Student Loan Debt Is Now as Big as the U.S. Junk Bond Market • Hacker News Board

Re: Student Loan Debt Is Now as Big as the U.S. Junk Bond Market

#101

Post by [deleted] » Tue, Dec 05, 2017, 5:27 PM UTC

godelski wrote: post #65

jedberg wrote: post #22

There is definitely an education bubble. It's way too easy to get money for college. You hear a lot of stories about the increasing costs of college and crushing debt on graduation, but you don't hear a lot of stories of "I wanted to go to college but couldn't get a loan". Almost everyone gets approved, regardless of their future ability to pay it back. We need a fundamental shift in the way college is paid for. Some…

The problem I really see is that we've dug ourselves a big hole. The safety net created for the banks were done to ensure that everyone could get a loan. Banks were "worried" that people would default on their student loans and run away with the money, even though this hasn't happened or is really rare. There was an unfortunate side effect that this incentivized banks to give out riskier loans. Couple that with telli…

[deleted]

Re: Student Loan Debt Is Now as Big as the U.S. Junk Bond Market

#102

Post by jMyles » Tue, Dec 05, 2017, 5:27 PM UTC

jedberg wrote: post #22

There is definitely an education bubble. It's way too easy to get money for college. You hear a lot of stories about the increasing costs of college and crushing debt on graduation, but you don't hear a lot of stories of "I wanted to go to college but couldn't get a loan". Almost everyone gets approved, regardless of their future ability to pay it back. We need a fundamental shift in the way college is paid for. Some…

> learning a trade or skill instead of four years doing something hate for a useless degree they'll never use.

The two aren't mutually exclusive.

In a compassionate society, we'll encourage people to pursue art or music or mathematics or dance and plumbing or auto repair.

There are enough educational resources to go around; our economy just hasn't found the right shape to make good use of them.

Re: Student Loan Debt Is Now as Big as the U.S. Junk Bond Market

#103

Post by kajecounterhack » Tue, Dec 05, 2017, 5:29 PM UTC

ProAm wrote: post #76

murph-almighty wrote: post #38

Earlier quoted context omitted.

> you'd probably see a lot more STEM degrees and a lot fewer of everything else I honestly think art schools are going to start running into problems convincing people it's a good idea to pay 60k a year for minimal ROI. My cousin wants to go into stage drama, and I don't want to tell her to not pursue her dream, but I think it's a lot to ask her to put herself in debt for years for a piece of paper that says she can…

Education doesn't always need to have an ROI, sometimes it's just worth what you spend on it.

The vast majority of folks can't afford something that expensive without an ROI. What's being discussed here is how our current system encourages getting into debt for it and how that's negative for our society.

Re: Student Loan Debt Is Now as Big as the U.S. Junk Bond Market

#104

Post by workthrowaway27 » Tue, Dec 05, 2017, 5:31 PM UTC

JonFish85 wrote: post #79

To me, this is another implementation of the housing bubble: - People see college graduates making a lot of money - Politicians make it a priority to make it easier for people to get loans to go to college - More people take out loans to go to college - Colleges realize there is no downward pressure on price and raise tuition. - Politicians continue to make it easy for people to go to college - People take bigger loa…

But as far as I know student loans aren't securitized and leveraged in the same way as mortgages were, so I'm not sure that the fall out will be as bad.

The root problem (as others have noted) is too many people are encouraged to go to college and even though most majors don't make economic sense students (rightly) feel that they need a college degree to be a competitive applicant for good jobs. Maybe I'm just in an ideological bubble, but it seems like there's pretty good agreement on this issue, but no real way to do anything about it.

Re: Student Loan Debt Is Now as Big as the U.S. Junk Bond Market

#105

Post by lazyasciiart » Tue, Dec 05, 2017, 5:31 PM UTC

ardit33 wrote: post #87

cloakandswagger wrote: post #63

Earlier quoted context omitted.

> We have too many people thinking it's okay to discredit scientists and scholars because they don't understand how research works. And a similar number of people who elevate science to the level of religion, marching in its name and developing a brand of hero worship for scientists when they too know nothing at all about the scientific process. Both are forms of anti-intellectualism that are growing in our polarized…

Say what? I'd say a "propper scientist" will know about the "scientific process" pretty well. Sure, there are plenty of pseudo scientists out there that promote their political or economic agendas, but you can't discredit all science because of that. Right now "hard" science is the best way to explain things around us and the universe. Sure, often it is wrong as new science gets discovered, but that's how human knowl…

I think the sentence is meant as 'too many people who don't understand research and are therefore willing to discredit scientists'

