A recent Associated Press headline on the ABC News site reads “College Prices up Again as States Slash Budgets.” The article reports that “This year total outstanding student loan debt has passed $1 trillion, now exceeding credit card debt. And concerns about student loan debt have been front and center with many of the Occupy Wall Street protesters.”
It goes on to quote Terry Hartle, senior vice president of the American Council on Education: “To see increases of 20 percent, as we saw in California, to see gains of 15 percent in other states, is simply unprecedented…. Tuition is simply being used as a revenue substitute in many states.”
That story makes the following previously issued letter from the Executive Director of Hubbard College once again very relevant to the current economic climate.
I thought you might find it interesting that according to the National Inflation Association, the yearly tuition at private colleges has increased over 20% in just the last 5 years.
This gives a yearly tuition rate of about $26,000 — this is in spite of the economic downtrend over that same period of time.
How is it possible that students are able to pay for these increases in tuition? By just taking out more government funded student loans sponsored by YOU the taxpayer.
Please have a look at the following excerpts from the National Inflation Association’s article.
“The college tuition bubble has been fueled by the U.S. government’s willingness to give out easy student loans to anybody who applies for them. If it wasn’t for the government student loans, the free market would force colleges to provide the best quality education at the lowest possible price. By the government trying to make colleges more affordable, they have actually driven prices through the roof. Colleges have been encouraged to spend recklessly on wasteful construction projects, building new libraries, gyms, sports arenas, housing units, etc. Colleges spent $10.7 billion on construction projects in 2009. Although this is down from the average of $14.7 billion per year colleges spent on construction projects from 2005 to 2007, colleges are still struggling to pay off their old construction related debt. When interest rates start to rise, it will add further upside pressure to college tuition prices.
“College students borrowed $106 billion in total student loans for the 2009-2010 school year, up from $96 billion in 2008-2009, $94 billion in 2007-2008, $87 billion in 2006-2007, and $83 billion in 2005-2006.
“Total student loan debt in the U.S. currently (as of 2010) stands at $830 billion and now exceeds credit card debt. President Obama’s new student loan bill that was passed last year now makes the government the primary lender to students.
“By taking the free market out of the student loan business and allowing students to receive loans from the government at artificially low interest rates, colleges will be encouraged to spend more recklessly than ever.
“None of this wasteful spending is doing anything to improve the quality of education in America.”
Conversely, Hubbard College takes no Government Funded Taxpayer monies to fund our programs.
In addition, our students are consistently producing results in the real world on their apprenticeships and internships. They routinely turn companies around in spite of the economy. For real eaxamples go to this link: Hubbard College Blog
These results give our students the confidence and certainty to really be a success in any economy and is why we still have a 100% job placement statistic upon graduation.
This along with our lifetime warranty (which no other college offers) presents a strong case to have your friends consider Hubbard College.
By the way our tuition per year is still 40% less than the above rates.
I am very interested in your feedback on the above.
My very best,
Nick Terrenzi Hubbard College International