Education costs rising out of range

Updated: Friday, May 30, 2014
Education costs rising out of range story image
KALAMAZOO, Mich. (NEWSCHANNEL 3) - It's the time of year for pomp and circumstance and graduation parties, as young American men and women make the transition from high school to the rest of their lives.

Never before has the cultivation of young minds been more important for the future of our country.

Tonight, in Tom's Corner, Tom Van Howe says if we expect to compete well in the growing arena of global competition, we should be making it easier for young people to continue their education, not harder.

=====================

We've all heard the numbers. And they're sobering.

In math, our kids rank 36th. In science, 28th. And in reading, 24th.

And its not so much that our scores are getting worse--theirs are getting better.

We're stagnating.

A generation ago the United States had the highest number of college graduates in the world.

Today we rank ninth--behind such countries as South Korea, Japan, China, Canada, and India.

This, at a time when how we compete in a global economy is going to be dictating our future. Whether we wish to burden our young people with this or not, the fact is, they are our warriors in an increasingly competitive battle for survival.  It's a war that will never end.

No longer is it whether the son or daughter is being groomed to take over the family grocery store. The day of the mom and pop enterprise is largely over. The game is now being played on a world stage.

And how are we helping?

We urge them to borrow large sums of money from the government--with interest rates of roughly 4 to 7 percent--to be paid back after they graduate from college.

With a smile, a signature, a handshake and a few words of encouragement, we award them a diploma and place them in a ten to twenty year financial bind.

Instead of saddling these young men and women with interest-laden debt, why not make it as appealing as buying a new car: "no money down and zero-percent financing." If auto companies can afford to do it to increase sales, we ought to be able to do it to increase our competitive edge.

Not to suggest free education. Just to suggest we drop the burden of interest. Why in the world should a student graduate with a debt of $50,000 and have to pay $80 or $90-thousand over the next 20 years to get out from under it? How about "pay back what you borrow."

To be sure, the government likes things the way they are. Our federal government takes in as much as $65 billion a year on interest from loans made to college students. Isn't that special?

Here's a snapshot of where we stand: more and more young adults want to further their educations. Applications are up at colleges and universities all across the state.

The trouble is, tuition rates over the past thirty years have risen three times faster than median family incomes.

A new ACT study says the average family income for high school seniors has actually declined 12 percent over the past eight years.

People have less and less to pay more and more.

Massachusetts Senator Elizabeth Warren says graduates are so strangled by student debt that for many it's nearly impossible to buy houses or cars or take part in our economy in any substantial way.

And the exact opposite is what we need.

Just as in the world of healthcare, we have to find a way to get control of the cost. There is no sane reason that healthcare and education should continuously outpace inflation.

And there is no sane reason we shouldn't be affordably equipping our young people with everything they need to compete head-to-head in an increasingly competitive world.

It's a cost we'd benefit from greatly.

And our future depends on it.

In this corner...I'm Tom Van Howe.

Business News

Last Update on April 27, 2015 17:31 GMT

PORT LABOR-TRUCKERS

LOS ANGELES (AP) -- Truck drivers who haul goods from the nation's busiest port complex in Southern California have walked off the job in a dispute over their wages and employee status.

Today's strike at the ports of Los Angeles and Long Beach comes after a weekend vote from the Teamsters, who say "several hundred" drivers from four companies are striking.

Some 16,000 truckers haul cargo, and the strike isn't expected to shut down all business at the ports.

The drivers are contractors for the trucking companies, but they're fighting to become company employees, saying it would mean better wages and workplace protections.

FEDERAL RESERVE

WASHINGTON (AP) -- Most economists say a still-subpar economy and low inflation will keep interest rates at record lows at least until September.

On Wednesday, the Fed could clarify its plans after ending its latest policy meeting. But analysts caution against expecting any specific guidance on the Fed's timetable for a rate hike.

Too many uncertainties still surround the U.S. economy and Fed's policymakers may want to leave themselves maneuvering room until their view of the economy's health becomes clearer.

For 6 1/2 years, the Federal Reserve has held its key interest rate near zero.

JAPAN-RATINGS DOWNGRADE

Fitch downgrades Japan citing economic concerns

(UNDATED) -- Fitch Ratings is lowering Japan's credit rating as the country wrestles with staggering debt.

Fitch says the government did not include sufficient measures in its budget to replace a deferred tax increase this fiscal year, which ends next March.

Japan's debt is the largest among developed nations and more than twice the size of the economy.

The ratings agency downgraded Japan's long-term foreign and local currency issuer default ratings to "A" from "A+." It also lowered its senior unsecured foreign and local currency bonds ratings to "A" from "A+."

Fitch says that though Japan cut corporate tax rates in the current fiscal year, it wants to cut them again in the next year. It says those factors increased the ratings agency's uncertainty over Japan's political commitment to consolidation.

CHIPOTLE-GMO

NEW YORK (AP) -- Chipotle says it has completed phasing out genetically modified ingredients from its food.

The Denver-based chain had already been using mostly non-GMO ingredients, but said in late 2013 it was working on transitioning to a tortilla that did not use them.

Most of the country's corn and soybean crop is genetically modified to have certain traits like resistance to plant diseases.

The head of the Food and Drug Administration's food safety center has said the agency found no basis that GMOs pose any different safety concerns than foods developed by traditional plant breeding.

Chipotle Co-CEO Steve Ells has said the company felt it was best not to use GMOs given the "lack of consensus" about their effects.

EARNS-SUN BANCORP

MOUNT LAUREL, N.J. (AP) -- Sun Bancorp Inc. (SNBC) is reporting first-quarter net income of $2.8 million, after reporting a loss in the same period a year earlier.

The Mount Laurel, New Jersey-based bank said today it had earnings of 15 cents per share.

The holding company for Sun National Bank posted revenue of $28.3 million in the period.

Sun Bancorp shares have climbed 3.5 percent since the beginning of the year.

RESTAURANT BRANDS-RESULTS

NEW YORK (AP) -- Restaurant Brands International Inc. is reporting adjusted earnings that beat analysts' expectations for the first-quarter as sales at its Burger King and Tim Hortons operations showed healthy growth. The Canadian company reports a loss of $8.1 million, or 4 cents per share. But it had earnings of 18 cents per share after adjusting for certain costs.

Analysts polled by FactSet expected profit of 15 cents per share.

Revenue rose slightly to $932 million. Analysts polled by FactSet expected $944.7 million.

DISCOVER-APPLE PAY

NEW YORK (AP) -- Discover credit cardholders in the U.S. are getting their Apple Pay.

After months of complaints from customers, Discover Financial Services announced today that it has reached an agreement with Apple Inc. that will let its cardholders make payments in participating stores through Apple Pay by using an iPhone 6, iPhone 6 Plus or Apple Watch.

With Apple Pay, credit card numbers are not stored on the device or on Apple servers. A unique device account number is assigned and each transaction is authorized with a one-time unique security code.

Discover customers will also be able to use Apple Pay with iPad Air 2 and iPad mini 3 when paying for goods and services within apps starting in the fall.

advertisement
Washington Times
advertisement