A student-debt strike to pressure Congress for wholesale student-loan forgiveness simply won't work

Student Debt Strike, an online Reddit community, advocates for a mass student-debt strike as the best way to pressure Congress to grant wholesale student-loan forgiveness.  I totally support this group's goals.

Economist Stephanie Kelton and others have argued persuasively that forgiving all federal student-loan debt would stimulate the economy. Relieved of burdensome student loans, more than forty million Americans would be free to buy homes, start families, and save for their retirement. 

Furthermore, I agree with Professor Kelton, who believes the federal government can handle massive student-loan forgiveness without wrecking the economy. The feds can simply select one of its many accounting gimmicks to absorb the loss, much as it dealt with the savings-and-loan crisis in the 1980s, the real-estate turmoil of 2008, and Puerto Rico's bankruptcy.  

After all, $1.7 trillion in outstanding student-loan debt is peanuts to a nation with a federal deficit that tops $30 trillion. What's $1.7 trillion among friends?

Nevertheless, it is dangerous for people to participate in a student-loan strike by refusing to make their monthly loan payments.

First, defaulting on a student loan is catastrophic for the individual debtor. Interest and penalties add up and get added to the loan balance. Over time, a student-loan defaulter's loan balance can double, triple, and even quadruple.

Moreover, student-loan defaulters rarely get free of student-loan debt in bankruptcy.  Congress inserted the "undue hardship" rule into the Bankruptcy Code to discourage bankruptcy relief. Many bankruptcy judges interpret "undue hardship" quite harshly and refuse to discharge student debt even when the debtor is in desperate circumstances.

Secondly, I do not believe a student-loan strike will have the desired effect on Congress. Thus far, Congress has shown little appetite for reforming the federal student loan program. Political pressure from the higher education industry (including the for-profit colleges) has blocked reform.

Besides, a significant percentage of college borrowers are already on strike because they have defaulted on their student loans. In a 2018 report, the Brookings Institution calculated that 40 percent of student borrowers may ultimately default on their student-loan obligations. If that is not a strike, I don't know what is.

If I thought a student-debt strike had any chance of succeeding, I would support it 100 percent. But I'm afraid strikers will simply be labeled as deadbeats without moving the needle on reform or loan forgiveness.

Much as I hate to admit it, I think the best option for an overburdened college-loan debtor is to sign up for the most generous income-based repayment plan that is available.

Someday, the student-loan crisis will become so massive and so scandalous that Congress will be forced to act--either by canceling all student debt or easing the path to bankruptcy relief. 

Unfortunately, I think that day is a long way off. 

"LSU administrators paid at outrageous levels, with faculty far behind:" Professor A.R. Rau's letter to the Baton Rouge Advocate

Professor A.R.P Rau published a letter to the editor of the Advocate this morning. I am printing the letter in its entirety.

LSU recently hired a football coach for an obscene $100 million. Athletic directors, other coaches, and umpteen assistant coaches have million-dollar salaries. And now the revenue secretary who is stepping down from state government is being hired as “chief administrative officer” at LSU for $370,000 in place of her previous $250,000.

LSU’s chancellor-president was recently hired for $750,000 plus substantial house and car allowances. There is a provost, and multiple vice chancellors and vice provosts, all making equally impressive six figures.

Why then is a new administrative officer needed, created by fiat by administrators and the LSU Board of Supervisors? This is taxpayer money.

The rot started with then-chancellor Mark Emmert. By bringing Nick Saban as a multi-million-dollar coach, he parlayed that to doubling his own salary, out of all proportion to salaries of faculty or staff. He went to his own further millions at the NCAA but left behind administrators down the line, all making huge salaries, more than double that of professors with decades of teaching, research and scholarship.

This has been noted elsewhere as “rapacious contemporary capitalism” at institutions that were created by societies for different purposes. It is an abuse of the tax-exempt status granted them on the grounds that knowledge generated and taught is a societal good.

LSU’s worth rests on its performance in education. Hiring contingent faculty at fractions of even the smallest numbers cited above, and grudging graduate teaching assistants who are paid even less minus health insurance and other fees they then must pay out of pocket, is shameful.

I leave as an exercise to our boards to calculate how many assistant professors, adjunct instructors, and graduate TAs would be supported by that $370,000 they conjured out of thin air for this new administrative hire.

A.R.P. RAU
professor
Baton Rouge

Revenue Secretary Kimberly Lewis will make $370,000 in new LSU job

Wind turbines have raped West Texas and the Great Plains: I hate the goddamn things

  John Prine wrote a lovely song called Paradise, a tribute to the landscape of his childhood, located "down by the Green River, where Paradise lay."

But that landscape was destroyed by strip mining, as Prine's lyrics attest. "I'm sorry my son, you're too late in asking; Mr. Peabody's coal trains have hauled it away."

Progressive Americans hate coal as they hate all fossil fuels. They lament the damage that was done by strip mining.

Let's stop drilling for oil and gas, they say. Let's stop mining for coal. Let's switch to renewable energy: solar power and wind power.

And the nation is going in that direction, faster than most Americans realize.  Enormous wind turbines are being erected on the Great Plains, turbines so large than an 18-wheeler can only transport one turbine blade at a time.

Year by year, wind power supplies a larger percentage of the nation's energy demands. But you have to drive over the High Plains to grasp the scope of the transformation.

Drive along Highway 84 across the Llano Estacado or motor up Highway 281 in western Oklahoma. Wind turbines by the thousands blight the landscape.

If you live in Boston, you may say that is all to the good. Sure, wind turbines destroy the grandeur of the prairie country, the majestic vistas of West Texas. But who cares?

