An early message to the Class of 2013
Dear Class of 2013:
Next spring, much ink will be spilled with advice for you: to work hard, but not too hard; to laugh but also to cry; to love; and, perhaps most practically, to wear sunscreen.
I am not jumping the gun in writing to you now. If anything, I worry I’m too late.
In fact, if you are in the collegiate Class of 2013, I am too late. This message is for high school seniors. And that message is: Don’t wind up like Katie Brotherton.
Brotherton is a young woman from Cincinnati who last month wrote in her local newspaper that she’s overly indebted and rather hopeless, because she made bad decisions about her education.
OK, she didn’t write that last part. In her telling, she met “societal expectations” by earning bachelor’s and master’s degrees. But now she owes nearly $190,000, lives in her parents’ basement and “want[s] answers.”
She has a point, sort of. When she was in your place seven years ago, there might not have been anyone warning her against attending such expensive colleges or borrowing to pay for them.
Americans long have been told furthering their education is the path to prosperity, that the surest path involves attending the very best college they can get into, and, more or less, that the best college is the one that costs the most.
The first part is still true: You owe it to yourself to continue your education past high school. It’s the next two parts of the story that are coming into question.
Thirty years ago, it was different. Even 16 years ago, when I was a senior, and attending Harvard cost about $30,000 a year less than it does now, it was different. Since then, tuition has increased so sharply as to make the housing bubble and health-care inflation look like flat lines.
Is it still better to graduate from college than not? Yes: Housing prices peaked in 2006 and then plummeted, but people still pay for shelter.
But it does mean, if we could go back to 2005 and advise potential homebuyers, we would caution them about which house to buy, how much to spend on it, and not to believe home prices can only go up.
You, the Class of 2013, are like homebuyers circa 2005.
Yes, many of you should go to college. But you should also think deeply about which college and which major, including job prospects in that field. Others should consider technical school more strongly than they might have before now. In choosing a route, think very hard about the debt you stand to incur.
Washington politicians have made a big deal out of whether the federal student loan interest rate should return to 6.8 percent or remain 3.4 percent. On a $100,000 loan, that’s the difference between paying $1,151 a month or $984 a month … every month … for the next 10 years.
But halving the interest rate doesn’t make nearly as much difference as halving the principal: A $50,000 loan at 6.8 percent would bring a payment of $575 a month for 10 years.
You know what $576 a month (the difference between $1,151 and $575) would pay for? The better part of an apartment’s rent in Atlanta. Or a pretty nice new car. Over the course of 10 years, you could save up the down payment on a $350,000 house.
This is not a call to lower your educational ambitions. You still can, and should, try to make the most of your God-given talents. Nor is it a call to view everything in terms of money, only a reminder that money is the way you’ll have to pay back whatever you do borrow. Just ask Katie Brotherton.
– By Kyle Wingfield
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306 comments Add your comment
md
October 14th, 2012
10:13 pm
Me thinks someone bought the 8 grand lie hook line and sinker.
Now, if one were to add up all the new taxes and changes just in Obamacare, I could see one approaching that number. Changes in fsa’s, hsa’s, taxes on providers (read us), medicare cuts, etc etc………add those up get and see what you have.
td
October 14th, 2012
10:22 pm
getalife
October 14th, 2012
10:13 pm
What economist? Klugman and other libs?
MarkV
October 14th, 2012
10:23 pm
Dusty,
I missed you earlier, and will not be in tomorrow, but I want to answer your earlier comment, as well as write the promised thoughts about Kyle’s article. The comment first..
Dusty @ 9:39 pm: “Of course you make comments here to influence people. Don’t we all post just to pass along our “great intelligence” to the ignorant world?”
Dusty,
My deeply ingrained modesty does not allow me to believe that my incisive and brilliant comments might influence anybody, even though I am always right (when I am not wrong).
td
October 14th, 2012
10:23 pm
md
October 14th, 2012
10:13 pm
Do not forget about that little 3.8% Obamacare tax if you ever decide to sell your house. That means $3,800 for every $100,000 you get out of it.
