The Student Debt Crisis: There's No Such Thing As A Free College

Episode Summary

With Democratic presidential candidates making the student debt crisis one of the central issues of the 2020 race, Kate and Luigi give an in-depth economics look at the ideas of free college tuition and debt forgiveness, explain the history of how we got to into this student debt crisis, and debate some solutions for how to get out of it.

Episode Notes

With Democratic presidential candidates making the student debt crisis one of the central issues of the 2020 race, Kate and Luigi give an in-depth economics look at the ideas of free college tuition and debt forgiveness, explain the history of how we got to into this student debt crisis, and debate some solutions for how to get out of it.

Episode Transcription

Luigi: Today, we have a very important announcement to make. Kate is getting married. Congratulations, Kate!

Kate: Thank you.

Luigi: Now, we have an important question. Are you getting married in spite of your student debt?

Kate: I think, first and foremost, I’m getting married for love, but no. I recently finished paying off my student loans. And now that it’s paid off, I do feel a lot more comfortable about spending another ridiculous sum on a wedding.

Luigi: Not all millennials are so lucky as Kate. In 2018, there were 45 million Americans with student debt for a total of $1.5 trillion. If you do the math, each is $33,000 in debt. This has not always been the case. In 2004, the number of people with debt was only 30 million, for a total that was roughly $250 million. So, it was only $8,000 per person. This is a topic that has come up often during the presidential campaign, because people blame the debt, the student debt, for everything from the decrease in marriages to the decreased demand for houses, to people not working, and so on and so forth.

Kate: But to be fair, Luigi, you’re even luckier. You didn’t have any debt when you graduated from college, did you?

Luigi: You’re right. I come from a country where university education used to be mostly free. Now, I attended one of the few private universities, which did have tuition. It was relatively small, and I was lucky my parents paid for it, but it wasn’t a foregone conclusion. I remember when I decided to go to this university that my father was concerned about the cost. At the time there were no student loans available in Italy, so I could not borrow even if I wanted to. If my parents decided that the burden was too big, I would have gone to a nearby public university, and most likely I would not be here today.

Kate: The debate being had, particularly in the Democratic presidential primary, is about whether we should be moving in that direction in the United States. Which is to say, should we have more completely free public schools?

Kamala Harris: We need free community college, we need to increase Pell grants. We need to refinance student loan debt ...

Elizabeth Warren: To make college universally available with free tuition and fees.

Pete Buttigieg: It’s logical to me that if you can refinance your house, you ought to be able to refinance your student debt. I also believe in free college for low- and middle-income students for whom cost could be a barrier.

Luigi: From the University of Chicago, I’m Luigi Zingales.

Kate: And I’m Kate Waldock from Georgetown University. You’re listening to Capitalisn’t, a podcast about what’s working in capitalism today.

Luigi: And, most importantly, what isn’t.

Kate: On this episode, with Democratic presidential candidates making the student debt crisis one of the leading topics of the debates, we give an in-depth economic look at the idea of free college tuition. We’re going to explain the history of how we got into the student-debt crisis and give some ideas about what we could actually do about it.

We should probably spend a little bit of time discussing the candidates’ plans when it comes to free public education or when it comes to the forgiveness of debt. Bernie Sanders and Elizabeth Warren have come out as the strongest proponents of the elimination of debt. So, I think Bernie Sanders’s plan is to get rid of basically all student debt, all $1.5 trillion for everybody, regardless of how much money you make. And he also wants to make public schools, historically black schools, free.

Elizabeth Warren proposes some part of that, which is that she wants to reduce the student-debt burden, but it to some extent depends on your income. So, if you’re making over $250,000 a year, it doesn’t matter how much student debt you have, you’re not going to get any forgiveness. Whereas if you’re at the bottom end of the income distribution, you can get forgiveness of up to $50,000. So, it sort of depends.

Luigi: There is a recent paper by Adam Looney at the Brookings Institution that analyzed Warren’s proposal. And he finds that the bottom 20 percent of borrowers by income will get only 4 percent of the savings. So, overall, it is a pretty regressive initiative, because there are two groups that have a lot of debt. One is people attending for-profit colleges, the other is people attending major universities. Those guys tend to have a really large debt, but they represent the upper class of the income distribution, and they are going to do fine the rest of their lives. So, it is as if we were canceling your mortgage debt. Who has the most amount of that? The rich people who bought the big houses.

