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Soaring Student Debt Prompts Calls for Relief

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Re: Soaring Student Debt Prompts Calls for Relief

#181

Post by morgante »

atombath wrote: post #28
NikolaeVarius wrote: post #3

If this happens, do I get benefits on the debt I've already paid off? I would be pretty pissed if I didn't. I worked my ass off to pay my loans.

I understand that feeling... I'm nearing the end of my loans and dropped $3k on one of them yesterday. I would have rather had a vacation if it's just going to vanish! ...but don't get salty because the debt won't vanish. I have no doubt that if an education loan is forgiven, it WILL affect that persons credit rating. Much like when a debt is forgiven/charged-off. Also, charge-offs are typically treated as a form of…

> Also, charge-offs are typically treated as a form of taxable income

That's not much consolation. I wouldn't be happy if the government decided to simply pay people for making poor financial decisions, even if we recovered x% of those payments through taxes.

I'd still be paying for it with my massively higher taxes.

Just get the government out of the student loan industry. Let the market signal which degrees are valuable and allow students to discharge through bankruptcy (but ruin their credit).

Re: Soaring Student Debt Prompts Calls for Relief

#182

Post by bsbechtel »

toomuchtodo wrote: post #180
morgante wrote: post #176

Am I the only one who hates the notion of being forced to pay for other people's bad financial decisions? I made the choice to go to a slightly less prestigious school so I wouldn't have to go into debt for college. I also worked all through college to pay for my expenses. Should I now be punished for that decision? Why should we make people's financial mistakes consequence-free? I think the government should get out…

TL;DR The health of the economy is more important than your moral high ground. Same reason we let people walk away from homes (or not walk away, simply not be able to afford them), but we'll still give them a mortgage 3 years after their foreclosure; the economy needs the monetary velocity to survive.

>>When the Fed could just poof more money into existence?

I hope you realize it doesn't quite work like that.

Re: Soaring Student Debt Prompts Calls for Relief

#183

Post by lawnchair_larry »

logfromblammo wrote: post #122
gxs wrote: post #97

I'm really torn on this for the same reason I'm torn on what to do with the people in jail for marijuana offenses: On the one hand, yes what's happening is wrong. On the other hand, you CHOSE to go into debt knowing that you would have to repay it after you graduated. Just like people who CHOSE to deal marijuana KNEW it is illegal. Disagreeing with the law doesn't entitle you to break it. Similarly, disagreeing with…

You are correct. Disagreeing with the law obligates you to break it. Or at least it does according to Thoreau, Jefferson, Gandhi, ML King Jr, et al. But the difference between a law and a promissory note is that the legislature didn't get your explicit approval before passing the law. The promissory note has your signature on it, under a promise that you made to pay a certain amount at a certain time in exchange for…

This is kind of bullshit.

The problem is assuming that borrowers are fiscally competent. We know this to be false, even among home buyers. 18 year olds, who have every adult that they trust telling them they must go to college and take these loans, don't stand a chance.

The loan industry not only knows this, but they optimize the system to capitalize on it. I don't think the student was represented when laws were passed to prevent discharges in bankruptcy.

A professional loan officer just has to fool some kid one time, and closing that 15 minute deal often destroys that kid's entire adult life.

We provide Donald Fucking Trump more protections from financial disasters than well-meaning students who have never had a loan or investment in their life.

Coincidentally, he is one of the many who are exploiting this system, with Trump University existing for little other purpose than siphoning this taxpayer-guaranteed free money.

Then when the cards inevitably collapse, half of the population eats up the propaganda about "personal responsibility".

Personal Responsibility would be not taking idiotic risks and getting the government to pay for it.

I can assure you that approximately zero students took out loans thinking they wouldn't be able to repay them. But we know the lenders knew better, because they won't give out these loans without a cosigner and/or a government guarantee.

Re: Soaring Student Debt Prompts Calls for Relief

#184

Post by jonahrd »

morgante wrote: post #176

Am I the only one who hates the notion of being forced to pay for other people's bad financial decisions? I made the choice to go to a slightly less prestigious school so I wouldn't have to go into debt for college. I also worked all through college to pay for my expenses. Should I now be punished for that decision? Why should we make people's financial mistakes consequence-free? I think the government should get out…

You may be right that it's a poor financial decision, but I still hope to one day live in a country where people can pursue education in any subject matter (not just STEM/other money makers) for the pure purpose of educational fulfillment. That can only be done with a system that helps pay for education instead of letting the market decide which degrees are most valuable in terms of pure capitalistic measures

Re: Soaring Student Debt Prompts Calls for Relief

#185

Post by toomuchtodo »

bsbechtel wrote: post #182
toomuchtodo wrote: post #180

Earlier quoted context omitted.

TL;DR The health of the economy is more important than your moral high ground. Same reason we let people walk away from homes (or not walk away, simply not be able to afford them), but we'll still give them a mortgage 3 years after their foreclosure; the economy needs the monetary velocity to survive.

>>When the Fed could just poof more money into existence? I hope you realize it doesn't quite work like that.

I removed that part because it wasn't relevant, but it does work exactly that way. The Federal Reserve simply credits the bank's reserve account from thin air.

