"Steel stud, first of all dumb ass i dont know where you got the idea that i kill people you idiot, and if you haven't payed any respects to your dearly departed then you should be ashamed of yourself you fucking asshole"
hmm. Deep breaths Don. I was just messing with ya. Psycho killer - Talking Heads. Great song by a bunch of arch school dropouts. Sorry for pushing your buttons at the wrong time. I apologize.
I mean, I'm not saying DonQuixote raped and killed a girl back in 1990, but has anyone seen him come out and deny it? :)
WTF happened to this thread? This puppy derailed minutes after leaving the station. The highlight is Unicorn's pyramid scheme thingy. I'm not giving you any money. Oh, that was a food pyramid? I don't see cheese represented in it. What am I supposed to eat then??
What are the lowest row of triangle's referring to? Is there a more basic form of construction, or construction related services benneath basic shelter?
UG in other words are you making a critique of architectural education broadly: that it doesn't prepare for things like "sanitation, conservation, electrification, communication, integration, etc."?
Trying to see where the connection is to the original poster's question...
There is some truth to: there are many valuable and marketable skillsets and knowledge sets that you don't learn in architecture school but which add value to the service and to somebody looking to hire someone...
That chart does seem overly rigid... Actually it seems sort of didactic to me... Why is integration the most profitable and design and engineering towards the bottom in terms of profitablity and also liability? That doesn't make sense? Are you selling BIM? There are plenty of much more profitable kinds of building that don't make use of BIM... Or conservation... Why is that more profitable? Seems to be selling an agenda, not that I don't think what you are listing there is important but why is it prioritizing certain things...
Is this a matrix looking at a potential employee's skillsets? Or the design process, the value of design services in the marketplace? These are different... And whose value system are you setting up there?
Yet another useful thread that Unicorn Ghost has totally and ignorantly (not to mention incomprehensibly) derailed...
re: steelstuds humorous note above: Chinese construction companies will need native speakers to assist in building of sweat shops and factories.
The sad part is - they won't even! If you look at what the Chinese are building all over Africa, they're importing their own laborers from China and putting them up in work camps, in order to avoid hiring any natives. So you might as well keep on writing your Mandarin novels... because China won't be needing you for design & construction, that's for sure!
jump, i messaged you a while back about transferring to uMan so i could save some dough. i would do it in a heartbeat. however, how do i rent/eat/live very cheaply there? can it be done for a couple thousand dollars a year?
i have never lived the life of a proper student though (married, then married again and with children)... so perhaps it is possible if you share a flat or similar.
manitoba is getting pricey if house costs are any indication. the tar sands are making the prairies a bit more expensive than they used to be all across the region.
but anyway, the truth is that even from my rural moosehead university it is possible to go to work for OMA, Kengo Kuma, etc etc. that is where my own classmates went. and a few of them are now starting very interesting offices, all without the benefit of an expensive education.
I have said before that i believe an ivy education is great for the doors it opens, and i still believe it, but only if you have the cash or a scholarship. if not, then take the long way round. it is possibly just as much fun, though definitely not as easy.
@ steelstuds, actually i went to london after 01, didn't make it to tokyo til 03. i blame it on leprechauns.
hehe mantaray. actually, I disagree. That's certainly how they've done things in the past but times-are-a-changing. China's starting to experience labor shortages and now actually has an illegal immigration problem of its own, particularly in agriculture and construction.
So yeah, not only will there be future opportunities to build sweatshops for our new Chinese masters here in the US, but there will be opportunities to work IN those same sweatshops as cheap labor. Just keep on voting Teabag and watching Reality TV, and you'll soon get to say those immortal Home Simpson lines, "I, for one. welcome..."
What's really stupid is somebody continued to give you money without ever questioning how you were going to pay it off...... and you wonder why the economy is in the tank.
"What's really stupid is somebody continued to give you money without ever questioning how you were going to pay it off...... and you wonder why the economy is in the tank."
Heh I wonder if they would let you borrow that much money if told them you were going to start a business or something.
"What's really stupid is somebody continued to give you money without ever questioning how you were going to pay it off....."
It's another well meaning federal program exploited for all its worth. Recommended viewing: PBS's "Frontline, Colleges Inc." You can watch it for free on pbs.org or netflix streaming. It's very eye opening as to what a joke US post-secondary education has become.
one can say the same about the housing market crisis presently destroying our country.. and the consumer credit crisis too.
The problem isn't that we have or want too much stuff, it's that we're addicted to too much cheap credit, and we have a dysfunctional financial system where firms compete to provide us with that credit ib terms that go against all common sense,
Real incomes and upward mobility have stagnated for nearly two generations now... yet each generation has ever-higher expectations for their ability to indulge in personal gluttony. They make up for this gap between reality and expectation by borrowing oodles of cash against (non-existent) future growth, using what amounts to a ponzi scheme whose ultimate victim is our nation's future.
No, nobody would give you that much money to start a business without collateral because the failure rate is so high. The "failure" rate for a student, even if they drop out or switch careers doesn't matter. There is nothing to fail, nothing to default on but the person themselves. I suppose we could put defaulters in student loan jail, where your college smarts are exchanged for room and board until you have paid your debt. I am alarmed at the number of people that have debt to this degree. This is a security issue, not just for the individuals, but the public that is going to witness another huge financial crisis to deal with.
