“Investing” in Students–As Long as They’re Good Wage Earners!

How could I not comment on this idea!  http://www.insidehighered.com/news/2012/05/03/plan-floated-britain-investors-pay-tuition-and-students-repay-based-income —

Under the plan, a student would sign a contract with a special purpose company, acting for a university or group of universities, to repay a fixed percentage of their earnings over a set number of years. Banks would package the graduate contracts and sell them on to investors, particularly pension funds.

“The sale proceeds will vary based on the market’s perception of the future earnings potential of the group of students,”

Of course this works for investors as long as they somehow can identify students worth the “risk.”  Hmmm.  But it does appear to guarantee employment – with what the British refer to as “special purpose” companies.

Would U.S. investors buy this idea? Would academic institutions on this side of this side of the pond approve of this novel marketing of their degrees?

 

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