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

#231

Post by simias » Tue, Dec 05, 2017, 7:01 PM UTC

RyanZAG wrote: post #175

simias wrote: post #146

Earlier quoted context omitted.

I don't think it's really about science, it's more about reddit. You'll find the same thing on any discussion on any somewhat popular subreddit regardless of the subject. There's almost always a reddit hivemind sanctioned Good Answer to any issue and if you stray away from the Good Path you'll get buried in downvotes, regardless of how much effort you put into arguing your point. Conversely if you make a completely u…

HN isn't all that different, so it's probably about more than just reddit. For example, you can post the same remarks criticizing functional programming in a post about C# or Java and get upvotes, while the same post in a Haskell discussion will be downvoted. You can try the experiment yourself to verify it. This applies to companies as well - you will be upvoted for pro-Microsoft or anti-Google posts in a news topic…

It's significantly better in my experience. It's not perfect but you can actually have a plurality of opinions on a subject. I think the fact that the community is tighter and that low karma accounts can't actually downvote help massively. Also no visible scores which reduces the "gaming" aspect. I kind of wish HN would go a little further still and ration downvotes for everybody, it shouldn't be something you throw willy-nilly.

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

#232

Post by moultano » Tue, Dec 05, 2017, 7:02 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…

There's a good midpoint of those two. Cap student loan payments at some fraction of your income for some fraction of your life. Those seem like reasonable restrictions for a loan that isn't dischargeable by bankruptcy.

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

#233

Post by sorrymate » Tue, Dec 05, 2017, 7:04 PM UTC

CalChris wrote: post #112

The fundamental problem here is that student loans have been declared a special debt not dischargeable through bankruptcy. At the same time, these loans can be Federally guaranteed through FFEL. This leads to $100K cooking schools promising to turn a recent dischargee from the Army into a pro-chef, sign here, here and here. If student loans were subject to bankruptcy banks would be more careful. Instead we have a pol…

I agree. Why is it that banks are able to charge 6.8% interest for student loans, but the government will provide banks with that same student loan money for 0.03% interest. The middle man adds no value.

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

#234

Post by kpwagner » Tue, Dec 05, 2017, 7:05 PM UTC

lazypenguin wrote: post #91

monkseal wrote: post #71

What feels so deceptive about the panic around student debt is the devil is the details. I think if you drill in median student loan debt for an UNDERGRADUATE is like $12k. That's less than a car loan and we don't have a panic about that. Most of the debt is for graduate, PHDs, law and MDs or undergrads who attend expensive private universities. These people should make more money from that investment. My point is ov…

It's also deceptive to downplay the situation by only looking at the debt in students' names. Many parents take out loans on behalf of their children. E.g. Parent Plus Loans: https://en.wikipedia.org/wiki/PLUS_Loan

Well over half of my student loan balance is in parent loans. I pay my parents monthly to pay for the loan payment. My younger two siblings are oblivious to what kind of debt they have. Now, my parents are a few years away from retirement--at least they hope--and they will be burdened with paying my siblings student loan debt on a fixed income.

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

#235

Post by simias » Tue, Dec 05, 2017, 7:08 PM UTC

cloakandswagger wrote: post #142

simias wrote: post #108

Earlier quoted context omitted.

"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 "March for Science" that happened earlier this year had estimated attendance of 1.07 million. Now go to Google Images and search for "March for Science". Nearly every sign I see is either political in nature, elevating science to a level of religion/infallibility, or casting science as a fashion/meme ("Scientific is the new chic", "Science isn't wrong", "In science we trust").

I'm not convinced, I haven't followed that particular event closely but as far as I know it was mostly about opposing the anti-science views of Trump and his administration. Given that he said multiple times that global warming was a chinese conspiracy I'm not sure this reaction is particularly extreme or uncalled for, regardless of your opinion on the topic. Using this to say that this million of people participating are adepts of scientism is a bit of a stretch IMO.

Using the same logic I could say that the 62+ millions of Americans who voted for Trump are climate change deniers but I don't think that would be fair either.

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

#236

Post by clhodapp » Tue, Dec 05, 2017, 7:08 PM UTC

ConceptJunkie wrote: post #155

jackweirdy wrote: post #68

Earlier quoted context omitted.

> 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 :)

The problem with subsidizing college in any way, including the current student loan system is that it encourages people to go to college whether it makes sense or not, and as several people have mentioned in this discussion, in a lot of cases, it doesn't make sense. Anyone who is properly motivated should be able to go to college, but when I hear cries for a free college education, I can imagine that that would stimu…

I think that we would simply end up with a better-trained, better-trained workforce if:

* We stopped educational subsidies for students with poor grades (ideally, gradually to give the student a chance to feel the pressure and correct)

* We equally subsidized trade schools (ideally, even college dropouts or older people could access these subsidies at least once)

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

#237

Post by throwawayaway12 » Tue, Dec 05, 2017, 7:12 PM UTC

ithilglin909 wrote: post #225

vec wrote: post #198

Earlier quoted context omitted.