After all, the nation's truly beautiful scenery only exists on America's East and West Coasts and in blue-state Colorado.  Nobody lives in West Texas, and those who do are elderly white people with non-progressive values who need to be ground down for the greater good.

But I disagree. The vast, lonely panoramas of the trans-Brazos country, the undulating hills of the Oklahoma short grass country are beautiful--as beautiful as the Rockies or the seascapes of California. This country once sustained the Kiowa, the Comanche, and the Cheyenne, who lived off the buffalo that grazed these lands in the millions.

If our national policy is to pollute our natural environment with wind turbines, I say let's share the pain. I will reconcile myself to wind turbines in West Texas when I can see them off the beaches of Nantucket, Martha's Vineyard, and the Hamptons.

Voting with their feet: College enrollment dropped by 475,000 students in the fall of 2021

As the Chronicle of Higher Education reported recently, college enrollment dropped by 475,000 students last fall. Since the COVID pandemic began two years ago, undergraduate enrollment has plunged by 9.2 percent.

A look at college enrollment over the last 10 years shows an even more dramatic decline.  Dahn Shaulis, writing for Higher Education Inquirer, reported that college enrollment is down by 20 percent or more in 18 states during the past decade. Unless conditions change, Shaulis writes, most states will see enrollments drop by 25 percent in the 20226-2027 academic year when compared to enrollment levels in 2010.

COVID is blamed for the recent enrollment exodus.  Doug Shapiro, Executive Director of the National Student Clearing House Research Center, said that students "are continuing to sit out in droves" due to the pandemic, which has forced colleges all over the U.S. to switch from face-to-face instruction to an online teaching format.

But there are larger forces at play. As Shaulis explained:

Enrollment declines are the result of several interrelated economic and demographic shifts. Reduced populations of college age people, economic distress, growing inequality, and migration are some of the interacting factors. 

 And there is another factor at work--difficult to quantify. Young people have begun to figure out that a college education is too damned expensive and often does not lead to a good job.  Liberal arts majors, in particular, often find that their college degree was not a ticket to the good life. Instead, it was a trap that ensnared them in debt and sentenced them to a life of penury. 

Perhaps that is why the number of students majoring in the liberal arts declined by almost a million students last fall, a drop of 7.6 percent from the previous year (as reported by CHE).

We're outta here!

College students: Avoid majoring in liberal arts, social sciences, or humanities: "Nothing was delivered"

 "Nothing was delivered," the Byrds sang more than fifty years ago, and "nothing was received."

I have no idea what the Byrds were singing about when they cut Nothing Was Delivered, but they might have been referring to college degrees.

In 2015, the Department of Education posted its College Scoreboard, allowing people to determine the return on investment for thousands of academic programs across the United States. Several think tanks and policy organizations analyzed the data, and their findings are sobering.

According to Third Way, "a center-left, public policy group," people who graduate in electrical engineering and nursing have very high returns on their investment. Most will be earning more than their student debt within five years of graduation.

On the other hand, the Foundation for Research on Equal Opportunity has terrible news for people getting degrees in the liberal arts. The poor schmucks who study art, music, philosophy, religion, and psychology are likely to end up financially worse off than if they had never gone to college. 

If you want to know more about the financial costs of majoring in liberal arts or the social sciences, you can read the various think-tank reports or the articles posted by the New York Times and the Washington Post.

But the bottom line is this. Given the transformation of the American workplace, with its increased focus on technological skills and mathematics, you would be nuts to take out student loans to get a college degree in a major that does not lead to a good job.

Why do so many colleges offer degrees that don't lead to remunerative employment? A couple of reasons. Schools have thousands of tenured professors teaching subjects for which there is falling demand. No one wants to take Professor Egghead's course on Martin Heidegger, Friedrich Nietzsche, and Soren Kierkegaard. Still, the old gasbag is tenured, and he's going to hang around the university until he is in his eighties.

Second, American universities are not subject to the laws of supply and demand. Enrollments in the humanities and the social sciences have been shrinking for decades. Colleges don't close these programs; they simply raise their prices to cover the growing cost of their bloated overhead and their unproductive faculty.

Students don't complain about rising tuition prices because they take out student loans to pay their tuition bills.  Millions of rubes don't realize they've been swindled until they graduate and suddenly realize they're hopelessly mired in college debt and have no job prospects.

As Friedrich Nietzsche observed, "Sometimes people don't want to hear the truth because they don't want their illusions destroyed." That's good advice. Maybe Nietzsche was trying to warn people not to major in philosophy.

Friedrich Nietzsche: For God's sake, don't major in philosophy!

Who the hell is Maximus--the new giant student-loan servicer?

 On October 20 of last year, the Department of Education announced that Navient, a giant student-loan servicer, was turning its business over to Maximus, a government services company. 

DOE spokesperson Richard Cordray said this about the switchover:

We are confident this decision is in the best interest of the approximately 5.6 million federal student loan borrowers who will be serviced by Maximus and will provide the stability and high-quality service they deserve.

So, who the hell is Maximus? To start with, it is a publicly-traded company whose shares are worth about $77.  Bruce Caswell, Maximus's CEO, is well compensated; he made more than $6 million last year.

Maximus has 35,000 employees, including the drudges who chase down student-loan defaulters. How much do the low-end employees make? The new minimum wage for federal contractors was recently raised to $15 an hour. Last year, Maximus's hourly wage for low-end workers was around 13 bucks.

Forty-five million Americans have outstanding student loans, and Maximus will be servicing 5.6 million of them. For those lucky millions, Maximus will be collecting student-loan payments and keeping track of delinquent debtors and defaulters.  Maximus will also replace Navient as the agent that will help student-loan borrowers switch repayment plans and certify eligibility for loan-forgiveness programs.

