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Papered over the issue? You liken a compromise which allowed the very union of the states to actually take place to ignoring a glaring hole or flaw in the structure of a building? You are entirely wrong to think of it as such.
They, being at least a great many of the architects if not all the signatories in any case, knowingly sowed the seeds for ultimately undoing the institution of slavery. They rightly chose priorities, and the alternative would have been two or more nations to arise from the thirteen former colonies and slavery might still legally exist today on this continent. They didn't paper over anything--they used paper to built what is, empirically (evidenced by migration statistics), still the greatest place to live, generally, in the world for any person in the world.
Love how we all use 21st century thinking, and apply it to times that were like another planet they were so different. What about women in 1775? Where is all the criticism of the founding fathers about the way they were treated? What other nation was treating them any better at the time? Do you think we are born with the values we have, or do we learn them from society? Thomas Jefferson was no more going to free his slaves in his lifetime than some Hedge fund manager is going to return the billions he stole by manipulating the market. Most are too invested in the status quo to even allow their minds to go there. The founding fathers were flawed men. But at least they were not content with the status quo entirely, like pretty much all their predecessors were. The mere act of setting up the system they did set in motion the eventual end of slavery, though I doubt that was a motive for many. Europe may have abolished slavery earlier, but then look at what they did in African colonies. You have to judge men in the context of the times. You can argue that most political leaders are dicks, and I would agree. But that is something that has never changed in history. They just find different ways to screw people over.
Just a highlight "The MBA class of 845 will occur $112.4 million in debt!" Just that single class over 2 years plus interest in their lifetime.
The Wharton School of the University of Pennsylvania( poetsandquants.com ) — Dubbed “The Class The Dollars Fell On” byFortune, the 1949 graduates of the Harvard Business School were undoubtedly the most celebrated group of MBAs in history. Though the 700 or so members of the class graduated with modest expectations, more than a third would become CEOs and well over half would end up as multi-millionaires. Fast forward to this year’s incoming class at the University of Pennsylvania’s Wharton School. The 845 students who start their first classes on Sept. 7 are among their generation’s best and brightest. Unlike the men of 1949 — there were no women — the Wharton group is as diverse as any in history: A record 45% are women and 36% hail from outside the U.S. To come to the Philadelphia campus, they left some of the most prestigious organizations in the world, where they already were on the fast track to success.
But there’s one other very big difference between this year’s incoming Wharton class and the most renowned: debt and lots of it. Largely funded by the GI Bill, few members of Harvard’s class graduated with any debt. If the class of 1949 had been the most wildly successful of all the MBA classes ever, it can be said with certainty that Wharton’s class of 2013 will be the most heavily in hock.
Call them the “Class The Loans Fell On.”
A record $112.4 million in debt
In all likelihood, this will be the first MBA class in history to pay more than $100 million in loans and interest payments for the privilege of gaining the degree. In fact, if the class of 2013 continues to borrow at rates similar to their predecessors, it will take on a staggering $112.4 million in debt, loan origination fees, and interest payments. That heart-stopping sum includes interest payments of about $33.5 million. All this, for just a single class of MBAs, one in four of which is likely to incur no debt at all.
Brought down to individual terms, a typical Wharton MBA in this class will graduate with average debt of nearly $124,000. With monthly payments of $1,477 over 10 years, the total would come to $177,256, including nearly $53,000 in interest alone. It would be the proverbial bite that would be hard to chew for most because a graduate would need an annual gross salary of $176,560 to comfortably pay down the loan, according to financial advisors. That’s not a comforting thought when the median starting pay of a Wharton grad was only $110,000 last year. (You can crunch your own numbers on an online loan calculator to estimate the impact of your own debt.) And none of these numbers include the debt assumed by students during their undergraduate years.
‘Can students pay tuition on American Express?’
It seems oddly appropriate that for several weeks this summer the post that rose to the top of the class’s e-Talk forum was on whether you should use a credit card to pay the fall semester tuition bill due by the end of July (students had to pay a 1.5% fee if they didn’t meet the deadline). An incoming MBA candidate asked, “Can students pay tuition on credit cards, in particular American Express?” (The answer, by the way, is yes. Wharton’s parent university allows online tuition payments with an Amex AXP0.53% card but adds a 2% “convenience fee”).