Kate: I think that the loan-forgiveness element, a lot of the rhetoric around it has to do with equality of opportunity. But I don’t think in practice it really has anything to do with that. If anything, the data has suggested that more federal loans have made college tuition more expensive, and people at lower income levels struggle more with these loans. And that the programs designed at relieving these loans benefit higher-income people disproportionately. So, I think what the real objective is, is to boost housing prices. Basically, it’s a bunch of people who are my age who can’t afford houses and want to be able to start buying houses. And, to be fair, that’s an important economic consideration to have young family-starters to be able to afford houses. But if that’s really what it would benefit, we should maybe frame the question in that way.

Luigi: I agree 100 percent with you, but I will add an extra element. College students and people just coming out of college are very active during the primaries. It’s a pretty good way to get easy votes promising to give a gift to all of them.

Kate: Well, that’s too cynical for me. Luigi, you’re from Italy, you’re from Europe, where most university education is free. So, do you agree with the Bernie Sanders, Elizabeth Warren plan to make public schools have free tuition?

Luigi: No, I’m not in favor of free university tuition. Milton Friedman used to say that there is no free lunch. When you eat and you don’t pay, somebody’s paying for you. The same is, of course, true for universities. So, the proper question is not whether universities should be free, but why taxpayers, i.e., me and you, should fully subsidize the cost of university education?

Kate: But we do the same thing for primary and secondary school. Why shouldn’t we do it for college as well?

Luigi: You’re right. Primary and secondary education are free, and you see the effect on quality. America has the best universities in the world, but this supremacy will not last very much longer with free education. And America used to have the best elementary and secondary education, but it doesn’t anymore. 

Now, there’s also another important difference. Primary and secondary education are mandatory. So, it is necessary to ensure that everybody can go. Not only is college not mandatory, but in the States, less than 60 percent of the population goes. In Italy, it is actually only a quarter. So, this 60 percent tends to come from richer families and up in the top quintile of the income distribution. Why should poor taxpayers who don’t send their kids to college pay to send my kids and your kids to college?

Kate: OK. I think that there’s several things that we can discuss in that statement. First of all, going back to what you said about the quality of American primary and secondary education. Your assertion was that they’re not as good partially because they’re free. But that doesn’t make sense to me. I mean, if we’re comparing educational outcomes across countries in which almost all of those countries have free primary and secondary education, then it doesn’t make sense to say that the United States is not as good because it’s free. 

If anything, I would argue that it’s the separating equilibrium that we have in the United States, which is to say that there’s some really good private schools that get all the best people. And because of the way that we fund public education, we have this system where there’s a really good set of schools and a really bad set of public schools. I would argue that that’s why our educational system has deteriorated. It has nothing to do with the fact that there is free public schooling.

Luigi: I think you’re partly right, but only partly. I think it’s true that in most places in the world it’s free, but the way it is paid for is different. For example, in Sweden … everybody thinks about Sweden as a socialist country, but in Sweden there is a pretty big chunk of schools that are funded through vouchers. So, there is a very strong connection between people attending and people paying and the quality of what they receive. And this is what you generally tend to lack when you have a free product, because people tend not to complain very much about a free product. 

And I can tell you in a lot of situations I’ve seen in Europe, you see a very low-quality product that is offered for free to people who don’t complain very much, because they don’t pay anything. I don’t think that’s the equilibrium we want to have. I think that we want to have a system where people even in primary and secondary education are accountable for the quality of the product they offer. Which, of course, can be done with vouchers or other systems.

Kate: Sure. I don’t think it can be done by linking public-school funding at lower levels to property taxes for that area.

Luigi: I completely agree. If you are saying that the United States has the most crazy system—

Kate: Messed up.

Luigi: —to fund primary and secondary education, I think you win the prize.

Kate: This is probably a topic for another episode, so maybe we’re getting a little bit distracted. But I’d also like to take issue with the second part of your statement, which is that it’s not necessarily fair for poorer taxpayers to be funding public college, when it’s the case that it’s generally wealthier people who end up going to college. So, in some sense, it would be a regressive subsidy. A, I think that it’s good when all smart people are educated, and so in that sense, I hate to say it, but a rising tide lifts all boats. It’s best for everybody in a society when the right people are getting educated, even those at the top and the bottom.

Second, I think that even though the data doesn’t necessarily support this very strongly, at least the spirit of making public education free at the college level is so that it can be more equal access. Which is to say that more black, African American, Hispanic students, people from poor backgrounds, can have access to college where they otherwise wouldn’t.

