Ending Ivory Tower Welfare
“The GOP needs to hold tobacco company-style hearings, hauling in the presidents of various universities and asking them to justify their multimillion-dollar salaries. We want professors explaining, under penalty of perjury, exactly how much they make per hour for their rigorous schedules of two classes a week, summers off, and full-year ‘sabbaticals’ every few terms. Also, we’d like to know how driving the getaway car for a cop-killer constitutes a qualification to teach college.”—columnist Ann Coulter This, my fellow Americans, is an idea whose time has come for the simplest of reasons: it is the American taxpayer who is ultimately responsible for any and all defaults on student loans. And the amount of outstanding debt is staggering, currently amounting to $1.6 trillion and projected to reach the $2 trillion mark by 2022. The average debt load carried by each student is now approaching $30,000, and a staggering one-in-five American households are currently on the hook. Those pursuing advanced degrees can ring up a tab of over $100,000.
“The GOP needs to hold tobacco company-style hearings, hauling in the presidents of various universities and asking them to justify their multimillion-dollar salaries. We want professors explaining, under penalty of perjury, exactly how much they make per hour for their rigorous schedules of two classes a week, summers off, and full-year ‘sabbaticals’ every few terms. Also, we’d like to know how driving the getaway car for a cop-killer constitutes a qualification to teach college."—columnist Ann Coulter
This, my fellow Americans, is an idea whose time has come for the simplest of reasons: it is the American taxpayer who is ultimately responsible for any and all defaults on student loans. And the amount of outstanding debt is staggering, currently amounting to $1.6 trillion and projected to reach the $2 trillion mark by 2022. The average debt load carried by each student is now approaching $30,000, and a staggering one-in-five American households are currently on the hook. Those pursuing advanced degrees can ring up a tab of over $100,000.
More importantly, the current student loan default rate is 13.7 percent. Even worse, there is a student loan forgiveness program that allows much of that debt to be discharged by the debtors themselves – meaning the rest of us get stuck with the tab. This reality was reflected in the Obama administration’s announcement in February that it would include an additional $21.8 billion in write-offs of expected future student loan repayments – meaning the budget deficit was increased by almost $22 billion. Moreover, it was done without Congressional input because Obama, as is his execrable habit, authorized the giveaway via executive action. "If nobody acts to stop this trend, that will be the first in a series of student loan giveaways that could cost taxpayers hundreds of billions or even a trillion dollars,” explains Forbes columnist Jeff Dorfman. “Those with student loan debt might be happy, but taxpayers need to wake up and grab hold of their wallets. Failure to act could be an expensive education for the taxpayers, not the college students.”
How much of that debt is borne by the universities where the cost of a college degree has increased by an unconscionable 1120 percent over the last three decades, four times faster than the increase in the consumer price index?
Not one dime.
“If colleges really believe their product is worth anything, why don’t they guarantee their own student loans?” Coulter asks. “Why should taxpayers be on the hook for everyone’s tuition?”
Are you angry yet? Prepare to get angrier. The government effectively nationalized the student loan program in 2010 – using ObamaCare to do so. Why? “So that the profit (the feds) were supposedly making from the student loans could then be plugged into how much money would come from Obamacare, so it didn’t look like it cost as much," explains Cato education scholar Neal McCluskey. "At the last minute, they said, ‘Look, let’s take what was then called the Student Aid and Fiscal Responsibility Act, make it part of healthcare and then we can make the budget numbers come out right… [W]e will take these projected profits from the student loans, and we will say that’s part of Obamacare.’”
In other words, students and taxpayers are getting screwed in order to make the healthcare bill appear less expensive.
On the other side of the equation, the legions of professors who overwhelmingly rail against the inequities of capitalism do quite well for themselves. Their average salaries come to $87,000 per year, but can range from $49K to $154K per year, depending largely on the subjects they teach, as well as career duration and geography. But former university chancellor David C. Levy puts that relatively modest compensation in perspective. “Though faculty salaries now mirror those of most upper-middle-class Americans working 40 hours for 50 weeks, they continue to pay for teaching time of nine to 15 hours per week for 30 weeks, making possible a month-long winter break, a week off in the spring and a summer vacation from mid-May until September,” he wrote in 2012.
