We are going to see the collapse of private universities nationwide. The only private Universities with a bullish future are the Ivy Leagues for the elite and well gifted only. 70% of those in college at this moment are utterly throwing precious time and taking very serious risks incurring massive debt. Your degree will not be worth the paper it is printed on in the very near future, prepare to accept any job you have the opportunity for. Most will be working the equivalent as a gas station attendant with the exception of Health Care.
A few items must be examined to bring this forecast into view; therefore I simply look no further than current events.
Here are just a few.
* Average tuition at four-year public colleges in the U.S. climbed 6.5 percent, or $429, to $7,020 last fall as schools apologetically passed on much of their own financial problems, according to an annual report from the College Board.
At private colleges, tuition rose 4.4 percent, or $1,096, to $26,273.(Huffington Post Oct 2009)
*Since 2004 tuition and fees have risen by up to 20%(Time Magazine)
*Because of a budget in peril, UCLA inflated college costs by 32% in November of 2009 (AP)
* College tuition has increased by more than three times the rate of inflation for the last 20 years, despite U.S. wages flat-lining since 2000.(Forbes Magazine)
This begs the question: why did prices increase to these obscene levels in the first place?(Hint: for the same reasons the real estate boom happened):
Despite the best intentions, Government intervention distorts free market principles and creates zero incentive for businesses to lower costs or modify services.
The straw man argument typical consists of “Well, if Government didn’t provide loans, no one would be able to afford college”.
Again, I simply fall back to the free market model to demonstrate the fallacy in that claim. For if the government were to exit the student aid market, enrollment would fall through the floor. Students who were unable to attend college in the first place, without Government aid, would not enroll forcing pressure on the Universities to bring down costs to meet demand.
*Many students today must undertake massive debt in order to pay for the cost of their college education. We will continue to see an increase in the amount of debt a student must incur, as colleges continue to inflate their costs and the Government expands its role in the loans market.
*The average student enrolling in college starting in the year 2012, will accumulate debt so massive that he or she will not be able to afford in a lifetime because most of the jobs available will be low wage! Yes, that is correct.
*Despite the increase in the cost of attending college, enrollment will continue to skyrocket in the short-term and then fall of a cliff by 2015.
*Every college in the nation will continue to inflate prices at a significant rate in the coming years as personal revenue falls. Because fewer will be able to afford costs, pressure will be put on the Government to step in to fill the void, which they will CERTAINLY do without any hesitation.