actually manage through government fiat what should have been done by market sensitive lenders in the first place: establish a system where people can pay back what they owe, and are more likely to pay back.

If I can afford the smaller payments, then I might quit putting off paying the loans off until I get a better job, and start paying now. If I start paying now, they have real postive cashflow, which is better than simple on-paper profits.

That’s what we need to realize here: no system is sustainable where the financing companies create circumstances where nobody can pay them back, but where fewer people are capable of settling their debts in a bankruptcy. Such a system could only work if you move around the debts in a deceptive way. That was our system, and the one which failed.

We have already tried a system where the lending is allowed to be predatory in its disregard for the means of those taking out the loan. Again and again, the lending companies used derivatives and other instruments to make it possible for them to make riskier loans, and to make it profitable to throw more money at those greater risks. Again and again, the Republican Congress crippled people’s ability to settle their debts. And again and again, those who regulated finance put the emphasis on letting them make as much money as possible rather than on their duties and obligations to both their debtors and their own investors and creditors.

To call the system we’ve had capitalism is to belittle capitalism, because our economic system was built on castles in the sky theories of perpetual growth based on unhindered speculation, rather than on substantive economic improvement, better jobs, more profitable, beneficial industries, efficiency and maintenance of of our economy beyond the simplistic terms of balance sheet trickery.

The real capitalism, the capitalism that works, rests on people’s shoulders rather than their backs. When people cannot stand up beneath the debts they incurred in order to maintain standards of living and meet society’s expectations of them, then that society cannot long sustain itself.

Stephen D. said: “Obama’s plan, while it may not let them recover all their money, could actually manage through government fiat what should have been done by market sensitive lenders in the first place: establish a system where people can pay back what they owe, and are more likely to pay back.”

I have to agree with this statement, though I don’t like it. High interest rates, philosophically and theoretically, are useful in promoting behaviors that avoid them where the borrowers are rational and have discretionary choice as to whether to borrow, or not borrow. The perversion of this concept however has been complete in turning it completely upside down. The Lenders are now the one’s designing, promoting and tricking borrowers into high interest rates, making them the primary product on the market, and low interest rates a hard to find commodity. That is a position by lenders that MUST, when all is said and done, undermine their entire enterprise and industry.

But, that is precisely what Adam Smith warned would happen if “enlightened self-interest” were replaced by greed in the free and open marketplace. And the difference between greed and enlightened self-interest is quality education, which I don’t think Smith states directly anywhere in his two massive works, but, certainly alludes to in detail in Theory of Moral Sentiments.

Max

Please read what I said in the first paragraph. The key part you missed was – “We are grateful, BTW, for the state college system and we are in favor of devoting some of the taxes we pay to support college education. It is a good investment. But like all investments, it depends on who, what, how and how much.”

I think you are mistaking me for your stereotype/caricature/straw man of a conservative. I know it is more fun to play the game by yourself, but there is nothing in your argument that applies to either C or J. The tax money C&J have paid over the past twenty-five years has probably put in more than enough anyway (I bet C&J are among the greatest financial supporters of public schools on this blog), but we support public schools and always have. That doesn’t mean we support everything about them nor do we believe that competition for vouchers (also a form of public school, BTW) wouldn’t improve the system.

David and Max

Yes, Max did an excellent job of knocking down a straw man. I am not impressed. IMO, it is a problem of educations these days that kids are praised for meaningless accomplishments and in college can sometimes win good grades for mouth PC platitudes even when they are off the mark.

Re college – let me reiterate that I believe in education and I believe that much of it will/should be paid for from tax dollars. That does not follow that I have to accept bad ideas and mismanagement of the process.

My main points (so that Max doesn’t have to attack another straw man) are:

We should spend tax money on education; we should try to get the best deal for the money.

We have a wonderful system of higher education that is one of our most important national assets, which we must conserve

College costs have risen too fast and an important reason is that costs are not controlled by good management.

Not everybody should go to college. Some have other skills that might be better employed elsewhere. Some have other opportunities. Some are not smart enough to make it worthwhile.

