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A couple weeks ago the Wall Street Journal confirmed our worst fears about the student loan program, that is, that it was going to blow up in the government’s face just like all the other gigantic debt-bubbles that preceded it. For the sake of background, here’s a brief excerpt from the article that will bring readers up-to-date:

“More than 40% of Americans who borrowed from the government’s main student-loan program aren’t making payments or are behind on more than $200 billion owed, raising worries that millions of them may never repay.

The new figures represent the fallout of a decadelong borrowing boom as record numbers of students enrolled in trade schools, universities and graduate schools.

While most have since left school and joined the workforce, 43% of the roughly 22 million Americans with federal student loans weren’t making payments as of Jan. 1, according to a quarterly snapshot of the Education Department’s $1.2 trillion student-loan portfolio.” (More Than 40% of Student Borrowers Aren’t Making Payments, Wall Street Journal)

While it all sounds very shocking, the real eye-popper was buried deep in the text where it was most likely to be ignored. Here it is:

“Carlo Salerno, an economist who studies higher education and has consulted for the private student-lending industry, noted that the government imposes virtually no credit checks on borrowers, requires no cosigners and doesn’t screen people for their preparedness for college-level course work. “On what planet does a financing vehicle with those kinds of terms and those kinds of performance metrics make sense,” he said.” (WSJ)

Let’s see if I got this right: The Fed, government regulators and the entire political establishment looked the other way while the mortgage industry cranked out trillions of dollars of “toxic” subprime liar’s loans that Wall Street bundled into garbage bonds that wound up blowing up the entire global financial system and plunging the world into a severe recession from which we still haven’t recovered. Then, a couple years later, they start pumping up another lethal trillion-dollar credit bubble, this time comprised of equally toxic “student liar’s loans”?

Is that what they’re saying?

That’s it, alright. This is why there should be blanket amnesty for all the student debt generated in the last decade. It’s because the whole thing was another filthy credit-swindle from the get go.

And let’s be honest; it’s not the government lenders who were scammed in this deal, it’s the students. They’re the victims, in the same way that the applicants, who borrowed hundreds of thousands of dollars for mortgages they could never repay, were the victims. The lender is ALWAYS responsible when a loan that goes belly up. ALWAYS. Because it’s their freaking job to figure out who can pay and who can’t. Period. That’s all they do, lend money. And they’re pretty damn good at it too, when they actually expect to get repaid, which in this case, they don’t. That’s why we know it’s a scam.

So now we’re supposed to believe that no one could have foreseen this trainwreck ahead of time. Is that it? Is that what Obama and the media and the rest of the crooked financial establishment want us to believe; that no one could known that 40 percent of the borrowers were going to ‘stiff’ the government?

Baloney. The handwriting was on the wall from the very beginning. Take a look at this interview I did with professor Alan Nasser in 2011.

M Whitney–Is it fair to say that the student loan industry is a scam that targets borrowers who will never be able to repay their debts?

Alan Nasser—It’s as fair as fair can be. First, the student loan industry is huge – a large majority of students from every type of school are in debt. Debt is held by 62 percent of students enrolled at public colleges and universities, 72 percent at private non-profit schools and 96 percent at private, for-profit (“proprietary”) schools. It was announced last summer that total student loan debt, at $830 billion, now exceeds total US credit card debt, which is itself bloated to the bubble level of $827 billion. And student loan debt is growing at the rate of $90 billion a year. So we’re not talking small change.

How many of these students are subprime borrowers? That is, how closely do student loans resemble junk mortgages? The answer hinges on three factors: how these loans are rated, how likely the borrower is to repay, and the default rate on student loans.

…the Department’s Inspector General Office employed a more realistic method in its 2003 audit, which calculated lifetime risk. It estimated that over their lifetime between 19 and 31 percent of college freshmen and sophomores would default on their loans… For community college students, the prospects were grimmer still: between 30 and 42 percent were expected to default. And the future was most discouraging for students at for-profits: between 38 and 51 percent were anticipated to default. You can see that the default rate among student borrowers is expected to be higher than that for subprime home mortgages.” (The Student Loan Swindle, CounterPunch)

Repeat: “between 38 and 51 percent were anticipated to default” … “Higher than subprime mortgages.”

Bottom line: The shysters who issued these roadside bombs knew from the beginning that a high percentage of them were going to blow up. What more proof do you need that the whole thing is crookeder then hell? And this interview was conducted back in 2011, which means that these credit chiselers knew what they were doing from the very beginning. The Obama-Fed-Wall Street cabal wanted to inflate another massive credit bubble so the thieving lenders could skim heftier profits while Obama crowed about his great economic recovery. That’s what it’s all about. And they didn’t care that gullible college kids were being drawn-and-quartered so they could make more dough either.

What kind of country is this anyway, where the government deliberately bamboozles its kids about the “value of a good education” just so they can extort as much money as possible from them in the future?