Navient, you recall, recently settled multiple lawsuits accusing it of deceptive trade practices.  As Pennsylvania's Attorney General summarized:

Navient repeatedly and deliberately put profits ahead of its borrowers – it engaged in deceptive and abusive practices, targeted students who it knew would struggle to pay loans back, and placed an unfair burden on people trying to improve their lives through education.

Will Maximus do a better job servicing student loans than Navient? Maybe, but probably not.

However, of one thing you can be sure. Navient's stockholders will do alright. And who are those stockholders?

They include institutional investors like BlackRock and giant banks such as Wells Fargo and Bank of America. 

And--ponder this: At least 17 public-employee retirement funds own shares in Maximus, including funds for California, Louisiana, New York, Oregon, and Wisconsin.

So if you are one of those 5.6 million Americans whose student loans are being serviced by Maximus and you are being ground down by your debt, you can take comfort in the fact that a lot of massive institutions--both public and private--are doing just fine.

Note: This blog relies heavily on Dahn Shaulis's reporting for Higher Education Inquirer. 

You should have bought Navient stock a year ago: Navient settles deceptive lending claims for $1.85 billion

 Forty state attorneys general sued Navient Corporation for deceptive lending practices in its student loan business. Navient settled the lawsuits last week for $1.85 billion.  

The loan giant admitted no wrongdoing, saying the claims against it were "unfounded."

The participating states will split $145 million, and Navient will forgive 66,000 private student loans.  In addition, Navient will pay $260 apiece to 350,000 federal student borrowers whose loans were serviced by Navient.

Did this settlement bring Navient to its knees? No, it did not. 

Almost exactly one year ago, Navient stock was worth about eleven dollars. What's it worth today? Twenty-one bucks.

During the past year, Navient sold its federal student-loan servicing business to an outfit called Maximus, which already had its tentacles in the healthcare industry. Then it settled lawsuits for deceptive lending, which cost it $1.85 billion.

But Navient will stay in the private student-loan business, which must be profitable. After all, Navient's stock price nearly doubled within the last year.

If you were one of the 350,000 student borrowers who will be getting a $260 check, lucky you! You'll be able to pay your light bill next month.

A measly 260 bucks

Why does Oklahoma have 8630 licensed marijuana growers and only 471 dairy farms?

 When I was in college, it was a felony to possess marijuana in any amount. If the cops caught you with it, you could go to the state penitentiary for a very long time.

When I was a child, Oklahoma prohibited the sale of hard liquor. Okies could drink 3.2 percent beer (usually Coors), but they couldn't buy a bottle of whiskey or order an Old Fashioned in an Oklahoma restaurant.

When I was growing up, there was no legal gambling in Oklahoma: no lottery, no casinos, no slot machines, and no video poker. 

My, how times have changed!

Medical marijuana has been legalized, and you can buy it in special dispensaries all over the state. The dispensary in my hometown of Anadarko is on Main Street.

Indeed, Oklahoma now has 8,630 licensed marijuana growers--18 times the number of dairy farms. The state lists them on a website, and ten growers give their addresses as Anadarko.

Once considered a grave sin in the Sooner State, gambling is now legal. The Native American tribes have casinos all over Oklahoma. One does business just two miles outside my hometown.

If you want to drink while you gamble (and who doesn't?), you don't have to find a bootlegger anymore. You can order a cocktail at the casino bar.

Ain't life grand? 

Even better, hardly anyone goes to church now. When I was a child, I got up on Sunday mornings, shined my shoes, put on my clip-on bow tie, and trotted off to Sunday School. 

My teachers kept track of attendance, and if I had a perfect attendance record for one year, I received a lovely ceramic pin for the lapel of my little sports coat.

Everyone went to church in those days, and adults dressed up for the occasion. Most men owned one suit, which was reserved for weddings, funerals, and church.

Of course, a few people still attend church on Sundays in my hometown--primarily old people. But the church parking lots are no longer full.

Anyway, what do the pastors preach about now?  Don't drink? Don't gamble? Don't do drugs? Oklahoma's politicians tell us all that stuff's OK.

When I was a child, some evangelical ministers preached that going to the movies was a sin (and they may have been right!).  But there are no movie theatres in my hometown anymore, so why bring up the subject?

I wish I could say Oklahomans are happier now that they can drink, gamble, and smoke marijuana. But I don't think they are.

Feel like praying? Go to the Prayer Teepee.

"A nation is not conquered until the hearts of its women are on the ground": I return to Anadarko

 I grew up in Anadarko, a small town settled near the banks of the Washita River in southwestern Oklahoma's Caddo County.

Anadarko was a thriving community when I was a child. Family shops lined Broadway, the town's main street. Farmers and their families came to town on Saturdays to do their weekly shopping, and elderly Plains Indians gathered on the sidewalks, talking to one another in Kiowa and Comanche.

Our town boasted a fine Victorian courthouse, as elegant as any county courthouse in Texas. The town square had a bandstand and a statue honoring the Caddo County boys who died in the Great World War.

And what a statue! A life-size bronze figure of a doughboy stood on a granite pedestal, where the names of all the dead were listed. The soldier wore a campaign hat and a uniform with puttees. In one hand, he held the staff an American flag. In the other, he clutched the barrel of his Springfield rifle. 

Facing the courthouse square stood the First Methodist Church, erected in 1917 in the Greek Revival Style. A Tudor-style Presbyterian church and the First Baptist Church also faced the square. All these churches were full when I was a child.

