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What The $1+ Trillion Student Debt Bubble Is Being Spent On

Tyler Durden's picture


By now everyone knows there is an unprecedented student debt bubble, amounting to well over $1 trillion and rising at a rate of nearly $200 billion per year. However, what is far less known, is what all these hundreds of billions in government loan proceeds are being spent on. The following two charts should shed some light on this all important matter just how Government money goes from Point A to Point B, using indebted to the hilt students as a pass-thru.

First, the change in the number of higher education employees since the mid-1970s, broken down by job category. One can almost see why preserving the status quo of the Keynesian religion is the lifetime goal of most professors.

And then, the change in average salaries across the higher education spectrum. It would appear the only thing Krugman would want more than being a tenured op-ed writer, pardon professor, is CEO of a private college.

Source: American Association Of University Professors, Losing Focus: The Annual Report on the Economic Status of the Profession, 2013-14


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Sun, 06/22/2014 - 22:33 | 4884402 TeamDepends
TeamDepends's picture

Cliff's notes?

Sun, 06/22/2014 - 22:34 | 4884406 aphlaque_duck
aphlaque_duck's picture

teachers driving BMWs

Sun, 06/22/2014 - 22:38 | 4884422 NidStyles
NidStyles's picture

"Teachers and their spouses driving 'paid for', new BMW's."



Sun, 06/22/2014 - 22:46 | 4884440 TeamDepends
TeamDepends's picture

Our tenure package stipulates that, should we become disillusioned with our BMW, while at the same time a teabagger gains control of congress, we can, at no danger to us or our progeny, bail to Quito, Ecuador to become surf-bums, on your dime.

Sun, 06/22/2014 - 23:07 | 4884456 philipat
philipat's picture

Of course, this only applies to the (small) portion of the total which actually gets spent on education............Stdent loans are the only type of credit available to many, and the show must go on. Until it doesn't.

Sun, 06/22/2014 - 23:12 | 4884506 philipat
philipat's picture

Beyond which, education must be the only industry which has not effectively adopted new technology. Attending lectures is a totally unnecessary waste of time, for instance. Of course, those resisting change are the same tenured folks who are benefitting from the Gubmin largesse. Same old same old...

Sun, 06/22/2014 - 23:33 | 4884556 gh0atrider
gh0atrider's picture

For a good arb opportunity, gh0atrider would recommend taking out several student loans and instead put all that money into Bitcoin.

Mon, 06/23/2014 - 00:06 | 4884612 cifo
cifo's picture

Not only BMW, but M5. And I am talking about my neighbours, both teachers in late 30s. Fucking amazing nonetheless.

Mon, 06/23/2014 - 01:23 | 4884707 TBT or not TBT
TBT or not TBT's picture

Lotsa Obama- Biden stickers in the employee parking lots of central government subsidized universities eh?    Very statist messages and messengers dominant among their ranks.   Weirdly, loans to students to support subsidize these vote and voter generating institutions are readily available.   

Mon, 06/23/2014 - 02:25 | 4884757 CheapBastard
CheapBastard's picture

The article forgets to mention the Backbone of Merika past time and the power drive of our future generations; college Football coaches:


U. Texas to pay $9.375 million for [coach] Charlie Strong in 2014


"Impotent things be impotent!"





Mon, 06/23/2014 - 07:53 | 4884952 eclectic syncretist
eclectic syncretist's picture

Higher education in the US?  Too many chiefs and not enough indians.  Fix that problem and the situation will improve vastly.

Mon, 06/23/2014 - 10:08 | 4885362 brown_hornet
brown_hornet's picture

Texas football program makes profits. BIG profits. Pays for women's lacrosse scholarships.

Mon, 06/23/2014 - 00:57 | 4884676 vie
vie's picture

Imagine if students had done that instead of going to school...

Mon, 06/23/2014 - 01:36 | 4884719 Hobo Sapien
Hobo Sapien's picture

In the 80's, a roomate would get his student loan, fly to Hawaii, came back and double his money, putting the principle back into a savings account. He called them govt sponsored small business loans.

Sun, 06/22/2014 - 23:45 | 4884586 Voicefather
Voicefather's picture

It is foolish to think you can teach science, math and technical courses online. I've been able to mix in a lot of online assignments and videos for my classes, but some concepts just require you to be there face-to-face to teach.


Mon, 06/23/2014 - 00:02 | 4884608 o2sd
o2sd's picture

Americans still study science and math?

Mon, 06/23/2014 - 00:42 | 4884658 economics9698
economics9698's picture

Some do and when they graduate with their chemical engineering degree they look for work for a year and then get a job paying $40,000.  

Mon, 06/23/2014 - 00:47 | 4884661 Nexus789
Nexus789's picture

Doing a job that does not relate to their degree or does not need a degree.

Mon, 06/23/2014 - 04:02 | 4884798 tempo
tempo's picture

Co. will offer most engineering jobs to India grads w/o visas at 1/2 the going rate. Will not interview those w visas. 90% of summer jobs at mega tech co in silicone valley go to well educated foreigners w/o visas. According to Sr in Computer Engineering at major University Its a myth good jobs available for most engineering grads, only the top grads get jobs.

Mon, 06/23/2014 - 05:53 | 4884849 Postal
Postal's picture

Big Tech wants thousands of graduates so they can pick the "best": the top 5% or so.

Tue, 06/24/2014 - 09:06 | 4888799 o2sd
o2sd's picture

I guess if you do maths and excel at it there is always a chance you will be tapped by a Wall Street bank as a quant or a HFT programmer.

Mon, 06/23/2014 - 01:42 | 4884724 Hobo Sapien
Hobo Sapien's picture

You're right, see Professor Doom's blog - but it might be more correct to say that you can't get a job with an online degree, unless it's in a field where cheating, corruption, and bullshit are valued qualifications - like University Administrator.

Mon, 06/23/2014 - 06:24 | 4884863 August
August's picture

I've been on both the giving and receiving ends of university lecturing in the USA system.  Unless the lecturer is a very talented presenter (and few are), lectures waste an awful lot of time which could be better spent by the students in self-organized small groups, or just working on their own. 