This is a security issue, not just for the individuals, but the public that is going to witness another huge financial crisis to deal with.
the financial crisis in my opinion is already quietly playing itself out in the current economy. my wife and i pay almost 20% of our income towards paying off government student loans. the feds make on average about 3.5% off of our debt, but there is $1,000/month less circulating through the economy. multiple our household debt repayment times the millions of others out there paying off student loans, and you wonder why consumers aren't spending?
Mortgage, credit card, student loan, and auto loan debt totals $13.5 trillion or an average debt per household of $120,000. 1/3rd of those households have effectively ZERO savings. $43,000 is owed by every man, woman and child in the US. Given the savings rate, some estimates suggest that 1/3rd of that is owed by the future earnings of Americans NOT YET BORN.
The GDP of the US is only $14 trillion, government debt is another $19 trillion, onshore corporate debt is about another $12 trillion. That's basically 4x as much debt as there is annual national income, without giving ANY effect to capitalized itnerest. The savings rate is about 1% of GDP, the tax rate on GDP is about 15%. At that rate, at 0% interest, that's 20 years savings. With interest, that's more like 50 years.
We're screwed. Forget the Great Depression. This is Spain, with its debt burden, after it's armies got wiped out in the 30 Years War and the Dutch and Brits sank their galleon fleets.
Urbanist .... I would argue that the general public "does have and do want too much stuff" and the cheap credit makes that available .... its a vicious cycle.
I personally have to say its pretty nice to not have to go to work sometimes and say screw it I would rather go biking / skiing etc instead of working because I have no mortgage, no student debts, no loans, don't need to pay for the next "big thing", no payment that needs to be made or a purchase that needs to occur. Good to enjoy life sometimes too.
"The largest factor of future financial success is delayed gratification."
He was talking about investments and not cashing out to buy a new boat, etc. Still think it applies to most anything, including an expensive education. Buying things on credit, anything on credit, is the exact opposite of delayed gratification.
$45 trillion in total outstanding government, consumer and onshore corporate debt is a lot of delayed gratification..
Let's say that you can sustain a savings rate of 13% of GDP and you collect taxes (at all levels) totalling 28% of GDP.. of this, let's say you can devote optimstically 2% of that savings rate and 5% of tax revenues to debt reduction. And you treat the $45 trillion as a relative cap (adjustable only by annual GDP growth), you can retire all of our debt in precisely 50 years! Yea!
'course this won't happen, and we'll just start borrowing at rates far faster than GDP growth as soon as banks let us do so! Cause that's the American way!
All I can say, "$45 trillion in debt between people, companies and government."... no amount of consumer protection is going to save us.
Hapsburg Spain - debt service 65% of revenue by 1697. As a consequence, it defaulted on its debt, the dynasty fell in 1700 and the country faced nearly 200 years of civil strife thereafter, finally losing its empire altogether by 1806 or so.
France - debt service 62% of revenue 1788, when it defaulted. Consequence: French Revolution 1789
Ottoman Turkey - debt service 50% of revenue by 1875 and sovereign default, resulting in the 1908 revoluton that ended the empire, after nearly 3 decades of civil strife
England - debt service 44% of revenue by 1930, couldn't afford to arm to fight Nazi's, we bailed them out and they lost their empire by 1947
US debt service is now about 20% of revenue, but that's at today's artificially low interest rates (0.26%/yr for the short term stuff). Moody's just released a report arguing for a very realistic case where the government's cost of borrowing increases to around 1%/yr (only!), at which point debt service will be 52% of revenue.
Dream's not dead. Dream's kind of nightmarish when you have a large portion of population (that may make a $1 million in a lifetime, if lucky) come out in support of tax cuts for the rich. How do you help someone when all they want from you is to shoot them in the face?
I love your geeky tendencies urbanist. You're always up for whipping out some great numbers and statistics, be that in a arch. or political discussion. Hope you got the memo on how facts are so 1990's.
well steelstuds, on the obsolescence of geeky facts:
"You are in what we call the reality-based community. You believe that solutions emerge from your judicious study of discernible reality. That's not the way the world really works anymore. We're an empire now, and when we act, we create our own reality. And while you're studying that reality—judiciously, as you will—we'll act again, creating other new realities, which you can study too, and that's how things will sort out. We're history's actors…and you, all of you, will be left to just study what we do."
- attributed by NY Times' Ron Suskind to Karl Rove
dreams aren't always happy and enjoyable, they are surreal.
debt is surreal.
desire is surreal.
it's all kind of funny when you think about it. and who is going to ask the US to pay them back? would you ask the biggest guy in the school yard who has the biggest gang and weapons to pay you back....good luck with that.
it's all fake, money - surreal.
the real deal is to get everyone working, and I won't qoute a philosopher that understood this more than anyone else for all the connotations that may follow mentioning his name...but labor forms your philosophy and your philosophy forms your labor.
most people just want the surreal and hence form no philosophy.
Excerpt from New York Times Article... worth checking out.
"Graduate school has traditionally been a great place to wait out recessions while honing your skills for a better job. But sometimes, the payoff doesn’t justify the cost.
When I analyzed economic costs and benefits of various degrees several years ago for an MSN column, “Is your degree worth $1 million or worthless?”, it was clear that certain degrees were winners:..."
Some expensive graduate degrees obviously pay off (medicine), others do not, and some don't [always] pay off AND are required to operate in the field (architecture).
