More Than 40% of Student Borrowers Aren’t Making Payments • Hacker News Board

Re: More Than 40% of Student Borrowers Aren’t Making Payments

#421

Post by ethanbond » Thu, Apr 07, 2016, 3:11 PM UTC

smileysteve wrote: post #413

ethanbond wrote: post #302

Earlier quoted context omitted.

I hope your ten year old has more options available than "go to college and take a gamble on being underwater" or "learn a vocation and hope you retire before it's swallowed by outsourcing or automation." Despite the statistics, there is no obvious choice here. Why are the wise old people encouraging young people to choose the path their generation just got screwed out of? This generation of students has only ever he…

> I hope your ten year old has more options available than "go to college and take a gamble on being underwater" or "learn a vocation and hope you retire before it's swallowed by outsourcing or automation." There are still many state schools w/ scholarships that are low priced; or upper tier schools if the family doesn't make enough money.

None of which guarantee a job anymore, which is exactly the problem. The average student loan debt for graduating undergrads is somewhere around $30,000.

It's not like they're taking out loans to buy their way into Dartmouth. They're taking out reasonable amounts of money to go to a reasonable school to get a reasonable job.

The "unrealistic idealists" in this situation are the people who think it's the student's fault for planning on getting the job that was more or less promised to them by society. And when they are woken up by the fact that there aren't jobs waiting on the other end, the rhetoric seems to be, "these stupid kids listened to what every adult in the country told them for the first 18 years of their lives!"

It's shameful to act like kids should've known better than to pay for a quality education. What the hell kind of society actually places that blame on children?

Now, the alternative is the same thing. Now adults are telling kids to go to vocational schools. Okay. By the time they get established in those fields, those jobs will be gone too. Then we can blame the kids for listening to us again!

Re: More Than 40% of Student Borrowers Aren’t Making Payments

#422

Post by [deleted] » Thu, Apr 07, 2016, 3:12 PM UTC

PeterisP wrote: post #384

ethanbond wrote: post #299

Earlier quoted context omitted.

When people make this kind of assessment they seem to be implying that because a college education is less surefire than it used to be, that it's useless. This is demonstrably false, and a college education is still the best bet a person can make on his or her future. In the same breath people say "all our manufacturing jobs went to China" and "why not go to a vocational school and pick up welding?"

Are you really sure that "a college education is still the best bet a person can make on his or her future" ? College education has quite a lot of worth, but that worth is much less than it used to be and the price is much more than it used to be. A degree that has some value is useless if obtaining it costs you twice as much as that value.

[deleted]

Re: More Than 40% of Student Borrowers Aren’t Making Payments

#423

Post by pc86 » Thu, Apr 07, 2016, 3:15 PM UTC

alanh wrote: post #294

serge2k wrote: post #250

Earlier quoted context omitted.

That sounds quite reasonable actually. A degree can be a good investment. The right degree from MIT will open a lot of doors .

Do you think everyone who has gained an education should then be burdened by an inescapable bondage to a particular high-paying career? What if they decided they would rather be a teacher? A musician and band director? A serial backpacker? What if they are injured and can no longer take the 40, 50, 60 hours in a chair at the office it would require to maintain the level of salary? Just because a college degree is oft…

> What if they decided they would rather be a teacher? A musician and band director?

There are literally government-subsidized student loan forgiveness programs for exactly this purpose.

> A serial backpacker?

Most student loans are backed by the government. As a tax payer I have no interest in subsidizing someone's backpacking trip. You can't be a serial backpacker if you have a car payment, rent, or a mortgage either.

> What if they are injured and can no longer take the 40, 50, 60 hours in a chair at the office it would require to maintain the level of salary?

A. Disability insurance exists for exactly this reason

B. You can make the same argument against getting a mortgage. FUD.

Re: More Than 40% of Student Borrowers Aren’t Making Payments

#424

Post by Spooky23 » Thu, Apr 07, 2016, 3:15 PM UTC

kefka wrote: post #391

marincounty wrote: post #332

Earlier quoted context omitted.

My parents didn't have college money set aside for me either, but even if they did, I don't think I would have taken it. I would take it if I had a rich father, but mine wasen't. He liked to brag he was a well paid union electrician, but we seemed to barely get by. After taxes, and my mom's depression shopping. (She didn't spent much, but she needed to buy something everyday. She was clinically depressed before peopl…

I second bcook's response. I have a good friend of mine who moved locally from the Kansas City area. He was a union carpenter, electrician, and framer there, so he approached our union hall. They snagged him up the same day, and was out on site the next. He has full benefits. 401k, insurance, vacation, sick pay, etc... And he works for the union hall. He decides the radius where he works, and gets paid 38-52k year, d…

Construction is feast or famine. I remember friends whose parents were laid off all winter -- makes life tough and uncertain.