Unless, of course, a student isn't actually interested in learning the material, in which case he should just drop the fuck out of my course.

Mon, 06/23/2014 - 12:14 | 4885816 cchoo
cchoo's picture

"Unless, of course, a student isn't actually interested in learning the material, in which case he should just drop the fuck out of my course."

Why do you assume the uninterested student is a "he"? Women can just as easily be uninterested in your course too.. 

And from my experience, the first 2-3 years of school were made up of mandatory "core" classes, and all of it was uninteresting until you get to the 400+ level courses. Don't blame your students for what your curriculum caused.

Mon, 06/23/2014 - 13:32 | 4886160 RaceToTheBottom
RaceToTheBottom's picture

The term "Creative Destruction"  was made for the education industry

Mon, 06/23/2014 - 08:43 | 4885071 rtalcott
rtalcott's picture

Nonsense...I don't think it's easy but it can be done and a nice compromise would be some "real" interaction but that can be done over the Internet also.

Mon, 06/23/2014 - 08:44 | 4885072 rtalcott
rtalcott's picture


Mon, 06/23/2014 - 05:58 | 4884853 Postal
Postal's picture

Having racked up (heh, rack) over 300 credit hrs over the decades, I much prefer traditional, face-to-face lecture. The social aspect is part of it--and getting to see cute, little coeds in micromini skirts.

But my biggest frustratioin with online courses is that the instructors didn't seem to actually do anything: Just slap their lecture notes on PowerPoint and say, "Here. Email with questions." Granted, that's not the fault of technology, but technology has to be used correctly if it's going to be effective.

Mon, 06/23/2014 - 06:49 | 4884885 NidStyles
NidStyles's picture

Shitty professors are going to give shitty lectures no matter the medium.


The only argument for wasting my time forcing me to attend in person lectures is a lousy one that doesn't stop shitty professors from being shitty professors.

Mon, 06/23/2014 - 07:12 | 4884904 mr_gandhi
mr_gandhi's picture

Education has adopted new technology, content is routinely available online for lecture-based courses.  there are two key benefits of lectures that technology can't replace - the feeling that you are part of a community of fellow students, and listening to a real person teach you stuff.  obviously this depends on the lecturer being good at what he or she does.  watching youtube videos just isn't the same thing. our techological bandwidth for delivering 'educational content' may have increased exponentially in the last 20 years, but the capacity of our brains to assimilate it has not.  a good/great lecturer can motivate students to learn in a way that technology cannot.

the article nails it - the problem is bloated administration.   

Mon, 06/23/2014 - 07:39 | 4884936 overmedicatedun...
overmedicatedundersexed's picture

having been on both sides of the lecturn-higher education out side of hard science and medicine is really an expensive hobby, and a luxury we pay for much too much for. what else would you call "woman's study" ? or all the other useless degrees in social - liberal arts?

Mon, 06/23/2014 - 13:52 | 4886216 RaceToTheBottom
RaceToTheBottom's picture

We are at the same place where companies that required knowledge workers to be onsite were 10 or so years ago.


Now teams do SKYPE calls every day and workers work from home.


The solution then was the same as now:  If you cannot define what needs to be done to the level that it can be done remotely and manage the deliverables, you don't know what you are doing.


Same thing with education.

Mon, 06/23/2014 - 00:10 | 4884509 libertus
libertus's picture

Cheap credit has blown another bubble in higher ed. In the coming years, when the interest rates go much higher lots of universities and colleges will crumble and close. That means there will be tons of unemployed faculty. Will they create new institutions or revolutions?

Education benefits all of society, but not the kind of education that creates debt and only enriches a very insular elite. Check out and build something very different. 

Mon, 06/23/2014 - 08:01 | 4884964 meghaljani
meghaljani's picture

This argument is wrong. According to Ben Bernanke, you are not going to see higher interest rates in your lifetime. 

Mon, 06/23/2014 - 08:12 | 4884988 overmedicatedun...
overmedicatedundersexed's picture

where are the mock trials the outraged professors marching on washington DC?? they sit silent and take the kings silver, they make a mockery of truth.. look at the history depts, law schools, look at economic depts, silent to the things ZH points out daily, may they all burn in hell.

Mon, 06/23/2014 - 10:57 | 4885539 Bendromeda Strain
Bendromeda Strain's picture

       According to Ben Bernanke, you are not going to see higher interest rates in your lifetime.

Incorrect - he said he doesn't expect to see them in HIS lifetime... length to be determined.

Mon, 06/23/2014 - 00:11 | 4884522 libertus
libertus's picture


Mon, 06/23/2014 - 07:01 | 4884897 SilverDOG
SilverDOG's picture

Was just @ Quito.

Elevation 9350 feet.

No surf bums there.

Did not see a single skate rat.

But of course for those who believe in there tenure package value and legal parameters...

SURFS UP ..dude.

Sun, 06/22/2014 - 22:39 | 4884425 babylon15
babylon15's picture

two elementary school teachers live next door to me.  $95k salary each.  one drives a bmw, the other drives an infiniti.


elementary school.


guess what state I live in?

Sun, 06/22/2014 - 22:42 | 4884431 FredFlintstone
FredFlintstone's picture

New Jersey, Maryland?

Sun, 06/22/2014 - 23:24 | 4884538 mjcOH1
mjcOH1's picture


Sun, 06/22/2014 - 23:52 | 4884595 thamnosma
thamnosma's picture

Has to be.

Sun, 06/22/2014 - 22:52 | 4884453 ENTP
ENTP's picture

Sounds like Illinois. 

Sun, 06/22/2014 - 22:55 | 4884462 philipat
philipat's picture

I'd guess CA..

Sun, 06/22/2014 - 22:55 | 4884464 ObamaDepression
ObamaDepression's picture

Sounds like San Francisco.

If they were Muni bus drivers they'd make $101K per year.

Sun, 06/22/2014 - 23:13 | 4884510 SF beatnik
SF beatnik's picture

What a horrible job, MUNI bus driver.   Have you ever ridden the MUNI?


