The Next Trillion Dollar Bubble

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Such a plan is preposterous. Doubling down on the same bailout mentality that has engendered a massive amount of public anger with respect to the banking system is a fool’s errand. It’s bad enough the government spent $700 billion of borrowed money on that monstrosity, even if it was a necessary evil. Government has no business subsidizing irresponsible behavior, especially when it is rationalized as two wrongs making a right. Furthermore, why should those Americans who wanted to go to college but didn’t, because they couldn’t afford it, underwrite the expenses of those who simply want to renege on their responsibilities?

The problem of runaway tuition costs should be attacked at the other end. For example, a study of 198 leading public and private universities produced by the Goldwater Institute reveals that in 2007 “nearly 39 percent of all full-time employees at these ‎universities were engaged in administration, an increase of 39 percent from the number of ‎administrators per 100 students in 1993. Only 29 percent of full-time employees were ‎engaged in instruction, research and service, an increase of 18 percent since 1993.” In other words, the number of bureaucrats has increased twice as fast as the number of teachers.

The Manhattan Institute’s Heather MacDonald offers further insight into this phenomenon, noting that “rising tuitions funnel straight into the preposterously unnecessary diversity bureaucracy and the rest of the burgeoning student-services infrastructure, as well as into the salaries of professors who teach one course a semester, the arms race of ever more sybaritic dorms and social centers, and the absolute monarchies of the football and basketball programs.”

Bloated bureaucracies and high-end amenities don’t translate into better educational experiences. A study led by New York University sociologist Richard Arum of 2,322 traditional-age students from the fall of 2005 to the spring of 2009, revealed that 45 percent of students “made no significant improvement in their critical thinking, reasoning or writing skills during the first two years of college.” After four years, 36 percent “showed no significant gains in these so-called ‘higher order’ thinking skills.”

The fallback position for those touting college at virtually any price is the idea that college graduates make far more money than non-graduates, high school graduates and high school drop-outs. Yet “College Conspiracy,” a film being released on May 15th, will reportedly debunk many of those myths, the most prominent of which is college graduates earn $1 million more over a lifetime than high school graduates. The film notes that that statistic fails to factor in some important variables: most Americans take 6 years to finish 4 years worth of college; tuition at private colleges is increasing at a rate 5.5 percent rate of inflation; and General Equivalency Diplomas (GED) unfairly skew down the earnings potential of regular high-school graduates.

Furthermore, Gerald Celente, editor of The Trends Journal who appears in the film, contends colleges are handing out “degrees in worthlessness.” He cites social studies, philosophy, art history, women’s studies, minority studies, foreign affairs, public administration, corporate management, and marketing as the most conspicuous wastes of time and money.

Yet even if one assumes such a film has its own axe to grind, one thing is certain: math doesn’t lie. If college tuition, aided and abetted by government subsidies, continues to almost triple relative to family income, at some point the amount of debt incurred to obtain a college degree will surpass the additional income one may derive from it. Considering that any attempt to reign in government’s role in facilitating these runaway costs is inevitably characterized as “depriving needy students of critically needed funds,” the trend is likely to continue.

Or at least it will until the bubble pops, exactly like the government-abetted housing bubble did. Are Americans ready for another trillion dollar bailout precipitated by irresponsible government? American are furious with “greedy” bankers. What about greedy college administrators and professors?

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  • StephenD

    In a recent brew-ha here in Florida over the Governor's insistence for Welfare Recipients to pass a drug test before being given aid, a young man sued. As it happens he is a veteran and has a 4 yr. old daughter and was attending college FULL TIME. I don't get it. When I came out of the military I lived in a basement Apt. for 3 yrs., had a wife and a small child. I worked full time AND a part time job AND went to school nights part time to make a better life for my family. The idea of welfare never entered my mind let alone having someone pay for my schooling.
    Why bother even going to school at this point? Since the Government will hand you a check, you don't need schooling at all. Hey, free health care, food and shelter. Why, soon they may hand out vacation vouchers. After all, it's tough yelling "give me more" you probably need a break. You…DESERVE it.
    Can you say "Hell in a Hand Basket?"

  • Amused

    I see FPM's still displaying it's aversion to the truth . What happened to my post ,which your "admin " had to approve ? It was totally innocuous , but because it put blame where your ideology doesnt want to see it , and btw precisely where it belonged .
    Look it's your ball and if you ewnt to run home with it , that's your righ. But PLEASE stop accusing others of being Marxist and communist , when you exhibit marxist and communist behavior yourslves .

  • Amused

    Another "trillion dollar bubble "is indeed just around the corner . Wall Street [ the casino ] is up to the same old tricks that got us here to begin with .The small invester [ the 99% you like to deride so much ] are no less at the mercy of Wall Street avarice now , than they were at the 2006 BUST .And the politicians OF SALL STRIPES are still sitting in their gilded cages waiting with bated breath fot Wall Streets Lobbyists to come knocking on their doors with fistsfulls of dollars .

  • Amused

    And you've just done it again FPM , I doubt this one will be approved either .

  • Amused

    The 99% , the people you deride , the small investors , are STILL at the mercy of Wall Street AVARICE. Another BUBBLE is indeed around the corner.

  • Amused

    Derivitives and short selling are Still the order of the day , and with no meaningfull regulation or safeguards . Wall Street's Lobbyists STILL get their bang for their bucks in favorable legislation.

  • Amused

    …and there's no shortage of imbeciles like StephenD with his little parrot memes, ,who'll play sycophant to all of it …..mindless man , mindless . oh did I leave you out Arnold ?

