32% Inflation in UCLA Tuition Causes Near Riots (14 Arrested, 1 Tasered)
This is HUGE. This is why:
Recession Still Causing Trouble for States
Although the recovery package is mitigating states’ fiscal problems, states are continuing to cut services like education and health care as they implement 2010 budgets. Additional cuts are likely for 2011. To date at least 42 states have addressed their shortfalls by reducing services to their residents, including some of their most vulnerable families and individuals. Cuts to state services not only harm vulnerable residents but also worsen the recession by reducing overall economic activity.
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At least 48 states addressed or are facing shortfalls in their budgets for the new fiscal year totaling $190 billion or 28 percent of state budgets.
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To keep pace with the cost of services, state revenues must grow. But overall revenues last year were essentially flat and have weakened dramatically this year. The U.S. Census Bureau reports state tax collections fell 17 percent in the second quarter of 2009 compared with last year — the worst decline ever.Sales taxes are the largest source of state tax revenue, and they are declining due to the fall in both personal consumption and business purchases. Income taxes and other taxes are also falling as wages and investment income decline. According to the U.S. Census Bureau, income tax collections during the second quarter of this year fell by 28 percent compared to the same period last year. Continued job losses will depress revenues further.
Basically, all state funded education institutions are looking down the barrel of this gun. This could be further exasperated by any corrections in the market that impact school endowments.
The point is that all institutions, companies, and individuals need to scale back. Our wealth is evaporating. It is being squandered on failed bailouts to failed companies. These actions are not creating jobs and this directly affects those in higher education because when the students are done with school... there are no places left for them except back home. Is an education worth it at this point? Being straddled with student debt for the next 30 years is not going to create wealth in the US.
This is just the beginning people. Things can only get worse as our dollar is intentionally or unintentionally devalued.
If the federal government decided tomorrow that it won't be paying interest on its own debt money to the Federal Reserve, there would be enough cash for US government to finance all the state deficits twice over without any impact. We could also stop these pointless wars (Iraq, Afghanistan, Drugs, etc) and pay for the state deficits 6-10 times over without having to monetize the gap. Also, instead of supporting fascism in America, would could let capitalism run free and let failed companies actually fail like they are supposed to. That bailout money could have financed state deficits 6-8 times over. If you use the real projections of $10 trillion that would be 100 times over.
What do we have to show for the bailouts? Well, a good number of those companies are going bad again and rightly so... their failed business model was never fixed with the bailouts. They only got some limited life support. The rest of us get our daily prozac from TV. Awesome.
Mean while, we are trying to stop the actual, and direly needed, correction. If it takes a depression to fix things then I'm all for it. The longer we put off the pain the worse it will be. If Greenspan stopped making bubbles in the 90s then that resulting recession would have been worse but we wouldn't be in this situation.
So, my heart goes out to the students at UCLA... and, soon, all the students in America.