MarkV
October 14th, 2012
10:25 pm
Dusty,
Here are my promised thoughts:
After reading Kyle’s article my first impression, like of many others, was positive. After all, who is against apple pie, motherhood, and thinking about consequences of your decisions?
What alerted me to think deeper about what Kyle was saying was his twisting the words of that young woman. OK, he did not openly lie in this case, but he implied by his “she wrote – well, she did not write that” that she believed she made a “bad decision about her education.” She did not write anything that would mean that she thought her decision to get the education she received was bad. Kyle also implied that she made that decision to meet societal expectations. She did not write or think that either, as you can see from the last line of her article, where she writes about her right to pursue happiness.
In spite of Kyle’s disclaimer, the gist of his article is to view everything in terms of money, and he shows it most clearly when he compares choosing education with buying a house. Choose what you can afford. You want to get a PhD and it would cost too much? How about a technical school?
So let’s think about consequences of that approach. In spite of exceptions, there is a general correlation between the quality of higher education and cost. And again with exceptions, there is a general correlation between the educational level and financial success. Those who cannot afford high quality/cost education will have less financial success, therefore their children will have to choose cheaper education and have less financial success, etc. The result, again with exceptions, would be a permanent underclass of less educated and less paid people.
I believe it is in the interest of the society to make the best education possible to people with best talent, ambition and willingness to work hard for it, rather than based on financial conditions, legacy and other similar considerations.
getalife
October 14th, 2012
10:30 pm
Our President cut taxes many times and if the gop want to prove to Vice President Biden that they are not lying to help the middle class, just pass a bill to prove it.
They won’t because they only vote to help the wealthy. Fact.
You cons support that so I asked a simple question but it was too tough for your minds to handle it.
md
October 14th, 2012
10:31 pm
“Those who cannot afford high quality/cost education will have less financial success, therefore their children will have to choose cheaper education and have less financial success, etc.”
You are aware that the current system is set up to favor those with lower incomes, right?
Pell grant, institutional grants and many other grants are designed just for the poorer among us. And for those in GA, HOPE does not discriminate at all…….all one need do is seize the opportunity we provide in a “free” education and make good grades their top priority……..
getalife
October 14th, 2012
10:32 pm
The 8 grand has nothing to do with ObamaCare.
You can’t answer that question too.
You cons need to take a break for self deflection to see what you are doing.
You are hurting yourselves and I am trying to help you understand this fact.
md
October 14th, 2012
10:34 pm
“They won’t because they only vote to help the wealthy. Fact.”
What a twisted filter you must have to arrive at that conclusion……..the facts of the matter are simple, we ALL got tax cuts and the gop says we ALL get to keep them. it’s not a difficult concept.
And please do remember that we also have a progressive tax structure in place that if anything is unfair to those that make more since choices are never even factored into the equation…….
md
October 14th, 2012
10:37 pm
“You are hurting yourselves and I am trying to help you understand this fact.”
If it comes down to voting for others to pay my share, I’m already not worth a dang……….can’t hurt myself any worse than that.
getalife
October 14th, 2012
10:37 pm
What a load of crap md. Your party wants the bush tax cuts to expire. Our President tried to keep the middle class tax cut but your party said no so we are back to letting them all expire. Fact.
getalife
October 14th, 2012
10:41 pm
“If it comes down to voting for others to pay my share, I’m already not worth a dang……….can’t hurt myself any worse than that.”
The me generation thinks it is all about them. If you are middle class , mitt’s tax plan costs you 8 grand to pay for his tax cut on the wealthy.
That is about you paying a higher share for voting for mitt.
md
October 14th, 2012
10:45 pm
Nice spin there get…….so the dems use class warfare in an effort to have others pay for you and that’s a good thing??
As I said, if it comes down to voting for others to pay my share, I’m not worth a dang. I have no problem with them all expiring, we ALL got them to start with …..didn’t we??