100k is the normal student loan debt nowdays, but 250k is pretty high, I think you should somehow get no more than 100k in debt, especially for architecture degree! And REMEMBER, it is not just 100k debt, it will grow fast over the years, even double of triple in the amount, so if you have 250k, it might become 750k by the time you are done with payments....
$100,000 student loan is the norm? That is totally insane...
What is wrong here?? Have people learned nothing from the recent mortgage lending and economic crisis?? The culture of indebtedness in this country is seriously scary, spending now for things that we don't know how we can pay off later...
Same goes for our federal debt... $8.7 trillion which is only going to spike once the baby boomers start drawing out of social security rather than feeding into it... How on earth is the next generation supposed to pay all this off??
my education was probably $130,000k, for a 5 year Barch, but because of scholarship money and grants, I only had to pay back less than half. My point being that there are all kinds of students, in college from all walks of life, I know that we as humans like to think in terms of averaged for everything, but I highly doubt that everyone pays full price for their tuition, I knew plenty of students that payed even less than I did. I mean not to sound as though I'm an elitist, but what ever happened to the idea that sometimes people with good grades will consequently get good scholarships? Though I would prefer not to owe any money at all, what are we going to do college is a business after all.
DonQuixote, the problem though is that it's a gamble with people's future, and the future of the economy generally... The system generally...
Maybe people will have grants and scholarships, but maybe they won't... The problem is that an uncontrolled market that encourages *college as a business enterprise* does not give any incentive for colleges and universities to control tuition costs, but rather encourages them to increase their tuitions and price tags in order to generate greater and greater profits, whether this comes at the expense of government grants- i.e. taxpayer money, or scholarships funds, or, as is mostly the case, greater and greater amounts of student loans and greater and greater indebted generations of new people entering the labout pool... This may be hugely risky but the banks providing these loans to students for degrees that where, especially in this economic climate, expected returns may not justify these loans, but the banks don't seem to care whether the individual can pay for this... Just like wreckless mortgage lending brought us to the edge of financial collapse, banks are again pumping people with debt regardless of the individual's ability to pay...
The problem is, in a so called "free market", the market price for certain things is not automatically set to the real worth by demand and supply... The return on investment for alot of these degress does not equal the price. The seller (the college or university) is making excessive profit and can set price far higher than real use value because: A. banks will always lend without care of whether the individual can repay, B. people are willing to pay whatever it takes and are out of touch with reality (are not rational buyers), don't understand the return on the investment and don't do the math, and there is an aura of intangible mystique (not quantifiable) that our culture has created around college that means it isn't just an education, it is a status object, it is the product of a marketing game... Just as with healthcare, people will pay for it regardless of how much it costs (unless they simply cant afford it), if you need a surgery for example you will pay regardless, the college degree likewise has become a kind of social necessity to many people, perception of the value of that degree is out of relation to what the return on investment really will most likely be...
IMHO there are some things which *should not* be unchecked, should not be encouraged as for profit enterprise... This goes for healthcare, and education... That is not in the best interest of our country or economic performance... Likewise, there are markets that need to be regulated like mortgage lending... Its a problem, the culture of consumption before budgeting...
Much of the problem goes back to high school, to earlier schooling. There is no differentiation between an education that 'makes money' and one that is 'just what I want to do'.
This, imho, is the largest problem. How can anyone justify paying 50k for an education in history?! There are many paths like this, but no one pulls the prospective student aside and says "you know, unless your folks can pay the bill without blinking, that's just stupid". No one.
There is no discussion of 'value' in education, just a "do what you want", "follow your dream", etc., etc. All fine and dandy, but you gotta pay the rent somehow, someday.
The education systems fails drastically at educating the young on money, investments, how the business world works and how to prepare. Mostly, I think, because most teachers simply don't know this stuff (or they probably wouldnt' be teachers!!).
Rich - this is also why the rich get richer (or one reason) - they understand money and business and, directly or indirectly, teach their kids how and what to do.
Personally, I think it is all sad. No reason you can't get out of high school with a good career. Why do we keep teaching bs classes as equal to ones that will impact everyone forever?? Fine to teach a diverse curriculum, but don't skip classes like "how does interest work, what is a mortgage, how does investing and compounding work", etc., etc.
I'd love to be in a position to volunteer this info, someday. God knows there has to be some fundamental changes (which will hurt colleges, as they obviously want the money for the history students!)
pauloknocks, I like how the very first contributor to that article said "The next bubble to burst is the education bubble." Seems very true - I can imagine all those swanky new student recreation/wellness centers and fancy food courts sitting empty in the near future!
trace, while I agree with everything else you posted, I don't agree with this No reason you can't get out of high school with a good career. Unless well-paid manufacturing jobs come back, that is. But even many of those jobs require a technical certificate from a trade school.
there is another option. everything just takes longer. pay as you go. a design eduction in its broadest sense is worth it. exposure to theory, indulgent naval-gazing, novel, paradigm-shifting techniques, as well as the practical and ground. if it is unaffordable in the traditional model for many and just putting it all on debt is not feasible now, it doesn't mean don't do it or do it but strip the variety, creativity, novelty and humanity out of it, making it just a dry, technical skillset --- rather, it takes longer and everyone pays as they go
but the trouble with this trajectory is that universities may not be set up to handle such a model --- it is one thing to be able to count on a full class in a structured curriculum and have a few people sitting in, adding,dropping, etc, each term --- it is another to offer courses buffet style where one semester fifty want it and the next six want it and the next no one wants to take it and the university is never sure until enrollment opens --- the university may find it difficult to make money that way unless they change their structure --- perhaps some are already set up for such a dynamic course selection process, but to what extent?
yeah, I think the 'pay as you go' method would slow progress as everyone would take twice as long to be truly productive and make a real contribution and salary.
