As I've written about before, Democratic presidential candidate Sen. Bernie Sanders (I-VT) refuses to learn basic economic concepts and is keen to demonstrate his lack-of-knowledge via tweets designed to outrage the voting population.
For instance, Sanders tweeted this on Wednesday, demanding that public colleges be free, and interest rates be lowered on student loans:
We must not only make public colleges and universities tuition free, we must also substantially lower interest rates on college debt.
— Bernie Sanders (@BernieSanders) December 31, 2015This isn't Sanders' first tweet discussing interest rates on student loans. In what was dubbed the "most economically illiterate tweet ever," he expressed outrage that houses could be refinanced at a lower rate than student debt.
Interest rates are higher on student loans because it's an unsecured debt. Unlike a house, a brain cannot be repossessed by a bank if the person who took out the loan stops paying. It's a riskier loan for the bank to give, so rates are higher by necessity--this is how banking works.
While places like Germany have free college education, their system is drastically different to colleges Americans are familiar with. In Germany, students are accepted into degree programs, and there's none of the cushy amenities that American students have grown accustomed to. While the education is still top notch, comparing the college experiences in Germany and the U.S. is like comparing apples to oranges.
An easy way for universities to pare down tuition costs would be to stop hiring expensive, often useless, administrators and to stop building ridiculous amenities (rock walls, water parks, student unions that resemble hotels) that don't actually improve the quality of an education. Of course, this isn't going to happen.
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