All you are doing get is voting for your neighbor to work harder……..I don’t want to be your neighbor.
getalife
October 14th, 2012
10:46 pm
md,
It is the truth and the reason mitt ran from it in the debate.
getalife
October 14th, 2012
10:49 pm
BTW, the class warfare comes when the income and wealth gap causes the people to lose hope and the Revolution is here. They confiscate wealth and turn to socialism.
md
October 14th, 2012
10:50 pm
And you really do need to lay off the 8k number, it makes you look like you are in left field. Obama uses 2k in is lie, you might want to get closer to that one to at least not look so far out there.
And all those economists are guessing as Romney said he wouldn’t even be the one deciding which loopholes and credits get cut, those would come from congress……on both sides. So you are basically peddling a very bogus premise to begin with.
getalife
October 14th, 2012
10:53 pm
md,
2k a year times a 4 year term equals 8 k.
mitt thinks you cons are suckers and he is right about that fact.
md
October 14th, 2012
10:56 pm
Wealth gap? If the american consumer would quit sending their money to China, Vietnam, Indonesia, India, etc, maybe they would make each other wealthy vs making all those folks on the other side of the planet wealthy.
Don’t tell me you’ve fallen for that lie about the wealthy here taking money from the masses??
The masses have given it to others around the globe……are current trade deficit is 50 billion a month………I’ll say that again, a month………gone out of this country…….that’s going to be an awful long flight for that revolution.
md
October 14th, 2012
11:00 pm
“2k a year times a 4 year term equals 8 k.”
Well at least you clarified your fictitious numbers…..you are aware that those ‘economists” that came up with those particular numbers had to assume a lot of data….right? Much like all that data they assume when they make their case for MMGW……….it’s called guessing………
Tiberius - pulling the tail of the left AND right when needed
October 14th, 2012
11:03 pm
“You cons need to take a break for self deflection to see what you are doing.”
We’re trying to save this nation from the destruction you and your party are doing to it, getalife.
Tiberius - pulling the tail of the left AND right when needed
October 14th, 2012
11:04 pm
“Your party wants the bush tax cuts to expire.”
Only in your alternate reality, getalife.
getalife
October 14th, 2012
11:20 pm
md,
It is up to congress and watch them vote and debate on C-Span.
The only party that votes for the middle class are the dems.
That is why I will vote for them.
If the gop ever decide to start voting for the middle class, I will take them seriously but now they vote to help Americans that need no help. It is what it is and that is the truth.
Tiberius - pulling the tail of the left AND right when needed
October 14th, 2012
11:26 pm
Why should any “class” be treated differently from another, getalife?
Aren’t we all equal?
I Report (-: You Whine )-: mmm, mmmm, mmmmm! Just sayin...
October 14th, 2012
11:36 pm
You can see the desperation setting in with the Hate America Crowd just by reading getalife’s comments.
I’d like to say I feel his pain but that would make me a liar.
He’ll come to like President Romney, after a while.
@@
October 15th, 2012
6:31 am
Getalife:
Tell them why you fight for Americans that never need your help.
Because they’re among the many that CAN offer help…many times better than others. I can help and do, but not to the extent (financial) that they can.
We’re all in this together, Getalife.
iggy
October 15th, 2012
6:43 am
Latest polls show NH now had moved into the Romney/Ryan column and this is great news as R/R will be able to bring new ideas to the table for these college students.
fair and balanced
October 15th, 2012
8:13 am
All I want to know from Romney about his phantom tax reduction plan is how much his taxes for 2011 would go up or down if the plan is implemented. Right now I see them going down to zero. If that is the case he is unqualified to be president based on conflicts of interest, end of story for me.
carlosgvv
October 15th, 2012
8:27 am
Guest – 8:46
I did not make any claims, one way or the other, as to the accuracy of thise site. YOU are the one who said they were questionable.
Bachelor of Arts vs Bachelor of Science
http://www.com/search?q=bachelor+of+artstvs+bachelor
Read and learn
JDW
October 15th, 2012
8:33 am
@Tiberius…”We’re trying to save this nation from the destruction you and your party are doing to it”
You should had that thought before the last Adminstration ran it in the ground…now what party was that again…hummmm…whatever we do we should leave those guys out.