I prefer to pay him than to pay anyone (other than the janitors) within our fucked system of higher ed. 

Sun, 06/22/2014 - 23:16 | 4884524 philipat
philipat's picture

SF has become a State? I thought it was still justs a state of mind.....

Mon, 06/23/2014 - 06:12 | 4884858 RafterManFMJ
RafterManFMJ's picture


That guy's qualified to be president.

Sun, 06/22/2014 - 23:02 | 4884471 Larry Dallas
Larry Dallas's picture

Long Island!

(Probably somewhere like Brentwood or Wyndanch where it is "more challenging to teach all brown people" as justification for higher salaries so they can fish all summer...)

Sun, 06/22/2014 - 23:08 | 4884500 TeamDepends
TeamDepends's picture

Common Core?

Mon, 06/23/2014 - 06:30 | 4884869 August
August's picture

Obviously, you are a rayciss who wants to condemn our little children to ignorance and non-affirmation.

Mon, 06/23/2014 - 08:01 | 4884962 Oleander
Oleander's picture

Conneticut or Massachusetts

Mon, 06/23/2014 - 09:46 | 4885243 SokPOTUS
SokPOTUS's picture

Pennsylvania.  Our local and surrounding district teachers at top of scale (year 17; age 39) with a Masters Degree (which they all have at that point, since it's "free" (paid for on my dime); and the fact that they have plenty of free time); are *ALL* well into six figures.

The salary for those 36 weeks work is missing the point, however.  The reason they can buy beemers, isn't even really the salary.  It's the fact that they know that they have that guaran-damned-teed pension on the dimes of kids they're teaching (I'll be dead); written into the state constitution that frees them from ever having to save on their own for retirement; hence the his-and-hers beemer splurges with current salary dollars.

Not to mention these people never have to fight true rush hour traffic due to the short-day hours, and most have little to no commute, as they generally have one employer after they establish themselves, and can move within a few miles of the building at which they teach.

I make more than my local teachers, but I drive a 9 year old Chrysler with 160K miles on it.  Why?  Because the day I walk away from work is the last day I have any incoming funds (I count 'Social Security' as a big fat Zero).



Sun, 06/22/2014 - 22:43 | 4884433 Almost Solvent
Almost Solvent's picture

These kids need to figure out the lenders have the real problem.

Sun, 06/22/2014 - 23:08 | 4884499 ENTP
ENTP's picture

The lender is essentially the federal government, funny how student loan debt cant be waived via bankruptcy when the government is the creditor.

Mon, 06/23/2014 - 02:30 | 4884762 CheapBastard
CheapBastard's picture

<< The lender is essentially the federal government .... >>


The ultimate lender is you and me. Buy more KY, you'll need it!

Mon, 06/23/2014 - 04:00 | 4884791 Kirk2NCC1701
Kirk2NCC1701's picture

But, but the Private sector is SO much more efficient!

Of course it's "more efficient"... more efficient at "charging whatever the market will bear".

Bullish for Money Supply and VoM. The Fed just loves to help clients who need it... much like the drug dealer loves his "clients" who need him. USA! USA! USA!

Mon, 06/23/2014 - 06:26 | 4884868 jerry_theking_lawler
jerry_theking_lawler's picture

No, you are jumbling the arguments here. True Capitalism is 'more efficient' at allocating capital/resources.....this is not capitalism. The USSA form of 'capitalism' has been hijacked and changed into corportism while trying to blame the latter. Always ask the question, why for each argument and you fill eventually find the real cause of the problem.....

Mon, 06/23/2014 - 06:49 | 4884884 doctor10
doctor10's picture

Students are merely the "excuse"-a secondary liability as it were, to the system. Which also means that none of them will be taught anything whatosoever about Constitutional Government and LIMITS of federal privielge and power

Sun, 06/22/2014 - 22:34 | 4884405 Aussiekiwi
Aussiekiwi's picture

I should have stayed at school......forever.

Sun, 06/22/2014 - 22:35 | 4884409 Silver_K-9
Silver_K-9's picture

Playstation 4?

Sun, 06/22/2014 - 22:37 | 4884416 Hubbs
Hubbs's picture

I thought for a minute that this was going to show what the school loans were really spent on, like .000001% on books, 10% on tuitions, and 80% on cars, spring break, clothes, beer and parties, and the rest on cellphones.

Sun, 06/22/2014 - 23:16 | 4884526 WAMO556
WAMO556's picture

Yeah me too!

But... We get to see who gets our tax money in these UNION OWNED purveyors of group think. Rather interesting to say the least! I wonder if these Professors are going to be able to survive the coming collapse???

Sun, 06/22/2014 - 23:27 | 4884546 WAMO556
WAMO556's picture

The purpose of these places of education was to serve mankind, instead they have been turned into a smorgasbord buffet for purveyors of theories that have NO PRACTICAL APPLICATION in the real world. Most of these parasites seem to regard education as some kind of dodge... or hustle. Their theories are the worst kind of popular tripe, their methods are sloppy, and their conclusions are highly questionable!

Sociology 101 for me was my introduction to a hair brained FEMINIST who knew everything and espoused the idea that MEN in General were responsible for the worlds problems and WHITE MEN in particular were DEVILS. I truly loved having sword fights with this idiot! It my personal policy to ALWAYS HEAP SCORN upon stupid ideas that have no usefull utility or practical application in the real world.

Mon, 06/23/2014 - 00:22 | 4884627 Proofreder
Proofreder's picture

Hair-brained ?

Well, yes, most women are well suited with hair.  Lovely tresses.

A few women do have the brains of rabbits (hares).  Like you ... an uneducated ignorant who dislikes women.

fuck off, swordfighter

Mon, 06/23/2014 - 06:05 | 4884856 Eirik Magnus Larssen
Eirik Magnus Larssen's picture

Don't be silly.

Mon, 06/23/2014 - 03:13 | 4884787 shouldvekilledthem
shouldvekilledthem's picture

like .000001% on books, 10% on tuitions, and 80% on cars, spring break, clothes, beer and parties, and the rest on cellphones.