President Obama’s proposal to limit student loan payments in time and size would lead to individual irresponsibility and pump more money in w/o a corresponding increase in quality. It would, IMO, hurt higher education.

You may passionately attack any of those points, but please limit yourselves to things I actually argued for or against.

BTW – your comment provides a very interesting insight. Do you really believe that conservatives oppose the idea of public school or don’t support the military or do you just say that for the shock purposes?

David

I disagree strongly with your contention – “in a nationally standardized essential quality of education which covers 2 years of junior college or vocational training school”. Standardization in a country as large and diverse as the U.S. is the road to mediocrity. Our system of higher education is by far the best in the world. It didn’t get that way by standardizing everything.

Knowledge is too protean to be contained by bureaucratic rules. It is far better to allow more freedom to innovate and tolerate differences in methods and outcomes than to level everything down to one standard of mediocrity.

Stephen

Let’s NOT drop the most competitive standing. We doing well now and have been for more than twenty five years. I bet you have been predicting the imminent decline for at least half that time. These facts are part of the evidence against the idea that we are just going down the tubes, or at least evidence that countries using different systems are not faring better, so maybe it would not be a really good idea to advocate getting to be more like them.

So maybe let’s restate it. The U.S. is now and long has been among the most competitive nations on earth. You think that this will soon change. What is different about the future versus the past? Could it be Obama and Democrats?

What we should drop is that idea of a hybrid system. “Pure” systems exist only in the minds of academics for whom the real world is a special case of which they know little. So let’s talk about what we have and not worry about the academic uselessness. We have a free market system which now and always has included the market mechanism, rule of law and reasonable regulation. Maybe we can call it a hybrid of FREE MARKET & DEMOCRACY. Those things go together.

We discuss the degree to which government should be involved in society and the economy. I like to go with the index of economic freedom. Indeed, we have slipped a bit and maybe we should work on it, but we are still a mostly free economy.

David R. Remer-
It wasn’t merely that they were encouraged to make the interest payments as high as they could, it was that they had the incentive to jack it up as far as it would go, and then pile on fees and late charges to boot. The larger the theoretical payoff at the end, the greater the profits they could claim.

You could see this in even more extreme form with the Credit Card industry.

But if I had to put this plainly, it’s that for the average consumer, including the average student, the market’s become a place of predatory loansharking, where the lenders deliberately sought out the worst risks, deliberately tried to trip up the persons who were responsible borrowers and debtors. And they did this to claim fraudulent gains and profits to gain the equity and high valuation of investors by false means.

In other words, this isn’t a real market we’ve got here. Folks who protect the industry as it is now are not protecting a free market, they’re protecting a parasitic system that generates false wealth to justify the enrichment of a few.

It’s not even rightly called capitalism, because the definition of capitalism is related to whose hands the means of production is placed, and to be sure, what many financial companies on Wall Street do is not productive.

By necessity, our economic wealth is mostly symbolic, a fiction that allows us to skip past the simplistic exchanges of a barter system, and get on to more complex economics.

What this means, though, is that we have to watch our asses on how we define productive behavior. Flipping houses and frontselling your own customers with high speed investment software is not productive. Neither is leveraging your business up to its eyeballs and beyond, and just hoping the bottom doesn’t fall out.

The Republicans would like nature to take its course, and weed out the financial morons. The trouble is, those morons somehow found a way to put themselves in charge, and they found a way to keep the financial meltdown from touching their rarified heights, and to keep a Congress pushed by people from below from actually doing something about the problem.

The current Laissez Faire system creates a whole host of perverse incentives for people to keep on doing the things that got us in trouble. It cannot be trusted to redress the greivances of a nation battered by economic disasters

What I would say is that we need to understand that business needs the freedom to make decisions in response to the market, but the market has to be built on a foundation that serves the public’s interest, whether those members of the public are customers, investors, employees, or leaders trying to do the right thing, rather than be outcompeted by those who simply cheat their way into financial success.