Fiat currency is a shared delusion of value with invisible hands exerting forces to enforce certain behaviors (the Federal Reserve attempts to stoke inflation in order for the economy to reach full employment, arguably unsuccessfully, while technology and cheap Chinese labor is having enormous deflationary effects, with the result being real estate and equities turning yet again into asset bubbles); never be fooled that we're somehow "losing" value by forgiving debts at the national government level.

Re: Soaring Student Debt Prompts Calls for Relief

#186

Post by morgante »

Salgat wrote: post #173
dragthor wrote: post #5

Earlier quoted context omitted.

My wife and I worked and sacrificed to pay our student loans off. Struggle builds character, appreciation, and gratitude.

Same here! However, there is a line to draw on how much debt to put on someone. I know people who have tuition payments cutting into their living wages, affecting their ability to have even the basic necessities. There is nothing good about this unnecessary suffering, having to worry if you will still be able to afford a meal or a roof over your head.

> However, there is a line to draw on how much debt to put on someone.

Yes, people should decide how much debt they want to take on.

There are vast differences in the value of different degrees (cost and earnings). It's people's responsibility to educate themselves. The rest of us shouldn't have to subsidize someone's terrible decision to go into debt for a degree in basket-weaving.

Re: Soaring Student Debt Prompts Calls for Relief

#187

Post by leereeves »

ams6110 wrote: post #165
leereeves wrote: post #137

Earlier quoted context omitted.

> "I make way more than that, what are you thinking??" Way more than that being $30/hour = $60K per year.

Most of my neighbors are "blue collar" entrepreneurs who started in trade jobs and eventually founded their own construction, electrical, or plumbing contracting companies. Most of them make way more money than software developers. Well into the six-figure scale.

Yes, those who start a successful company make great money. Most don't.

Re: Soaring Student Debt Prompts Calls for Relief

#188

Post by viraptor »

morgante wrote: post #176

Am I the only one who hates the notion of being forced to pay for other people's bad financial decisions? I made the choice to go to a slightly less prestigious school so I wouldn't have to go into debt for college. I also worked all through college to pay for my expenses. Should I now be punished for that decision? Why should we make people's financial mistakes consequence-free? I think the government should get out…

I agree with the conclusion, but:

> other people's bad financial decisions?

This is different than someone taking a bad loan on their own. This is the case of your parents and grandparents, your government, the schools, the newspapers, etc. all effectively telling you that it's a good idea to invest in education. So good that in a country that loves its liberties and independence so much people will fight against public health care, the government will do the work to guarantee that you can get your education loan.

Surely they can't be all wrong... I cannot honestly blame people for believing the lie in this case.

Re: Soaring Student Debt Prompts Calls for Relief

#189

Post by ghaff »

pwthornton wrote: post #164
icehawk219 wrote: post #10

Part of the problem is that the last few generations have been told the same thing: blue collar jobs aren't "good" jobs. You need to go to college so you can get a "good" job sitting at a desk because those other jobs are below you. If you take one of those blue collar jobs then you've failed and aren't "achieving your potential". The grand irony in all of this is that the people who did go on to become plumbers, ele…

Blue collar employment has been falling in this country, replaced by either knowledge work -- which usually requires further education -- or service industry jobs. If there were truly huge demand for many of these professions, pay would be skyrocketing, encouraging more and more people to go into these professions. I agree that there are and will continue to be good skilled trade jobs and many people would be better…

OTOH, I've been trying to get a bathroom remodel done for about 18 months at this point. (Hopefully about to start.) It's 1.) Not cheap and 2.) Isn't about to be done by a robot.

Not for everyone obviously and it's not big pay but I know what I pay contractors and it's nowhere near minimum wage.

Re: Soaring Student Debt Prompts Calls for Relief

#190

Post by Broken_Hippo »

forrestthewoods wrote: post #75
dv_dt wrote: post #50

Earlier quoted context omitted.

The education market won't fix itself because students are not in a sufficiently secure bargaining position where they (collectively) can make an informed decision that corrects the market.

What? How is the education loan market any different than the automobile or home loan market with respect bargaining position and ability to make an informed decision? Loan issuers are forced to issue loans without regard to the likelihood those loans will be paid back. Someone seeking a computer science degree from Stanford is treated the same as someone getting an English degree from a 4th tier state school. That's…

First of all, most education loans are handled by the government. Most students can't qualify for normal private loans due to little things like lack of credit history. There is really no way to tell if a 17-18 year old just legal enough to get a loan will be able to pay it back in 4-8 years after completing their education. This is why the government backed loans are issued in this manner. most middle to low income students need these loans to go to school. Private student loans, however, usually have a cosigner with good credit.

Second, students don't get much choice in loans with the government-backed loans. There really is no 'market' for the student to shop, nor does the student have bargaining power except for refusal to accept the loan. With automobile or home loans, one can do things like have a larger down payment, shop aroudn for interest rates, or improve their credit rating. Students have none of these options.

Third, informed decision? You get promised for years as a young person that college is the key to having a comfortable life. The university promises all sorts of possible careers with the degree, and quotes numbers that may or may not be true.

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