I returned to Anadarko a few days ago, and the town of my boyhood is gone. The county bureaucrats tore down the Victorian courthouse in the 1950s and replaced it with a concrete structure built in the mid-century modern style--which, of course, is no style at all.

The Presbyterian church still stands but is closed-- not enough Presbyterians to pay the light bill. The Methodist church can't afford its own preacher anymore and shares a minister with a nearby town. The Baptist church stands abandoned, although a new church was erected at the edge of town.

The bandstand is gone, and so is the bronze doughboy. All the local businesses are closed, wiped out by Walmart, which sells everything a rural Oklahoman could ever need.

Anadarko’s losses are sad, but the new town is sadder still.

I drove by the home my father built with his own hands in 1953. It is empty now and looked abandoned, just one of a few hundred abandoned houses in the town.

Anadarko had two movie houses when I was a kid, as well as a drive-in movie theater. They are all gone—killed off by television.

Of course, there are new things for the townspeople to do. The Plains Tribes are now in the gambling business, and the citizens of Anadarko can gamble with the Kiowa, the Comanche, the Fort Sill Apache, or the Wichita. Most casinos are open until 2 AM if they can’t sleep and want to play the slots.

When I was a kid, a person could be sent to state prison for possessing a single marijuana joint. But times have changed. 

Now there’s a medical marijuana dispensary on Anadarko's Main Street. Of course, you have to have a medical prescription, but I don’t imagine it is difficult to find an accommodating doctor.

And my hometown's marijuana might have been grown locally. Oklahoma has hundreds of licensed marijuana-growing sites, and ten are near Anadarko.

Perhaps these marijuana greenhouses brought new jobs to Anadarko, which would be good. But no, growers bring in workers from outside.  Someone told me that some of the guys who grow marijuana in Caddo County are Chinese.

But at least the landscape of my childhood is still lovely—the stunning Oklahoma sunsets, the red-dirt hills, and the timeless vistas of the Great Plains.

But again, no. Corporate America has built hundreds of wind turbines in Caddo County—scarring the landscape I once believed could never be changed. 

Anadarko—abandoned homes, closed businesses, a marijuana dispensary, and nearby gambling dens. No wonder many of the people I saw looked clinically depressed. The town has a high suicide rate—primarily young people.

As I stood in the courthouse square, I saw an empty lot where someone had painted a mural on the side of a building—a mural that proclaimed this cryptic message: 

A nation is not conquered until the hearts of its women are on the ground.

I do not know if the hearts of Anadarko’s women are on the ground. But if they are not, the town has some goddamned strong women.

Administrative bloat at American universities: Why it costs so much to go to college

 During my years at the University of Houston, I parked my modest Honda in the faculty parking lot next to other modest cars driven by UH professors--mostly Hondas, Toyotas, Nissans, and Fords.

Then I would walk through the parking lot reserved for administrators, and all the vehicles were luxury cars: Audis, Lexuses, BMWs, and expensive SUVs. Those cars reminded me of the university's priorities--and they didn't include teaching. 

I finished my career at the University of Louisiana at Lafayette, where I volunteered to teach a class of first-year students. I remember a young freshman telling me that my class was his only class taught by a professor. His other teachers were poorly paid adjuncts and instructors who weren't even earning a living wage.  

Yesterday, Robert Kuttner posted an article pointing out that administrative bloat is a significant reason college tuition prices keep going up. He pointed out that Harvard has thirteen vice presidents. 

Mr. Kuttner is right. Universities are crammed full of administrators packed like sardines in campus administration buildings. Vice presidents for technology, enrollment management, diversity, and fundraising. Deans in charge of fraternity and sorority affairs, directors in charge of investigating sexual misconduct, associate deans to generate the paperwork demanded by the various accrediting bodies. And on and on.

Most of these bureaucrats make more money than associate professors. Administrative ranks are growing while universities shift more and more teaching to part-time instructors who are paid a pittance and don't get health insurance or retirement benefits.

"Executive bloat," Kuttner observed, "has gone hand in hand with the usurpation of the historical role of the faculty as the university's governing body, in favor of a corporate model."  Again, Kuttner is right.

Today's professors have very little say about how the universities are run. Faculty senates are purely advisory bodies and have about as much power as the Reichstag had when Hitler was Chancellor of Germany.

Kuttner suggests that the federal government limit college's non-instructional costs. The money spent on administrators cannot exceed a set ratio compared to instructional costs. That's a great idea, but the universities won't stand for such a rule. 

 Kuttner compares modern universities to hedge funds. But I think of them more like medieval fiefdoms where administrators lord it over student peasants who are forced to pay annual tribute to the manor lord with money borrowed from Uncle Sam.

image credit: Medievalists.net

Princeton bars students from leaving Mercer County: False Imprisonment?

You've seen those old crime movies. Detectives wearing fedoras arrive unannounced at some poor schmuck's home and accuse the guy of committing murder.

"Am I under arrest?" the schmuck askes nervously.

"Not yet," a detective snarls, "but don't leave town."

American universities are beginning to act like movie detectives. To stem the tide of COVID, they have become dictatorial and autocratic.  Last December, hundreds of students were quarantined in their dorm rooms and forbidden to walk their campuses due to the COVID crisis.

For example, the Washington Post recently reported on Oscar Lloyd, an undergraduate at Columbia University, who was isolated in a cell-like room for ten days after testing positive for COVID. The university fed him and presumably let him out to shower, but he was not allowed to leave his assigned room to exercise. His life for ten days must have been very much like being in jail.

And at Princeton, the university recently took the extraordinary step of confining all students within the boundaries of Mercer County, where Princeton is located.  

