Students

[Kuciwalker]

The price of the college goes up however since the loans are available to more people, thus people can pay more for college and more people are going to college, etc. So the government intervention increases the price college.

If I understand this correctly.

Yes, you have correctly identified the mechanism by which all subsidies increase prices. What does that have to do with "but you eventually have to pay the full price"?

[Kuciwalker]

If I'm going to get ripped off by forking over large amounts of money just to take some classes and get a certification, at the very least it should go to a non-profit....

If I'm going to spend money on X at the very least it should go to a non-profit... think about this, gribbler.

[Hauldren Collider]

Yes, you have correctly identified the mechanism by which all subsidies increase prices. What does that have to do with "but you eventually have to pay the full price"?

In an ordinary subsidy the recipients of the subsidy do not pay as much as those not receiving the subsidy. Whereas with the loan, those receiving the subsidy do eventually pay about the same price, not including interest.

[Kuciwalker]

In an ordinary subsidy the recipients of the subsidy do not pay as much as those not receiving the subsidy. Whereas with the loan, those receiving the subsidy do eventually pay about the same price, not including interest.

The lower interest is the subsidy.

[giblets]

Gribbler: What makes nonprofits inherently better than for-profit?

For-profits make the rich richer, non-profits work for public benefit... of course, for-profits do help people save for retirement.

[Hauldren Collider]

For-profits make the rich richer, non-profits work for public benefit... of course, for-profits do help people save for retirement.

"Profits direct enterprises towards activities that promote general welfare."

[Kuciwalker]

non-profits work for public benefit

no

[giblets]

Why? What makes you think that the people who get paid the residuals in the nonprofit (professors) are more deserving than people who get paid the residuals in a for-profit (owners)?

Professors teach classes, what are the owners doing for me?

[Hauldren Collider]

The lower interest is the subsidy.

Actually I think part of the subsidy is that as it is a government guaranteed loan, it enables people to pay for college now who otherwise would not. Thus the demand for college increases not just because of the lower interest rate but because they can get the loan at all when a private moneylender would never consider them to have enough credit.

NB: I don't want to pretend to understand all of this stuff. There's no need to act condescending though, a simple correction would suffice.

[Hauldren Collider]

Professors teach classes, what are the owners doing for me?

Running the university? The professors get paid a salary, right?

This is kinda like saying "the clerks at Burger King sell me hamburgers, what does the manager ever do for me?"

[giblets]

Actually I think part of the subsidy is that as it is a government guaranteed loan, it enables people to pay for college now who otherwise would not. Thus the demand for college increases not just because of the lower interest rate but because they can get the loan at all when a private moneylender would never consider them to have enough credit.

Wait, is this what you said that you're not sure if it was a good thing? Making everyone able to borrow money to go to college?

[giblets]

Running the university? The professors get paid a salary, right?

This is kinda like saying "the clerks at Burger King sell me hamburgers, what does the manager ever do for me?"

Just because you own something does not mean you run it...

[Hauldren Collider]

Wait, did you say that you're not sure if this was a good thing? Making everyone able to borrow money to go to college?

The problem occurs when you consider why they couldn't get loans in the first place--poor credit. Granted, it's hard to figure out a credit rating for someone who's only 18 years old. But the risk of default (and thus the costs falling on the government) could very well be a bad thing. I think I would need more data (and more knowledge of economics) to come to a conclusion though. I just am not 100% confident that the subsidized loan system is superior to another form of subsidy.

[giblets]

The problem occurs when you consider why they couldn't get loans in the first place--poor credit. Granted, it's hard to figure out a credit rating for someone who's only 18 years old. But the risk of default (and thus the costs falling on the government) could very well be a bad thing. I think I would need more data (and more knowledge of economics) to come to a conclusion though. I just am not 100% confident that the subsidized loan system is superior to another form of subsidy.

Wait, you can default on your student loans? I'm pretty sure the government has measures against that.

[Hauldren Collider]

Wait, you can default on your student loans?

Sure you can, if you run out of money, what can they do to you? The government promises to pay the university in the event of default. That's why the interest is so low.

EDIT:

I'm pretty sure the government has measures against that.

They might, I'm not sure...but if you're bankrupt, what are they gonna do? Throw you in debtors prison? We don't have those anymore.