And, finally, and I think that this is probably what I most strongly believe in, poor people shouldn’t be paying that much in taxes anyway. So, most of this would be funded by wealthier people to begin with.

Luigi: Yes. But given the fact that there is a budget constraint, if you think that you can print money and pay for everything, then you have no problem. But if—

Kate: Are you accusing me of being an MMTer?

Luigi: That’s for another episode. But what I’m saying is that if there is a budget constraint, you have to think about how to make resources work in the most effective way. And think about one of your goals, which I think is very important, which is to promote access to lower-income people. Do you really think that the best way to promote that access is to give free tuition to the university? Or is it to invest that amount of money to make the primary and the secondary schools much, much better in poor neighborhoods?

I give you the example of Brazil. Brazil is the most interesting example, because there is free university in Brazil, but the primary and secondary schools are so terrible that only the rich kids who went to private primary and secondary schools can reach college. And that—

Kate: I hate to say it, but I think that’s the system that we have in the United States now.

Luigi: I think it’s going in that direction, but the way to fix it is not by giving free tertiary education. It is actually to dramatically improve the primary and secondary education.

Kate: OK. I agree. If we’re talking budget constraints here, then where should the first dollar be spent? There are probably better places where it can be put to use to help more people, i.e., in lower levels of education. But if we’re just talking about the issue of, will it help society overall to make public schools totally free, I think that there’s some merit to that.

Luigi: But I think it will help society overall to give a free iPhone to everybody. There are so many things that, if they are free, they might help society overall, I’m not so sure you want to do that. I think we need to be careful in how we use public money. Given that I’m glad that, at least, we agree on this, that there is a budget constraint.

Kate: Well, I would probably be giving people more iPhones before I spent so much on, say, multimillion-dollar drones and various elements of the defense budget. But again, that’s a conversation for another day.

Luigi: This brings us to the core of the discussion today, which is, how did we get here? Because you go to England, you go to Canada, you don’t hear about people being overwhelmed by the amount of debt they have. But you do hear it in the United States. And, honestly, I’ve been around enough to know that 20 or 30 years ago it was not such a big problem. It did exist, but it was not such a big problem. So, I think it’s important to understand how the problem has ballooned to this level in such a relatively short period of time. Remember, the numbers I said at the beginning were, we went from a quarter of a trillion to a trillion and a half in less than 15 years.

Kate: OK, so where to start? Well, federal student-lending programs were first established in 1958, and they were subsequently expanded several times, notably under the Higher Education Act of 1965. The main federal lending program today is the Federal Direct Loan Program, created by the Higher Education Amendments of 1992. And the way that this works is that loan limits are set by legislation, and loans can only be used to meet educational expenses like tuition and other costs of attendance.

Luigi: What happened very recently that led to the explosion of the amount of debt, is not so much that university tuition has become more expensive. It did, but that alone cannot explain the phenomenon. It is not that there has been a boom in attendance. The real reason is that there was a relaxation in the lending standards. Before 2006, you had to have more than 50 percent of your students enroll in no online or correspondence courses in order to qualify as a college for this federal program. The removal of this rule led to a sharp increase in the enrollment in for-profit institutions, most of them online. And those schools account for approximately one-third of the increase in new student-loan defaults between 2000 and 2010.

Kate: We talked a little bit about the legal history of the expansion of federal student loan programs, but still, does that address the question of why colleges have become so much more expensive?

Luigi: No, it does not, but I think that we should distinguish three factors. Factor number one is you see a dramatic increase in the sticker price of college. De facto, you also see a dramatic increase in grants that are reducing that cost. And I’ve not seen any serious study of this, because most of these grants are dark and they’re not disclosed, but my impression is that the real price, at least when it comes to business school, the real price has not gone up. It has been pretty flat in the last 10 years.

Luigi: The second issue is that the existence of subsidized loans does increase the cost of college. If you are in a sector where the supply is not perfectly elastic, and you increase demand, you inevitably increase the price. The third aspect, which is often ignored, and this is a bit more technical, but we know that increasing prices are very much dependent on the labor content of a product.

If you are producing computers, where you have incredibly large productivity gains, the price has dropped tremendously, in nominal terms, let alone in real terms. If you go into a profession where the productivity gains are not that big, and maybe that’s part of the problem, but we teach more or less like Socrates used to do. Maybe we have PowerPoints, but that’s the only invention in the last 2,500 years. I think that productivity has not increased, and as a result, the prices in nominal terms have to increase more than inflation. They have to increase in real terms. So, that’s one last reason why university tuition has increased so much.

