Scott Walker Takes On The Higher Ed Bubble
Posted at RightWisconsin.
Going into the 2014 (and maybe the 2016) campaign, Scott Walker may have an even more potent issue than Act 10: his tuition freeze.
Last month, Walker called for extending the freeze at the University of Wisconsin System by two years. That freeze will be on top of the two-year tuition freeze in the current budget that was imposed after the UW system was found sitting atop a massive slush fund. The latest freeze comes as UW officials report they will have more than $1 billion left over after this fiscal year.
But more important, Walker’s freeze comes even as a student debt crisis is exploding. Nationally, student debt now exceeds $1 trillion and there is growing evidence that the higher education bubble may be about to burst.
With striking parallels to the housing bubble of the last decade, the cost of a college degree has soared by 439% since 1982, even as the value of that degree is increasingly questionable. A generation of graduates is emerging from higher education carrying a crushing debt burden, but without the skills or job prospects that had once been taken for granted.
Unless relief of some sort is provided, the problem will haunt the middle class for decades to come; and that is what makes Walker’s freeze so politically potent.
While the left will focus on adjustments to student loans, Walker’s move puts the focus directly on the underlying cost of higher education. Rather than providing more cheap credit, Walker’s move suggests that the underlying crisis runs deeper: the collapse of the value of higher education at a time of exploding costs and debt.
Over the last few decades, the cost of a college education rose at four times the rate of inflation and dramatically outstripped the rise of medical costs and even home prices. By 2016, the cost of a college degree will have doubled in just 15 years. At the same time, student debt also skyrocketed. Ninety-four percent of students now borrow to pay for their education – up from 45% as recently as 1993. Student debt now exceeds the nation’s total credit card and auto loan debt. ...
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