Cost of University Education in the USA

University fees in the USA have increased at a rate 6% higher than the general rate of inflation in the US for the past 25 years, making it four times as expensive relative to other goods and services as it was in 1985.

[1985 was the year when Duran Duran released the James Bond title song, A View To A Kill, and Madonna was Crazy For You….]

The logical explanation is that University finance departments have a talent for increasing top line fees via tuition. However the number of science and engineering graduates are falling in a lot of Universities. This is a trend in the mature economies in The West. We have focused on arts instead of more practical subjects such as mathematics, science and engineering.
The shocking statistics, are that the average US college graduate now leaves University with $24,000 of debt and total student loans now exceed the US credit card debt of $1 Trillion, (yes, I did say Trillion) and counting (7% of the US national debt). Yes, I said 7%, do the numbers, the US total national debt is about $14.2 Trillion. The US Economy is has an output (GDP) of $14.2 Trillion. Yes, you are reading my numbers correctly, the US National Debt is now approaching 100% of GDP.

Don’t be surprised, this is becoming the accepted state of affairs in Western Economies. Greece is worse of course, it is about 142% of Debt to GDP, and the UK is 76% of GDP with the UK total national debt outstanding is about £1105.8 billion, plus or minus a few billion, which I am sure you will forgive me for. Back to the US Universities. They are run for the benefit of the adult establishment, both politically and financially, not students. To radically change the system and to question the sanctity of a University education would be to jeopardise trillions of misdirected investment dollars and financial obligations.

The numbers are huge when it comes to our economies, debt, student tuition fees, healthcare, pensions etc etc. Also when it comes to government debt, of course the debt is issued in the form of debentures (the posh word), commonly known as bonds. Pension funds buy these bonds to pay pensioners. We can’t default on our debts, a lot of people rely on these bonds.

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