Here’s Nasser again:

“Alan Collinge of StudentLoanJustice.org has shown that the Department of Education makes more on defaulted loans than it does on loans in good stead. Washington has just as much an interest in encouraging student loan defaults as do, for example, collection companies, which obviously live off defaults.”

“Cha-ching!” That’s the happy sound of your predatory government fleecing your children.

It’s outrageous!

Of course the private lenders make even more than the government does because they’ve developed a whole system for extracting as much wealth as possible from their unwitting victims. No surprise there. Private lenders always get their pound of flesh and then-some.

So here’s a question for you: Why do you think Congress passed legislation making it impossible to discharge student loan debt through bankruptcy just months before the surge of student lending began? Do you think it was all just a big coincidence?

Give me a break! This thing has “setup” written all over it. Congress knew what they were doing. They knew they were part of a big sting operation targeting credulous students who never guessed that their government was just a bunch of lousy shakedown artists. And now congress can pat themselves on the back for a job well done, for luring millions of millennials into a lifetime of indentured servitude. That’s quite an accomplishment, don’t you think?

Hurrah, for Congress! The scumbags.

Here’s Alan Nasser again:

“Because Congress chose to withhold key consumer protections from student borrowers …the latter are virtually forced to enroll in “loan rehabilitation” programs. The borrower is subject to a form of extortion, whereby (s)he essentially buys her way out of allegedly more severe penalties with payments that are rarely applied to principal or interest on the defaulted loan. These outlays are in effect the price of access to a substitute loan, accompanied of course by additional fees. The new loan is typically larger than the defaulted one…

The fee system is at the heart of the private lenders’ affection for default. It gives to loan guarantors the same kind of interest in default that is so obvious in the case of collection companies. Collinge has analyzed IRS filings of guarantors of federal student loans. It turns out that guaranty agencies average about 60 percent of their income from fees alone. If the default rate declines, so do the fees and income of the guarantors.” (CounterPunch)

Get the picture? So the worse it gets for the students, the better it gets for the lenders. Students get a lifetime of drowning in red ink, and lenders get a nice fat bonus of 60 percent off the top. Nice, eh?

Don’t you love America?

Let’s cut to the chase: Students have been defrauded on a massive scale by the credit Mafia, the brotherhood of crooks (Gov and private) whose only goal in life is to suck as much blood as humanly possible out of their victims and then move on to the next. That’s how the game is played.

The only way to defeat this cadres of racketeers is to stop paying. That’s it. No more money for you.

We’re not talking about lower rates, or partial relief or a temporary debt moratorium. Oh, no. We’re not looking for any namby-pamby, half-loaf “loser” solution. We’re talking about total, blanket student debt amnesty. Wipe the slate clean. End the debt now.

And if it crashes the US Treasury, well, good riddance.

MIKE WHITNEY lives in Washington state. He is a contributor to Hopeless: Barack Obama and the Politics of Illusion (AK Press). Hopeless is also available in a Kindle edition. He can be reached at [email protected].

(Republished from Counterpunch by permission of author or representative)
 
• Category: Economics • Tags: Student Loans 
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  1. Heymrguda says:

    Do the students who paid off their student loans — or paid a substantial amount into them — get their money back?

    • Replies: @Realist
    , @Anonymous
    , @pyrrhus
  2. Not one mention of the real criminals behind this whole mess; the post-secondary education mafia; the congeries of ultra-corrupt university and college administrators, faculty, and staff, whose numbers, salaries and other emoluments have risen to extraordinary levels, all paid for by taxpayers and students. These folks are the ones who’ve lobbied for all the policies mentioned in this article. They are also the ones who ultimately get the money. The interest earned by those making the loans is chicken feed by comparison. It is the colleges and universities who have been recruiting and enrolling students they know are incapable of benefiting from what these institutions have to offer. Even the so-called first and second rank colleges and universities today offer most of their students fifth rate educations compared with what was available fifty years ago. Yet they are charging, in real dollars, two and three times as much for a dumbed-down stew of PC crap. Let’s pass a law allowing college and university students and their loaners to sue the institutions who screwed them out of their money.

    • Agree: Mark Green
    • Replies: @Seneca44
    , @JackOH
    , @joe webb
  3. Ignoring that this is nothing more than a payoff by the Democrats to a loyal constituency in academia aided and abetted by the unwitting Republicans in Congress who continue to go with it because it is politically popular among voters, I feel like a schmuck for working my way through several schools all those years ago, and I am of half a mind to go back and get a PhD in history or something just to take out a sh*t-load of loans I will never repay so that I can get my fair share of the spoils.

  4. Anonymous • Disclaimer says:

    These lazy bums need to work, not get bailed out.

    • Replies: @TomSchmidt
  5. So here’s a question for you: Why do you think Congress passed legislation making it impossible to discharge student loan debt through bankruptcy just months before the surge of student lending began? Do you think it was all just a big coincidence?

    Give me a break! This thing has “setup” written all over it. Congress knew what they were doing.