JDW
October 15th, 2012
8:47 am
“Great sound bite, JDW, but WHERE is it disappearing to?”
My God you are a Maroon…since 1980 it has been marginalized as the more wealthy take a larger and larger piece of the pie. Jobs sent overseas to maximize earnings, minimum wage increases forgotten, health care costs run amok and educational opportunities increasingly expensive.
And the response of the Party of No…why let them eat cake of course! More tax cuts, more whining, more obfuscation and above all more “morality”.
Funny thing is about half the Party of No’s support (in the South at least) comes from those that are acting in their own economic disinterest.
Get out and read man…poverty higher than in the last 52 years, income gap widest in 50 years…doesn’t that tell you anything?
JDW
October 15th, 2012
8:50 am
@TD…” If you make no money and have a family of 4 in America then you receive $573 per month is FS”
Yes you do…of course, according to the Department of Agriculture that doesn’t quite cover the “low end” cost of feeding a family of four and folks like you want to cut the program.
“Now tell us how much a middle class worker in China makes per month? ”
So China is your basis for comparison when in comes to quality of life… you need to think bigger.
JDW
October 15th, 2012
9:04 am
@Rafe…yes the chickens got it…now we have to actually hope for the hated Gators to give us a direct line back.
“You seem to like Clinton a great deal, but you do know that most of his success, occurred after he abandoned the notion of big Government and embraced some GOP positions of lowering taxes and growing the economy. ”
Interesting view…as I remember Clinton raised taxes never lowered and it was his positions in opposition to the Republicans that were proved effective. From an economic perspective there were two key ones…first he raised taxes (O’ don’t your remember the howling about how the economy was going to implode
) and by doing so raised revenue. Then he embraced PAY GO and in doing so controlled spending.
Net result is he accomplished what any good businessman will tell you…the key to driving growth is to raise revenue at a faster rate than spending. That is the point that is lost on today’s Republicans. They prefer to tilt at windmills like reducing spending…hint IT WILL NEVER HAPPEN…you just can’t do it because of the impact on the economy. Why just look at the blathering on the Sequester, anyone that wanted to reduce spending would just let it happen but they won’t. Actual spending reductions are a waste of time. What you have to do is slow the rate of growth so that the economy and revenue grows faster. Then the problem takes care of itself over time…that is until the next Duhbya that doesn’t understand….you know the guy that lowered taxes and tossed PAY GO.
“Romney is talking about those things, lowering taxes and growing government, ”
See that’s the problem with Mitt…here we are, taxes lower than the were the in 90’s, government revenues at their lowest percentage of GDP in 50 years and Mitt wants to lower taxes claiming he will then pay for it and lower spending…it’s a pipe dream…net effect of Mitt will be the same as Reagan and Duhbya…lower revenue, higher spending and higher deficits.
Rafe Hollister, suffering through Oblamer's ineptocracy
October 15th, 2012
9:26 am
JDW
Clinton lowered the capital gains rate, something Obama says he will not do, as it is not “fair”, even when he was provided figures that showed it raised Fed revenue. Lowering Cap Gain rate boosted the economy significantly under Clinton, as lowering taxes usually does.
Rafe Hollister, suffering through Oblamer's ineptocracy
October 15th, 2012
9:30 am
JDW
Check out GDP growth and job growth under Reagan. If only he had gotten the spending cuts he was promised by Tip O’Neill, the deficit would have dropped significantly. I blame the Dems for the debt increase as Reagan brought in the revenue he promised, but the Dems just spent it all instead of applying it to reducing the debt. Hopefully Romney has learned the lesson of promised cuts.
md
October 15th, 2012
10:01 am
“you know the guy that lowered taxes and tossed PAY GO.”
Thanks for the chuckle…….the dems passed the new Pay Go when they walked in the door 4 years ago and proceeded to stick it in the draw. What good is pay go when an admin is running 1.5T yearly deficits??