What will happen if a Princeton student breaks out of stir and makes a run for Hoboken? Will the campus police pursue him, sirens wailing and guns blazing, like a scene from a Jimmy Cagney movie?

False imprisonment is a civil offense under the common law. According to the Restatement (Second) of Torts, people are subject to liability for false imprisonment if they confine a person within fixed boundaries against that person's will and the confined person knows he is confined. 

Can universities be sued for false imprisonment when they quarantine their students? I doubt it.

After all, the detained student can always elect to drop out of school and leave the campus. And a genuine health emergency can sometimes justify draconian measures.

Nevertheless, the COVID pandemic is in its second year, and colleges and universities are becoming increasingly inhospitable and tyrannical. 

In my view, elite colleges can't justify tuition rates at extortion levels while forcing their students to take online classes, submit to being quarantined, or be restricted from moving freely when they are off-campus.

It costs students almost $80,000 a year to study at Princeton. Do you think a student laying out that kind of bread wants to be confined to Mercer County?

You're not under arrest yet, but don't leave Mercer County.

Is 2022 the year when young people should postpone college?

 "Nobody thinks of anything as long as his luck is good," Kurt Vonnegut observed in one of his novels.  "Why should he?"

American colleges have had a remarkable run of good luck. For half a century, they've enjoyed a steady supply of students and a cornucopia of federal money flowing into their coffers. International students flocked to American universities in ever larger numbers, and they obligingly paid their tuition bills with no complaints about the cost.

Salaries for university presidents rose ever upward, and administrative staffs became more and more bloated with overpaid administrators--vice presidents and associate vice presidents, deans and associate deans, provosts, and executive vice provosts.  

Universities launched aggressive building programs: luxury dorms, ostentatious athletic facilities, world-class student recreation centers.  Wealthy alumni made fat contributions to have their names on all these gleaming edifices.

Tuition went up every year to pay for all this, but students paid their bills with federal and private student loans, and no one complained. 

Those were the gravy days!  

Then, in March 2020, the black swan arrived. COVID swept across the country, forcing universities to close their campuses. College leaders shuttered all those glittering student rec centers, emptied out the posh student dorms, and canceled college sporting events. 

Still, no worries. The coronavirus pandemic wouldn't last forever. How could it? In a year or so, the crisis would be over, and everything would be back to normal in the halcyon world of academe.

In fact, University leaders patted themselves on the back for responding to the pandemic so nimbly. In a matter of days, virtually every college in America had kicked their students off-campus and forced them to finish the spring semester by taking courses on their home computers. 

But students weren't happy about taking classes online, and they filed hundreds of lawsuits, demanding refunds for their tuition and fees. More than 300 lawsuits were filed.

And the COVID virus did not go away. In fact, many American schools are starting the 2022 spring semester with online classes--even such snooty joints as Harvard. Stanford and Georgetown.

Now student enrollments are declining--especially in the for-profit sector, the community colleges, and the non-elite private schools. For reasons that college presidents can't seem to understand, students don't want to pay $70,000 a year to attend online classes from the parents' basements.

In addition, universities across the country have been mired in scandals and litigation: sexual misconduct by varsity athletes, bribery in the admissions offices, and accusations of race discrimination.

In sum, American higher education's run of good luck has run dry.

So, if you are a young person, is 2022 a good year to postpone going to college? A good year to let things settle down?

I think it is. Unless you clearly understand how your college education will improve your life, don't take out crushing student loans to pay tuition at a college that won't let you on its campus.

Just leave your tuition check on the doorstep.

Why Doesn't the Federal Government Just Cancel All Student Debt? To Find the Answer, Take a Look at Our National Balance Sheet

 When Joe Biden was running for President, he said he would cancel $10,000 of every college borrower's student debt if Congress consented. But Congress hasn't acted.

Senators Elizabeth Warren and Charles Schumer have urged President Biden to cancel $50,000 of every borrower's federal student loans, saying he has the executive power to do so. But that hasn't happened either.

Why not? Given the hardship that student debtors are experiencing--especially since the COVID crisis began--why not just wipe the slate clean and cancel all $1.7 trillion in federal student debt?

In my opinion, President Biden and most members of Congress would like to cancel all student debt. After all, there are about 45 million student borrowers, and canceling their student loans would make them all very happy. 

But Congress can't do that, and neither can President Biden. And here's why.

Student loans are carried on the nation's balance sheet as assets. As of September 30, 2020, the United States held almost $6 trillion in assets, and about a quarter of that amount is listed as outstanding student loans. 

As of September of last year, total national liabilities amounted to roughly $32 trillion, resulting in a national debt of around $26 trillion (give or take a few trillion).

Thus, if Congress simply wiped out all those student loans or President Biden canceled them through executive action, the nation's balance sheet would look significantly worse than it already does.  Instead of holding total assets of $6 trillion, our government would have only a little more than $4 billion.

Simply put, the federal government pretends that all that student-loan debt--closing in on $2 trillion--will be paid back.  And that fiction cannot be maintained if Congress wipes out all student debt or allows large numbers of distressed debtors to discharge their student loans in bankruptcy 

If you are a student-loan debtor, you have benefited from the moratorium on making monthly loan payments--a moratorium that won't be lifted until May 2022.

But just because you haven't made any student-loan payments over the past two years, don't get your hopes up that Congress will simply forgive all federal student debt.  It won't do it because it can't do it. The Federal government's balance sheet simply can't take the hit.

Biden administration extends student-loan repayment moratorium until May 2022: Loaning money to cousin Rudy

 Don't lend money to a friend, an ancient proverb advises, because you will lose both your friend and your money.