Easy grandpa, times have changed. Drugs, sluts, smartphones and hopefully they manage to buy bitcoin too.

Sun, 06/22/2014 - 22:38 | 4884418 ENTP
ENTP's picture

We have to invest in our children's future.  It is impossible for America to be a world superpower if our children dont learn Women's lit.

Sun, 06/22/2014 - 23:50 | 4884593 thamnosma
thamnosma's picture

or LGBT studies.

Mon, 06/23/2014 - 00:00 | 4884602 adr
adr's picture

Did you know that LGBTs have a greater right to equality than straight people. One of my LGBT friends told me that.

Dumbfounded I replied, so more equal then? But really what they really mean is to turn the tables and make LGBT mainstream and being straight the wrong awkward lifestyle.

Just like CEOs who don't know anything about business believing they deserve millions for what they think is running a business.

Sun, 06/22/2014 - 22:39 | 4884423 Billy Shears
Billy Shears's picture

There really is no moral obligation to pay back/into an immoral system if an alternative, paralell system is unavailable. How can/why should a person keep faith with or "honor" an obvioulsy corrupt, venal and evil system?

Mon, 06/23/2014 - 01:58 | 4884739 ricky663
ricky663's picture

Then you are going to stop paying taxes, fines, banks, credit card companies, and corporations? That is, if you aren't already.

Sun, 06/22/2014 - 22:41 | 4884426 jeff montanye
jeff montanye's picture

i'm guessing the category on the left could be more specifically termed "salesperson".

the non-tenured professors? non-union/defined contribution/obamacare.

Sun, 06/22/2014 - 22:41 | 4884427 tempo
tempo's picture

Profs winner, students losers. My grandson completed his 2nd year and now works 15 hrs/wk at a city sports camp at minimum wage. Yea!!! He had the same job as a jr in HS. He has a pretty expensive pot smoking habit acquired at college. Nearly max out on student aid so he is contacting relatives to co-sign for another wasted year of pot smoking and sexing. Anyone interested in co-signing?

Sun, 06/22/2014 - 22:44 | 4884434 jeff montanye
jeff montanye's picture

no, but there are probably some takers here for the pot smoking and sexing.

Sun, 06/22/2014 - 22:53 | 4884447 ENTP
ENTP's picture

Substance abuse/addiction is simply part of the American college experience.  To boost GDP, not only should we legalize and tax weed, we need to make it a mandatory part of the college experience.   The children are going to smoke it anyways, why not create a $500 weed access fee and force them to purchase with the rest of their student loans.

Sun, 06/22/2014 - 23:44 | 4884582 enloe creek
enloe creek's picture

would there be a video perk on this deal

Mon, 06/23/2014 - 01:10 | 4884592 thamnosma
thamnosma's picture

Apparently the professor class is being turned into a part-time one.   The real winners are administrators and bloated bureaucracies.

Mon, 06/23/2014 - 00:25 | 4884629 Farqued Up
Farqued Up's picture

You are not alone.

Sun, 06/22/2014 - 22:44 | 4884436 booboo
booboo's picture

Florida had scholarships called Bright Futures, the college administrators call them Brilliant Retirements. Jokes on us.

Sun, 06/22/2014 - 22:46 | 4884439 tempo
tempo's picture

My relative in grad school is one of 4 TAs overseeing 800 enrolled in freshman econ at a major University that has 1 full time prof. responsible for the course. The prof never teaches, has office hours, or grades papers, only emails TAs.

Sun, 06/22/2014 - 23:02 | 4884486 Vint Slugs
Vint Slugs's picture

If what you state is true, why don't you let us know the name of both the Univ and the full-time prof? 

Sun, 06/22/2014 - 23:55 | 4884597 SilverIsKing
SilverIsKing's picture

Grand Lakes University
Professor Phillip Barbay

Mon, 06/23/2014 - 02:40 | 4884769 JuliaS
JuliaS's picture

Most people here won't get the reference. One of my favorite movies, though I'm no longer sure it was a comedy.


Mon, 06/23/2014 - 04:15 | 4884802 tempo
tempo's picture

To protect my nephew I can only say the Univ football team is ranked near the top every year and is known for the band that dots the "I" at every football game attended by 100,000 fans. Don't know the prof name, just told by the TA that is the TA  job is to teach the class, attend office hours, and grade papers working over 20 hours per week. The outline of weekly lectures and tests are prepared by the Prof.

Mon, 06/23/2014 - 06:49 | 4884888 Wahooo
Wahooo's picture

But I bet the prof does an awesome O ... H ... I ... O

Mon, 06/23/2014 - 08:00 | 4884959 tarsubil
tarsubil's picture

How many of the TAs is he sleeping with? That's another thing. The made man position of tenured professor is still sacrosanct. As universities have grown they've used slave labor (grad students/TAs/post-docs) to manage the higher work load. Some professors are real geniuses that have contributed a lot to humanity's understanding of the world. But many have not and live like feudal lords.

Sun, 06/22/2014 - 22:57 | 4884473 bankonzhongguo
bankonzhongguo's picture

I am pretty friendly with UC admins across several campuses.

The amazing thing to me is the absolute bias toward only hiring "higher-ed" people to run these bloated university bureaucracies.

Yes the Feds have onerous requirements when managing all that research money, but that still does not prevent the PIs from having a free for all.

Those that can't do - teach.  Those that can't teach - administer higher-ed.

The California community college system is even worse.

Even if you have 10 years of experience running all sorts of business operations, you will still be consistently overshadowed by some 20 somethings with six months of student affairs' "sitting in a booth on the quad" experience.

Wait!  You Photoshopped and handed out VD flyers as part of Condom Awareness Week?!

You are the new Assistant Associate Executive Vice Chancellor for Administrative and Business Functions for the Office of Sponsored Projects and Institutional Planning.

These folks just burrow themselves into the system, never leave, never bring in modernity, vote themselves pay raises, and raise tuition because it's an endless pit of government subsidies and debt slavery.