And cutting expenses/spending is a proven method even today……..all this complaining about corps sitting on record profits…….it tends to happen when they cut 23 million employees and benefits…..
Want to boost the economy? Reduce the tax rate to 0% on the 2T of offshore profits and bring that money home to our system……..it WILL get taxed once it’s in the system vs the $0 we’ve been getting from it the past 4 years because the dems “understanding” of how things work.
Oblama
October 15th, 2012
10:04 am
Never worry……… vote Obama and he will “pardon” their debt at the expense of the few remaining tax payers.
Oblama
October 15th, 2012
10:06 am
Colleges are expensive because pay of college teachers has tripled in the last 20 years.
Oblama
October 15th, 2012
10:13 am
“Cutting spending is a waste of time”………. and that mindset has given us a $16 T R I L L I O N dollar deficit. You socialists are brain dead zombies for Obama.
JDW
October 15th, 2012
10:41 am
@Rafe…”Clinton lowered the capital gains rate, something Obama says he will not do, as it is not “fair”, even when he was provided figures that showed it raised Fed revenue. Lowering Cap Gain rate boosted the economy significantly under Clinton, as lowering taxes usually does.”
First off, that was changed in 1997 well after the budget was under control. Second, I have no issue with tax cuts WHEN WE CAN AFFORD THEM as we could then. Third, I think it’s effect is debatable…the most likely effect was to reduce revenue.
Lastly you want Clinton capital gains rates Whoopeee….they are 20%…see you can’t keep cutting…sooner or later to you get to zero or as we are today in the toliet.
JDW
October 15th, 2012
10:42 am
@Rafe…BTW…if it were my choice we would go to Clinton era taxes circa 1996 across the board. That is not on the table so I have a choice between cutting all or raising some…I go with raising some.
JDW
October 15th, 2012
10:45 am
@MD…”Thanks for the chuckle”
Glad you got a chuckle…I didn’t find it so funny. Net result was a budget deficit of $1.4 Trillion that was in turn passed on to the current Adminstration where it has been cut about 20% over the last 3 years.
Tiberius - pulling the tail of the left AND right when needed
October 15th, 2012
10:53 am
JDW, just a suggestion: righteous indignation is NOT an effective debate skill. Countering arguments is.
Income disparity has nothing to do with the middle class disappearing, which is the DNC talking point I was debunking.
So poverty levels are highest in 52 years, hunh? Care to do the research and see what percentage of our population is in poverty according to government figures? Here’s a clue: It has always been hovering between 13% and 18%, with 15% being the average. Despite over 50 years of income redistribution policies by YOUR party, we haven’t moved the needle lower than those two numbers. Including now.
Oh, another effective debate trick – answer the question being asked. If the poverty needle hasn’t moved, where is the middle class supposedly disappearing to, JDW? They aren’t getting poorer according to the government you are so enamored with, so if they aren’t moving downward, where have they gone?
The ONLY direction is – UP.
JDW
October 15th, 2012
10:55 am
@Rafe…”Check out GDP growth and job growth under Reagan. If only he had gotten the spending cuts he was promised by Tip O’Neill, the deficit would have dropped significantly. I blame the Dems for the debt increase as Reagan brought in the revenue he promised, but the Dems just spent it all instead of applying it to reducing the debt. Hopefully Romney has learned the lesson of promised cuts.”
See problem is thats just not true…Reagan could have vetoed anything he didn’t agree with and did not. Other point you fail to note is that all that spending drove growth way more than those “tax cuts”. Reagan’s record is really due to spending growth in combination with a reduction in revenue.
Other problem is you are misrepresenting the impact of Reagan’s tax cuts…the rates really didn’t change until AFTER the recovery. Top rates went from 70% to 50% in 1982, from 50% to 38.5% in 1987 and to 28% in 1988. All WELL after the recovery…psssttt it was the spending.
http://taxfoundation.org/article/us-federal-individual-income-tax-rates-history-1913-2011-nominal-and-inflation-adjusted-brackets
Now I don’t think we should go back to 50% but the 1996 rates sound about right.