    More likely there were a few in Congress who still had some functioning brain cells and knew the program had “BOONDOGGLE” written all over it. They could not stop it, but tried to limit the damage – which will not be done.

    The country is so deep in debt that there is no moral argument for making the “students” pay when no one else is going to pay, so that does not really matter. I do, however, find the high moral dudgeon about doing so more than a little boring. Letting them off isn’t going to make any difference in the long run.

    I would like to hear a little more honesty about the value of the typical college edumacation and the qualifications of the typical “student.”

  6. Adoll says:

    I have spent 6 years living in austerity to pay off my debts and put my wife through school without incurring any new debt.

    Granting the student spendthrifts who drive new cars and live in nice houses as I scrape by in the smallest one bedroom apartment available while paying full taxes with no real writeoffs on top of all that is spit in the face of people like me.

    What needs to happen is removal of the law preventing backruptcy out of student loans. That is all we require.

    • Replies: @TomSchmidt
  7. Everything government touches turns to crap.
    – Ringo Starr

    Most university classes should be terminated. A neighbor is an associate professor of jazz piano at the local uni. Jazz piano?

    A program like Kettering University’s three months of studying and three months of working in your field of expertise makes sense instead of the compulsory social mind control experiments that currently make up a college education.

    https://en.wikipedia.org/wiki/Kettering_University

  8. Realist says:

    Too many students and college courses that should not be.

    • Replies: @pyrrhus
  9. @Anonymous

    Many if not most of them cannot earn what is needed to pay off the loans. I agree they should work; it beats idleness by a country mile. Should they be forever debt slaves to a debt that cannot be removed in bankruptcy? No other debt is like this; student loan debt creates a debtor’s prison.

    • Replies: @Jeff
  10. @Adoll

    I’m willing to bet that you will thrive even after an amnesty, Adoll. Your sort of future orientation will succeed in any but the most warlike societies.

    Making student debt dischargeable in bankruptcy would be a better solution.

  11. One of the things to remember is that the BushCo administration did away with Pell Grants, and heavily promoted student loans; as a parent of two college kids in the early 2000’s I had no choice to but co-sign student loans, or they could not get the funds to attend. I did not know at the time that the new Bush Corpo-Bankruptcy laws meant that none of these debts could be discharged, regardless of circumstances…..I ended up borrowing over $30,000.00 to pay off these loans. I was being threatened because I had too much debt….Also my wife had been very ill and I ended up with thousands of dollars of med-debt, even though I had company sponsored health insurance, but with huge “deductibles” I still had debt; lots of it. Ultimately I did file bankruptcy.
    So I agree completely with Mr. Whitney: all these debts should be forgiven; lets have the Fed bail out the Student Loans; folks who have paid back their Student loans should have the sums returned to them. That will free up over a Trillion dollars that will now act as an economic stimulus. The money not paid into Wall Street will, for the most part get spent on normal, everyday matters, and thus help our small & large businesses grow. This will increase economic activity, so that business will have to hire more people. . Our economy is over 70% driven by people spending their money. That is how you grow our economy.

  12. No mention of Griggs v. Duke Power. This decision essentially ensured that businesses could no longer use any reasonable criteria for filtering employees except educational credentials. This created the current demand for college diplomas – not education – which is fueling the spiraling education debt among young people.

    BTW, since it is primarily colleges and universities that have indebted these young people it is these institutions which should be forced to reimburse students for their loans. The loan companies are just intermediaries, collecting money already given to colleges and universities from indebted students.

    • Replies: @Discard
  13. Anonymous • Disclaimer says:
    @Heymrguda

    “Do the students who paid off their student loans — or paid a substantial amount into them — get their money back?”

    Good question. And what about the ones who prudently didn’t take on a lot of debt, but instead went to a less expensive, and probably less nice, college or didn’t go to college? Are they also just a bunch of suckers? As a taxpayer, I have no desire to see my tax dollars go toward paying off the loans of greedy college students and their parents. Also, the greedy banks and politicians who keep creating these messes need to finally be made to pay for the problems and crises that they keep causing. They – all of the smartest people in the room investment bankers and others in the finance industry – have no excuses for their behavior.

  14. Seneca44 says:
    @Jus' Sayin'...

    Wholly correct that it is criminal to see admissions reps from various colleges and uni’s tell 17 year old kids that they should study what they want and just sign here for the loan–you won’t have to pay it back for a long time. Four years seems like an eternity in your teens. This is where parents should step in and say something like, “You’re going to study WHAT for $200K!” Only problem is, most of the parents have been just as bamboozled into believing that the university degree is worth a mortgage sized debt.

    An acquaintance of mine had what seems like a decent scheme for those thoughtful enough to do it. Get out of school and get some job to make the absolute minimal payments on the loan. Get a little bit of a credit rating so that you can, in a year or two, sign up for about 20-30 different credit cards. Get all the cash you can out of these cards and use them for all your expenses while you take all your cash and pay off the educational debt–then you can (at least theoretically) default on the credit card debt. I don’t know anyone who has actually done this, but it sounds promising.

