Student loan buffoonery in New Jersey
By: Akash Chougule
The high cost of higher education is no secret. Tuition costs have continued to skyrocket leaving young people with a college degree, mountains of student loan debt, and few job prospects. Taxpayers are feeling the hit too – the Congressional Budget Office estimates that with fair value accounting, the student loan program will cost about $95 billion over the next ten years. However, these problems are not only occurring from traditional universities, but also at vocational, skill-based institutions. Across the board, schools are milking billions from federal taxpayers. At a chain of cosmetology schools in New Jersey, a one-year certification has come to cost as much or more as a year of tuition at a traditional four-year college.
Empire Beauty Schools, according to Spending Spotlight, has received over $4 billion in federal direct student loans since 2008. Students enrolling at Empire Beauty Schools are using taxpayers to fund their educations, lining the pockets of Empire.
This strategy must be profitable, as their chain of schools continues to grow. Empire now has locations in twenty-one states across the country, ripping off taxpayers for more and more.
The purpose of federal student loans is to provide low-income students the opportunity to receive an education they may not otherwise be able to afford. However, as tends to be common with government spending, federal student aid has exploded to harmful levels. With so many students receiving so much in federal aid, it has allowed schools to continue to inflate the cost of education, and schools like Empire are profiting off of taxpayers as a result.
Empire provides a net price calculator for prospective students to see how much their certification may cost. The one-year certification costs $14,500 just for tuition. By comparison, at Rutgers, the State University of New Jersey, and a top one hundred school, tuition for one year of schooling costs about $10,718 for an in-state student.
That means federal taxpayers are spending 1.5 times more per year to fund a one-year cosmetology certificate program than for a year of tuition at a top 100 university.
Clearly, government intervention and excessive loans have inflated the cost of Empire’s cosmetology certification. Despite the billions in taxpayer dollars that schools like Empire receive to subsidize education, the increase in price will inevitably prevent some students from being able to afford the degree while the chain continues to profit at taxpayers’ expense. While they may be producing well-qualified graduates, the cost of their education could be kept in check with responsible government spending that does not pour millions of unnecessary dollars into student loans. Furthermore, by reducing the amount of federal student loans the government gives out, not only could they cut spending, but also reduce the cost of education and lessen the burden of debt on graduates.
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