Re: More Than 40% of Student Borrowers Aren’t Making Payments

#425

Post by NDizzle » Thu, Apr 07, 2016, 3:15 PM UTC

ethanbond wrote: post #302

NDizzle wrote: post #131

Earlier quoted context omitted.

Did your parents never talk to you about this kind of thing? I have already had this discussion with my 10 year old. For what it's worth, I never went to college but I understand the importance of compound interest and understanding financial contracts which involve you.

I hope your ten year old has more options available than "go to college and take a gamble on being underwater" or "learn a vocation and hope you retire before it's swallowed by outsourcing or automation." Despite the statistics, there is no obvious choice here. Why are the wise old people encouraging young people to choose the path their generation just got screwed out of? This generation of students has only ever he…

She totally has options available. She has me for guidance! I'm not forcing anything on her. Right now she is interested in everything and I'm just helping her understand how things really work. Things like I mentioned above are critical for success - college or not.

Re: More Than 40% of Student Borrowers Aren’t Making Payments

#426

Post by nkurz » Thu, Apr 07, 2016, 7:06 PM UTC

pc86 wrote: post #418

nkurz wrote: post #357

Earlier quoted context omitted.

the U.S.A. does not have debtors' prison While true in theory, this may not be true in practice. There are several loopholes, one main one being that failure to pay fees and penalties assessed by the justice system itself can be a criminal offense. In some states a significant percentage (as high as 20%) of current prisoners are being held for failing to pay these LFO's (Legal Financial Obligations). Here are a coupl…

> failure to pay fees and penalties assessed by the justice system itself can be a criminal offense Which doesn't have much of anything to do with the real estate market, right?

Correct. I hoped from context that it was clear that I was responding only to the line that I quoted (which said that the US "does not have debtors' prison") and not to the main thrust of the argument.

Re: More Than 40% of Student Borrowers Aren’t Making Payments

#427

Post by __jal » Thu, Apr 07, 2016, 8:15 PM UTC

iofj wrote: post #395

douche wrote: post #379

Earlier quoted context omitted.

They've been out of work too long to qualify for unemployment...

Sorry I'm not actually an American. You lose unemployment after being unemployed for too long ? How long ?

Depends on which state we're talking about. Don't know where you are, but by European standards the policy in any U.S. state looks punitive in comparison. In California, the limit is 26 weeks.

Re: More Than 40% of Student Borrowers Aren’t Making Payments

#428

Post by refurb » Thu, Apr 07, 2016, 8:28 PM UTC

Pinckney wrote: post #342

refurb wrote: post #337

Earlier quoted context omitted.

It should just be normal debt that you can discharge through bankruptcy. I think doing that would likely result in no loans for many students or at least higher interest rates. Hell, if I were 22 with $100K in student loan debt to be discharged, I'd be silly not to declare bankruptcy.

It's not clear to me that this would be a bad thing.

I don't disagree.

Re: More Than 40% of Student Borrowers Aren’t Making Payments

#429

Post by kamaal » Thu, Apr 07, 2016, 9:48 PM UTC

igetspam wrote: post #27

My wife is one of these borrowers. She has a master's degree in teaching. It cost her over $100k to get and she can't find job that would pay her enough that she'd be required to pay anything back. I've seen her loan repayment docs and her minimum payment due is $0 every month. While I think her decision to get a masters in education was a bad one (before we were married) I laugh at an institution that would loan her…

>>She has a master's degree in teaching. It cost her over $100k

Why does it cost that much?

As an Indian, this doesn't make any sense to me.

Re: More Than 40% of Student Borrowers Aren’t Making Payments

#430

Post by dv_dt » Thu, Apr 07, 2016, 10:19 PM UTC

chadzawistowski wrote: post #276

eellpp wrote: post #144

Earlier quoted context omitted.

How about gov do quantitative easing for these student loans. Basically provide contracts and various incentives for companies that are employing these students who have loans. Also to various vendors like house owners etc who provide service to these students. This would create a negative impact on students who did not took loans or got good jobs and paid up in time etc. But that's how largely it was done for QE als…

"QE for the people" is essentially just Basic Income.

Sort of:

Just this morning Ray Dalio commented in an interview on problems with Fed controls via interest rates or injecting money via QE, vs times when the economy might respond better to 'helicopter money' or injecting money directly to the people.

http://www.marketplace.org/2016/04/06/world/economy-debt-cyc...

I'm reading further than the Dalio comments, but if one were to implement Basic income with some ratio of "helicopter" injection selectable by the Fed, it would give the Fed another control pedal to better manage the economy. In particular, when investment level injection is just circulating among the financial circles and not making it down to the main street economy which cycles money with buying and selling of more real goods.