Tiberius - pulling the tail of the left AND right when needed
October 15th, 2012
10:59 am
Barack Obama finally finds a job he’s qualified to do:
http://multimedia.heraldinteractive.com/images/20121015/641478_obama101512.jpg
Rafe Hollister, suffering through Oblamer's ineptocracy
October 15th, 2012
11:02 am
JDW
If we lowered the cap gains rate to about 10%, made the Obama Tax Cuts permanent, and lowered everyone’s income tax rates the economy would boom, from all the money going into investments (true investments, not government spending which Obama calls “investments”) and people feeling a little more comfortable and willing to spend. A growing economy plus some serious spending cuts are the only way we ever avoid this fiscal cliff. Raising taxes like Obama proposes is going to send us in the other direction, recession, slow economy, and more increase in debt.
We will not get out of this economic mess unless we get government growing, nothing else is going to be sufficient. BTW, without the artificial dot com bubble and the GOP holding Clinton’s checkbook, the budget cuts necessary to bring the deficit down would not have happened. It also helped that he left Iraq to Bush to deal with. Clinton did not come into office as a budget cutter, he was hell bent on healthcare reform and other big government initiatives, until he learned he couldn’t get them through congress. He was the reluctant fiscally responsible President.
Obama could have followed Clinton, and put the country first, but he choose to pout instead of deal with reality.
JDW
October 15th, 2012
11:02 am
@Tiberius…”The ONLY direction is – UP”
I don’t have much time for your nonsense today…Google is your friend…in 2000 the Poverty rate for families was around 9.3% today it is north of 15%…that’s a change and not a good one. That’s where the middle class is going. It’s real simple if you read a bit…the bottom 80% of the country is doing worse the top 20 better…the middle class, according to historical norms is shrinking.
Now live in a fantasy world if you like but my guess is if you spent the day going through your own financial situation over the last 10 years you would see the same trend…not because you are unique but because that’s what is happening everywhere.
Rafe Hollister, suffering through Oblamer's ineptocracy
October 15th, 2012
11:10 am
JDW
If Gov spending caused the economy to grow, we would be on Easy Street during the last four years.
The tax cuts, allowing people to have more money in their pocket, causes them to spend, which stimulates and grows the economy. Even a proposed tax cut that people feel is going to come, will boost economic activity. Consumer spending creates demand for products, which creates jobs, which create individual wealth, which creates revenue for the Gov.
md
October 15th, 2012
11:19 am
Gov’t spending as a cure? Japan has been doing it for 2 decades…….debt to gdp ration now at 200%.
It worked so well for Greece that they are now using Germany’s money to do it some more……..
Borrow and spend is a gamble at best, and does nothing but make the hole deeper if the gamble does not pay off………..a bit like borrowing money to gamble to pay the bookey, and getting ones legs broken when that bet also goes bad .
Rafe Hollister, suffering through Oblamer's ineptocracy
October 15th, 2012
11:21 am
I thought this was interesting, wonder what % Obama/Biden tax returns would show.
Obama’s team has mocked the 14.1 percent tax rate that Romney is in as shirking his responsibility. But Charlottesville, Va.-based Marotta Wealth Management, which pens a widely-followed research blog, found that when Romney’s tax burden and charitable gifts are included, he paid out 57.9 percent of his income.
So, he has 42 % left to live on, is that fair?
Tiberius - pulling the tail of the left AND right when needed
October 15th, 2012
11:28 am
Take a gander at the first chart in this link, JDW:
http://www.washingtonpost.com/blogs/ezra-klein/wp/2012/07/11/poverty-in-the-50-years-since-the-other-america-in-five-charts/
Not the poverty level, as complied by the government you worship, has NEVER been anywhere near 9% (unless you’re cooking the books as well). Note that it has hovered between 18% in 1965 to lows of about 11% (once again, the average is around 15%) but it’s always been there, despite trillions of dollars of income redistribution by your party.
Epic, epic, fail.