    I am proud to say that both my kids went to the state uni and we were able to pay it in full. They certainly were attracted to schools such as U of Miami, Syracuse, and American U, where the tuition and expenses would have easily exceeded $50K per year. My children are now debt free–If only their degrees were worth something!

    • Replies: @joe webb
    , @RadicalCenter
  15. Wally says: • Website

    No one forced them.

    The slackers took the money, they should pay it back.

  16. OutWest says:

    Most loans are dischargeable in bankruptcy because they were issued against collateral. Students have no collateral so they really shouldn’t be getting loans. But that’s the reason the loans are not dischargeable.

    When I ran out of money after my first year of graduate school I got a day job in my field and went to night school. I learned more in my job than in class, had lots of money for a single guy –though not much time- and graduated with enough in the bank for a very substantial down payment on a house.

    This whole loan thing is rotting out student initiative as well as their future prospects. But they signed the papers and should at least learn responsibility.

  17. JackOH says:
    @Jus' Sayin'...

    “[T]he post-secondary education mafia; the congeries of ultra-corrupt university and college administrators, faculty, and staff, whose numbers, salaries and other emoluments have risen to extraordinary levels, all paid for by taxpayers and students.”

    Yes. Plus, two-thirds and more of the students who matriculate at my less selective state university will never graduate, will not enjoy the alleged income and opportunity benefits of a degree—but will be in debt. Screening out the less able and less motivated is a political non-starter.

  18. joe webb says:
    @Jus' Sayin'...

    a large component of the blame is to be laid at the door of the Liberals’ Everybody can go to College….Obongo stated shortly after he was elected that the wanted every high school grad ready for college by 2014.

    The lefties bought into this stuff big time since they are the college perfessers and pointy headed intellectuals with their hands out for gov’t money and Revolution! ‘

    So the Whitney raised closed fists of the Revolution! are probably more to blame than anybody.

    Nobody should go to college except about the top 10 percent. But this does not fit the liberal leftie delusion, especially with regard to blacks whose average IQ is such that only about 3 percent of them are fit for college work.

    Oh yeah, how about that old wrinkleass white trait of paying one’s bills, Not Revolutionary enough?

    Joe Webb

  19. joe webb says:
    @Seneca44

    more white trash talk, or is it a person of color? Joe Webb

  20. Discard says:
    @Jus' Sayin'...

    Griggs v. Duke Power. Can’t say it often enough.

  21. Wally says: • Website
    @bill ziebell

    What a load of whining welfare king nonsense.

    You took the money, you spent it, you will pay it back and rightly so. No one forced you, you had plenty of choice, you could have said no.

    What? You cannot read a contract?

    This ‘woe is me’ smells of attempted fraud at taxpayers expense.

    Your little spoiled brats could have worked for awhile to save some money such that any loans would have been much smaller.

    Question: Have your slacker brats graduated?

    And if so, what were their majors?
    Lesbian – Gay Studies, History of Hot Air Balloons?

    Do they even have jobs? Are they even employable?

    How pathetic.

    • Replies: @TomSchmidt
    , @Anonymous
  22. The modern education industrial establishment is a weird mixture of neoliberal economics and left-liberal idealism.

    Give the kids large amounts of money via student loans and then let the universities compete to attract them with over-hyped courses, easy entry standards and gross misinformation about graduate employment outcomes. What could possibly go wrong?

    One of my favourite pieces of university PR propaganda is the claim that liberal arts graduates have lower unemployment rates than STEM students – technically true, but that’s only because cute communication majors make better serving staff than aspie tech nerds. No mention of what taxpayers and students really want to know – how many graduates in each subject actually find degree level work.

  23. tsotha says:

    The idea students should have their loans forgiven because they’re not a good credit risk is nonsense. If you take out a loan you pay it back. These are adults, and they need to start acting like adults.

  24. Jay says:

    The only thing Whitney gets right here is that lenders and the administration/faculty of universities are both corrupt. I spent a career in the latter, mostly destroying my career by speaking out against the corruption. But I also saw how most students were that in name only; they were just as corrupt in their own way. They squandered their time while living off student loans. I supervised more than one graduate student who had to be dragged kicking and screaming to completion of a degree. An utter waste of time of the student, of my research time, and of the taxpayers who funded us both. In academic departments, the game is numbers, not quality, not real beneficial impact.

    In the early 60’s, I paid for my undergraduate studies from savings accumulated by having a large paper route starting at age 12. My bike was so loaded that if it fell over I had to empty the baskets in order to right it. I put up with getting caught in lightning storms, going to work at 4 a.m. on Sundays, getting stiffed by customers, and even getting beaten up by the local hoods in an apartment complex I delivered to.

