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Student Loans a Lot Like the Subprime Mortgage Debacle, Watchdog Says

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Re: Student Loans a Lot Like the Subprime Mortgage Debacle, Watchdog Says

#211

Post by frockington1 »

CathedralBorrow wrote: post #141
ponsin wrote: post #94

Earlier quoted context omitted.

"Education" is necessary up to a certain point. In America, up to highschool education is free and for the most part required. Why draw the line at a bachelors degree? Should Masters and PhDs be free and partially required? Based on how I framed the question I assume that you can tell that I draw the line at highschool education. I can however see the argument for raising it to bachelor's. However I would expect the…

> Based on how I framed the question I assume that you can tell that I draw the line at highschool education. I'm asking out of curiosity and not trying to make a point or win any argument: Why do you draw your line there? I wouldn't combine "free" and "partially required" though, as I don't see the need to conflate them. Where I live Masters and PhDs are free, but your required education is completed at age 15. Ever…

I have a bachelors degree in biomedical engineering, complete waste of time and money. All it has really provided me is a piece of paper that says I am smart

Re: Student Loans a Lot Like the Subprime Mortgage Debacle, Watchdog Says

#212

Post by lr4444lr »

roenxi wrote: post #173
eggie wrote: post #172

Earlier quoted context omitted.

> If universities had to worry about students defaulting, they would get rid of bullshit degrees that don't result in an actual job and the prices would come done due to free market forces. This is a hypothetical but classic example of how regulation is required to support a free market.

A free market? Nobody but nobody would be stupid enough to lend money to students in a free market. The student would be an infeasible credit risk. They have no money or assets. There is no free market here.

That's why the loans are not dischargeable in bankruptcy. Awful state of affairs, but it is an effective thing to leverage.

Re: Student Loans a Lot Like the Subprime Mortgage Debacle, Watchdog Says

#213

Post by frockington1 »

lotsofpulp wrote: post #125
godelski wrote: post #78

Earlier quoted context omitted.

This is part of the issue. Loan providers pretty much have to give everyone loans. But the only way this can happen is by guaranteeing these loans, federally and legally. So our solution to a problem backfired and we found out that federally guaranteed loans aren't the solution to "college should be available to everyone." Maybe it is time to look for a different solution. And maybe time to clean up the mess that the…

> So our solution to a problem backfired and we found out that federally guaranteed loans aren't the solution to "college should be available to everyone." This was already known, but since simply providing taxpayer funded education results in increases of government expenses and hence higher taxes, we of course went with the Byzantine route of indebting people who don’t even know what amortization is to the tune of…

I don't think its unrealistic for an 18 year old to understand debt. Also, how are they being tricked into hundreds of thousands of dollars of ? State schools start around 15k/year and provide bachelors degrees. I've never understood these stories of people graduating (non-PhD/Lawyer)with so much debt

Re: Student Loans a Lot Like the Subprime Mortgage Debacle, Watchdog Says

#214

Post by SantalBlush »

planetzero wrote: post #15

We need to get rid of student loans. The problem is that Universities don't ever need to worry about a student defaulting and can keep increasing the prices of tuition with impunity. If they default, they don't care, because the money is already in the bank. If universities had to worry about students defaulting, they would get rid of bullshit degrees that don't result in an actual job and the prices would come done…

Universities are not just job training programs. They offer degrees that will enhance one's expertise in pretty much any sphere of human knowledge. If you want a job in accounting, don't get a degree in philosophy.

Re: Student Loans a Lot Like the Subprime Mortgage Debacle, Watchdog Says

#215

Post by corporate_shi11 »

Time to eliminate government funded student loans. Most of the kids going to college now shouldn't even be there in the first place.

I was doing volunteer work a few years back, speaking to some kids from the local community. One said he was going to a 4 year college, probably paid for by the government given the circumstances. Said he wanted to study "coaching". And our tax dollars are paying for this...

Re: Student Loans a Lot Like the Subprime Mortgage Debacle, Watchdog Says

#216

Post by afarrell »

swebs wrote: post #168
adventskalender wrote: post #137

Earlier quoted context omitted.

That may be so, but doesn't necessarily imply that health care is more expensive in the US. It's possible that in the US they simply spend more money on useless things, or do more screenings with better technology, for example. Many things can go wrong with interpreting such statistics, see also my comment here: https://news.ycombinator.com/item?id=21760725 Afaik, some of the best (and also most expensive) medical pr…

In Sweden, you pay taxes for healthcare and everyone receives healthcare. In the USA, you pay taxes for healthcare, but only the old and the poor receive that tax funded healthcare. So the average taxpayer has to buy their own health insurance in addition. The linked chart also shows a clear correlation with Purchasing Power Parity, which also should be accounted for.

