Sunday, July 22, 2007

Middle Class Entitlements

According to the Dallas Morning News, over 700 college students are receiving letters this week informing them that loans they thought they would be receiving from the state of Texas will not be available. Under the state's "B on Time" loan program, students can apply for interest free loans that will be forgiven if the student graduates in four years with at least a B average. Many students who were previously told by their schools that they would be receiving the money are now learning that funds are not available.

This is, of course, unconscionable. Financial aid officers knew that there was some question about the availability of funding, but still chose to include it in expected financial aid packages for new students. These school officials claim to be "caught in the middle," but it is simply unacceptable essentially to promise money that may not be available to students and families making decisions.

Nonetheless, it is interesting to see the response of one such student, Brad Barmer. As reported by the DMN, Mr. Barmer does not want to take out an alternative loan which charges interest and that does not offer the possibility of being written off. As a result, he is pursuing another way of dealing with the unexpected loss: Basically, I'm trying to earn $5,000 by the end of the summer. I'm working an insane amount of overtime."

That is laudable, but it makes clear that this popular government program, which mostly benefits middle and upper middle class students (a separate grant program is targeted toward lower class students), uses taxpayer money to help those who could help themselves. Why should this middle class welfare program exist, when students can work at summer jobs and come up with the money themselves?

In addition, it should be noted that this and other government aid programs have the unintended effect of raising tuition rates. Tuition at state colleges has risen by 40% in Texas since 2004. Tuition will rise consistent with the willingness and ability of students to pay, and that willingness and ability rises with the availability of loan programs that defer the pain of payment. It is no accident that the two areas of the economy in which price growth has greatly exceeded the overall inflation rate in recent years, education and health care, rely heavily on funding sources from government and other third parties, rather than the individual consumer.

2 Comments:

Blogger Bizzle said...

Hi, my name is Brad Barmer, the same one who was quoted in the Dallas Morning News. Before I say anything else I would just like it to be known that when the B-On-Time Loan was revoked at the beginning of the summer I was already working at a textbook warehouse about 50 hours a week, Monday through Saturday. I would just like you to know that my parents set aside little to no money for me to go to college, and that they flat out refused to cover any of my expenses if I went to a school other than a community college. Because I didn’t want to go to a community college, I worked my butt off in high school to get good enough grades so as to get recognition and scholarships. I had to get the warehouse job because the financial aide that was offered to me, despite my good grades, was not enough to cover all of my costs and expenses.

After the loan was revoked I got a second job as a cashier and was working 80+ hours a week, every day of the week. I had no free time and ended up working from dusk until dawn every day of the week until three days before the start of school. Now whenever I fill out FAFSA I have to report the money that I was FORCED to earn. So of course I seem better off than I really am, and my expected family contribution goes up. I’ve already filled out the applications for the warehouse and grocery store in hopes that they will re-hire me this summer. I’m sure I will be working at those locations for many summers to come.

Don't write your blog and insinuate that I'm some sort of upper middle class snob that’s too lazy to work and that I somehow feel entitled to government handouts. If anything I’m lower middle class by anybody’s standards. I had the job to begin with, and when the loan was revoked the whole situation turned into something I could barely handle. I had already sent rejection notices to the other schools that accepted me, I had already signed the lease to the apartment I planned on residing in, as had my roommate (who incidentally also had her B-On-Time Loan revoked), I had paid for and attended freshman orientation, and I had paid the non-refundable down payment on tuition. I found myself at a do-or-die moment.

My work over the summer allowed me to squeak by and barely earn more than what was revoked. Your article would have been more relevant if it had been about why college is so expensive rather than why I’m receiving a loan undeservedly. Do you think the time and effort I put into regaining what was taken from me was easy? Is 80+ hours a week at two jobs enough to make me seem less upper middle class and snobby to you? Have you ever had to support yourself in a similar fashion? Do you think everyone should shrug off governmental support of any kind and break their back to barely get by? Have you ever found yourself in a do-or-die moment like that where everything threatens to blow up in your face? If you haven’t, then you have no business judging me or condemning my supposed lack of desire to work.

6:54 PM  
Blogger MCO said...

Mr. Barmer, thank you for taking the time to comment. If you will re-read my post carefully, I think you will see that I never expressed any criticism of you. I called your effort to work to pay for college "laudable," and I said that the failure by the state to provide you the promised loan was "unconscionable."

My only question regarded the validity of the program itself. However, the program was in place, you were promised the money, and you had acted in reliance on the promise. You should have received the grant as far as I am concerned. I fully respect what you have set out to do, and certainly did not intend for my post to be interpreted as criticism of you or your efforts.

I hope that you return to my blog and read this. If you still feel that I have treated you unfairly, feel free to e-mail me personally (the address is in the sidebar). I would be happy to work this out with you.

Best wishes in your endeavors.

9:36 PM  

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