    In the last 30 years, the concept of deferred enjoyment has largely disappeared from mass consciousness, perhaps because the connection to agricultural production has been severed for so long. Today’s students must have, while students, all the consumer comforts that they received from their parents and that they expect to have upon employment. My college comforts were a lively young lady, a bottle of cheap wine, and a quiet place to park my junker car. It was a better time. Had I the choice, I would choose it.

  25. Jay says:
    @bill ziebell

    Wally has your number. Pathetic indeed. You want the Fed to bail out your kids’ consumption of goods and services, while for nearly a decade it hasn’t allowed savers to receive interest on their capital. Screw you and your kids.

  26. @Wally

    “What? You cannot read a contract?”

    A lot of them cannot. You really need an over-100 IQ to make use of college, but a lot of the people who were enrolled were not in that category. I know the story of one student who was enrolled who could not read or write. Ideally, you’d get the money paid for tuition for that person back from the college that took it, or even better from the administrators who paid themselves millions to scam kids.

    College long ago became a scam for a lot of people. Canceling their debt at least undoes some of the damage to them. Finding them takes judgment; sticking it to the ones who simply partied is more understandable.

    • Replies: @Wally
  27. @Jay

    I have one student who is not corrupt, but makes good use of the GI bill. He lives 1500 miles from my campus but takes my class on a Tuesday night, flying in on Tuesday an out on Wednesday, sleeping overnight in the airport. PRetty good student, too, so I am glad to have him.

    The reason? The GI bill will pay him a stipend for living expenses for every month he his enrolled at a university, and the stipend varies by location. The highest stipend is SF, and the second is NYC, and he needs to attend one on-campus course per semester to qualify for it (he takes other classes online.)

    he gets $3800, tax free, monthly, and his tuition is fully paid as well. Because he can arrange his flights ahead of time, he spends about $1000 a month on planes and pockets about $2800 in tax-free cash. Given SS/Medicare and income taxes, he has the equivalent of a job paying 60k pre-tax.

    • Replies: @Jay
    , @guest
    , @Inque Yutani
  28. anonymous • Disclaimer says:
    @Jay

    The reality is it was much more affordable in your day to attend college.

    The real dollar cost has increased massively since the good old days of the early 60’s

    Also, it wasn’t always necessary to have a post secondary education to get a reasonably good job back then… it’s a prerequisite for anything approaching a decent position today.

    Kids are shiftless, I don’t doubt it, but let’s at least be fair… It *is* more difficult in many ways now. There is a lot of uncertainty out there that didn’t exist for previous generations.

  29. @Jay

    I could not agree more with your assessment.

    I started my post-secondary education in 1965 and ended it with a Ph.D. in 1977. I interrupted my academic career at several points for full-time employment. Over the years since then I’ve occasionally taught graduate and undergraduate courses as adjunct faculty. I and my fellow students back in the day worked much harder and enjoyed far fewer amenities than the students I’ve taught since. Yet we seemed to enjoy ourselves much more and flourished dealing with far more rigorous curricula and evaluations than today’s matriculants.

    I accrued a student debt of about $30,000 in today’s dollars and paid it all off within a year or two of receiving my Ph.D. Many of the less academically talented individuals in the classes I’ve overseen in the last decade or so have managed to rack up hundreds of thousands of dollars of debt. Given both their frequent lack of talent, their often lackadaisical study habits and self-discipline, and some of the more common majors they have chosen, these individuals have essentially no expectation of ever paying off this debt. Some have admitted to me that they do not even expect to pay it down. This is one harbinger of a coming, almost inevitable economic and social disaster.

  30. Yak-15 says:
    @Jay

    There is a massive difference. The explosion in the cost of college has made working to pay for college impossible unless you get a job as a corporate attorney when you are twelve.

    The tremendous cost increase in college is forcing many intelligent, high-IQ types to forgo marriage and/or raising a family. How can you afford house when you still owe 100k when you hit 30? How can you begin to raise kids when are you 75k in the hole?

    The cost to society is staggering and quite likely disgenic. This is killing not only the middle class, but making sure that many with intelligence do not breed.

    • Replies: @Alec Leamas
  31. Leftist conservative [AKA "Make Unz.com Great Again"] says: • Website

    America has ALWAYS been an exploitation factory, ever since the 1600’s….the colonies started out as a way to exploit cheap white slave labor, then cheap black slave labor…

    college students are young and naive, exploitable…and that is the essence of america—exploitation of people who are vulnerable…always has been…

    the establishment crams in millions of cheap labor foreigners, who then push young americans out of entire industries and employment areas….the only choice they have left is college and debt…

    the only real solution is an article 5 convention that strips power from the federal govt….that would increase social capital…keep devolving power back to the local level until social capital rises enough that the exploitation factor is sufficiently lowered.

    • Replies: @Jay
  32. Wally says: • Website
    @TomSchmidt

    Anyone who legitimately cannot read but then signs a contract agreeing to terms within it are engaging in deception, fraud. By signing they are stating they understood the terms.

