Our Government: Taking Away Incentives
On Saturday, interest rates for student loans are going to rise approximately 2%. Why does this matter for our discussion of K-12 education? Because, as the economists say, it's all about incentives.
Currently, a huge number of students drop out of high school every year. The staggering statistics on this have made headlines for months. If you are lucky enough to be one of the ones who makes it all the way through public school and through the crazy gauntlet of the college admissions process, you then have to deal with how to pay the astronomical costs of a college education.
Many students are able to afford college because of loans. Unfortunately, on Saturday, interest rates on those loans are going to rise. 2% does not sound like much, but it amounts to thousands of dollars and therefore years more time spent in debt for graduated college students.
Here's where the incentives come in. One of high school students' biggest worries about college is funding. If college is suddenly becoming thousands more dollars more expensive for them, this takes away more of the incentive for going to college. It will take many more years to pay off debt and cause more stress and more work for the same benefit. Finally, if students realize that college is even more financially unattainable for them while in high school, they will have more incentive to drop out.
The bottom line here is that the education system is fundamentally connected even if it does not seem obvious. What happens to preschoolers in America matters to students all the way up the line. What happens to college students matters to high school students, middle school students, and elementary school students.
Instead of subsidizing things like mega-corporations, war, and agro-business, why doesn't the federal government spend more on subsidizing education and the future of our great nation?