Truth is, Wharton students show little concern about the costs of the degree. They rightly believe the school’s brand is among the best in the world and will pay off in the long run. The investment is something of a “calculated risk.”
As one incoming student puts it, “The tuition is a big number when you look at it. But I think an MBA or an education in general is a long-term investment. When you graduate from a program, you might get a salary, which is not all that great. But that’s a short-term phenomenon. At the end of the day, you take a calculated risk. There’s a lot more that I’ll gain from the program, and if I have to repay the loan over a longer time, that’s okay.”
Other students take a similar view, even if they’re inclined to worry a touch more. Consider Monica Tai. She will begin her MBA studies at Wharton next month. After graduating with a B.A. in economics from Cornell University in 2006, she worked as an “actuarial analyst” for Mercer Consulting for nearly four years. Clearly, Tai knows and understands the compounding effect of numbers. She was able to secure what she calls a “good financial aid package” from Wharton, but still has to borrow an unspecified amount of money to pay for the degree. She also has “less than $10,000” of undergraduate debt left.
Is she concerned? “I’m a little bit worried,” she says. “I think there will be enough incremental value to pay back what I’ve lost by not working for two years. But I don’t know if it’s enough to pay back what the loans cost. I guess it really does make me think that I have to recruit in particular types of jobs so that I can pay back the loans.” The one ranking Wharton would rather not top
Wharton is passing the $100 million threshold before any other business school because of the large size of its classes as well as the size of its average MBA debt, which is the highest in the world. Wharton MBAs rack up a third more debt than those at Harvard Business School. For the class of 2010, Harvard MBAs walked off campus with average debt of $73,100 versus Wharton’s $109,836.
The total debt tab for Harvard’s class of 2013? It’s more than $40 million less than Wharton — an estimated $71.7 million in debt, loan origination fees and interest. With a $2.3 billion endowment that is three times the size of Wharton’s, Harvard Business School has a distinct advantage in this game. It has been among the most generous B-schools when it comes to offering fellowship grants to keep student borrowing in check.
Over several months, Wharton has repeatedly declined requests to speak about its students’ appetite for debt. On Friday, a Wharton spokesman declined yet again. “We still have no plans to participate in this story,” said Ira Rubien of Wharton.
Christian Schraga, for one, thinks the numbers for the class are nothing less than “frightening.” Schraga graduated from Wharton in 2002 and believes that this level of debt has major consequences on a person’s life. “I’m not sure that these people understand what they’re getting into,” he says. “They’ve limited their options for what they want to do because of the debt. It requires a level of indebted servitude to pay back the debt, versus going after what your heart desires.”
That means that anyone who’s thinking about taking on the uncertain job prospects and the very certain loan payments should have a clear idea of the job they hope to get, their chances of getting it, and what it’s likely to play. With today’s steep tuition bills, studying hard and hoping for the best is a risky strategy at best.
Schraga should know. He enrolled in Wharton’s MBA program in 2000 with a glamorous image of life after B-school. “I would be living in a Trump luxury apartment with crystal whisky decanters on some sort of bar cart,” he quips. He didn’t worry much about borrowing $112,875 for the privilege. Schraga, however, did not have a very clear picture of how to achieve that dream beyond having a sense that he wanted to work in the entertainment industry.
Then the market crashed, and a sense of desperation set in around campus. Without a job, he and his classmates began to fear the unthinkable: bearing unshakable debt — U.S. bankruptcy law rarely forgives student loans. Like most of his classmates, he scrambled for the jobs that came up on campus, rather than focusing on ones he really wanted. ‘If I have to do this job, I’ll die’
During a McKinsey interview for a consulting role in New Jersey, Schraga felt miserable: “I thought, ‘if I have to do this job, I’ll die.’” McKinsey offered him the job, which included a salary that would have comfortably covered his loans, but a September start date gave him time to look harder for that coveted entertainment gig.