Meanwhile some of these "graduates" can barely walk and chew gum.

Look at a recent grad's penmanship to gauge what is happening in higher-ed.


Sun, 06/22/2014 - 23:49 | 4884590 thamnosma
thamnosma's picture

Absolutely true, everything you state.  I would only add that this thinking also exists at the private institutions I've had experience with.  They are paid handsomely as well.   Sure, when administering large grants you need real professionals.  Seems to be people with actual business experience would be a plus in handling the reporting requirements. 

Mon, 06/23/2014 - 00:37 | 4884648 Proofreder
Proofreder's picture

Penmanship indeed is becoming a lost art.

For some reason, instruction in cursive has been dropped from most elementary school systems.  In many middle school literacy courses, typed papers are the rule, and occasionally a hand-printed project will be turned in.  Rarely, a cursive example appears proudly written by a former home-school student as some Parents encourage beautiful writing.

We lose so much so slowly that no one notices.

Well, almost no one.

Mon, 06/23/2014 - 02:28 | 4884760 I Write Code
I Write Code's picture

My own penmanship is becoming a lost art, started at least fifteen years ago but I was an early adopter to computer stuff.  I've been trying to recover better legibility, at least, when using pencil or pen.  Can barely read my own signatures anymore.

Thu, 06/26/2014 - 09:35 | 4897363 zuuma
zuuma's picture

I, too, lament the loss of penmanship. For that matter, the loss of spelling & grammar, too.

However..  we live in the age we live in - keyboards, touchscreens, bar codes, icon clicks, and so on.

Like buggy whip handling, penmanship will continue to fade out.

Sun, 06/22/2014 - 23:00 | 4884480 The Most Intere...
The Most Interesting Frog in the World's picture

Thank you for your reference to the student as the "pass-thru". Students, EBT card holders, welfare recipients, nothing more than a pass thru...

Sun, 06/22/2014 - 23:02 | 4884484 alfred b.
alfred b.'s picture


   No wonder there's no revolution in this country....the ruling cabal buying more unsuspecting souls! 

Sun, 06/22/2014 - 23:03 | 4884487 Seasmoke
Seasmoke's picture

They better hope they got it all tucked away. Because this ponzi pyramid is about to come crashing down.

Mon, 06/23/2014 - 00:57 | 4884675 Proofreder
Proofreder's picture

is about to ...

Doubt it, sincerely.  Been hearing the crash is just around the corner for years.  Ain't gonna happen that way.  Just a long, slow slide down in comfort while costs rise and rise.

Maybe an asteroid will come along and get it over with.  Should be good for 10,000 S&P.

Sun, 06/22/2014 - 23:05 | 4884491 limacon
limacon's picture

Monastery . Best .

Sun, 06/22/2014 - 23:08 | 4884498 yellowsub
yellowsub's picture

I just want to know where tf $1 billion budget for Newark Public Schools every year!

Sun, 06/22/2014 - 23:59 | 4884601 SilverIsKing
SilverIsKing's picture

New basketballs for the varsity squad.

Mon, 06/23/2014 - 01:08 | 4884684 Proofreder
Proofreder's picture

It works out to roughly 10 thousand dollars per student for educational services, and 8 thousand dollars per student for administrative and physical plant. (50,000 students in the system)

Certainly better than building more prisons.

Mon, 06/23/2014 - 01:14 | 4884693 Proofreder
Proofreder's picture

The state of New Jersey spends 1.4 billion dollars yearly to lock up less than 26 thousand prisoners; about $58,000 per prisoner.

Schools are a bargain

Mon, 06/23/2014 - 04:22 | 4884805 SunRise
SunRise's picture

Schools are a bargain compared to prison ONLY if those in prison did not also go to school.

Sun, 06/22/2014 - 23:19 | 4884530 AdvancingTime
AdvancingTime's picture

A student loan is designed to help students pay for university tuition, books, and living expenses. It seems that many students are borrowing against their future at an almost unimaginable pace, unfortunately the money is often used for things other then education.

Too many young people and others taking student loans "living expenses" go on to include cars, trips, vacations and more. All this has a very dark side that will effect the lives of these borrowers going forward and has the potential to grow to crisis dimensions in the future.

In many ways society is encouraging young people to take on this debt and to hock their futures. This is akin to the, "I will gladly pay you Tuesday for a hamburger today" way of thinking. More on this subject in the article below.

Sun, 06/22/2014 - 23:22 | 4884535 disabledvet
disabledvet's picture

this is the last gasp of the biggest real estate bubble in human history. the purpose of all this debt relief is/was to keep the building spree going. the Universities long ago gave up on the idea of educating the kids. even if they wanted to the internet won't allow it. all of their research is "in the public domain" since now that we have the internet no idea or thought can remain "isolated" anymore. we're all "feeding the beast."

what better way than with young fresh minds?

Sun, 06/22/2014 - 23:25 | 4884543 limacon
limacon's picture

Beer .As always .

Sun, 06/22/2014 - 23:26 | 4884545 Elliptico
Elliptico's picture

I spent some of mine on blow. Fucking Mexican janitor. "You look like a guy who likes to get high."

Anyway, 8 balls though my second year, got my MBA, paid off the loans, and the rest is, as they say, hitsory.

Mon, 06/23/2014 - 06:38 | 4884872 RafterManFMJ
RafterManFMJ's picture

That's why I quit coke; I was worried I'd lose control, get addicted and one day find myself with an MBA.

Sun, 06/22/2014 - 23:39 | 4884571 alexcojones
alexcojones's picture

    At the University of California at Davis.  the campus police chief, Annette Spicuzza, who is basically a taxpayer-subsidized public servant for a bankrupt state, earns $140,000 PER YEAR.


Must be tough fighting crime at a California campus. Not long after that incident, Annette was put on suspended (paid) leave.

No money was taken from her account.

Mon, 06/23/2014 - 02:11 | 4884747 sangell
sangell's picture

(Must be tough fighting crime at a California campus)

Oh it can be. It was the campus cops who took out the madman at a Santa Monica Jr. College last year.

