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I titled my post appropriately.
The economy was going to be ruined if we forgave $400 billion in student loans, but would be (miraculously) unaffected with a different $400 billion disappearing from the economy?
It's especially obtuse of some readers on their high-horses about student loans in that they're missing that nearly all of that $400 billion isn't going to be paid. Ever.
The debtors are simply going to default and make their way the best they can.
It's an impossible situation for many of them.
"I got a good degree!" Great for you. Now quit so I can take your job to pay my loan. Oh, you're not going to quit until you retire? That makes your degree useless for everyone else.
"I paid my loans back!" Yes, but college was $10k then, not $75k and wages did not get 7.5 times bigger since then.
Something else you can't seem to absorb, you got your degree at the perfect time and place. Booming economy when college was as cheap as it ever got and it stayed boomed for you to get just enough experience to keep your job and not so much seniority that you were clipped to save the company money when the boom ended.
Those high-experience people went out and took jobs below their experience and education to fill the time until they could access their retirement funds, shutting the entry level people out until then. Then they retired and there's nobody working their way up anymore!
Cue second economic hit.
Everything is compounded by politicians "doing something" every time.
And you voted for them. So don't shirk your responsibilities now.
It's your fault as much as anyone.
My objection to the plan was that I was fairly sure the President did not have any legal authority to simply erase billions of dollars of debt, no matter the source of that debt. If it went through Congress and got funding and sign-off by the President, then sure. But the BISS ruling erasing as you mentioned $400 billion in debt? This seems a VERY bad precedent to set and again I fail to understand what legal authority exists for a President to do such a thing outside of martial law I suppose...
ReplyDeleteAnd yes, working in higher education and seeing the costs go up so quickly... The artificially low interest rates and near 100% student loan acceptance rate allowed Universities to increase the cost at a rate far exceeding the rate of inflation or reality, whatever you want to measure it against. I'm just an IT guy though, so this isn't really my area... Why I was super glad I had the GI Bill to pay for mine, not thrilled to be paying for my kids...
You are in the minority in why you're objecting to the plan. You've probably noticed it too.
DeleteWhat the president CAN do is defer and delay indefinitely.
There's as much public support for doing that forever as there is to keep ignoring that Social Security and Medicaid are going to be boned soon.
But there might be a net-positive in forgiveness if the beneficiaries can become tax payers instead net-tax sinks. That'd be worth society as a whole paying off some of it.
But there needs to be stuff in place that keeps the situation from happening again. Like putting the burden on the worthless colleges. Like imprisoning administrators who put this fraud on their customers.
The analogy of houses, cars and credit cards keeps coming up and in all three cases, if you got goods as misrepresented as the average degree; you could sue the seller and get your money back, pay the lawyer and prolly keep the goods. Or go bankrupt.
But there's zero recourse for student loans and ONLY student loans.
All because fewer than 100 rich people took out loans, hid their assets, got juris doctorate and medical degrees, then declared bankruptcy on them. Look it up, it's famous.
:-) I cannot comment on a lot of that except to say my degrees are in Mechanical Engineering, Computer Science and Information Technology (Management)... I have worked in area that produced degrees that... How best to put it, did not really have jobs waiting for them on the other side. But the University pushed them, and the kids (technically adults of course) signed on the line for the Student Loans to pay for degrees that the Universities knew with absolute certainty were worthless. But more $ from the Feds, Grants, these loans or just tuition in general and so more Faculty (Tenure needs to go away), and more good Union jobs in places like Illinois... While the gravy train rolled it was all good... For them at least. Was extremely glad I had almost no Student loans, and even those were supposed to be paid by the National Guard after I got out of the RA... Turns out they (Illinois at least) can break that contract too if the State feels like it :-) Only cost me a few thousand and of course a wrecked credit rating for a few years to find that out...
Deletesorry Angus, forgot to sign my post yesterday...i want to thank all of you and myself for my degree that i spent 4 years in the army to get...and i actually used it while working full time and graduated about 2 months before the time limit expired...panzer guy
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ReplyDeleteLook, everyone, someone who can't read who thinks they can lecture.
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