Unfortunately, an MBA doesn’t hold much weight in entertainment. He landed a “foot in the door” job for ColumbiaHouse.com. “Starting in the mailroom” may be a time honored tradition in Hollywood, but it’s a much more difficult proposition when you’re carrying tens of thousands of dollars in student debt. Schraga’s job paid half of what he needed to make his $1,500 loan payments every month. So he moved into an apartment with four other people and went on a strict budget.
Three years later, from the same shared apartment, he published a warning on the Internet to MBA hopefuls. “Business school,” wrote Schraga, “is a big risk. Should you choose to enroll, the only certainty is that you will shell out about $125,000. Such a figure correlates to… a ten-year period of time in which you will not be able to save a red cent.”
Much of the debt is eagerly taken on because students don’t think through the full costs of borrowing, says Mark Kantrowitz, publisher of FinAid, a website that helps college students with financial aid. “They don’t really think about it,” says Kantrowitz. “If you have a dream, you sign whatever piece of paper is put in front of you to enable the dream. You think you’ll figure out how to pay it back later on.”
MBA degree: Not so rare and much more expensive
For the Harvard Class of 1949, of course, the rich life was easy. They ascended the ranks of business in the Go-Go years as the U.S. bestrode the world as an economic colossus. When they graduated, there were only 2,300 other students getting MBAs that year — and only 50,000 living MBAs in the entire U.S. Today, roughly 250,000 people in the U.S. alone are enrolled in MBA programs, which pump out more than 100,000 MBAs a year. There are some 40,000 living Wharton MBAs alone.
Bottom line: The degree isn’t as rare as it was, it costs a lot more to get, and the rewards for having it have fallen as well — even at Wharton.
Just take a look at what has happened in the last decade alone. In 2001, Wharton recommended that applicants budget $59,728 a year to attend, or about $120,000 in total for the two-year MBA program. Graduates from Wharton in 2001 reported median base salaries of $95,000 a year.
Ten years later, the median starting MBA salary at Wharton was just 15.8% higher, at $110,000 for the class of 2010. But the recommended budget was up 40.6% to $84,000 a year, or some $168,000 for the two years. Translation: In the past decade alone, the costs of getting a Wharton MBA has risen nearly three times as much as the initial financial rewards of having the degree in the past decade.
For the class of 2013, however, these calculations are likely to get scarier. Wharton is now recommending an annual student budget of $89,200 — a sum that does not include the school’s global immersion program, which typically costs between $4,000 and $5,000 more. That brings a student budget up to $94,200 for the first year alone, or $183,400 for the two-year program.
Unless starting salaries rise dramatically, or Wharton finds more cash to help its students, the continuing increase in tuition will mean that an MBA from Wharton MBA will become an even more uncertain investment.
Roughly 30% of the University of Pennsylvania’s graduates are having trouble paying back their student loans, according to government statistics. (Wharton does not report this data separately to the Department of Education as some other business schools do). Missing payments and extending a loan can substantially increase the costs of debt. But most students are less concerned about potential defaults than they are about how this much debt constrains their freedom to pursue their passion.
“The Class The Dollars Fell On” had no such concerns. They graduated — with virtually no debt — into an era of unparalleled prosperity. That’s far from today’s frighteningly volatile economy, where most worry whether the U.S. is about to enter into a “double-dip recession” that will make it even more difficult for “The Class The Loans Fell On” to land the jobs that will help them pay off their huge debts.
Last edited by ProdigyofZen; July 23, 2014, 09:50 AM.
Jeebus! I did two years in Wharton's old Evening Program and I thought it cost a fortune nearly 20 years ago, fortunately my employer at the time covered the cost with tuition reimbursement.
"Unfortunately, an MBA doesn’t hold much weight in entertainment. He landed a “foot in the door” job for ColumbiaHouse.com. “Starting in the mailroom”"
So now MBA grads are "landing" the jobs that high school grads used to get just 6-7 years ago? What a country.
i figured, but thought someone might just scan the thread and assume that that much debt must be associated with 4 years of school. it's certainly a large enough number for someone to think that. it might even be why you wrote 4 when you very well knew 2.