My cousin Rudy taught me that lesson. A couple of years ago, Rudy called me from the Travis County Jail in Austin, TX, asking me to go his bail.

I can't remember why the Texans locked him up. I think he rolled a homeless man on Congress Avenue or took a leak on the State Capitol grounds. Maybe both.  Rudy was a little vague about the charges.

"You gotta get me out of here," Rudy pleaded. "The jailer is threatening to shave my face and my head. I need a good lawyer."

"How much do you need?" I asked, thinking he would ask for a few hundred dollars.

"I need ten grand," Rudy replied. Ten grand! 

But who can say no to a relative in need? I wired the money. "Just pay me back when you can," I told him.

Did Rudy ever pay back the loan? What do you think?

The federal student loan program is sort of like the money I loaned cousin Rudy. More than 40 million people owe Uncle Sam $1.7 trillion, and most of them aren't paying it back.

In fact, I suspect a few million student-loan debtors have concluded that their loans are really gifts--like the money I wired Rudy.

And the government is encouraging that point of view. The Department of Education has put nine million borrowers into long-term, income-based repayment plans (IBRs).  People in those plans make token payments for up to 25 years, but they will never pay off the principal on their loans.

There are millions more who have gotten economic-hardship forbearances, and they ain't paying nothin.'

And yesterday, the Biden administration extended the moratorium on making student-loan payments until May 1, 2022. By the time the moratorium expires, 27 million student borrowers will have avoided making student-loan payments for more than two years.

Let's face reality. Just like my loan to cousin Rudy, the feds will never collect all of that student-loan debt. 

Just pay me back when you can!

Southerners eat black-eyed peas and cabbage on New Year's Day: Do these foods symbolize prosperity or survival?

According to the Farmer's Almanac, Southerners traditionally eat black-eyed peas, cabbage, and pork on New Year's Day. 

The Almanac says these foods symbolize prosperity. Cabbage represents money, black-eyed peas suggest coins, and pork represents forward motion.

On New Year's Day, I will honor this Southern tradition by eating pork, black-eyed peas, and cabbage.  But I wonder if these foods represent something more fundamental than prosperity. 

Perhaps they symbolize survival.

If you are eating cabbage and black-eyed peas in January, that means you planted a fall garden and were able to harvest your crops.  

If you are eating pork in the winter, that means you slaughtered a hog in the fall and are getting some protein in your diet.

In my mind, the humble foods that Southerners eat on New Year's Day are a sign that we will survive until spring because we made prudent preparations in the fall; we planted winter crops and raised a pig.

This year, I planted a fall garden and began harvesting my produce in early December.  I discovered that broccoli, mustard greens, collards, and cabbage are easy to grow and thrive in cool weather.  

 So, I plan to plant a fall garden every year from now on. For me, my fall garden will be a reminder that I can't depend on the government, the national economy, or the global supply chain to keep me alive in my winter years. Ultimately, I alone am responsible for myself and my family.

(Nevertheless, I hope I am never obliged to own a pig. And I'm not crazy about chickens either.)

Urgent message from the real world to college administrators: We are sick of academic politics

 I don't care if you are a cool, young wokester with an AOC t-shirt and a biodegradable water bottle or a 90-year-old grandma who wears a MAGA hat and carries a Glock in her purse. Let's all agree on one thing: America is sick of academic politics.

Here are some examples of gratuitous political posturing coming out of our universities. At San Diego State University, a dean tweeted this totally inappropriate message:

Just so we’re clear on the Right’s agenda: racism good, abortion bad, money good, women bad, capitalism good, sustainability bad, stupidity good, science bad, power good, equality bad, white people good, nonwhite people bad. Stench, indeed.

 At MIT, the administration disinvited a University of Chicago professor to give a prestigious lecture because of his unpopular views about colleges' diversity agenda.

And at Buffalo State College, the administration won't rehire a writing instructor because she wrote that she was "sick of talking about Black Lives Matter."

I'm not speaking from a political perspective. I don't give a damn about anybody's politics--particularly the politics of fatuous university administrators.

I'm thinking about the students who are burying themselves in student loans to attend universities run by fools. 

They didn't sign up for a lifetime of debt just to become a captive audience for a bunch of gasbag administrators who think they are entitled to inflict their political views on the paying customers.

To paraphrase Mark Twain, the Constitution gave Americans the right to free speech. Thank God most people are smart enough not to use it.

Woker than thou

 

 

Columbia University v. Jacobsen: Do Colleges Teach Wisdom, Justice, and Beauty?

In a case decided over 50 years ago, Columbia University sued Roy Jacobsen, a former student, to collect about $1,000 in unpaid tuition.

Jacobsen countersued, demanding $7,000 in damages. He claimed Columbia had not taught him what it promised. Specifically, Jacobsen pointed to language in a brochure that said it would teach students "wisdom, truth, character, enlightenment, understanding, justice, liberty, honesty, courage, beauty and similar virtues and qualities."

Jacobsen also argued that Columbia had not lived up to its Latin motto: In lumine tuo videbimus lumen ("In your light, we shall see light") and a similar inscription over the college chapel: "Wisdom dwelleth in the heart of him that hath understanding."

In essence, as the appellate court noted in its opinion, Jacobsen's essential beef was that Columbia "does not teach wisdom as it claims to do."

Not surprisingly, a New Jersey trial court dismissed Jacobsen's claims, and the appellate court affirmed the lower court's decision.

"[W]isdom is not a subject which can be taught," the court observed,  and "no rational person would accept such a claim by any man or institution."