Yeah, but isn't that also the "problem" with subsidizing K-12 public school? One doesn't need a high school education to wait tables or stock shelves, and most apprenticeships and trade schools could probably be started several years earlier without issue. We used to have this Enlightenment ideal of a Liberal Arts Education. It served as job training, sure, but it also tried to make its recipients better citizens and…

Comparing a college education to K-12 public education doesn't make sense. In general, one needs to understand some mathematics up through Algebra and have some reading and writing abilities to be an employable, productive adult. Whether the public school system in the USA does a good job of providing a basic education is a different discussion. I’m not the kind of engineer that has a STEM only mindset and I see a lo…

>Comparing a college education to K-12 public education doesn't make sense. In general, one needs to understand some mathematics up through Algebra and have some reading and writing abilities to be an employable, productive adult. Whether the public school system in the USA does a good job of providing a basic education is a different discussion.

It does seem like this baseline understanding does shift with progress though. For example our ancestors did not need a lot of education to push a plow, but more education will be needed with the continued elimination of physical labor.

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

#238

Post by dnadler » Tue, Dec 05, 2017, 7:12 PM UTC

mattmanser wrote: post #97

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…

The thing I don't understand is, how does it unravel? It feels like politically acceptable short-termism of shunting education costs onto future generations. No-one's going to 'lose' money over it. Who will suffer? It doesn't look like it will be corporations that will suffer, save some institutions will close when the endless supply of money suddenly dries up. It looks to me like it will be governments, a political…

Yeah, as you say, it's not really a traditional "bubble".

From what I can tell, a few entities will suffer, but not in a spectacular fashion.

1. The government may be forced to forgive a lot of debt, thus taxpayers will suffer.

2. Those making whose student debt payments are not proportional to their income will be an economic drag on the US.

So there is no "bubble" to "pop". Rather, it looks like it's going to be a long-term economic drag on the country.

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

#239

Post by cinquemb » Tue, Dec 05, 2017, 7:14 PM UTC

grandalf wrote: post #138

There are two relevant things to realize about this: 1) Student debt is much different than normal consumer debt in that it is not dischargeable if the holder declares bankruptcy. 2) For years, many politicians have been calling for the massive increases in the issuance of student loans, presenting the issue as though the only hope for many people to obtain education is to take on massive amounts of debt. If there we…

Only reason why I think there is much press about this is because it would make sense to me that increasing delinquency/amount of student loans will bleed into mortgage asset valuations and feed a long term bearish (inflation-adjusted) trend[0] (after all, these debts cannot be discharged[1] and negatively affect credit when not serviced, which factors into getting approved for mortgages, even after setting aside how stagnant wages have been for decades on avg), and I'm not too sure how banks would feel that if people are no longer opting to taking out 30year + mortgages that I'm sure compromise a significant part of their "assets".

[0] https://fred.stlouisfed.org/series/ASHMA

[1] Well outside of some political student loan debt jubilee that will probably leave a lot of universities holding the bag, not to mention other private entities that have attached themselves to the student loan system.

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

#240

Post by sorrymate » Tue, Dec 05, 2017, 7:15 PM UTC

wmeredith wrote: post #211

code4tee wrote: post #35

A lot of that debt is funding bloated administrative costs and other overhead that doesn’t directly make for a “better” education, just a “more expensive” education. Fixing this problem starts with getting costs at universities under control. Taking on debt to fund education isn’t inherently bad, but having that debt back a bloated higher education sector is terrible.

As I posted elsewhere in this thread... The majority cost increase (65%)[1] of higher education in the US over the last couple decades is due to a systematic defunding of government support for schools. It would be nice if we started investing in our country's education again. [1]2015 Study by the New York Federal Reserve - https://www.newyorkfed.org/medialibrary/media/research/staff...

Unfortunately this is only the start. It seems Republicans have started a war on education.

"a majority (58%) of Republicans say colleges and universities are having a negative effect on the way things are going in the country"

We should be continuing to encourage higher education in addition to trade schools. Bachelor Degree holders, on average, earn a million dollars more during their life time than those who only have a high school diploma. Even if you are accounting for lost earning potential, cost of tuition, supplies etc... your still talking about hundreds of thousands of dollars more earned than if you were to not achieve a degree.

Pew Research Poll http://www.people-press.org/2017/07/10/sharp-partisan-divisi...

Figure 2A Lifetime Net Earnings by Education https://trends.collegeboard.org/sites/default/files/educatio...

Figure 1 Lifetime Earnings by Education https://www2.ed.gov/policy/highered/reg/hearulemaking/2011/c...