Man what a depressing read. PoZ I don't know whether to thank you for posting such an insightful essay or curse you for causing my ham and tomato sandwich to start backing up on me.
Without a doubt though this article touches on something that is very real and very hard to address: Kids that age just ~cannot~ comprehend what $100k or $150k means. They just can't. Even trying to explain that this means in terms of buying a house or raising a child or auto purchases for most of a lifetime would be a waste of time. The dream dies hard.
Kids want to achieve and to be successful. We've told them for generations that education is the way to do it. I fear that the truth behind this maxim has passed its best buy date. Like a lot of other economic advice the ground has shifted under our feet in the last decade or two and made them suspect and at times totally at odds with reality.
these loans are not a big deal for new mba's who are going into the fire sector. the example of a kid who wanted to go into "entertainment" just shows that he chose the wrong route. i have a friend whose son got an mba at nyu after a ba at yale, took a job at one i-bank, just switched to another i-bank, and is making well into 6 figures NOT COUNTING his annual bonuses.
I think the point is that there are lots of young people at the margin who don't get the plum FIRE job.
The very well educated and super IQs will most likely find themselves a place. But, too many young people are told to follow the myth that buying a super expensive education is the way. What happens to the number of FIRE jobs as interest rates eventually resume climbing? How many newly minted Wharton, NYU Stern, Tuck over indebted MBA will be stranded by bad timing?
I will again recommend College Un bound - which does a great job detailing the College cost crisis and it is written by a guy who works for the Chronicle of Higher Ed. http://www.amazon.com/College-Unboun.../dp/0544027078
i think the wharton, nyu, harvard, mit, stanford, etc mba's will continue to do just fine. i wouldn't lose any sleep worrying about the products of the top tier institutions. but that just emphasizes that the problem of a low growth economy hits hardest at the low end and mid-range job-seekers.
i think the wharton, nyu, harvard, mit, stanford, etc mba's will continue to do just fine. i wouldn't lose any sleep worrying about the products of the top tier institutions. but that just emphasizes that the problem of a low growth economy hits hardest at the low end and mid-range job-seekers.
Do keep in mind though that the "best education you can buy" needn't be the most expensive education. I haven't read every post in this thread so my apologies if this has been brought up before...
Skilled blue collar jobs can pay quite well. By going to community college and/or a good public vocational school, a young person can gain a viable skill for a lot less money than going the high academia route, where they'll need a least a Master's degree to even get an interview.
Working as a plumber or mechanic might not be their dream job, but there are advantages. While their peers are graduating college with massive debts only to find careers in the fast food industry, twenty-somethings with good blue collar skills can earn decent money without the burden of so much debt.
As an example, young HVAC repairpeople with associates degrees in refrigeration can earn $70,000 a year in Phoenix. Any twenty-something earning $70,000 a year who has the discipline to live frugally and save is capable of paying for more college themselves if they ever want a different career.
If you can instill in your children good social skills, a strong work ethic, a love for lifelong learning and the ability to be a self-starter, you can rest easy knowing that they will always be able to take care of themselves.
Things have changed drastically in the last 45 years when I first entered the job market. I worked construction and machine shop through college and was never without a job for than two weeks when I wanted one.
These days manufacturing, agricultural have been whittled down to single digits, MBA's attorney's , accountants are a dime a dozen, robot's and automation are taking more jobs everyday with automatic meter readers to waitress jobs with electronic order pads at the table etc.
This is seismic as far as the job market is concerned and I believe even the well paying HVAC jobs will be under intense pressure wage wise with increasing surplus labor and everybody moves down market for a job. I do not think it will be business as usual and competition will be fierce for just about any job with lots of downward pressure on wages.
If I had my druthers I would prefer to have my daughter in her own business rather and skip college altogether./ I believe the money would be better spent on a Duncan Donuts franchise or be the owner of a HVAC company as a more secure way to go but she is reasonably bright and I can not deny her the option.
All kind of reminds me of the old Asimov Si-Fi story where people lived alone on robot plantations with a thousand robots managing everything for them
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