    I say pay the loan or be prosecuted for fraud.

    I say be responsible for your actions & behavior. Stop pretending to be a spineless ‘victim’.

    • Replies: @TomSchmidt
  33. Jay says:
    @TomSchmidt

    So you think that it is not corrupt for someone to game the system for as much as he can get? From my 19th Century perspective (grandfather born on a mountain farm in Alabama in 1858, whose values were transmitted to me), he is corrupt, as are you for promoting such gaming. Do you really think that the average taxpayer would approve of paying a $60K stipend to a student for taking one course, GI Bill or not?

    • Replies: @TomSchmidt
  34. The higher ed system is mostly a scam. Most majors aren’t worth the money you pay to get the degree, and there are majors which will never result in decent employment – degrees like Womyn’s or Black studies. No one should be able to major in such things on the public dime.

    • Replies: @pyrrhus
  35. Jay says:
    @Leftist conservative

    You write as if America were uniquely exploitive. That’s obviously crazy. Exploitation occurs in any social group. My homeowners association tried to exploit me and I had to face down 50 people to avoid it.

    As to a Continental Convention, the Federal Government should have only two roles: defense and environmental protection.

    • Replies: @Leftist conservative
  36. Jay says:

    To Yak15 and anonymous:

    Yes, a college education does cost more (inflation-adjusted) now than 50 years ago. And I have seen why from inside the belly of the beast during 30 years of university teaching and research.

    However, there are alternatives to becoming massively indebted at 18. A) The GI Bill. B) Start working and saving early and keep doing so until educational costs can be paid up front (most adolescents are too unfocused to gain a lot from going to college at the age that is traditional).
    C) Educate oneself for several years, so that better choices of institutions and majors can be made. With the internet anyone can become as knowledge as most college graduates.

    I don’t buy the “everyone is a victim nowadays” meme.

    • Replies: @TomSchmidt
  37. pyrrhus says:
    @Heymrguda

    Excellent point, my son’s wife did that, this would make her a sucker…..

  38. pyrrhus says:
    @Realist

    And too many “students” who aren’t smart enough or prepared enough to do even remedial college work, getting loans to attend worthless schools and take worthless courses.

    • Replies: @Realist
  39. pyrrhus says:
    @Quartermaster

    Most of the people majoring in such garbage can’t do math, and probably shouldn’t be in college anyway…

  40. @Jay

    From the definition of corrupt:
    “having or showing a willingness to act dishonestly in return for money or personal gain.” I cannot see what my student is doing that is dishonest: the rules of the program were not set by him, and he has not violated any of them to my knowledge. Ergo, not corrupt. If he offered to pay me to report him present in Class when he did not show, that would make him corrupt, and if I accepted I also would be corrupt.

    I do not promote the gaming; he is one of 20 students, and I get paid no more money for 20 than 19. I am amused by it, as I am amused by all the ways creative, adaptable people get around bureaucratic legalism.

    I think most “average taxpayers” would not approve most of the programs that our government blithely blows money on. That’s why we need “enlightened” representatives to create these boondoggles, the largest of which is the one that created the ability for this student to get the GI Bill, the military-industrial-congressional complex.

    However, somebody keeps voting for these representatives to create these boondoggles. maybe not you, definitely not me, but a lot of “average taxpayers” vote to support things like Medicare thinking it will allow them to benefit at the expense of others. Do you really think the average taxpayer would approve of spending 300k to keep an elderly person in a vegetative state on a ventilator for the last 6 months of life. Not if they were spending their own money they wouldn’t.

    • Replies: @Jay
    , @Anonymous
  41. @Jay

    D)Avoid the first two years of college at State U, where you’ll be jammed into lecture classes taught by grad students but pay the same tuition as people getting small classes and real professors. E) don’t go to Tier-1 research institutions as an undergrad where you are nothing more than a meal ticket paying for hypertrophic administrative bloat. F) CLEP and PLAC all the credits you can while working full time.

    Most importantly, do NOT go right from high school to college, but work for a year or two so you appreciate the privilege that time spent studying without working affords.

    • Replies: @Jay
  42. Jay says:

    Some data on inflation-adjusted cost of tuition and fees: public four-year institutions $9400 in 2015; $2400 in 1975. Yes, that is a huge and unwarranted increase. But it is possible to live on $1000 a month if you are willing to have a can of beans or corn for lunch. So that means that a young person would have to save about $40K to pay for four years of college out-of-pocket. I know someone who is working toward that. He is a service technician for a HVAC company and plans to go to school when he is 25 to major in mechanical engineering. I know a man running a solo lawn-service who last year paid $100K cash for a river-front cabin and rebuilt into a wonderful little home. He has two bank accounts: one for living expenses and one for savings, and he feeds the one for savings first each month. Discipline and foresight would solve most of anyone’s problems, but they are rare characteristics today. Too much easy fossil-fuel based living. That will change.