  • Amused

    So let's all keep that Wall Street Casino open , America's WORKING class DESERVES to be screwed again after they think their investing in their economy and country .
    Damn right , huh Stephen D , those s.o.b.s bloody well deserve it . Imagine the nerve of those low-lifes!!!!!! ….demanding a level and fair playing field . How dare they question skewed Conservative [up the arss of buisiness ] values !

  • Amused

    How dare those low-lfes demand a fair playing field ? The desrve wahat they get huh Stepen D ? Imagine that ! Questioning conservative values ! How dare they ?

    • StephenD

      Amused, WTF are you ranting on about? The guy I spoke of was on the dole while getting all his needs met off other peoples money. You're telling me that is fair? THAT is your idea of a level playing field?
      All I am saying is that you should do for you and yours and I for me and mine. We all should kick in for those that CANNOT do for themselves. For those that WILL NOT do for themselves I say F**k em, let them starve.
      If you have as problem with that…you have a problem.

  • Amused

    Bloody 99% , screw them all !

  • LindaRivera

    Most people are not aware of government raids made on small-medium sized farms. Raw, organic dairy farms have had their healthy dairy products seized and thrown out. At least one farmer has been taken away in handcuffs! Many people in a desperate struggle to regain their health (or not lose their health) know how IMPORTANT raw, organic dairy is in the battle for health.

    Businesses and jobs must be PROTECTED! The WAR against small-medium sized businesses must stop!

  • LindaRivera

    The new Animal Identification rule will act like a tax on every livestock animal that crosses state lines – something that happens THOUSANDS of times a day in the United States! This is incredibly hard on small-medium sized farms WHO CANNOT AFFORD THIS!

    Family farmers and ranchers cannot afford additional paperwork and unnecessary expenses to please the industrial agribusiness lobby. We must stand up for our rights and the rights of farms! Farm and Ranch Freedom Alliance is standing up for family farms and backyard livestock growers!

    This is their internet address: http://farmandranchfreedom.org/

    PROTECT JOBS! PROTECT BUSINESSES!

  • LindaRivera

    Americans must not be denied the human right to have jobs and businesses!

    FOXNEWS
    Is Fed Raid on Gibson Guitar​ Company Enforcing Policy . . . or a Push to Target ‘Made in the USA’?
    September 07, 2011

    They are among the most sought-after musical instruments in the world.
    Gibson is also a company that is proud to put the “Made in the USA” label on its instruments. While the company has lower-end lines that are made overseas, every guitar that bears the “Gibson” label is made in the U.S. by American workers.

    Related Stories
    Attacking U.S. Companies Is No Way to Create Jobs
    Gibson: Feds Want Guitar Woodwork Done by Foreign Labor

    Related Video

    Gibson Guitar CEO: Don’t Know Why We Were Targeted

    On August 24, armed agents from the U.S. Fish and Wildlife Service and Homeland Security raided the corporate headquarters and two factories of the Gibson Guitar company. The agencies took away 24 pallets of Indian rosewood and ebony, as well as a number of guitars and computer files.

    “I think they’re taking the position that we should be shifting these jobs overseas,” says Bruce Mitchell, the chief legal counsel for Gibson. http://www.foxnews.com/politics/2011/09/07/does-w

  • LindaRivera

    An inferior health care plan that no one wants and CANNOT afford to pay. The threat to jail and/or fine those who don’t purchase the government enforced plan.

    Massive spending as if there is no tomorrow. Fighting wars we have no money for. Massive borrowing.

    The Massive​ giving away of Billions of dollars every year to other countries, including the oil-wealthy Middle East, Hamas-controlled Gaza and the Palestinian Authority organization who fill their war chests, build mansions and laugh all the way to the bank with FREE infidel money. Whilst in America, homeless shelters are filled to capacity; tent cities have sprung up all over the U.S. filled with desperate, jobless, homeless, neglected Americans.

    Massive debt. The massive printing of paper money out of thin air to DELIBERATELY create out-of-control inflation. There is no question that the total DESTRUCTION of America’s economy is planned. The results will be horrifying. In the once wealthy and great nation of America, millions of Americans will become destitute, hungry and homeless with no money or resources to help them.

  • LindaRivera

    Organic, non-GMO avocado, fruit and nut trees and berries must be planted in all of our nation’s cities’ and towns’ parks to help the many millions of Americans who will soon be in a desperate struggle to survive because of the frightening, highly destructive economic policies of our government.

    Watch it. And weep for our great nation and people:

    FALL Of The Republic – The Presidency Of Barack H Obama – The Full Movie HQ http://www.youtube.com/watch?v=F8LPNRI_6T8&fe

  • sod

    The more subsidized students, the more government dependent students and therefore the bigger government. Education institutes are just tools for the lefts to achieve their self-destructing goals.

    Higher education cost should be carefully scrutinized, as the greedier the educators become, the greedier the students they will bring about. Who should be blamed for those greedy CEO's and bankers and officials and congress people?

  • B-dubs

    One thing missing here is that no one has mentioned Griggs v. Duke Power. This Supreme Court decision means that IQ and other testing by employers can be discriminatory, as blacks and Hispanics, on average, score lower than whites and Asians. So, companies can no longer use them in hiring. Instead, so many companies require a college degree as a proxy for an IQ test. Generally speaking, someone who manages to get a bachelor's degree has a modicum of smarts, motivation, and social skills (though not so much anymore).

    Overturning this decision will mean that companies can be legally safer when implement testing for hiring and make decisions based on test results rather than degrees.

  • johnnywoods

    It is interesting to me that the more a degree from collage costs the less it seems to be worth. Why are the tax payers getting screwed for this?

  • findalis

    Someone explain this to me:

    Why does the football coach and/or the basketball coach make over $1 million a year from the university/college? In some cases it is way more. No professor makes that much. Neither does the head of the school.

    Could it be that the cost of these programs are driving up the true costs of a College Education.

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