College presidents? An average of $400,000 per year in compensation, with many receiving well in excess of $1 million per annum. College coaches and sports staff? Here’s a chart showing the off-the-chart costs associated with college sports programs.
And then there are college administrators. From 1987 through 2011-2012, the most recent school year available for comparison, universities and colleges collectively added 517,636 administrators and professional employees to their rosters, according to analysis of federal figures done by the New England Center for Investigative Reporting and the American Institutes for Research. Again for perspective sake, that averages out to the addition of 87 employees every working day. In 2012 Bloomberg News profiled a single college that demonstrates the absurdity of that bureaucratic expansion. “Purdue has a $313,000-a-year acting provost and six vice and associate vice provosts, including a $198,000 chief diversity officer. It employs 16 deans and 11 vice presidents, among them a $253,000 marketing officer and a $433,000 business school chief,” they explained.
Writing for SFGate, former Clinton Labor Secretary Robert Reich tries to paint a happy face on the cost of college vis a vis one’s future earnings, noting that in 2013 Americans with four-year college degrees earned on average 98 percent more per hour than people without college degrees, compared to the 1980s, when the differential was only 64 percent. Unfortunately two realities intrude, as in “a college degree no longer guarantees a good job,” and the fact that the increasing differential is explained by the reality that non-college wage earners are seeing a decrease in their wages. Furthermore, the Federal Reserve Bank of New York reveals that 46 percent of recent college graduates, and more than a third of college graduates in general, are now working in jobs that don’t require college degrees.
And all that’s happening before Obama’s plan to legalize 5 million illegals – and increase the number of H-1B visas that recently led to Southern California Edison tech workers training their foreign replacements – kicks in.
Reich’s “solution?” “I don’t believe the main reason to go to college – or to choose one career over another – should be to make lots of money,” he explains. “Hopefully, a college education gives young people tools for leading full and purposeful lives, and having meaningful careers,” adds the man whose net worth was $4 million as of 2012. Reich also raked in an additional $242,613 for teaching exactly one course in the 2014 fall semester at the University of California, Berkeley.
Reich’s arrogance is hardly an anomaly. Last week University of California President Janet Napolitano was caught on an open mic telling a fellow regent they “didn’t have to listen to this crap” in regard to students who were protesting a five percent tuition hike – every year for five years. That would be the same Janet Napolitano for whom the university leased housing at $9,950 a month, ponied up $8,916 a year for car expenses, and doled out $142,500 for one-time relocation costs – in addition to an annual salary of $570,000 – when they hired the former DHS Secretary in 2013.
None of these outlandish salaries and perks that drive the cost of tuition through the roof would be possible if universities had “skin in the game” with regard to student loan defaults. That they don’t is precisely why they can spend money with impunity, secure in the knowledge that the American taxpayer is the ultimate backstop for their lavishness.
And all for what? It is no secret that the vast majority of colleges have devolved into little more than progressive finishing schools, replete with course “trigger warnings,” unconstitutional “speech codes” and the rampant expansion of aggrieved sub-groups (including a proliferation of anti-Semitic, Israel-bashing Muslim Student Associations), all centered around the despicable notion that the right “not to be offended” must be enshrined. Add an overwhelming majority of America-hating faculty members to the mix, and the genuine picture of America’s current university system emerges.
Make no mistake: if that’s the path these so-called institutions of higher learning wish to trod, fine and dandy – as long as taxpayers are kept out of the equation.
“Republicans need to force colleges to issue reports, just like drug companies, attesting to the average cost, and the average salary, for every degree,” Coulter insists. Why? “Democrats need to be exposed as hustlers for the most fraudulent, overpriced scam in the country. There’s no other industry that has politicians flacking for it, much less conniving to prevent consumers from getting truthful information about the merchandise.”
Exactly. It’s time to take some taxpayer-backed ivory out of those ivory towers, and put some market-driven economics in. If a former student can’t pay his or her loans, send their former university a bill for part, or all, of the difference. A taxpayer backstop amounts to nothing more than an academic welfare program. Every other business has to make their product affordable or they go bankrupt. Colleges should face the same choice, or be forced to come before Congress and tell the American public why they should remain exempt from such realities. For the “high-minded” doyens of higher education, it might be their first brush with reality in quite some time.
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