U's just have to reduce the requirements for graduation, we simply do not need such a diverse education (can I recall my "Non Western Art History" class? Hell no! A or not, it was pointless and a waste of money).
DS - I was thinking of things like animation, 3D, graphics, web, more specifically. My nephew is 9 and he's playing with SketchUp (quite successfully, I might add, thanks to the clear Google videos), I plan to introduce PS soon. No reason he can't have an option to find a decent job by the time he gets to high school. By the time he graduates, he could have business classes under his belt too.
With computers and education so accessible, anyone can start taking anything whenever they want. Theoretically, you could get a college education at home, part time, while going to high school (only thing I can recall that built on hs ed was math, and even that was more or less forgotten). This is what will start to separate the truly ambitious and entrepreneurial kids from those that want to party and skip school (I was the latter ;-) )
Most won't do this, of course, and it'd be a rare kid that chose that, but I think it is possible and will become a more and more viable option with parents that encourage it.
High school kids are also capable of working jobs that can be used to pay for higher education. You can save up several grand before entering school. Working summers too can be enough to get a state school education without much debt, if any.
Pay as you go doesn't have to mean a delayed timeline. My husband paid cash for his masters, and I will likely pay cash (at least a good portion of it) when and if I get mine.
I hear what you are saying trace, and it is true that banks will take advantage of young people, but remember that officially speaking a there are "for profit institutions" which will take your money and simply train you to do something, officially a university, or private college, are "non for profit Colleges", they survive off of money from tuition and alumni donations among other business ventures derived from its own campus recources.
My point is that with so much scholarship money out there, why in the world are people paying full price for their tuition? I'm not a Social Scientist, so i cant confirm nor verify all these numbers of people that are in debt, but heck if everything else fails then go the blue collar route like I did, meaning i signed up for the Military had to sacrifice my late teenage years and early twenties so I could get the MGIBill, and VetBill, not to mention that in IL and TX, if you sign up for the military, for at least 3 or 4 years you get all of your tuition payed for, but the key is that you have to bust your butt in the military, and be discharged Honorably, which not a lot of people can do depending on your military role, its not easy, I went to a private university, so consequently I could not use the option to pay full tuition because the "VeteransBill" only pays if you go to a state university, but was still able to use my MGIBill, and scholarship, and grants which I worked very hard to get.
Granted I know a lot of people don't want to take the route I took because its kind of a long route. I was grateful that I went to college in my early twenties after the military, vs. right out of high school, only down side to what i did was that I was socially alienated by the younger students because to them i was an old weezer. Thinking back on it now it is laughable because I was still so young, and by the time I got to college, I had already been through a life changing experience.
to summerize, yes banks are evil, work hard to get scholarship money. I'm other people have good advise to high school students.
Incidentally Trace,
do you realize that you are posting on a website full of people that are dying to get into the most expensive and lucrative of Architecture Colleges?
Didn't mean to single you out Trace, was responding to other peoples comments as well.
one addition to a statement i made
"but remember that officially speaking a there are "for profit institutions" which will take your money and simply train you to do something, officially a university, or private college, are "non for profit Colleges", they survive off of money from tuition and alumni donations among other business ventures derived from its own campus resources. " state universities get money from the state private colleges do not.
I dont know if what i said will change any young persons mind or help in anyway but either way good luck.
ps. I dont even want to think what college tuition will be like when my one year old reaches 18 or 19.
DQ - (I think you were replying to other's posts, I didn't mention anything about banks or even the cost of tuition, really, more about how things are sold to the youth)
Yup, I realize where I am posting. I was one of those that wanted to get in to Ivy and I did, and even with the money they offered it was just insane (living in Manhattan not helping things). Thankfully, I preferred to go to a state school more and chose that route. But my loans are large, still, given undergrad and grad.
My big point was that the young just aren't educated as to what is valuable later on. Getting an education today, early, is a significant boost in what they'll produce in a lifetime. In that case, some things are worth borrowing for, it just comes down to someone sitting the kids down and explaining it, understanding what is a good investment (career wise) and what is not.
Sadly, that won't happen until highschool teachers are doing that themselves, which means that some subjects will, inevitably, become less valuable, which makes less money for colleges to teach (or, at least, makes the money distribution even more disproportional).
That'd be my regret of school - that it took me so long to get started. Get a degree young and you'll make exponentially more over the course of your career vs. someone that waits or takes a long time (theoretically, anyway).
t seems like it wouldn't take much effort to promote a well rounded understanding. I hope I can offer that, someday. If someone chooses to be a history major after understanding the finances of it, then fine, but at least they won't get out and be blind sided by reality.
Same could be said for an architecture profession, esp given our current world.
I can't afford the dream
hmm. Deep breaths Don. I was just messing with ya. Psycho killer - Talking Heads. Great song by a bunch of arch school dropouts. Sorry for pushing your buttons at the wrong time. I apologize.
I mean, I'm not saying DonQuixote raped and killed a girl back in 1990, but has anyone seen him come out and deny it? :)
jump went to a little known Canadian school called University of Moosehead.
He got traded to Japan back in '01 for a case of Sake and a promise of more frequent Chinooks.