Obviously, the New Jersey court is correct. Students should not be able to sue a college because they failed to obtain all the intangible benefits that the college breezily promised in its brochures.

Nevertheless, the Jacobsen case reminds us that students need to think about why they signed up for college before writing those tuition checks.

The average cost of attending Columbia is more than $80,000 per year. Nobody lays out that kind of bread to get a deeper understanding of wisdom, justice, and beauty.

No, when students enroll at Columbia, they do so for one primary reason. They hope to benefit enough from their education to obtain a good job--one that justifies their student loans.

In lumino tuo videbimus lumin: What the hell does that mean?

Omicron variant harasses American colleges: "I've enjoyed as much of this as I can stand!"

 Porter Wagoner, singing about a chance encounter with an ex-girlfriend, quickly bade farewell. "I've enjoyed as much of this as I can stand," he tells her.

College students are singing the same song. The COVID pandemic has been with us for almost two years, and Omicron promises to prolong the disruption well into 2022.

This week, several colleges announced that final exams for the fall semester would be online, and classes at some schools were temporarily switched to online formats earlier in the fall term.  

NYU recently banned all "discretionary, nonessential nonacademic gatherings," presumably allowing nonessential academic meetings to proceed. At some schools, students who meet friends over pizza and beer at an off-campus dive run the risk of being suspended from their classes.

Since the campus closings in March 2020, students have sued more than 300 colleges, demanding their money back. Specifically, they want tuition refunds for classes that switched from face-to-face classroom settings to an online format.

They also want their fees refunded--the fees they paid for access to campus recreation centers, varsity sporting events, and collegiate health clinics. You closed all these venues, the students argue, but you kept our goddam money.

As I have said since the beginning of the pandemic, I sympathize with the universities.  College leaders acted reasonably when they closed their campuses in the spring of 2020, cleared out the dorms, and sent students home.

But the students who got booted paid big bucks to take classes during the 2020 spring semester.  At the private schools, tuition bills were north of 25 grand! Many students shelled out $30,000 for the dubious privilege of matriculating at snooty universities for four months when you tack on housing, fees, and books.

Colleges responded reasonably to a public health crisis when they closed down in March of 2020, but they need to understand that it costs too damn much to go to college these days. Students will put up with this banditry when they can stroll through elm-shaded campus quads and listen to gassy professors opining in quaint, wood-paneled classrooms.

But they ain't gonna put up with face-to-face college classes periodically going online or rules that prevent them from meeting their friends off-campus.  Not for long anyway.

College enrollments are already down significantly from pre-pandemic levels.  Men, in particular, are increasingly deciding to sit out of college until the chaos comes to an end.

What can colleges do to entice students to continue taking out loans to pay their tuition bills?  They can start by publicly admitting that online classes are inferior to on-campus learning and lowering their prices accordingly.

Porter Wagoner: "I've enjoyed as much of this as I can stand!"

Paul Campos says that college presidents and varsity coaches "are robbing us blind," and he is right

Paul Campos, a professor at the University of  Colorado Law School, wrote an essay for The Chronicle of Higher Education on the astounding salaries paid to college football and basketball coaches, who are now making far more money than university presidents. 

Campos commented specifically on the salary paid to Louisiana State University's new football coach, Brian Kelly, and Michigan State University's contract with its football coach, Mel Tucker. Tucker and Kelly both got ten-year contracts worth $95 million.

Varsity coaches are paid far more than college presidents, but they too are making out like bandits. As Campos points out:

[T]he outrageous athletic salaries can even seem to justify the administrative overpay. By a kind of perverse psychological effect, paying a college football coach $10 million per year makes paying a university president $1.5 million, a provost $800,000, and various vice provosts and vice chancellors $500,000 each seem positively parsimonious by comparison. 

Campos notes that most universities operate as tax-exempt charitable institutions,  but they have been captured "by the most rapacious forms of contemporary capitalism." Or, as the Campos essay's headline put it, "Coaches and Presidents Are Robbing Us Blind."

Meanwhile, undergraduates are increasingly being taught by graduate students and non-tenured instructors who are paid a mere pittance.  At my former university, some instructors are paid less than $3,000 per course. If they teach five courses per semester (a killing teaching load), they work at the poverty level.

Meanwhile, the football coach makes three-quarters of a million dollars a year.

LSU's new football coach makes $9.5 million a year and gets personal access to private jet

Senator Chuck Schumer Wants to Extend Moratorium on Student-Loan Payments: Is that a Good Idea?

Quite a few country songs are about guys who made a big mistake when they were young and went to prison.

Merle Haggard tells a story about a man who “turned 21 in prison, doin’ life without parole.” George Jones eulogizes a wretch who spent eighteen years in the slammer “and still has life to go.” And Porter Wagner sings about a guy rotting in a cell because he stabbed his wife and her lover in a fit of rage.

Heck, even Wanda Jackson, the queen of rockabilly, wails out a song about a riot in cell block number 9.

Student-loan debtors can empathize with these prison songs. Like the people Merle, George, Porter, and Wanda sang about, they made a big mistake when they were young and spent their adult lives dealing with the consequences.

Indeed, that is the great tragedy of the student-loan crisis. Young people borrow tons of money to pay for their college education when they are clueless about what they want to do with their lives.

Then they graduate from college (or drop out) and can’t pay back their loans. Interest and penalties accrue, causing their original loan balances to double or triple, and ultimately, they realize they’re facing a lifetime of debt, which they can’t discharge in bankruptcy.

College debtors got a break when the COVID pandemic hit in the spring of 2020. The Department of Education allowed them to skip their monthly loan payments without penalty and without interest accruing on their loans. But that reprieve comes to an end next month.

