Crisis of generations – younger Americans moving back home in large numbers. Student loan default rates surging largely due to for-profit college expansion.

The United States has over 4,000 college institutions many which have been raising tuition and fees far faster than the overall rate of inflation. Combine this with a younger and poorer population and you have a recipe for massive debt serfdom. As the recession drags painfully on, being the deepest and longest economic contraction since the Great Depression many people are questioning once deeply held mantras of economic prophesy. A home never goes down in value. You can’t go wrong with a college education. Of course these hollow statements mean little without further examination of the details. Buying a home isn’t necessarily a bad decision but it can be a bad decision if you over leverage yourself like a Wall Street investment bank. A college education is useful if you go to a quality institution but how many of the 4,000 are for-profit paper mills simply looking to steal money from unwitting students? The young are facing a challenging future but this pain is also leaking into the balance sheet of their parents.

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via Crisis of generations – younger Americans moving back home in large numbers. Student loan default rates surging largely due to for-profit college expansion..

Un-preparing the future with the higher education bubble – graduating students with more debt and with degrees that have little demand in the marketplace. For-profits now account for nearly 10 percent of all undergraduate enrollment when in 1997-98 they accounted for 3 percent.

he higher education bubble only continues to spiral out of control because the profits are so good for the massive banking industry that is pushing student loan debt to the trillion dollar level. At the same time the return on investment in education has been slowly diluted as more for-profit degrees enter the market place and water down what it once meant to have a bachelor’s degree. If you can get what is the equivalent to a piece of paper and claim you have an education then the marketplace is going to add more scrutiny to those that graduate. On a bigger scale is the fact that our country is largely run by gambling bankers that are exploiting the population in every facet from housing, education, and even healthcare. Our financial system is a predatory mess and this can be seen in the form of the higher education bubble. What is more troubling is the subject areas students are studying in and the amount of debt they are going into for these degrees.

Students are simply not preparing for jobs in the current marketplace

I saw this fascinating chart that also propelled me to dig deeper into the massively expanding for-profit sector:

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via Un-preparing the future with the higher education bubble – graduating students with more debt and with degrees that have little demand in the marketplace. For-profits now account for nearly 10 percent of all undergraduate enrollment when in 1997-98 they accounted for 3 percent..

Misguided by Higher Education

0/28/11 Paris, France – When the financial crisis of 2008 hit, we saw how state-managed capitalism works. Favored companies are allowed to make as much money as they can. But they are protected from going broke.

Certain firms are deemed “too big to fail,” by virtue of the key role they play in the economy, or at least by the role they play in a politician’s plans for re-election or future employment. But state-managed capitalism is very different from the real thing. It is capitalism in a degenerate form.

Real capitalism progresses in fits and starts, described by Josef Schumpeter as “creative destruction.” It is like a jungle…not like a zoo. It cannot be managed. You cannot take out the predators or feed selected species without upsetting the balance of nature. Take out the destruction, and you block the creative process too.

Since the beginning of the Industrial Revolution, most real wealth has come from real capitalism. Not from “playing the market.” Not from getting a good job. Not by trying to cadge favors from the government.

So, what is real capitalism? It is what we’ve seen in the computer/Internet industry over the last 20 years. This was a new industry. It had not yet been tamed by the government. Regulations were few. There were no large, entrenched companies to block start-ups. There were no lobbyists to curry favor from the politicians. There were no subsidies…and no barriers. It was young, dynamic, chaotic…and very prone to blow-ups.

The whole industry blew up in January 2000. Mistakes were not bailed out. They were corrected. Money moved from weak hands to strong ones. Many companies failed. The companies that survived, and prospered…went on to glory. Amazon. Google. Microsoft. Apple.

And who was behind these new companies? College drop-outs, computer nerds, products of teenage mothers and broken marriages. They did not enter the ranks of existing technology companies, work their way up to senior management and then create new product lines. It is almost as if they succeeded not because of advanced American capitalism, but in spite of it. They created an entirely new industry…with new companies nobody had ever heard of. And then, they destroyed some of the biggest businesses in America.

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via Misguided by Higher Education.

College Education: The Largest Scam in U.S. History

College Education: The Largest Scam in U.S. History.

The Great College-Degree Scam

Innovations – The Chronicle of Higher Education.

The College Scam

The College Scam – Reason Magazine.

16 Shocking Facts About Student Debt And The Great College Education Scam

16 Shocking Facts About Student Debt And The Great College Education Scam.

Bloomberg Cautions Riots from Jobless – Especially Jobless College Grads

Bloomberg Cautions Riots from Jobless – Especially Jobless College Grads « ON MY WATCH – the writings of SamHenry.