Sacramento State had a deranged student ( one Quran Jones) who beat a harmless soul to death with a basebat and was snarling and drooling when they entered the dorm room. I believe the UCSB cops were out dealing with Elliot Rodgers recently. Let's also not forget that it was a MIT campus cop who died in a shootout with the Boston Marathon bombers. I'm sure there are a lot of other examples I am omitting. Campus cop is every bit as dangerous as any LEO job these days.

Sun, 06/22/2014 - 23:41 | 4884577 Bemused Observer
Bemused Observer's picture

I hope all the money is being on Spring Breaks, foam fingers and beer balls. The poor bastards might as well have a little fun before they get sucked into the debt-vortex and spat out into the slow-grind of the wage slave life for the next 50 years.
C'mon guys, WE know what's coming for these kids...let's not begrudge them a few moments in the sunshine. At this point any further talk of fiscal responsibility is kinda ridiculous, no? Why pretend anymore?

"Let us eat and drink, for tomorrow we die."

Mon, 06/23/2014 - 00:19 | 4884624 mijev
mijev's picture

I would be happy to have a few ultra horny, ultra hot college chicks take out their frustrations on me.

Mon, 06/23/2014 - 00:49 | 4884663 Proofreder
Proofreder's picture

You seem like a perfect guy ...

818-297-3281 ... Britney

Sun, 06/22/2014 - 23:44 | 4884583 thamnosma
thamnosma's picture

Interesting trends -- the largest increases in numbers are part-time faculty (this way administrators avoid the costs of full time actual teaching personnel) and full time administrators (or whatever full-time non-faculty professionals are -- come to think of it, what ARE those?).   The money, however, is flowing to management not to the actual teaching faculty.  The full time professors are being replaced by part-timers, much like the rest of society.  

I have had dealings with these upper level academic administrators at private institutions.  It is truly appalling what they are paid for what they do.   Many are incompetent and it's stunning how far up the ladder they go.  They are good at "meetings" though.

Mon, 06/23/2014 - 01:21 | 4884704 Bazza McKenzie
Bazza McKenzie's picture

Part-time faculty are likely to not have research loadings, so just paid for teaching hours.

Mon, 06/23/2014 - 00:48 | 4884662 Max Cynical
Max Cynical's picture

Faculty also gets hugely subsidized housing at many college the U.C. Irvine campus, faculty are offered very nice homes on campus for $250K - $350K when comparable housing is $800K+.

Mon, 06/23/2014 - 01:21 | 4884691 knowshitsurelock
knowshitsurelock's picture

New fiat enters commerce as debt, based on a line of credit which the private Federal Reserve lends with interest to Federally Chartered central banks.  The only way to have access to this credit outside the Central banking model, is through the criminal justice system, which has the only other direct access to the spigot, or through student loans.

Quite convenient for making debt slaves out of the emerging generation.  You either go into debt to get a worthless education, or we extract the fiat from your birth certified line of credit through the criminal justice system.  Either way you're screwed.

But the money supply must increase exponentially to keep the Keynesian ponzi scheme going, otherwise the system will turn on itself like a cancer and eat the host, and destroy itself with too few dollars chasing too much debt.

So, do your part to keep the ponzi scheme alive and go get a loan!  Until you can't!

Mon, 06/23/2014 - 01:24 | 4884700 sangell
sangell's picture

My anecdotal experience. Back in the 1980s I worked for a formerly Catholic women's college that had gone coed and non denominational (to be competitive). The school president, dean etc. were still nuns and had rooms on campus. Fast forward 20 years and I have occasion to vist the home of the president of a mediocre public university in Richmond, Virgina ( VCU). He was being paid on the order of $800,000 p.a. and his home ( not on the campus) was provided in addition to his salary. It was a very large mansion in the finest residential neighborhood of the city. I'd guesstimate its value at around $5 million a decade ago. Not much by California standards but at the top of the Richmond housing pyramid. Not long after that I also met with the president of the ( private) University of Richmond at  his 'official residence'. It was on campus and a nice home it was but I managed to refrain from calling it a dump compared to the grand home of his competitor. It might have fetched a million or two if he could sell it but for a middling private university it wasn't bad ( the president wanted to raise tuition not for any fiscal reason but to put his school's tuition on a par with more elite Eastern private schools so parents would not feel 'cheated' and think the University of Richmond was the equal of any other private university in the region and maybe to upgrade his residence too).

Mon, 06/23/2014 - 08:00 | 4884835 TeethVillage88s
TeethVillage88s's picture

Charts show deeper things going on as you point out.

-Cash Flows are Cash Cows
-Uncle Sugar Credit or Grant Programs
-Uncle Sugar Subsidies thru Dept Education
-Cultural Memes: Work, Success, Education

Presidents are picked from a "Connected subset of people" or probably started out that way and like 100 years ago.

-Organized Capitalism where everyone gets a cut of the deal, especially the bankers, and executives
-Construction Funds, Like Hospitals, Universities Represent a Cash Flow to be targeted by capitalist, big donation attached to terms for construction loan for new Buildings
-Technology & Equipment Funds, Constant salesmen trying to sell new equipment for labs perhaps induced by donations or perks

So Let's see some charts. Looks like Spike in 1997. But data origin in like 1994: Federal government; consumer credit, student loans; asset, Level

Represents only part of the data, 2014:Q1: 770,888 Millions of Dollars. Federal government; consumer credit, student loans; asset, Flow

2013: 113,063 Millions of Dollars (Data Spikes from 2008 when Obama came in after being shut down under G.W. Bush), only part of Total Educational Funding, but again data seems to Originate in 1994.