Kate: Yeah, that last one is known colloquially as the Baumol hypothesis, right?

Luigi: Yes, it is. But I was trying to avoid the jargon.

Kate: I don’t know. I thought people might want to have that one in their back pocket.

Luigi: I don’t think that it’s called a hypothesis, I think it’s the Baumol theory, or Baumol something. It’s not a hypothesis. I think that there is evidence suggesting that’s the case.

Kate: Yeah. Baumol’s cost disease.

Luigi: Well done.

Kate: I’m not going to lie. You had mentioned this before the podcast, and I wasn’t very happy about it. Part of me is not happy to learn that when you expand federal subsidies, federal grant programs or loan programs to low-income students, that’s the cause, or part of the cause, of the increasing tuition. I wish I could disprove you, but unfortunately, this is what the majority of the research in this area finds. 

But Luigi, certainly there are elements that we’re missing here, right? Don’t you think it’s possible that universities, colleges, could be colluding, and that’s part of the reason for the tuition increase?

Luigi: I think that universities are very likely to collude on the price of teachers. We see remarkable similarities in the price of assistant professors at entry. And, as we know from economics, when you see identical prices, there could be two things. Either perfect competition or perfect collusion, and I suspect it is more the latter than the former. 

But I’m not so sure that there is such a gigantic sensibility to prices. So, if I were to discount massively, would I get many more students of the quality I want? Not necessarily. In fact, I would say that it is the opposite. One big question is why universities, especially the ones in high demand, have not expanded to provide the same product at a lower price. What we observe is that Harvard is turning away a lot of willing customers, and many of those of pretty high quality. So, it’s not like on the margin the guy they are not admitting is much worse than the guy they admitted.

They could admit probably three times as many students and not impact quality at all. The question is, why don’t they do it? And part of it is because Harvard Yard is so limited and they can’t expand it. No, you’re laughing, but I think it does play a role, because if they had to create a second campus, nobody would want to be on the second campus. It would be like a child of a lesser god. But the other part is that these are not-for-profit institutions. I think they are run with the interest of maximizing the benefits of the faculty, not with the interest of maximizing profits that will lead them to expand. Faculty don’t necessarily want a massive expansion, because that will lead to dilution of the faculty. But also, they don’t want a massive expansion of students, because they might be actually working more, God forbid. And then, so the result is that universities tend to restrict supply.

Kate: What do you do when you have this system where the demand for college education increases a lot? The good schools in your country refuse to expand the number of students they’re admitting. And then you have a bunch of for-profit schools that pop up. They exploit your grant subsidy program, to some extent exploit the students as well. What’s the solution?

Luigi: I think it needs to be a bit more complex than a political one-liner. Let’s start with what we already agree upon, that we should eliminate subsidies for for-profit institutions in terms of guaranteed loans. That would be a first step.

Kate: I think that the solution, when it comes to for-profit colleges, is pretty clear. We should just abolish them. They don’t necessarily make up the majority of degrees that are granted today. So, I think that people graduating from for-profit colleges account for 10 percent, something on that order, of people graduating with degrees in the United States. But still, 10 percent is a lot. It’s up significantly since 30 years ago. And as you pointed out, yeah, in some sense it’s like a direct transfer from the government to these for-profit colleges. If you’re guaranteeing the loans, and they just want to make as many profits as possible, then it’s a pretty clear business model. You just accept everybody and you try to exploit every penny out of them.

Luigi: Wait, wait, wait a second. I don’t think that they should be abolished. If I want to start a for-profit college, it’s a free country. I should be able to do it. The question is, why should I be subsidized to do it? Because, currently, as long as I have some accreditation … and, by the way, the accreditation is done by a board that many of the existing colleges are on. So, it’s basically like the fox in charge of the chicken coop. Once you have the accreditation, then you can have your students take out as many loans as they can, and those loans are guaranteed.

I think that if you are a for-profit college, you should take on the risk of your investment, at least part of the risk. So, if a student comes to me, the student takes a bunch of that. I, as a college, take the rest of that cost on my books, because I’m betting on the success of the students. And I can guarantee you that the quality of the education would go up, and the success rate of students would go up, and the amount of defaults would go down.

Kate: I guess I just have a more extreme view, which is that I just don’t think that they should exist at all. Certainly, they shouldn’t be eligible for federally subsidized grants.

