Universities are Ripping Off Americans

Universities are Ripping Off Americans

During the last election, Bernie Sanders, Elizabeth Warren and Hillary Clinton led the charge, calling for free universal higher education for everyone.  They called it a human right and decried the fact that upon graduation millions of Americans who now enroll are saddled with thousands of dollars of college debt upon graduation, weighing them down for years, sometimes decades.

The argument that unlimited access to higher education is a right that every American should enjoy is a separate and very political matter for discussion at another time. 

What is far more compelling and immediate is the fact that higher education costs have skyrocketed in recent years, are ridiculously and irresponsible high, and are continuing to increase annually unabated and way above annual, national cost of living increases.  Pricing by higher education (public as well as private) is a rip off of huge proportions.  And the institutions are the perpetrators. 

Average tuition and room and board this year, 2016-2017, is around $30,000 for 4-year public institutions, $62,000 for ordinary private institutions and $71,500 for elite private colleges and universities.  And, that is the average.  Costs are significantly higher still at the better 4-year private colleges and at the very best elite institutions.  We are coming very close to reaching and exceeding $100,000 per annum.   

These figures are simply ridiculous.  Universities are a monopoly and they are reaping huge profits to the detriment of the very people they claim to serve.  Coincidentally, they are also legally defined as “non-profit institutions.”  What a joke!

Of course, government provides subsidies to the poorest and loans to many others.  But as costs rise exponentially year after year, tax-payer funded government expenditures increase dramatically, as does student loan debt.  In fact, at current prices, student loans have already become lifetime burdens for many. 

Universities control access and, thus, have infinite opportunities to increase charges at will.  And, they do, recognizing that government will shell out directly and through loans for many and that consumers will pay almost any amount for their children. 

The prices they charge are extraordinarily high under any scenario.  If they were the very best of institutions and delivered superb results, they would still be cheating Americans.  But, they are, every one of them, decidedly poor at what they do and how they do it.  In a subsequent article I will show how far they miss the mark on educating young people and providing the skills required for men and women of the 21st Century.

For the moment, let me suggest that universities never will get better at what they do on their own and never will bring costs in line with what is appropriate without some dramatic challenge by their most important constituency.  A total and sustained boycott by students and parents, lasting a year or longer, is the only action that is likely to force these institutions to act responsibly.  So, take a year or two off after high school and force America’s colleges and universities substantially to lower tuition and fees and to hold the line on increases for at least a decade out.

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Not Even Smoke and Mirrors

Not Even Smoke and Mirrors

BestCashCow first projected that Trump’s extreme and malignant narcissism would cause him to fail properly to divorce from his assets in a way that would call into question his independence, his freedom from the emoluments clause, and his and his family’s liability.

Many well-versed in the law and in trusts maintained that Morgan, Lewis and Bockius, Donald Trump’s law firm, would put together an air-tight, yet complicated, ownership structure.  A smart ownership structure would use his ascendency to the presidency as an opportunity to pass his assets to his children and grandchildren with limited tax liability, while assuring that he would have all of his needs met for the rest of his life should he be removed from the presidency.

Following this weekend’s release of the trust documents under the Freedom of Information Act, it is very clear that everything, including the lease on the Old Post Office Building in Washington, has passed into the Donald J. Trump REVOCABLE Trust.  President Trump is the only beneficial owner of the trust, but the trust is run by his son and chief financial officer.  There is no legal impediment to Donald Trump’s receipt of information on the trust assets and their performance (as Sheri A. Dillon proclaimed in her January 11, 2017 news conference) and the trust is revocable at any time.

In short, Donald Trump’s law firm has done nothing, absolutely nothing, to separate Trump from his assets and the ethical liabilities that those assets create, save to introduce a single legal entity, wholly owned by Donald Trump himself.

The new administration – and the Republican Congress – are bent on exploiting the government for their own self-interests.  Inherent in that goal is an assumption that the majority of the population at large is totally indifferent to, or unable to understand, the color of the wool being pulled over their eyes.  In this case, there is no smoke, no mirrors, and the wool can be seen right through.

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Image: Courtesy: Pexels

Retirees Face Uncertain Future

Retirees Face Uncertain Future

It is exceedingly hard to look even months out with a modicum of confidence as to coming trends and events.  We are in the most uncertain of times.

This is especially true for those in retirement.  Over the last decade, really beginning in 2008, retirees have had to break with conventional wisdom and invest a much larger proportion of their assets in the market than in the past and than wisdom would suggest; bonds and cash simply offered too little yield to meet their needs. 

Now, with a new and unsteady president, the market seems even more risky for all Americans, and especially for those depending solely on unearned income.  The country has certainly enjoyed a significant upswing following the election, but that seems more fueled by irrational exuberance than by a thoughtful weighing of the major risks ahead resulting from irrational and off-the-wall government leadership.

Logic suggests that the market, however strong in recent days, is due for a major fall as the impact of a seriously unstable president with a seriously flawed agenda clashes with reality.   Those in retirement are caught in the middle.  Stay in the market and enjoy a temporary surge or get out now before an almost certain and lasting drop takes place. 

Market timing has never worked.  While all looks good for the moment (interest rates are beginning to creep up and the market is doing well), logic and clear thinking dictate that retirees need to act now in their best interests, reduce significantly their market holdings, and move to the safety of government-insured bonds and bank or credit union savings accounts and CDs.  To do anything else will leave a significantly large proportion of the population today in great jeopardy of falling short of the resources required to cover basic needs.  

Explore FDIC-insured, high yielding savings accounts and CD accounts here.