  43. @Wally

    Can you legitimately enforce a contract signed with a minor? How about an imbecile? Your world of imagining everyone to be “equal” seems taken right out of Hobbes. It’s ok for a neoliberal viewpoint, but not a popular alt-right approach, which might better be described as benevolent paternalism.

    I’m not a fan of the persecuter-victim-rescuer game myself, but you might want to imagine the place of people with a lower IQ than you possess. Mine’s quite high and so I can understand most contracts without going to a lawyer. I’d bet yours is too, but that you regularly use software without reading the whole license agreement. Assignment: go watch “Human centipad” for a humorous sendup of this tendency, then decide whether unfair dealing and exploitation can happen. Oh, and enjoy a vanilla pudding, too.

    • Replies: @Wally
  44. Max Payne says:

    noted that the government imposes virtually no credit checks on borrowers, requires no cosigners and doesn’t screen people for their preparedness for college-level course work.

    That’s a good thing. No joke.

    I got rejected for both private loans (no credit history) and the government subsidized loans (because my parents at the time were making enough) that I had to work a year before I went into university (many years ago) unlike most of my peers who just went in directly.

    I wish there was a system in which you can just ask for money to go to school and get it hassle free.

    Personal responsibility has to be factored in. If you took out a loan to study something useless it’s the same as taking out a loan to buy a crappy car or a shitty home. In the end the end-user has to be responsible for such a decision.

    I didn’t know it was that easy to get money for school in the US….. here, in Canada, you have to jump through literal hoops.

  45. Jay says:
    @TomSchmidt

    As a academic, you go straight for a dictionary definition. Corruption is more insidious than that. In my view, it is any behavior that unduly advantages one, and that would be unsustainable if everyone did it, as per your example of the respirator. Your student’s behavior certainly qualifies as well.

    As to you getting no advantage, errrh, you teach in SF so you are positioned to benefit if hundreds more one-course “students” become airborne. This thread will spread the idea. As I said, corruption is insidious.

    • Replies: @TomSchmidt
  46. Wally says: • Website
    @TomSchmidt

    Minors cannot sign contracts.

    Right, Southpark reflects reality, not.

    You must do better.

  47. Leftist conservative [AKA "Make Unz.com Great Again"] says: • Website
    @Jay

    You write as if America were uniquely exploitive.

    yes, it is.

    That’s obviously crazy.

    I would have to be crazy, wouldn’t I? Letting premium used cars go for these low low prices!

    Exploitation occurs in any social group.

    I burned the tip of my finger on the stove. A man down the road suffered 100 percent burns and died. How come I didn’t die from my stove burn? We both got burned.

    The DEGREE to which something occurs–that is significant.

    My homeowners association tried to exploit me and I had to face down 50 people to avoid it.

    A tale that will be passed down through the ages, no doubt.

    As to a Continental Convention, the Federal Government should have only two roles: defense and environmental protection

    You are so drenched with noble conservative principles that I can smell you from here.

  48. ANYONE who takes out a loan is responsible to pay it back.
    Many aren’t paying in anticipation of their debt being forgiven.
    It SHOULDN’T be.
    Is no one personally responsible anymore ?
    How about car loans?
    PLEASE forgive my home loan.
    Credit cards ???

  49. @Wally

    “Must” is rather strong vocabulary, don’t you agree?

    As for must, that is either the first- or second-funniest South Park ever, tied with perhaps “The Death Camp of Tolerance.” (Which could probably not get made today.) The humor comes from this: the lengthy user agreement that Kyle clicks through and agrees to includes a provision that allows Apple to connect him into a daisy chain of humans. The first person in the chain is a Japanese man who complains that he couldn’t even read “Eengrish.” Still, he “agreed” and thus Apple has the “right” to experiment on him.

    If you have never clicked through ANY agreement to do something without carefully reading each paragraph, then you will find no humor in it. My guess is that you HAVE in fact done this, and so the exaggerated effect is particularly funny.

    BTW, your mortgage/note contract likely is void if you keep a gas-powered mower in the garage; check it carefully. Such is the world the lawyers have made.

  50. @Wally

    Minors cannot sign contracts.
    Correct.

    Now, can an idiot (IQ below 25) sign a contract? How about an imbecile (40), or a moron (75, I think)? Clearly there’s a “brainpower” requirement to contracts as well. My point was that I saw plenty of people who had no business being on a college campus from lack of IQ signing contracts. There’s a line which separates legal contracts from unenforceable ones. You want those defrauded dummies to pay also?

  51. Art says:

    It was announced last summer that total student loan debt, at $830 billion, now exceeds total US credit card debt, which is itself bloated to the bubble level of $827 billion.

    If this student debt is forgiven – who will lose? Who holds the loans?

  52. Agent76 says:

    Department of Education whistleblower Charlette Iserbyt about the deliberate dumbing down of America.