Luigi: OK. We start from what we agree on and then let’s build on that, OK? I think we probably both agree that we should boost public universities. In my view, one of the unique features of the United States was an intense competition between good state universities and private institutions. And the two were both checking each other out, to some extent. The fact that you have a private alternative reduced the ability of the state to be too controlling of the university. But the existence of a good public option was keeping at bay the private institutions’ ability to price whatever number they wanted in terms of tuition. The University of California is a great example. Now, as we know, the funding for this has been going down, and the quality also has been going down, so I think that, rather than forgive student loans, I will go more in the direction of boosting public universities.

Kate: I agree with you on that one. Going back to the budget constraint conversation we had, if you have a fixed amount of money, and you can’t do all of the good stuff that you want to do, where should your first dollars be spent? I think that that’s probably it. Most states have pretty good state schools. We should be investing in making them even better and also expanding the number of students that they accept, that they’re able to accept. 

One of the objectives of the initial California plan was to focus on matriculation. And part of the reason that community colleges, in particular, really struggle is because not enough people finish school. It’s hard to convince people to stay in school when they’re racking up a lot of debt, when they could be making money as an alternative. So, I think that we should expand initiatives to keep people in school once they’ve started. And, similarly, follow other leads that have been successful.

Luigi: Yeah, but this is exactly the point. I think what we should try to do is create the incentives for people to succeed in education, not just to enroll in college, not just to get a degree. But actually to succeed in education and life. My proposals would be, on the one hand, as I said earlier, I think it would be good if some schools took on some of the risk of their graduates. That would be a way to motivate them to do better. But also, paradoxically, trying to create a market for so-called equity financing your investment in education instead of financing it all with debt that you have to repay no matter the outcome. You finance it with a fraction of your future income. And so, if you are super rich, you’re going to pay a lot. And if you’re super poor, you’re going to pay very little.

Kate: Isn’t that just indentured servitude?

Luigi: You are absolutely right that if pushed to an extreme, it does run against the 14th Amendment. However, there have been some early examples of contracts like this that have survived. I think that if you limit what is the amount … if you give up 100 percent of your future income, that’s indentured servitude, absolutely. But if it’s capped at 20 percent or 10 percent or 15 percent, I don’t think that will run against that limit. And I think it is a way to create an incentive for somebody else who financed you to support you and help you in the choices. Saying, “Look, you need to choose this program of school or studies, because this program will lead you to more success and better earnings in life.”

Kate: OK. But we know that if frictions are too overwhelming, if there’s too much of an information asymmetry or there’s too much moral hazard, then that market will break down. I think that this is an example of where there’s just too much. I mean, it’s too hard to verify cash flows, it’s too hard to verify the income that you’re making. But, perhaps more importantly, there’s a huge moral hazard component, which is that if you know that someone has an equity claim on your own personal earnings, then you can just take a pretty bad job for six months, default and then eliminate that equity stake.

Luigi: I disagree, Kate. First of all, in the United States, tax evasion on your income tax is relatively low, and even if you move out of the country, you still have to file a tax return. So, if you can share your 1040, then people know exactly how much you’re making. The cash flow is verifiable, especially over a long period of time. Yes, can you play around? If I say that you have to give me 10 percent of this year, but not next year’s income, on the margin you can play around. 

But if we’re talking about, you promise 10 percent of your income over the next 15 years, I don’t think there is a lot of unobservability there. And when it comes to moral hazard, do you really want to underwork for 15 years in order to penalize somebody that controls just 10 or 15 percent of your income? You have a choice of becoming an investment banker or a janitor, and you choose janitor in order to stick it to somebody who owns 10 percent of your future income? I doubt it.

Kate: Well, look, I’m sort of giving you a hard time about the idea of having a perpetual equity claim on an individual. I think a lot of people would just find that morally reprehensible, whether or not it makes financial sense.

Luigi: It’s not perpetual. I would say 10, 15, 20 years, not perpetual.

Kate: OK, Luigi, I still think that this is a pretty... I don’t know. This is coming out of left field, this proposal, at least relative to what the Democratic candidates are proposing. I personally think that if we had this sort of system, it wouldn’t be the type of system that would be available to everybody. Which is to say that the types of financial investors who are interested in taking equity stakes in people probably wouldn’t be doing that for people going to community college, but they would be doing it for people at the very high end for whom they have a big possible upside.