Senator Chuck Schumer and other progressive congressional leaders want President Biden to extend the student-debt moratorium yet again.

I think that’s a mistake, which will only prolong the misery.

No, Congress should face the fact that the federal student loan program is a catastrophe. Our national legislators need to amend the Bankruptcy Code to allow distressed student borrowers to discharge their student-loan debt in bankruptcy.

Also, the feds need to put severe pressure on the colleges and universities to lower their tuition prices.

Finally, we need to shut down the for-profit college sector and shut down dodgy graduate programs—the third-rate law degrees and vacuous MBAs.

Otherwise, we are just enlarging an enormous debtors prison that now holds more than 45 million inmates.

Wanda Jackson: "There's a riot goin' on."

 

LSU Football Coach Brian Kelly: Can a Guy from Notre Dame Sell Raising Cane's Chicken Fingers?

 Brian Kelly hasn't even started work yet as LSU's new football coach, and people are already making fun of him for trying to speak with a southern accent. Even Jeff Foxworthy ("You might be a redneck") got in on the fun. 

Hey, give the guy a break. Until he was in the hunt for the LSU football coach's job, Brian Kelly had never even been to Louisiana. So give him points for trying.  

But here's my advice to Coach Kelly. Louisianians have a multitude of accents, and Kelly needs to carefully choose a particular accent and then stick with it. 

His new contract includes 50 free hours on the LSU private jet. I suggest that he fly around the state and choose an accent that works for him.

First, he should fly up to Shreveport and then drive east to Claiborne Parish--on the Arkansas border. 

Those North Louisianians have an accent all their own.  But here's a warning: Don't poke fun at the way they talk, or they'll kill you.

Then take a leisurely drive through Acadiana.  Talk with people from Pierre Part, Galliano, Bayou Pigeon, or Grosse Tete.  Accents in that part of Louisiana vary from town to town, but they all fall under the broad heading of Cajun. Coach Brian might want to choose one of the Acadian accents.

Or he might explore the Irish Channel in New Orleans. Now that's a distinctive accent.

But Coach Brian shouldn't worry about getting his southern accent right. A southern accent is the easiest thing in the world to pick up. Even Hillary Clinton can do it. No need to sign up for Rosetta Stone. Just pop a couple of quaaludes and wash them down with a 40, and you're on your way.

No, Coach Kelly should worry about losing his southern accent after he acquires it. Six months from now, Coach Kelly may sound like Senator Lindsey Graham. But if he goes back to South Bend, Indiana, to visit old friends, they'll all laugh at him.

So Tiger fans shouldn't fret. Kelly will get the southern accent down within a few months. 

No, my biggest worry is whether Coach Kelly can hawk Raising Cane's chicken fingers with enthusiasm and conviction. Coach O could do it. Coach Miles could do it. Can Coach Kelly do it?

I say we give Coach Kelly a tryout to see if he can credibly do a Raising Cane's chicken fingers commercial. If he can't get that right, let's buy out his contract!

Coach O could sell those chicken fingers!

LSU signs $95 million contract with new football coach: "We must have been our of our minds."

 John Prine and Melba Montgomery recorded a great country song a few years ago: We Must Have Been Out of Our Minds." The song tells the story of a couple who foolishly broke up because they both thought they loved someone else.

Then they realized their mistake. 

They both turned out to be the wrong kind. Oh, we must have been out of our minds.

That song should be LSU's theme song.  A few days ago, LSU hired Brian Kelly, who currently coaches at Notre Dame, to be LSU's next football coach. 

LSU and Kelly signed a ten-year contract for $95 million. Ninety-five million! And that doesn't include various incentives and endorsements. I predict Kelly will soon be promoting chicken fingers on local television stations--which will earn him even more money.

Kelly is 60 years old. What are the odds that he'll still be coaching for LSU ten years from now?

Not good, I believe. Scott Rabalais, a sports columnist for the Baton Rouge Advocate, pointed out that seven of the last ten LSU football coaches were fired.

LSU bought out its last two coaches' contracts. The university cashed out Les Miles for $10 million. Coach Orgeron, LSU's current football coach, got bought out for $17 million. 

And Miles and Orgeron both brought home national championships!

Stephanie Riegel, writing last year for the Baton Rouge Business Report, said LSU is mired in moral bankruptcy. She referenced a video of the 2019 football championship team dancing to a "bounce" song titled Get the Gat at the White House.

The lyrics of Get the Gat are misogynistic, to put it mildly. Here are some sample lines:

You ain’t nun but a dope man’s bitch . . .

Cuz I’m a [N word] wit a rock hard bone
And I’m takin’ one of these hoes home.

Gat, by the way, is a slang word for a gun. 

LSU must be out of its mind. The university recently renovated the football team's locker room at the cost of $28 million. The revamped facilities include a performance nutrition center and cushy study areas that feature "sleep pods." 

Meanwhile, the LSU library looks like a Dollar Store on the wrong side of town, and the university is muddling through a sexual misconduct scandal by student-athletes.

LSU's communications execs tireless assure the public that all the costs run up by the football program are paid by the athletic foundation, not tuition money.  Maybe that's true.

Nevertheless, all this football hype is not improving LSU's academic standing. The law school dropped 13 places in last year's U.S. News & World Report rankings. The university as a whole ranks 1lth in the U.S. News rankings among the fourteen schools in the Southeast Conference, just above Missippi State, Old Miss, and Arkansas.

But LSU is number one in at least one category. The university is the first SEC school to sign a sports-betting contract with a gaming company.

Go Tigers!

Sleep pod in LSU football locker room: Nighty Night!