WTF happened to this thread? This puppy derailed minutes after leaving the station. The highlight is Unicorn's pyramid scheme thingy. I'm not giving you any money. Oh, that was a food pyramid? I don't see cheese represented in it. What am I supposed to eat then??
What are the lowest row of triangle's referring to? Is there a more basic form of construction, or construction related services benneath basic shelter?
UG in other words are you making a critique of architectural education broadly: that it doesn't prepare for things like "sanitation, conservation, electrification, communication, integration, etc."?
Trying to see where the connection is to the original poster's question...
There is some truth to: there are many valuable and marketable skillsets and knowledge sets that you don't learn in architecture school but which add value to the service and to somebody looking to hire someone...
That chart does seem overly rigid... Actually it seems sort of didactic to me... Why is integration the most profitable and design and engineering towards the bottom in terms of profitablity and also liability? That doesn't make sense? Are you selling BIM? There are plenty of much more profitable kinds of building that don't make use of BIM... Or conservation... Why is that more profitable? Seems to be selling an agenda, not that I don't think what you are listing there is important but why is it prioritizing certain things...
Is this a matrix looking at a potential employee's skillsets? Or the design process, the value of design services in the marketplace? These are different... And whose value system are you setting up there?
Or is this basically a "additional scope of services matrix"... Next level of added profit (for the architect) moves you up one more level...
Because, it is not like people need BIM to make a building... What is the added value for the client?
Yet another useful thread that Unicorn Ghost has totally and ignorantly (not to mention incomprehensibly) derailed...
re: steelstuds humorous note above:
Chinese construction companies will need native speakers to assist in building of sweat shops and factories.
The sad part is - they won't even! If you look at what the Chinese are building all over Africa, they're importing their own laborers from China and putting them up in work camps, in order to avoid hiring any natives. So you might as well keep on writing your Mandarin novels... because China won't be needing you for design & construction, that's for sure!
jump, i messaged you a while back about transferring to uMan so i could save some dough. i would do it in a heartbeat. however, how do i rent/eat/live very cheaply there? can it be done for a couple thousand dollars a year?
@5%, a couple thousand a year? i don't think so.
i have never lived the life of a proper student though (married, then married again and with children)... so perhaps it is possible if you share a flat or similar.
manitoba is getting pricey if house costs are any indication. the tar sands are making the prairies a bit more expensive than they used to be all across the region.
but anyway, the truth is that even from my rural moosehead university it is possible to go to work for OMA, Kengo Kuma, etc etc. that is where my own classmates went. and a few of them are now starting very interesting offices, all without the benefit of an expensive education.
I have said before that i believe an ivy education is great for the doors it opens, and i still believe it, but only if you have the cash or a scholarship. if not, then take the long way round. it is possibly just as much fun, though definitely not as easy.
@ steelstuds, actually i went to london after 01, didn't make it to tokyo til 03. i blame it on leprechauns.
Some people just don't work or play well with others, do they?
hehe mantaray. actually, I disagree. That's certainly how they've done things in the past but times-are-a-changing. China's starting to experience labor shortages and now actually has an illegal immigration problem of its own, particularly in agriculture and construction.
So yeah, not only will there be future opportunities to build sweatshops for our new Chinese masters here in the US, but there will be opportunities to work IN those same sweatshops as cheap labor. Just keep on voting Teabag and watching Reality TV, and you'll soon get to say those immortal Home Simpson lines, "I, for one. welcome..."
What's really stupid is somebody continued to give you money without ever questioning how you were going to pay it off...... and you wonder why the economy is in the tank.
"What's really stupid is somebody continued to give you money without ever questioning how you were going to pay it off...... and you wonder why the economy is in the tank."
Heh I wonder if they would let you borrow that much money if told them you were going to start a business or something.
It's another well meaning federal program exploited for all its worth. Recommended viewing: PBS's "Frontline, Colleges Inc." You can watch it for free on pbs.org or netflix streaming. It's very eye opening as to what a joke US post-secondary education has become.
one can say the same about the housing market crisis presently destroying our country.. and the consumer credit crisis too.
The problem isn't that we have or want too much stuff, it's that we're addicted to too much cheap credit, and we have a dysfunctional financial system where firms compete to provide us with that credit ib terms that go against all common sense,
Real incomes and upward mobility have stagnated for nearly two generations now... yet each generation has ever-higher expectations for their ability to indulge in personal gluttony. They make up for this gap between reality and expectation by borrowing oodles of cash against (non-existent) future growth, using what amounts to a ponzi scheme whose ultimate victim is our nation's future.
No, nobody would give you that much money to start a business without collateral because the failure rate is so high. The "failure" rate for a student, even if they drop out or switch careers doesn't matter. There is nothing to fail, nothing to default on but the person themselves. I suppose we could put defaulters in student loan jail, where your college smarts are exchanged for room and board until you have paid your debt. I am alarmed at the number of people that have debt to this degree. This is a security issue, not just for the individuals, but the public that is going to witness another huge financial crisis to deal with.
the financial crisis in my opinion is already quietly playing itself out in the current economy. my wife and i pay almost 20% of our income towards paying off government student loans. the feds make on average about 3.5% off of our debt, but there is $1,000/month less circulating through the economy. multiple our household debt repayment times the millions of others out there paying off student loans, and you wonder why consumers aren't spending?
Mortgage, credit card, student loan, and auto loan debt totals $13.5 trillion or an average debt per household of $120,000. 1/3rd of those households have effectively ZERO savings. $43,000 is owed by every man, woman and child in the US. Given the savings rate, some estimates suggest that 1/3rd of that is owed by the future earnings of Americans NOT YET BORN.
