6 Responses to “And education comes in last..”

1. james
   September 8th, 2010 @ 10:54 am

   Not to be a conspiracy theorist..but several generations of a “dumbed down” electorate generate an easy-to-manage national population.

   Who needs a corporate-dominated, economic ruling class when you can just breed stupid people? Provide just enough…to prevent economic riots in the streets…where is the tipping point?

2. Dave Allen
   September 8th, 2010 @ 11:02 am

   James,

   Yes, one doesn’t need to be a conspiracy theorist to simply understand that making it hard, e.g. expensive, to get a reasonable education, results in the dumbing down of any population. And yet many other countries make it easy and affordable to get to college.
   The other side of the coin is that one doesn’t necessarily need a college degree to be “educated.” It would do the majority of Americans a lot of good to just travel to other countries and immerse themselves in different cultures. Watching the Discovery channel on cable doesn’t count..

3. Todd
   September 8th, 2010 @ 2:11 pm

   Dave,

   It appears (at least to me), that you’ve mixed up the health care and food cost lines. Food was actually the highest cost on the chart until ~’90 and accounted for ~33% of household spending in ’45. Health care has only surpassed the other items on the chart since ~’90. As far as education spending, you have to consider this is an average across all households. I would argue that the majority of households do not have college age children and send younger children to public schools which are funded by taxes (a household expense not represented in the chart at all), not tuition. Furthermore, anyone taking advantage of scholarships, grants, and other opportunities to offset education expenses will actually decrease the amount shown on the chart, making this a less than ideal metric to judge education opportunity. If you look at other sources, I think you’ll see that people in the US have greater opportunity for post-secondary education than in the majority of other countries. Borrowing from the Wikipedia page on Education in the US, “The U.S. ranks 10th among industrial countries for percentage of adults with college degrees. In 2009, a record high of 40% of 18-24 year olds were enrolled in college.” As to whether or not earning a college degree makes one “educated,” that has a lot to do with the individual–there are certainly many who don’t take full advantage of the opportunity…

4. Dave Allen
   September 8th, 2010 @ 3:25 pm

   Todd,

   Yes you’re right..the food lines and healthcare lines are so similar in color that they blur together. I’ll update the post for accuracy. Meanwhile students in the USA leave college with huge debt, a combined debt that now exceeds the combined credit card debt in the country. http://articles.moneycentral.msn.com/Banking/HomeFinancing/article.aspx?post=1791335

   There has to be a better way..opportunity is one thing but going into debt for a decent education is surely another?

5. Todd
   September 8th, 2010 @ 4:50 pm

   Dave,

   A good point–the debt burden associated with higher education can’t be ignored. I’ve been relatively lucky in offsetting the majority of my higher education expenses with scholarships and employer funded tuition assistance programs. However, in the coarsest of analyses, it seems to me that education debt is to be preferred over credit card debt (though the differing loan standards and consumer protections highlighted in the article you cite could be addressed to help students a bit more).

   At the very least, one can make the claim that education debt is self-servicing. Increased education leads, at least theoretically, to higher pay and an improved ability to pay back the associated debt. Once the debt is paid off, the increased earning potential lasts the rest of a person’s life. In contrast, credit card debt rarely leads to increased income potential.

   But the bottom line is that personal financial management (whether it’s a loan for college, a home mortgage, or a “12-months with 0% interest” credit card for the latest 60-inch HDTV, PS3, and Rock Band game) is the responsibility of the individual. If your current and likely future income won’t allow you to pay back the loans for a $200K education without undue hardship, then you should set your tuition sights lower. There are plenty of state and city universities out there that provide a quality education for much less than a private or “ivy league” school.

6. Dave Allen
   September 8th, 2010 @ 7:44 pm

   Todd, I agree with you on the personal financial management issue. Credit is not the best way to get by as we now see with the collapse of the housing market and the spate of foreclosures, as over-leveraged home buyers walk away from their debts.

   Education debt is worth it if those high paying jobs are there. Unfortunately there may be a lot less of those jobs in the foreseeable future.

   Which brings us back to the original article, where the writer posed the question – do you believe that housing is a luxury good and that societies spend more on it as they get richer? Or do you think it’s more like food, clothing and other staples that account for an ever smaller share of consumer spending over time?

   I think the “housing as a luxury good” model has proven that homeowners can’t resist borrowing against their homes to fuel extravagant and unrealistic lifestyles.

   I consider my house a home not a cash cow.

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