How government programs drive up college tuitions

What people said

mixmastamyk · 2018-09 · Recommendation

When you subsidize industries they no longer attempt to contain costs. Unintuitively, instead of getting cheaper they get more expensive. There's an interesting video by Peter Schiff on the subject: [VIDEO]

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anonymoushn · 2011-02 · Recommendation

I suspect that Peter Schiff is closer to the mark. [VIDEO] His hypothesis is that increasing the capacity of students to pay (to almost arbitrarily high levels) by providing government guarantees of student loans allows allows schools to charge ridiculously high tuition. To some extent, this is correct, and there is no reason for the people involved not to want to increase tuitions. For the school, higher tuition will mean the school can improve itself and become more attractive to students. For the lenders, higher tuition means more loans returning 5% or more for which the government assumes all the risk. It isn't entirely accurate to say "the government assumes all the risk" either. Student debts are the most toxic debts around, and cannot be thrown off in bankruptcy. If you refuse to pay, the government is authorized to garnish your wages or raid your savings. This isn't to say that Schiff's hypothesis explains the entirety of the increase in the cost of tuition, but I think that it plays a much larger role than what is discussed in the article.

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josh33 · 2010-11 · Recommendation

Agreed. Here's a solid video on the topic where Peter Schiff explains why college tuition is so high: [VIDEO]

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