The GDP of the US is only $14 trillion, government debt is another $19 trillion, onshore corporate debt is about another $12 trillion. That's basically 4x as much debt as there is annual national income, without giving ANY effect to capitalized itnerest. The savings rate is about 1% of GDP, the tax rate on GDP is about 15%. At that rate, at 0% interest, that's 20 years savings. With interest, that's more like 50 years.
We're screwed. Forget the Great Depression. This is Spain, with its debt burden, after it's armies got wiped out in the 30 Years War and the Dutch and Brits sank their galleon fleets.
Urbanist .... I would argue that the general public "does have and do want too much stuff" and the cheap credit makes that available .... its a vicious cycle.
I personally have to say its pretty nice to not have to go to work sometimes and say screw it I would rather go biking / skiing etc instead of working because I have no mortgage, no student debts, no loans, don't need to pay for the next "big thing", no payment that needs to be made or a purchase that needs to occur. Good to enjoy life sometimes too.
One way to become richer is to desire less...
isn't that called living within one's means?
A financial advisor once told me -
"The largest factor of future financial success is delayed gratification."
He was talking about investments and not cashing out to buy a new boat, etc. Still think it applies to most anything, including an expensive education. Buying things on credit, anything on credit, is the exact opposite of delayed gratification.
$45 trillion in total outstanding government, consumer and onshore corporate debt is a lot of delayed gratification..
Let's say that you can sustain a savings rate of 13% of GDP and you collect taxes (at all levels) totalling 28% of GDP.. of this, let's say you can devote optimstically 2% of that savings rate and 5% of tax revenues to debt reduction. And you treat the $45 trillion as a relative cap (adjustable only by annual GDP growth), you can retire all of our debt in precisely 50 years! Yea!
'course this won't happen, and we'll just start borrowing at rates far faster than GDP growth as soon as banks let us do so! Cause that's the American way!
i heard on npr the other day that the total amount in outstanding student debt just passed the outstanding amount of consumer credit card debt.
that is horrific. truly, truly horrific.
All I can say, "$45 trillion in debt between people, companies and government."... no amount of consumer protection is going to save us.
Hapsburg Spain - debt service 65% of revenue by 1697. As a consequence, it defaulted on its debt, the dynasty fell in 1700 and the country faced nearly 200 years of civil strife thereafter, finally losing its empire altogether by 1806 or so.
France - debt service 62% of revenue 1788, when it defaulted. Consequence: French Revolution 1789
Ottoman Turkey - debt service 50% of revenue by 1875 and sovereign default, resulting in the 1908 revoluton that ended the empire, after nearly 3 decades of civil strife
England - debt service 44% of revenue by 1930, couldn't afford to arm to fight Nazi's, we bailed them out and they lost their empire by 1947
US debt service is now about 20% of revenue, but that's at today's artificially low interest rates (0.26%/yr for the short term stuff). Moody's just released a report arguing for a very realistic case where the government's cost of borrowing increases to around 1%/yr (only!), at which point debt service will be 52% of revenue.
buh bye.
Will Canada take us in?
The dream is dead. We just don't know it yet because we can still fool ourselves with cheap debt.
Dream's not dead. Dream's kind of nightmarish when you have a large portion of population (that may make a $1 million in a lifetime, if lucky) come out in support of tax cuts for the rich. How do you help someone when all they want from you is to shoot them in the face?
I love your geeky tendencies urbanist. You're always up for whipping out some great numbers and statistics, be that in a arch. or political discussion. Hope you got the memo on how facts are so 1990's.
well steelstuds, on the obsolescence of geeky facts:
"You are in what we call the reality-based community. You believe that solutions emerge from your judicious study of discernible reality. That's not the way the world really works anymore. We're an empire now, and when we act, we create our own reality. And while you're studying that reality—judiciously, as you will—we'll act again, creating other new realities, which you can study too, and that's how things will sort out. We're history's actors…and you, all of you, will be left to just study what we do."
- attributed by NY Times' Ron Suskind to Karl Rove
.. and you know where that attitude got us...
dreams aren't always happy and enjoyable, they are surreal.
debt is surreal.
desire is surreal.
it's all kind of funny when you think about it. and who is going to ask the US to pay them back? would you ask the biggest guy in the school yard who has the biggest gang and weapons to pay you back....good luck with that.
it's all fake, money - surreal.
the real deal is to get everyone working, and I won't qoute a philosopher that understood this more than anyone else for all the connotations that may follow mentioning his name...but labor forms your philosophy and your philosophy forms your labor.
most people just want the surreal and hence form no philosophy.
now get back to work, dreams are dead.
Whenever I see this thread, this song comes to my mind:
http://www.youtube.com/watch?v=Y2YOGfBFAbs
Excerpt from New York Times Article... worth checking out.
"Graduate school has traditionally been a great place to wait out recessions while honing your skills for a better job. But sometimes, the payoff doesn’t justify the cost.
When I analyzed economic costs and benefits of various degrees several years ago for an MSN column, “Is your degree worth $1 million or worthless?”, it was clear that certain degrees were winners:..."
http://roomfordebate.blogs.nytimes.com/2009/06/30/what-is-a-masters-degree-worth/
Some expensive graduate degrees obviously pay off (medicine), others do not, and some don't [always] pay off AND are required to operate in the field (architecture).
a masters is NOT required to be an architect.