Re: Student Loan Debt Is Now as Big as the U.S. Junk Bond Market

#106

Post by crocal » Tue, Dec 05, 2017, 5:32 PM UTC

jackweirdy wrote: post #68

jedberg wrote: post #22

There is definitely an education bubble. It's way too easy to get money for college. You hear a lot of stories about the increasing costs of college and crushing debt on graduation, but you don't hear a lot of stories of "I wanted to go to college but couldn't get a loan". Almost everyone gets approved, regardless of their future ability to pay it back. We need a fundamental shift in the way college is paid for. Some…

> Another solution is to let you go to school for free and then pay a percent of all your future earnings back to your college, or at least into a pool that pays for the next generation's college. We could call it income tax :)

Nah, let’s find some flashy Valley name for the concept and disrupt the market.

Re: Student Loan Debt Is Now as Big as the U.S. Junk Bond Market

#107

Post by godelski » Tue, Dec 05, 2017, 5:32 PM UTC

bluGill wrote: post #93

godelski wrote: post #65

Earlier quoted context omitted.

The problem I really see is that we've dug ourselves a big hole. The safety net created for the banks were done to ensure that everyone could get a loan. Banks were "worried" that people would default on their student loans and run away with the money, even though this hasn't happened or is really rare. There was an unfortunate side effect that this incentivized banks to give out riskier loans. Couple that with telli…

I'm working with an idea that you can go bankrupt on student loans, but in doing so you lose the degree - including all rights to a job that might use the degree. There are a ton of things I haven't figure out (follow my post history for more detail on what I have)

While that is an interesting idea I see two major problems with that. 1) It doesn't really encourage colleges to decrease the price of college. 2) Degrees matter little when you compare to knowledge. You can clearly say on your application to a job that you graduated but your degree was revoked. What does the company care? You didn't lose the experience and education, only the paper.

Re: Student Loan Debt Is Now as Big as the U.S. Junk Bond Market

#108

Post by simias » Tue, Dec 05, 2017, 5:33 PM UTC

cloakandswagger wrote: post #63

umbrellathorn wrote: post #51

Earlier quoted context omitted.

> for a useless degree they'll never use I went to school for such a degree. While I don't use it in my day to day now, I still consider it priceless. There's some inherent value added to a person who pursues to study a bit of humanities, history, philosophy and art in college apart from their major. Scholarly work really helps shape the way you look at life for the better. Part of this is that you really understand…

> We have too many people thinking it's okay to discredit scientists and scholars because they don't understand how research works. And a similar number of people who elevate science to the level of religion, marching in its name and developing a brand of hero worship for scientists when they too know nothing at all about the scientific process. Both are forms of anti-intellectualism that are growing in our polarized…

"A similar number of people" developing a brand of hero worship for scientists? Maybe I'm hugely biased but that doesn't really mirror what I see online and elsewhere.

Are you telling me that for every climate change denier, for every anti-vaxxer, for every creationist, for every chemtrail/tap water/moon landing/flat earth conspiracy theorist there's a rabid scientist who elevates the current scientific consensus to the level of religion?

That's borderline whataboutism IMO.

Re: Student Loan Debt Is Now as Big as the U.S. Junk Bond Market

#109

Post by [deleted] » Tue, Dec 05, 2017, 5:33 PM UTC

[deleted]

Re: Student Loan Debt Is Now as Big as the U.S. Junk Bond Market

#110

Post by WkndTriathlete » Tue, Dec 05, 2017, 5:34 PM UTC

JonFish85 wrote: post #86

toomuchtodo wrote: post #66

Earlier quoted context omitted.

> Don't worry, your salary gives them a way out too. And I'm not just saying that to be snarky, I think it's very likely what will end up happening: you'll end up paying for their poor choices one way or another. If it's not directly via taxes to pay off their student loans, it'll fund their retirement. Social Security benefits, without any other retirement savings, puts you right around poverty level. I would not co…

I'm not thinking just SS. Imagine in 30-40 years when SW engineers are retiring with their $5m 401k, but their neighbor is still barely making rent at their service-level job. I imagine there are many more people who have foregone retirement savings to pay off their massive college loans. Politically, the story would be something like this: why should you, a multi-millionaire SW engineer who hasn't paid taxes on your…

Strangely enough that proposal was floated around in earlier versions of the currently proposed tax bill: the 401(k) yearly contribution cap was going to drop from $18,000/year to $2,400/year. That would have driven savings into Roth 401(k)s/Roth IRAs so that the tax income would be realized sooner rather than later.

I currently save at a 50/50 mix of 401(k)/Roth 401(k) just in case the scenario you described comes true. I expect that as I age I'll contribute more post-tax dollars to my Roth and fewer to my 401(k).