Here is the Best Total in FRED: Student Loans Owned and Securitized, Outstanding 2014-03: 1,261.5739 Billions of Dollars

-Federal Employee/Military Educational Benefits for Collages
-Private Bank Loans wo loan guarantee
-Parents Savings
-Private Savings
-Private Grants/Scholarships
-Federal Grants/Scholarships

Total--Department of Education Outlays 2013 = $89.5 Billion
Total--Department of Education Outlays 2000 = $33.4 Billion
Total--Department of Education Outlays 1998 = $30.6 Billion

Total--Direct Student Loan Outlays 2013 = $3.28 Billion (?)
Total--Student Financial Assistance 2013 = $34.04 Billion
Total--Office of Federal Student Aid 2013 = $41.31 Billion
Total--Department of Education Outlays 2013 = $89.5 Billion

Seems like take the middle man out of Loans & Subsidies you can cut half the costs. Question: is are Direct Student Loans the lowest interest rates & the lowest costs?

Total--Direct Student Loan Outlays 2014 = unk
Total--Student Financial Assistance 2014 = $21.3 Billion (*So Far*)
Total--Office of Federal Student Aid 2014 = $22.1 Billion (*So Far*)
Total--Department of Education Outlays 2014 = $53.8 Billion (*So Far* Corrected)

Numbers from FRED don't match well with 2013 Monthly Treasury Report. There is a funny Proprietary Receipt from the Public in 2013 for $48.6 Billion Dollars (common).

Heard that Even Private Universities Take Federal OR State Funding, SO WE SEE MORAL HAZARD (IMHO).

Your point about Mansion for University President makes additional issues:

-Under Reform US Government
-Under Tea Party Government
-Under Libertarian Government

Maybe rules of incorporation could be interpreted quiet differently to reduce Executive Pay, Executive Compensation, Executive Perks (like cars & housing), and high admin costs/high overhead.

(I'm not a Tax guy or Financial Mgr)

-Section 501(c)(3) Nonprofit entity
-Section 509(a)(1) 1/3 of support from gifts, grants from public
-Section 170(c)(1) state or government entity

Many Charities got whacked in the 1970s as it was uncovered that either March of Dimes or UNICEF has huge Admin Costs (forcing them to report & disclose & even reduce admin costs to below 23% of expenses)

990 EZ Form Instructions:

-2) The Council of Better Business Bureaus "Standards for Charitable Solicitations" states, "Reasonable use of funds requires that, a) at least 50% of total income from all sources be spent on programs and activities directly related to the organization's purposes; b) at least 50% of public contributions be spent on the programs and activities described in solicitations, in accordance with donor expectations; c) fund raising costs not exceed 35% of related contributions; and d) total fund raising and administrative costs not exceed 50% of total income."
-5) Is the organization paying its Board Members inappropriately, or are its staff salaries unreasonable?
-6) Section 4958 (Line 40b) - Excess benefit transactions
(Nice Chart on Top Salaries for Universities)

-Instructions for Application of Tax Exempt (IRS Form 1023) Status as 501(c)(3) state that the PRIMARY PURPOSE can not be for Trade OR Business, but College is an Capitalist Industry these days formed to Capture Funding & Provide Jobs.

Mon, 06/23/2014 - 01:41 | 4884723 Atomizer
Atomizer's picture

Get back into school muppets. Double down your investment and aquire degree in basket weaving or climate change. 


Mon, 06/23/2014 - 02:09 | 4884746 Peter Pan
Peter Pan's picture

Too bad at least 20% of that money was not spent on buying gold and silver. At least there would have been something to show for it.


Mon, 06/23/2014 - 02:29 | 4884761 CultiVader
CultiVader's picture

But...but...but...what about about the children? Cue the teacher hating in 3...2...1...

Mon, 06/23/2014 - 02:56 | 4884776 JuliaS
JuliaS's picture

The internet is here. The only way to get cheated by the system is through willful ignorance. If you are a pre college kid, or have kids, tell them the truth. Tell them college is worthless and money is wasted. Make them get their own street smart education. Make them earn their worth debt free. Meanwhile, let the schools starve themselves, as the admins and academia go for eachothers throats, fighting for the last scrap of meat like stray dogs.

Schools had a purpose when knowledge was scarce... when there were fewer books than students. Schools had a purpose training conveyer belt minds when there were conveyer belt jobs. That world is gone. Fucking gone.

 Go online. Learn something and then do something. As easy as that.


Mon, 06/23/2014 - 06:15 | 4884859 reTARD
reTARD's picture

We've seen MIC, now welcome to the School Propaganda Complex. It's more about schooling than education.

Mon, 06/23/2014 - 06:41 | 4884877 highwaytoserfdom
highwaytoserfdom's picture

Would not want to revert back to old bankruptcy laws and put the the same budget constraints on.   Just think 70% of all  graduates are business  majors.  Is it me or is the second grade arithmetic missing?    What was that old Monster .com commercial


"When I grow up,

I want to file all day.

I want to claw my way up through middle management.

Be replaced on a whim.

I want to have a brown nose.

I want to be a Yes Man.

Yes Woman!

Yes sir!

Coming sir!

Anything for a raise sir!

When I grow up…

I want to be under appreciated.

Be paid less for doing the same job.

I want sunshine blown up my dress."

Mon, 06/23/2014 - 06:44 | 4884881 deerhunter
deerhunter's picture

I can't get kids to knock on doors for 12 bucks and hour and pass out fliers.  We don't teach our kids anything any longer.  Give them money,  give them cell phones,  give them condoms,  give them praise for being 8th place in a contest,  give them A's for C work,  be their friends not their parents,  give them 4 years of parties, sex and drugs and then at the age of 23 having never worked for anything,  bought anything with money they earned, never been on time to anything and expect them to run the country and commerce.

America 2014.  In a nut shell,,,,,,, turn out the lights the party is long over.  We just had a suburban fire chief retire while making 218K a year.  Pension until death 174k  a year.  The suburb promptly created a new Office of Public Safety and rehired him at 144K a year on top of drawing his full pension.  Next time a cop is lurking at a freeway off ramp that will soon be toll road nationwide ask him what his salary is while he is writing you a ticket for 125 dollars for not having your seat belt on.