Luigi: Sorry, I disagree, because there is a startup here in the Chicago area that basically upgrades the skills of disadvantaged kids. What they do is they take mostly kids in poor neighborhoods, and they train them in some computer skills, and then they find them employment. And at the beginning, part of their salary is taken back by the company that trained them. The way they do it is, actually, they employ them themselves, and then they rent them out to these institutions or to these companies, and they get paid by these companies. And they are paid back only part of the salary. But that lasts for a couple of years, and then if they continue, they actually become fully employed by the ultimate employer. I think we should experiment. I’m not saying that this is the solution to all the problems, and I do know that there are some firms that are trying, but there’s a lot of resistance in that direction.

Kate: I think an interesting thought question is, what happens if nothing changes? What happens if the current debt level of $1.5 trillion of student debt just continues to stick around?

Luigi: There is a paper by my colleague Constantine Yannelis, looking at the history of the fluctuation of student loans. What he documents is that there are a lot of ups and downs in the amount of student loans that are driven mostly by regulation. So, when the regulation became more lax, you see a huge increase in the loans, and shortly after, you see a huge increase in defaults. Then, after that, you have a reaction, a political reaction. You have some restriction to the supply, you have fewer student loans, and then you have fewer defaults and things kind of level down.

Now, of course, the level has crept up dramatically in the last 10 or 15 years, so the problem of the adjustment would be more severe. But I think that this is not unique to student loans. We’ve seen that with the housing crisis. We’ve seen that with a lot of things where you have this boost in supply of loans, and then, when it becomes excessive, you have an adjustment. Now, the question we have is how painful this adjustment would be.

Kate: I’m a lot less technical than Constantine Yannelis, and so I like to think about it from an individual, anecdotal perspective. What happens to these borrowers? The issue is that there’s very different types of people, right? Let’s say you have someone graduating from Yale with $100,000 of debt. What are they going to do? Well, chances are they were restricted in what occupation they could take. Even if they wanted to become actors or writers, they probably couldn’t afford it. So, they’d probably have to do something that they don’t like to do for 10 years, maybe become consultants. They probably can’t purchase a house until they’re in their 40s and maybe they put off marriage for another couple of years, even though it’s hard for me to imagine that they would not get married at all. But yeah, I think it will eventually, for those types of people, have an effect on housing prices and also on birth rates in that strata.

What about the lower level? The lower end of the spectrum? If you went to a two-year college, if you dropped out after one year, you have $12,000 of debt, but you can’t get a job that pays you more than $18,000 a year. And then you have a kid. So, what are you going to do with that $12,000 of debt? They’re a good candidate for a hardship writeoff in bankruptcy. Some people can write them off, and especially if you went to a for-profit college that closed down, or if you can prove that you were somehow manipulated in your decision to go to college. There are exemptions where you can get that written off, even though I think Trump is trying to do away with them. I think there are options for them, but ultimately for both groups, it leads to a lot of hardship. It leads to a life of renting rather than owning. Oh, and then it leads to disillusionment with the system and radicalization.

Luigi: But I will make a big distinction between the two cases, in the sense that for the person who got $100,000 in loans because they went to Yale instead of going to University of Illinois, that’s a choice.

Kate: I mean, first of all, when you’re 17, 18 years old applying to college, you really don’t have that much choice. Especially if you have my Asian mother as I do. It was like, “These are the schools you’re applying to.” You have absolutely no autonomy. I had no idea what labor-market outcomes would be, what people got paid, what sort of jobs were available to me, what I was going to do in college. I mean, I think that kids are pretty in the dark about those things, and so I don’t think it’s fair to attribute all of the choice to them. And also, there’s a question of whether … yeah, you made a choice. Should you have to pay $18,000 when you graduate or should you have to pay $120,000 when you graduate? There’s a difference between something that’s a fair amount for any young person versus something that completely dictates the rest of your career set.

Luigi: You know, if you want to blame mothers, I’m always ready to do that. So, you have me on the same page.

Kate: Luigi and I both have overbearing mother problems.

Luigi: But this said, I think that maybe you should make the mothers pay. But no, more seriously, I think that we should make a lot of effort in trying to educate people.

Kate: Yeah. Jokes aside, I think that one thing that we both definitely agree on is that a lot of less-than-ideal college outcomes stem from less-than-ideal earlier school outcomes. High school, middle school, even elementary school. And it seems like we need to improve those in conjunction with any improvements to college if we really want a better-functioning educational system in the U.S.

Luigi: We all agree on that.