You are right. A M.A. or an accredited mega Bachelors. I think either are comparable.
100k is the normal student loan debt nowdays, but 250k is pretty high, I think you should somehow get no more than 100k in debt, especially for architecture degree! And REMEMBER, it is not just 100k debt, it will grow fast over the years, even double of triple in the amount, so if you have 250k, it might become 750k by the time you are done with payments....
"100k is the normal student loan debt nowadays"
Are you out of your mind? The average student debt is around 20k.Where did you go to school??!
$100,000 student loan is the norm? That is totally insane...
What is wrong here?? Have people learned nothing from the recent mortgage lending and economic crisis?? The culture of indebtedness in this country is seriously scary, spending now for things that we don't know how we can pay off later...
Same goes for our federal debt... $8.7 trillion which is only going to spike once the baby boomers start drawing out of social security rather than feeding into it... How on earth is the next generation supposed to pay all this off??
my education was probably $130,000k, for a 5 year Barch, but because of scholarship money and grants, I only had to pay back less than half. My point being that there are all kinds of students, in college from all walks of life, I know that we as humans like to think in terms of averaged for everything, but I highly doubt that everyone pays full price for their tuition, I knew plenty of students that payed even less than I did. I mean not to sound as though I'm an elitist, but what ever happened to the idea that sometimes people with good grades will consequently get good scholarships? Though I would prefer not to owe any money at all, what are we going to do college is a business after all.
DonQuixote, the problem though is that it's a gamble with people's future, and the future of the economy generally... The system generally...
Maybe people will have grants and scholarships, but maybe they won't... The problem is that an uncontrolled market that encourages *college as a business enterprise* does not give any incentive for colleges and universities to control tuition costs, but rather encourages them to increase their tuitions and price tags in order to generate greater and greater profits, whether this comes at the expense of government grants- i.e. taxpayer money, or scholarships funds, or, as is mostly the case, greater and greater amounts of student loans and greater and greater indebted generations of new people entering the labout pool... This may be hugely risky but the banks providing these loans to students for degrees that where, especially in this economic climate, expected returns may not justify these loans, but the banks don't seem to care whether the individual can pay for this... Just like wreckless mortgage lending brought us to the edge of financial collapse, banks are again pumping people with debt regardless of the individual's ability to pay...
The problem is, in a so called "free market", the market price for certain things is not automatically set to the real worth by demand and supply... The return on investment for alot of these degress does not equal the price. The seller (the college or university) is making excessive profit and can set price far higher than real use value because: A. banks will always lend without care of whether the individual can repay, B. people are willing to pay whatever it takes and are out of touch with reality (are not rational buyers), don't understand the return on the investment and don't do the math, and there is an aura of intangible mystique (not quantifiable) that our culture has created around college that means it isn't just an education, it is a status object, it is the product of a marketing game... Just as with healthcare, people will pay for it regardless of how much it costs (unless they simply cant afford it), if you need a surgery for example you will pay regardless, the college degree likewise has become a kind of social necessity to many people, perception of the value of that degree is out of relation to what the return on investment really will most likely be...
IMHO there are some things which *should not* be unchecked, should not be encouraged as for profit enterprise... This goes for healthcare, and education... That is not in the best interest of our country or economic performance... Likewise, there are markets that need to be regulated like mortgage lending... Its a problem, the culture of consumption before budgeting...
Much of the problem goes back to high school, to earlier schooling. There is no differentiation between an education that 'makes money' and one that is 'just what I want to do'.
This, imho, is the largest problem. How can anyone justify paying 50k for an education in history?! There are many paths like this, but no one pulls the prospective student aside and says "you know, unless your folks can pay the bill without blinking, that's just stupid". No one.
There is no discussion of 'value' in education, just a "do what you want", "follow your dream", etc., etc. All fine and dandy, but you gotta pay the rent somehow, someday.
The education systems fails drastically at educating the young on money, investments, how the business world works and how to prepare. Mostly, I think, because most teachers simply don't know this stuff (or they probably wouldnt' be teachers!!).
Rich - this is also why the rich get richer (or one reason) - they understand money and business and, directly or indirectly, teach their kids how and what to do.
Personally, I think it is all sad. No reason you can't get out of high school with a good career. Why do we keep teaching bs classes as equal to ones that will impact everyone forever?? Fine to teach a diverse curriculum, but don't skip classes like "how does interest work, what is a mortgage, how does investing and compounding work", etc., etc.
I'd love to be in a position to volunteer this info, someday. God knows there has to be some fundamental changes (which will hurt colleges, as they obviously want the money for the history students!)
Colleges accept cash, no debt required.
pauloknocks, I like how the very first contributor to that article said "The next bubble to burst is the education bubble." Seems very true - I can imagine all those swanky new student recreation/wellness centers and fancy food courts sitting empty in the near future!
trace, while I agree with everything else you posted, I don't agree with this No reason you can't get out of high school with a good career. Unless well-paid manufacturing jobs come back, that is. But even many of those jobs require a technical certificate from a trade school.
there is another option. everything just takes longer. pay as you go. a design eduction in its broadest sense is worth it. exposure to theory, indulgent naval-gazing, novel, paradigm-shifting techniques, as well as the practical and ground. if it is unaffordable in the traditional model for many and just putting it all on debt is not feasible now, it doesn't mean don't do it or do it but strip the variety, creativity, novelty and humanity out of it, making it just a dry, technical skillset --- rather, it takes longer and everyone pays as they go
but the trouble with this trajectory is that universities may not be set up to handle such a model --- it is one thing to be able to count on a full class in a structured curriculum and have a few people sitting in, adding,dropping, etc, each term --- it is another to offer courses buffet style where one semester fifty want it and the next six want it and the next no one wants to take it and the university is never sure until enrollment opens --- the university may find it difficult to make money that way unless they change their structure --- perhaps some are already set up for such a dynamic course selection process, but to what extent?
yeah, I think the 'pay as you go' method would slow progress as everyone would take twice as long to be truly productive and make a real contribution and salary.
