Fun on Friday: What? A Free iPad? I Didn’t Get Squat!

I was perusing my local newspaper’s website the other day when I came across this headline – “University of Kentucky to Give iPads to All Incoming Freshman This Fall.”

I have to admit, just seeing the headline kind of annoyed me. Because you know what I got when I started at UK as a freshman in 1985?

Nothing.

I didn’t get squat!

I have a friend who went to UK about a decade after me. She was a little miffed about the free iPads too. She said all she got was a T-shirt.

I didn’t even get a T-shirt. What’s up with that?

According to the article, the iPad distribution is part of a partnership between the University of Kentucky and Apple. The university will fork over about $1.5 million for 5,900 iPads.

I was just curious, so I did the math. That comes to about $254.24 per iPad. This brings us to the first problem. I did a Google search and found the latest 32GB iPad model available on the Walmart website for $249.

Ummm – y’all are getting hosed on your partnership. Maybe the trustees should just make a Walmart run?

But who cares, really. The iPads are free, right? At least from the student’s point of view. We can’t argue with free, now can we? Heck, a lot of students think the whole university experience should be free. So, I guess an iPad is a start.

Except that it’s not free. Somebody has to pay for it and that somebody will be the students.

People wonder why the cost of college is going up and up and up. Well, there ya go. Free iPads and stuff.

But while we complain about the rising cost of college, it’s not stopping anybody from going. Kids just take out nice fat loans, grab their free iPads and they’re on the path to educational success!

Or something.

Here’s the dirty little secret — Universities are flush with cash thanks to the infusion of student loan money. With all of those dollars available backed by the good name of Uncle Sam, schools are competing for students and all the student loan dollars that come with them. Schools have to one-up each other with amenities to attract the brightest and best  – or whoever can get a loan. As a result, kids today get a much more luxurious university experience than I could have ever imagined — now complete with “free” iPads.

Just consider student housing. We lived in concrete block dorms two to a cell and shared communal showers. Just a couple of years ago, the UK shut down the last of those dorms.

“Ninety-three percent of our freshman have never shared a room, so the demand just isn’t there,” UK’s housing project implementation director Penny Cox said at the time. “There are very few students who want to live in those kinds of buildings.”

And what the kids want, by-god the kids get.

Over the last several years, the university has built a number of new dorm complexes. They feature 7,000 private bedrooms. Because, you know, little Suzie and Johnny need their privacy. They might not be able to study with a pesky roommate lurking about. These dorms come complete with features like Tempur Sealy mattresses. When I was in college, we slept on lumps of foam. And we liked it that way.

Oh, and let’s not forget the granite countertops. I’m not kidding. There is a dorm complex at the University of Kentucky with granite countertops. I’m 52 years old. I’ve never even had granite counter tops in my house.

But, you gotta have the best if you want them to come. So, universities are spending billions on luxury housing and iPads.

In fact, the more money the government throws at universities, the more creative they get at spending it. Tuition has skyrocketed over the last couple of decades. This is basic economics. Student loans increase the demand for the college experience. Prices rise.

Millions of Americans are saddled with student loan debt.  The Department of Education says 43% of those government-backed loans are considered “in distress.” But hey, the kids have got to be able to stream Netflix in private while they earn those Women’s Studies degrees.

A paper published by the National Bureau of Economic Research in 2015 found that a large percentage of the increase in college tuition can be explained by increases in the amount of available financial aid. And as schools have tried to entice kids to spend those student loan dollars at their institutions, we’ve ended up with $1 billion dorm complexes, fitness facilities fit for pro athletes, and state of the art student centers.

Fun on Friday is a weekly SchiffGold feature. We dig up some of the off-the-wall and off-beat stories relating to precious metals and the economy and share them with you – with tongue firmly planted in cheek. Click here to read other posts in this series.

Get Peter Schiff’s most important Gold headlines once per week – click here – for a free subscription to his exclusive weekly email updates.
Interested in learning how to buy gold and buy silver?
Call 1-888-GOLD-160 and speak with a Precious Metals Specialist today!