There won't be a revolution.  There is a lot of whimpering.  Our tolls doubled and our state income tax went from 3 to 5 percent.  I spend 120 to 200 dollars a month on tolls.  There is talk in DC now to turn the entire US interstate highway system into toll roads.  Just an idea for you what that would mean.  I recently traveled from Chicago down to DC to visit some relatives.  I used the Indiana,  Ohio and PA toll roads and if I recall tolls for the trip were in the low 40 dollar range.  We pay excise taxes on tires and federal taxes on every gallon of gas we buy.  Will national toll roads be enough of a spark?  Will 300 dollar no seat belt tickets be enough of a spark?

We now have not only redlight right turn 100 ticket cameras in Illinois we now have cameras that issue speeding tickets by mail.  The government taxing beast is bleeding us all dry.  I have a son in law in streets and san in a yuppie suburb who makes 85K a year.  My daughter has a Masters of Education and teaches high school in a rougher school district making 38k a year.  Snow plow driver versus educator.  6 years of college.  And for all out there who say those who can't do teach,  she was 5th in her class of almost 800 students and could have chosen any field of study she wanted.  I agree their are slugs in education as their are slugs in every industry.  In corporate world the ass kissers can survive.  Real talent goes out on its own.  It is no different in education.  50 percent of teachers are gone in 5 years.  Professors and college level hocus pocus is a whole new world.

Rant off,, sorry to start a Monday like this,,,,,,,

Mon, 06/23/2014 - 06:58 | 4884895 Last of the Mid...
Last of the Middle Class's picture

Don't forget the studies at NOAA verifying global warming! All the data now has been completely disproven because of "manipulation of data". And the NOAA has the audacity to ask for your suggestion to improve their service when you log onto their frigging page! Not unlike amassing unattended infected children at our border for the sake of immigration reform and giving them a band aid. Good luck when the lights go out at the kiddo city and the gang rape crews begin to move about. Utterly and completely irresponsible government by the people for the elite few.

Mon, 06/23/2014 - 07:00 | 4884896 spinone
spinone's picture

Make student loan debt dischargable in bankruptcy.

Mon, 06/23/2014 - 08:13 | 4884993 tarsubil
tarsubil's picture

That's like asking the master to hand the slaves the key when they get chained.

Mon, 06/23/2014 - 08:38 | 4885057 Zeta Reticuli
Zeta Reticuli's picture

That's why it can't be discharged in bankruptcy. People were borrowing over $100,000 for medical school with no intent to ever pay back a penny. They would file within a year of working as a doctor and screw over the banks.

Mon, 06/23/2014 - 07:41 | 4884940 Took Red Pill
Took Red Pill's picture

Those who can, do; those who can't, teach. Those who want to be rich, teach college.

Mon, 06/23/2014 - 09:10 | 4885143 SillyWabbits
SillyWabbits's picture

Education: In the past, (50 years ago) a college graduate knew a language besides the one he was born with, knew mathematics and science beyond the high school level, and knew some of his own culture’s history.

Today, we have educated persons, (with 800 or less SAT Scores – not critical thinkers by any means) proficient within their sphere of learning carefully constructing studies and data without wisdom.

Most have not lived long enough to acquire wisdom and so they rely upon data more than facts, and schools of thought rather than life experience to formulate official documents in support of something lacking the test of time.

Additionally, these come from not even the best and brightest, merely from enlightened persons enlisted into the dogma of groupthink able to scatter social engineering gibberish via the internet and media.

 I am sure that you were taught in school that the biggest impact of the internet is to be able to control larger and larger organizations more easily with fewer participants as decision makers. Thus, agendas are much more easily imbedded before vetting can take place. Dare I say, narrow-minded!

About those hard earned grades ……
Apparently, it’s not hard work. As Michael Fischer writes for The Georgetown Hoya, “Students today study less, party more, and spend more hours in time-consuming and academically distracting internships and extracurricular activities than at any time in the past. Clearly then, something larger is at work.”

Here’s what they found: In 1961, the average full-time college student spent 40 hours per week on academic work (that’s time in class and studying). In 2008, it was 7 hours.

The authors figure that 21st-century students spend an average of 30 hours fewer every week studying than their 1961 counterparts. Over the course of a four-year college career, that would add up to something like 4,500 fewer hours spent hitting the books. Indoctrination seems to require less study than critical thought.

In one CIRP Cooperative Institutional Research Program survey subset last year, analyzing predominantly private institutions considered to be mid-level or high-achieving colleges, some 32 percent of college freshmen somehow managed to study less than six hours a week — not even an hour a day.

Seniors studied only slightly more, with nearly 28 percent studying less than six hours a week. And other surveys of today’s students report similarly alarming results. The National Survey of Student Engagement found in 2009 that 62 percent of college students studied 8 hours a week or less — even as they took home primarily As and Bs on their report cards.

The ignorance of Ph.D.s is still ignorance and high-IQ groupthink is still groupthink, which is the antithesis of real thinking.

Mon, 06/23/2014 - 09:29 | 4885197 RabbitOne
RabbitOne's picture

A distinguished American historian said in 1973:

 “All nations are much simple to define because they are all based on human nature. In the beginning their citizens start out in fetters (chains) dreaming of freedom, through enormous struggles they have faith they will gain this freedom, then at their peak they attain the freedom they so desperately wanted, then all nations abuse their freedom believing it will last forever and as you guessed this nation returns to fetters for having abused its freedom. There have been no exceptions to this cycle throughout history. I will finish by saying America today is abusing its freedom and will some day in the near future go back to fetters…”

Student debt is just another loss of our freedom because our government bribes us with our own money. To end this loss of freedom never vote the same party or politician back into power no matter how sweet their message or how tempting their bribes. 

Mon, 06/23/2014 - 09:40 | 4885245 Lostinfortwalton
Lostinfortwalton's picture

Certain majors from certain schools lead to gainful employment of the graduate, and it is not all Ivy League by any means. Becoming educated and becoming employed are not mutually exclusive, and the Liberal Arts profs should drop the act.

Mon, 06/23/2014 - 12:46 | 4885947 Metalredneck
Metalredneck's picture

I spent most of mine on wine & motorcycles.  The rest I wasted.

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