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Soaring Student Debt Prompts Calls for Relief

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Re: Soaring Student Debt Prompts Calls for Relief

#341

Post by wang_li »

viraptor wrote: post #188
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 pub…

> 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.

I'm pretty sure that absolutely no one anywhere tells their kid, go to Columbia University, live full time in Manhattan, take an extra three years to finish your bachelors, study pottery making, live entirely off of student loans. Aim for at least $400,000 in debt when you finish.

No one ever says that. Ever.

(As a random data point, the average student debt in 2015 was $35,000. That doesn't seem like an insurmountable bill.)

Re: Soaring Student Debt Prompts Calls for Relief

#342

Post by huherto »

tuna-piano wrote: post #241
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…

The other irony is that when college is paid for by taxes of the entire society, both those who went to college and those who didn't, the ones who didn't go to college end up paying for those who did. Net, it's literally a transfer from the non-college educated people to the college-educated people. Absolutely insane.

Even if they were not able to get a college education, their kids might. Also people who benefit the most for college will pay more. The productivity that society gains as a whole will offset the costs.

Re: Soaring Student Debt Prompts Calls for Relief

#343

Post by robohamburger »

I got a 2-year degree from a community college and then went to a cheaper university for CS. I would recommend it, especially if your grades are not the best or you don't have a ton of money.

My wife, on the other hand, is in another boat. She is studying vet med and has a pile of debt, and will likely be paying off her loans for most of her career.

Re: Soaring Student Debt Prompts Calls for Relief

#345

Post by tw04 »

leereeves wrote: post #137
tw04 wrote: post #116

Earlier quoted context omitted.

>>...fer instance: "Here's what 10$ an hour looks like! Had to put in my 2 weeks." And pretty much every reply is "I make way more than that, what are you thinking??" I'd imagine the guy either doesn't know how to show up consistently and on-time, or has such a severe lack of social skills that he can't properly interview for a job. If you can weld like that and can't find a job making more than $10/hr you are doing…

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

My parents retired from teaching making roughly that both with masters degree plus max credits. Either that's a good wage or we grossly underpay our "overpaid" teachers.

Re: Soaring Student Debt Prompts Calls for Relief

#346

Post by Jimmy »

dragonwriter wrote: post #259
deegles wrote: post #200

Earlier quoted context omitted.

How would one repossess an education? Isn't that the reason student loans are not dischargeable?

> How would one repossess an education? You can't. > Isn't that the reason student loans are not dischargeable? No. First, student loans are, in fact, dischargeable, though there is a higher bar to discharging them. So expalanations of why they are not dischargeable are unnecessary (and necessarily incorrect.) But, more to the point, unsecured loans in general are dischargeable without the heightened requirements tha…

>>How would one repossess an education?

>You can't.

Yet. ;)

Re: Soaring Student Debt Prompts Calls for Relief

#347

Post by skybrian »

nstj wrote: post #277
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.

What does this have to do with the velocity of money? If the students continue to pay off their debt then the money flows to their creditors, who will use put it to work in the economy. If the debt is forgiven then it won't go to their creditors and will instead go to those who had student loans who will similarly spend it. Is there another reason that forgiving student loans improves the health of an economy?

The spending isn't necessarily the same. Here's a hypothesis: people who aren't well off will buy stuff they need and therefore spend money more readily than banks that will only spend on fairly safe, profitable investments. There are lots of investors looking for safe investments and this seems more supply-limited than demand-limited (yields are low due to competition).

Of course you'd need a real economist to do a study to find out if that's actually true.

Re: Soaring Student Debt Prompts Calls for Relief

#348

Post by toomuchtodo »

dragonwriter wrote: post #308
toomuchtodo wrote: post #185

Earlier quoted context omitted.

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 chea…

> Federal Reserve attempts to stoke inflation in order for the economy to reach full employment No, the Federal Reserve attempts to provide easy money to spur employment, balancing that goal against the competing goal of controlling inflation. The Fed does not try to stoke inflation to drive employment (especially since inflation doesn't drive employment, though employment can help drive inflation.)

You're right, I misspoke. The Federal Reserve, through its mandate to obtain full employment conditions, creates inflation as a side effect.

Re: Soaring Student Debt Prompts Calls for Relief

#349

Post by ArkyBeagle »

nstj wrote: post #333
ArkyBeagle wrote: post #292

Earlier quoted context omitted.

For a student, they can either spend money on educational debt service or they can buy other things. "Buy other things" presumably increases monetary velocity.

But if the investor receives the cash from the student as payment of their loan, they have to do something with that cash too (buy dinner at Per Se, grab a new Vertu phone, lend the money to a startup so that the startup can spend the money on consuming goods and services, etc)

Presumably, the Fed will send new money to Treasury for this, which will actually inflate the currency just a wee smidgen ( and in an economy in which the Fed's growth targets go chronically unmet this is no sin - quite the opposite).

Otherwise...

While there is an element of truth to that, see "the marginal value of a dollar". You "spend" your ten millionth dollar quite differently than you spend your ten thousandth.

Some of these guys for whom money is simply a means of keeping score won't change their consumption patterns much no matter what.

If you want to increase velocity, the way to do it is cause more cash to be in the hands of broke people.

Re: Soaring Student Debt Prompts Calls for Relief

#350

Post by GunboatDiplomat »

deegles wrote: post #200
morgante wrote: post #199

Earlier quoted context omitted.

> Same reason we let people walk away from homes (or not walk away, simply not be able to afford them) Like I said in my comment, I recognize that there needs to be some option for people who can't possibly repay their student loans. Defaulting on your mortgage is not consequence-free: you lose your home and hurt your credit. We don't let people just forgive their mortgages and keep their homes without hurting their…

How would one repossess an education? Isn't that the reason student loans are not dischargeable?

Make them hand back their diploma, strip their name from all documentation of ever having gone to the school, bar them from referencing their degree in any way.
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