https://twitter.com/sama/status/1505597901820477441

>Most of all, it's clearly a bad deal for many students, or we wouldn't have the student debt crisis.

People keep saying that, and it's not true.

The evidence still suggests college is a good deal

1. College loan debt has lower interest rates, more forbearance options and payment plans compared to consumer debt, like credit card or car loan debt. Credit card debt has very high interest rates. There needs to be more outrage about that, not student loan debt, which comparably has better terms.

2.Even adjusted for student loan debt and inflation, college grads today are earning more than than ever compared to non-grads, and compared to past college grads . The college wage premium is wider than ever and shows no signs of narrowing, even with Covid. This premium even applies to non-STEM fields and low-ranking colleges. The rise of online learning and remote learning has not put a dent in the premium. This is not too surprising: college courses, especially in STEM, are more rigorous than online videos/courses; and second, college attendance confers other attributes beyond learning, like contentiousness and maybe even conformity.

3. The college wage premium is 2-fold: higher wages and then higher returns from investing said wages in rapidly appreciating assets like stocks and real estate. The post-2009 bull market is the biggest and longest ever, even adjusted for inflation, for both stocks and real estate. The fed is hellbent on making stocks go up as much as possible, by keeping rates rock bottom and raising them very, very gradually even as inflation rips higher. Most calculations of the college wage premium only look at wages and not returns from investing said wages in the stock market and or real estate.

4. Small biz has high start-up costs and a high failure rate. Sure, if you have rich parents or can get VC backing, maybe give entrepreneurship a shot, but for everyone else, a professional, high-paying job, like at a FANG company, offers a much more reliable, consistent way of making money. Or investing that $ in the stock market. And even many tech founders have college degrees. Dropouts like Bill Gates and Steve Jobs are more the exception than the norm. There many tons of people who have made 7 or even 8 figures with the college-to-STEM-job route. The FIRE movement is full of such individuals who have amassed large nest eggs in their 20s and 30s by doing this. For these people at least, college was certainty a good deal.

5. High school grads may have a 4-year head start compared to college grads, but this is negated by a higher unemployment rate.

6. What about cost of living in Silicon Valley? That too is not such a big deal (for people in STEM at least). A simple calculation shows that a job that pays $200k still has plenty of discretionary income to invest with, after subtracting expenses. Rent is the biggest expense, but still very small relative to monthly wages for a tech job. Buying a home offers way better returns anyway, and is doable with six figure salary. You can buy a home with 5-15% down. (I am assuming a single person household; costs will obviously go up if children are involved.)

https://greyenlightenment.com/2021/12/22/higher-ed-may-be-br...

>Cancelling student debt is good if it's tied to fixing the problem going forward, which means not offering it, or having the colleges be the guarantor, or ISAs, or something.

The problem is that 50% of students not finish college. They get all of the debt of having attended but none of the benefits of graduating. More effort needs to be made screening ppl who are unlikely to finish, as opposed to debt forgiveness. If anyone deserves to have debt forgiveness it's dropouts, who were compelled to go to college but for whatever reason were not suited for it. Student loan forgiveness will not solve this problem. Even if dropouts have their debts forgiven, they should ideally be doing something else.