My discussion group last night was mostly about the value of getting a higher education. Everyone but me was advocating getting as much education as possible even though these days it means going into deep debt to do so. These people didn’t discriminate between two years in a community college plus two years in a state college, versus four years at a top school, like Harvard, MIT, Stanford, or Cal Berkeley. They were of the opinion that the total of four years in any college was equivalent, and I didn’t make much attempt to argue that point, but limited my comments to such things as coming out of Harvard and the local college with a huge personal debt doesn’t promise the same likelihood of a wholesome economic future.

The group opinion was that knowing the material was all that mattered. I would agree to some extent, but the intellectual material that is bred into the two groups of graduates isn’t equivalent. I asserted that the top-school graduates would have the mental material and attitudes to become members of the wealthy ruling class, and on their way to becoming part of the hated 1% who own everything. I asserted that the four-year graduates they were cultivating were on the certain route to being members of the 99%, slave class, who would remain behind the curve of economic debt for most of their lives, and very few would become directors of their own destiny.

Graduating from a secondary college with a debt and forced to work at a restaurant to pay off the monthly student loan debt, isn’t the same as taking an internship as a page in Congress, or on Wall Street. Both are entry-level positions, but one leads to responsibility and prosperity, and the other leads into buying a new car and new house and a life of permanent debt.

Of course few people can get into a top institution that leads to an upper-class life, so what is the alternate route? I assert that going into debt is a poor choice for an average student, and that having a strategy of avoiding debt is a better route to a comfortable life. American society is moving away from a middle class of homeowners into a two class system where there are owners and debtors, toward one where there are aristocrats and slaves. You can be a relatively poor owner, and a relatively rich slave, and it all depends on debt. Those who are in debt are in the slave class, and the bigger the debt the greater the pressure of loss if you fail in any way to make your payments.

My policy is looking forward from age twenty to age seventy, and designing one’s fifty years of working life in such a way as to always be out of debt. One of the most oppressive forms of debt is housing rent, because it puts the person in a position of always being forced to move on if anything changes. Fifty years of rent will have paid for the place one is living in three times over; thus the best policy is to buy the very cheapest livable place possible and wholly own it at the very earliest moment. When you own your residence you can then improve it, and every penny is money invested that can probably be gotten back when the property is sold. Whereas every penny spent on rent is gone forever. There is a double payment here, because you have your unspent rent money in your pocket, and you have that rent value put into your home which makes it that much more valuable  when you sell. Make enough money over the sale price to totally cover the price of your next home.

Okay, four years later the college graduate is in a better position to make money, but in a world with lots of debt-ridden college graduates the job market will be depressed. My homeowner will have four years of rent in his pocket and a small house mostly paid for, and he is moving into the debt-free owner class, whereas the college graduate is entering into the slave class while in serious debt. Four more years down the road the college grad is probably still in debt, while living in a rental apartment, and driving a new leased car which he needs to keep up his appearances of prosperity. Our other guy is now living in a wholly owned middle-class home, and probably still driving a used older car, because he has no need to keep up appearances.

When you graduate from high school, if you can’t go to a top university become a small home owner.