Christine-
I’ve experienced the decline in this country’s fortunes as a young man who grew up in middle class surroundings. I’ve watched things get steadily harder, steadily more strained. I’ve watched healthcare get steadily more expensive.

I’ve been watching the news all my life, and I have a long memory. The trouble is, we have a system that lets the economic upper-classes treat the lower- and middle-class folk out there like peons, steadily eroding their freedoms, their ability to get work, redress greivances concerning safety, pay, and equality, and so on and so forth.

The question I would ask you is how much of our pride is based on substance, and how much is just based on the unwillingness to admit that we’re not the best at everything.

If we admit we’re not necessarily born superior here, we might realize that we need to do better, we might put more effort into responding to the negative situations out there. There is a moral hazard in fostering complacency about how America competes. America cannot rest on its laurels.

Stephen

Sorry you had a hard time. C&J started off poor and during the last 25 years did well, so I suppose your outlook depends on which direction you are headed. There seemed to be a lot of opportunity.

Our kids have always found jobs that paid better than the kinds of crap jobs we did as young people, so our personal point of view is based on that.

When we look at the statistics, we see that median income has risen over that time, even despite the recent downturn. We will not agree on this, I suppose.

I do believe that college has become too expensive, as I wrote in the original post. I don’t think that providing more money to the system will bring those costs down.

Christine, the only way to bring Higher Education costs down is to convince consumers (students) that they can benefit from attending a less prestigious school at a lower costs. I’m a college student right now and I am not affected by Obama’s programs. I worked by butt off to earn scholarships in excess of my tuition costs. I also turned down acceptance letters from several private universities so I could attend Stony Brook University with all tuition paid by scholarship. If I had attended my dream school, I’d have to borrow at least $100,000 over four years.

High School Seniors need to learn that a Bachelor’s degree from their favorite private University is not worth $100,000 more than one from UMass or Stony Brook. Until students are willing to shop around and find the best price, prices at top schools will never come down.

Lenders also need to stop preying on students. When its so easy to borrow money, students often forget how much their education really costs.

Warped

You are absolutely right. J is a graduate of State univerisites, but he also spent a year at one of the Ivies. IMO, the State schools are just as good - at the top. The Ivies have a generally higher standard, so the dumb kids at the Ivies are smarter than than the dumb kids at State.

But if you are smart and motivated, you can get an excellent education at any major university. This is a development of the last two generations, BTW, as education spread.

Finally, I recall the old saying, “You can always tell a Harvard man; you just cannot tell him very much.”

Christine-
Medians are the numbers that separate the top half of a sample from the lower half. If the Rich get richer, median income rises, even if the poor and middle Class stay put.

The rise of the Wealth of the upper class out of proportion to that of working class and middle class Americans is documented fact.

The question is not what those people can sustain, but what those who live closer to the margin on cost of living can. The Republican Party has become a party that mainly requires that people looking for populist outcomes seek them through the private sector. Meanwhile, the economic elites can and often do demand policies to suit their needs. Trouble is, the economy as a whole doesn’t benefit when folks beneath don’t get their fair share, or become sidelined by economic difficulties.

A lot of the current rise in Upper-Class income was based on placing those economic difficulties on people, and then inflating profits by quantifying their burden as definite, reliable returns. Our system failed, basically because they overwhelmed their debtor’s ability to pay.

We can talk about perverse incentives to spend money going to school when we have taken care of the perverse dis-incentives the credit crunch and the dire straits of student loan debtors that could cause students not to be able to attend colleges equal to their skills.

Stephen

If MORE than half the people get richer, the median rises. If the top 49% or less get richer, it doesn’t make any difference. The median is whoever is making the middle.

For example, if we have nine people making $100 and Bill Gates making a billion, the median is STILL $100.

Perhaps you are thinking of the average.

You are right that the richer half of the population has gotten a greater share of the increase in wealth, but no group has less than they did a generation ago.

To take my simple example again, maybe a generation ago everybody was making $50. Now the guys at the top make $100 and the guys at the bottom make $55.