Student Loans.

There is a news item that more than £ 5 Bn student loans have become bad due to the lender’s inability to locate the students who availed of the loans, finished their education and have simply vanished!

Nick and I had this exchange on FaceBook.

Ramana Rajgopaul Leaving aside the debate about free education, there is a question of morals and ethics here that is highly disturbing for depicting the educated youth of a country.

Nick Rogers Ramana, the morals and ethics of what exactly?

Ramana Rajgopaul Of borrowing money and disappearing without repaying the loans.

Nick Rogers Ramana, I think that’s entirely moral and ethical because higher education should be free. Graduates benefit everyone in society with their skills so why should they be landed with the bill?

Ramana Rajgopaul I beg to differ Nick. The students borrowed the money knowing that education is not free. They did not borrow from the authorities who decide on who is to bear the cost. They entered into a voluntary transaction like they would to buy an automobile on hire purchase, This has got nothing to do with what should be or not be about higher education’s cost to students. This has got everything to do with the students’ character.

Ramana Rajgopaul On the other hand, in India, something like this would straight away indicate a big scam. The Minister in charge of the department concerned and its officials would have siphoned off the funds using fictitious names!

Nick Rogers Now that really IS immoral and unethical.

I submit that in the process of defending universal free higher education, we cannot overlook the morals and ethics involved in pure commercial transactions and throw open this subject for debate.

19 thoughts on “Student Loans.”

  1. Difficult one this. There is Nick’s, and I couldn’t agree more, that education should be free. However, Ramana, you are right: When you enter a contract you have to honour its conditions. As galling as those conditions may be. One could, of course, argue, possibly in line with Nick, that when you are made to sign a contract, merely held to ransom (in order to acquire a university degree), it amounts to coercion. And who hasn’t admired Robin Hood redistributing wealth – if by somewhat unorthodox means.

    Ursula recently posted..Fat Chance

  2. Coercion, indeed, Ursula. It’s hardly a free choice taking on a student loan when you know a degree is vital for employment purposes but you can’t afford to pay the extortionate fees (around £9,000 a year) upfront. I think that’s what lawyers call unequal bargaining power.
    nick recently posted..The agony of divorce

    1. Nick, where I would part company is this. Not all school leaving students wish to go to colleges for higher education. There is already a snob value to that in that presumably it takes one to white collar careers. If that is what the student wants, then s/he must be willing to pay the price for it if he wants quality education. Otherwise, poorly paid teachers will provide them with poor quality education which we are already seeing producing unemployable/over qualified graduates.

  3. Even if education were free to the students, someone would be paying. There ain’t no such thing as a free lunch (TANSTAFL).

    I paid very little for my degree. Almost all of it was paid via veterans’ benefits or reimbursement from my employer. But it was paid.

    General education of children to about age 18 is supposedly free throughout the United States. In most places, it’s funded by property taxes. And I don’t have a problem with that because, to a degree, we have a say in how high that tax is going to be.

    Education at universities should be affordable, if not free, but more and more, it’s not. I don’t know about other universities, but our local university seems to be set on building bigger and finer facilities, without improving on the quality of the education. At the same time, the cost of tuition and housing continues to rise along with all the new buildings.

    Student debt is scandalous here. The laws are such that there is little way to escape it, not even through bankruptcy.

    I’ve heard it said that the next financial bubble that may pop in the near future will be on student debt.

    Two points:
    (1) If you make an agreement, then you honor it. If you don’t honor it, then you are less than honorable. That includes student debt.
    (2) If university education is to be made free to the student, someone is going to have to pay and in the end that is going to be the consumer, the taxpayer, the little people.
    Mike recently posted..Up in the Sky!

    1. Mike, we don’t expect trainee doctors, trainee teachers or trainee police officers to pay for their training (not in the UK anyway), on the basis that we will all benefit from their skills, so likewise why should higher education students have to pay?
      nick recently posted..The agony of divorce

      1. They may not have to pay, but society is paying through taxes, like anything else that comes from the government.

        That’s not the case for teachers and doctors in the United States. Many doctors have horrendous student loans to pay off.

        I’m probably in the minority here, but I think we need significant reform in higher education, including costs and how it’s paid for. I think a university education is over-emphasized and that much of what is being “taught” is useless in today’s world. Too many people graduate with degrees that they can’t use because there’s no demand.
        Mike recently posted..Up in the Sky!

        1. I agree, and a lot of people are starting to agree with us. U. S. News and World Report has an annual issue about the best colleges in the U.S. The last one I saw said they still ranked the colleges, but they couldn’t honestly say that many of them were worth the cost to the student and student’s families.
          Cheerful Monk recently posted..Play. It’s Good For You.

    2. The problems of high cost of higher education, and in India, even good primarly and upto high school education, is more or less universal now Mike. I think that the whole scene barring a few countries, is in a mess with increasingly unemployable and over qualified and in debt graduates crowding an increasingly narrowing labour market.

  4. I think the poor quality or irrelevance of the subjects is a different issue from whether higher education should be free. If that’s the case, then the answer is to improve the courses, not to charge penniless young people massive fees for wasting their time.
    nick recently posted..The agony of divorce

  5. I don’t agree that higher education should be free. For one thing, government pay scales for teachers can be really low! What is required is some kind of standardization of the fees. Graduates may benefit people with their skills, but it is not a free service! They charge for what they do. for example, doctors really do. At the Breach Candy Hospital OPD i pay Rs 1000/- just for a 5 min consultation. No receipt from most of the doctors. No one gives back to society really, you do your job and you are paid for it. If you took a loan, pay it back!

  6. I don’t know the ins/outs of younger students at this level as such. I suspect if I had someone in my family I would understand it more. I do understand that although the loans are interest free, that is only if you are domiciled here – well actually I DON’T KNOW…it doesn’t affect me at this stage of my life 🙂
    Cathy in NZ recently posted..NZ Census data 2013

Comments are closed.