> only the old and the poor

Also government employees, and those under the care of the VA.

> Purchasing Power Parity, which also should be accounted for.

Yes, I agree.

To illustrate with a simplified example:

Imagine nation A has median wage of $20k and nation B has median wage of $40k. Also imagine that their income distribution is the same. Then, if healthcare costs in nation B are twice as high, healthcare is equally as affordable.

Re: Student Loans a Lot Like the Subprime Mortgage Debacle, Watchdog Says

#217

Post by Clubber »

dillonmckay wrote: post #162
Clubber wrote: post #41

Earlier quoted context omitted.

>Why was it necessary to change student loans to being non-dischargeable in bankruptcy? I believe it was something along the lines of people borrowing for law degrees then discharging the debt right after graduation with the knowledge gained from their new degree. I'm sure it was done in other degrees as well.

So, nothing to do with undergraduate degrees?

>I'm sure it was done in other degrees as well.

Re: Student Loans a Lot Like the Subprime Mortgage Debacle, Watchdog Says

#218

Post by adventskalender »

afarrell wrote: post #159
adventskalender wrote: post #137

Earlier quoted context omitted.

That may be so, but doesn't necessarily imply that health care is more expensive in the US. It's possible that in the US they simply spend more money on useless things, or do more screenings with better technology, for example. Many things can go wrong with interpreting such statistics, see also my comment here: https://news.ycombinator.com/item?id=21760725 Afaik, some of the best (and also most expensive) medical pr…

> It's possible that in the US they simply spend more money on useless things, or do more screenings with better technology These are both components to saying that the health care system is more expensive in the US. > a rich country could spend more money on health care and still have worse average health than poorer countries Yes. I think that multiple people on this thread would argue that this is the case with th…

"> It's possible that in the US they simply spend more money on useless things, or do more screenings with better technology

These are both components to saying that the health care system is more expensive in the US."

Sorry, but that doesn't make sense. If the service is better, the higher price is justified. Presumably you can always choose to not use the better technology to save money.

"This implies that differences in social services and urban design have an impact on healthcare spending."

How does it imply that? More social services would stop people from overeating? Do you have a citation for that?

Re: Student Loans a Lot Like the Subprime Mortgage Debacle, Watchdog Says

#219

Post by alistairSH »

moduspol wrote: post #189
eggie wrote: post #172

Earlier quoted context omitted.

> If universities had to worry about students defaulting, they would get rid of bullshit degrees that don't result in an actual job and the prices would come done due to free market forces. This is a hypothetical but classic example of how regulation is required to support a free market.

It's federally guaranteed student loans that got us here! It wasn't like this for our parents. This comment is an example of how any amount of problems caused by government intervention can be framed as a need for more government intervention.

The predecessor of the Stafford Loan program was created in 1965, so it was like this for most of our parents.

But, the cost of school has outpaced inflation for that period, making the situation worse. No question about that.

We'd probably all be better off if the government simply gave grants to students who meet some minimum threshold. Call it top 20% of class or thereabouts.

Re: Student Loans a Lot Like the Subprime Mortgage Debacle, Watchdog Says

#220

Post by astura »

rwmj wrote: post #147
magnusss wrote: post #83

It seems like the majority of the commenters here are missing the point. The increasing rate of student loan default is not a result of kids who go to a four year college, graduate with an unmarketable degree in philosophy, fall on hard times and then can’t pay their bills. It's kids who go to barber or cosmetology school, take on $30k of debt, then realize they don't make enough money cutting hair to support themsel…

Speaking has someone who co-runs a hair salon, those numbers don't make sense. $30K should be a reasonable loan compared to how much a single stylist can make annually (easily $50K, up to six figures if they are any good). Just shopfitting a hair salon costs $10-20K. New or relocating salons do that routinely and will expect to recoup it comfortably in the first year.

Maybe in some high end markets or very high end or speciality salons, but I'm having a very, very hard time seeing an average stylists making 50k, let alone six figures(!!) anywhere I've ever lived. The BLS says that the 2018 median pay is $24,830 per year.

https://www.bls.gov/ooh/personal-care-and-service/mobile/bar...

FWIW all my peers that I went to high school with who got their cosmetology license 1) did so for free as our public education system offers cosmetology school for free and 2) no longer are practicing 20 years later

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