U's just have to reduce the requirements for graduation, we simply do not need such a diverse education (can I recall my "Non Western Art History" class? Hell no! A or not, it was pointless and a waste of money).
DS - I was thinking of things like animation, 3D, graphics, web, more specifically. My nephew is 9 and he's playing with SketchUp (quite successfully, I might add, thanks to the clear Google videos), I plan to introduce PS soon. No reason he can't have an option to find a decent job by the time he gets to high school. By the time he graduates, he could have business classes under his belt too.
With computers and education so accessible, anyone can start taking anything whenever they want. Theoretically, you could get a college education at home, part time, while going to high school (only thing I can recall that built on hs ed was math, and even that was more or less forgotten). This is what will start to separate the truly ambitious and entrepreneurial kids from those that want to party and skip school (I was the latter ;-) )
Most won't do this, of course, and it'd be a rare kid that chose that, but I think it is possible and will become a more and more viable option with parents that encourage it.
A Harvard law degree is about the only education I would pay 250k for...
High school kids are also capable of working jobs that can be used to pay for higher education. You can save up several grand before entering school. Working summers too can be enough to get a state school education without much debt, if any.
Pay as you go doesn't have to mean a delayed timeline. My husband paid cash for his masters, and I will likely pay cash (at least a good portion of it) when and if I get mine.
Most important concept is compounding interest works both ways!!
I hear what you are saying trace, and it is true that banks will take advantage of young people, but remember that officially speaking a there are "for profit institutions" which will take your money and simply train you to do something, officially a university, or private college, are "non for profit Colleges", they survive off of money from tuition and alumni donations among other business ventures derived from its own campus recources.
My point is that with so much scholarship money out there, why in the world are people paying full price for their tuition? I'm not a Social Scientist, so i cant confirm nor verify all these numbers of people that are in debt, but heck if everything else fails then go the blue collar route like I did, meaning i signed up for the Military had to sacrifice my late teenage years and early twenties so I could get the MGIBill, and VetBill, not to mention that in IL and TX, if you sign up for the military, for at least 3 or 4 years you get all of your tuition payed for, but the key is that you have to bust your butt in the military, and be discharged Honorably, which not a lot of people can do depending on your military role, its not easy, I went to a private university, so consequently I could not use the option to pay full tuition because the "VeteransBill" only pays if you go to a state university, but was still able to use my MGIBill, and scholarship, and grants which I worked very hard to get.
Granted I know a lot of people don't want to take the route I took because its kind of a long route. I was grateful that I went to college in my early twenties after the military, vs. right out of high school, only down side to what i did was that I was socially alienated by the younger students because to them i was an old weezer. Thinking back on it now it is laughable because I was still so young, and by the time I got to college, I had already been through a life changing experience.
to summerize, yes banks are evil, work hard to get scholarship money. I'm other people have good advise to high school students.
Incidentally Trace,
do you realize that you are posting on a website full of people that are dying to get into the most expensive and lucrative of Architecture Colleges?
Didn't mean to single you out Trace, was responding to other peoples comments as well.
one addition to a statement i made
"but remember that officially speaking a there are "for profit institutions" which will take your money and simply train you to do something, officially a university, or private college, are "non for profit Colleges", they survive off of money from tuition and alumni donations among other business ventures derived from its own campus resources. " state universities get money from the state private colleges do not.
I dont know if what i said will change any young persons mind or help in anyway but either way good luck.
ps. I dont even want to think what college tuition will be like when my one year old reaches 18 or 19.
DQ - (I think you were replying to other's posts, I didn't mention anything about banks or even the cost of tuition, really, more about how things are sold to the youth)
Yup, I realize where I am posting. I was one of those that wanted to get in to Ivy and I did, and even with the money they offered it was just insane (living in Manhattan not helping things). Thankfully, I preferred to go to a state school more and chose that route. But my loans are large, still, given undergrad and grad.
My big point was that the young just aren't educated as to what is valuable later on. Getting an education today, early, is a significant boost in what they'll produce in a lifetime. In that case, some things are worth borrowing for, it just comes down to someone sitting the kids down and explaining it, understanding what is a good investment (career wise) and what is not.
Sadly, that won't happen until highschool teachers are doing that themselves, which means that some subjects will, inevitably, become less valuable, which makes less money for colleges to teach (or, at least, makes the money distribution even more disproportional).
That'd be my regret of school - that it took me so long to get started. Get a degree young and you'll make exponentially more over the course of your career vs. someone that waits or takes a long time (theoretically, anyway).
t seems like it wouldn't take much effort to promote a well rounded understanding. I hope I can offer that, someday. If someone chooses to be a history major after understanding the finances of it, then fine, but at least they won't get out and be blind sided by reality.
Same could be said for an architecture profession, esp given our current world.
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