    The former US Department of Education Senior Policy Advisor suggests that the our educational system is not based upon children learning. Is the Carnegie foundation instrumental in developing a socialist-collectivist style educational system that is detrimental to our youth? Are the elites impacting the development of the general population through our school systems?

    This single chart demonstrates the ineffectiveness of federal education spending as measured by student test scores:

  53. @Jay

    As a academic, you go straight for a dictionary definition.
    That’s how I roll. But then, I think Lewis Carroll was an academic and wrote: “When I use a word,” Humpty Dumpty said, in rather a scornful tone, “it means just what I choose it to mean—neither more nor less.” I have to start with some area of common understanding in reaching out to and embracing your argument, and since Ray Kurzweil hasn’t succeeded in uploading your consciousness to the Web yet, the dictionary is my best chance to seek common ground.

    “In my view, it is any behavior that unduly advantages one, and that would be unsustainable if everyone did it, as per your example of the respirator. ”
    Unduly, or unfairly? There’s a whole bunch of social theory in that one sentence. I think we can agree: government programs, unable to use more effective means of social control like the Amish do, come up with rules that are open to all to examine and use. It is a flaw of ALL government programs, and sows discord in a non-mono-ethnic society, like the USA. I’d prefer that there be NO Federal Government assistance to higher education (mostly because that means no interference in academics; see the tuition at a place like Grove City College that refuses ANY Federal dollars and the bureaucratic sludge that comes with them, at about 22K, versus, say, NYU. Accept the Fed Man’s money, dance to his tune, and pay all those assistant and associate deans of whatever to enforce his laws.)

    Perhaps you’d like to restore mens rea as a feature of US law? It’s been dead for a while; we live in a land of “letter of the law” instead of “spirit” of it. I think that spirit of the law is obtainable in small, private groups but the ship on it in public sailed long ago, maybe about the time Ida May Fuller started collecting Social Security (“Ida May Fuller [September 6, 1874 – January 27, 1975] was the first American to receive a monthly benefit Social Security check. She received the check, amounting to $22.54, on January 31, 1940… By the time of her death, Fuller had collected $22,888.92 from Social Security monthly benefits, compared to her contributions of $24.75 to the system.”)

    I teach in NYC, not SF. The student chose us because his check, while second-highest here, paid for the best university he could get in the locale where it was paid. It is apparently well known amongst recent military about this particular idea, since my student got the idea from a fellow serviceman.

    I feel for the students who don’t have Uncle Sugar paying their way, since Uncle has driven the cost of higher education, medical care, and lord knows how many other things sky high, and also destroyed the qualitative nature of many of those businesses. You seem like a fellow who genuinely cares about his students’ learning, and I hope you’ll continue to fight for them.

  54. guest says:
    @TomSchmidt

    Your class meets one night a week? What is it, five hours long? Or is it worth a fraction of a credit? Not too long ago students only used to get Sundays off.

    • Replies: @TomSchmidt
  55. woodNfish says:

    The Fed, government regulators and the entire political establishment looked the other way while the mortgage industry cranked out trillions of dollars of “toxic” subprime liar’s loans that Wall Street bundled into garbage bonds that wound up blowing up the entire global financial system and plunging the world into a severe recession from which we still haven’t recovered.

    Oh stop being a shill for the federal mafia which caused the mortgage collapse in the first place by requiring lenders to make subprime loans to deadbeats who couldn’t afford them or be sued for redlining and discrimination. It was called “The Affordable Housing Act”, and lenders had no choice but follow its rules. The government loves to create problems so it can also claim to be our savior by solving those same problems and usually making the problem worse.

    http://spectator.org/articles/37680/true-story-financial-crisis
    http://www.wsj.com/articles/SB123414310280561945
    http://www.forbes.com/sites/peterferrara/2011/05/19/how-the-government-created-a-financial-crisis/#60586aa64b69
    http://www.forbes.com/sites/richardsalsman/2013/09/19/the-financial-crisis-was-a-failure-of-government-not-free-markets/#34894c94449e

  56. Isn’t it just like “conservatives” to oppose debt foregiveness because they’re not indebted. No wonder “conservative” has become a term of abuse.

    • Replies: @Bill Jones
  57. @guest

    3 credit hours, and 2 hours and fifty minutes long for, um, 14 weeks. That counts as a 3-credit hour graduate course. Of course, I actually do the full 3 hours. others, perhaps not.

    It’s designed for working adults to be able to take class after work, but it’s a real university.

  58. @Yak-15

    What it does produce is a caste of perpetual students (which the European continent had for a while before we had gotten ours) and underemployed self-regarded intellectuals, who are ready foot soldiers for leftist causes and susceptible to appeals to resentment and envy.

    • Replies: @Yak-15
  59. @Wally

    Traditionally at common law, minors, habitual drunkards, spendthrifts, women and sailors could not be held to their contractual duties. Accordingly, contractual counterparties were circumspect about entering contractual relations with them.

    Obviously, for good or ill some of these distinctions have been abrogated in the interests of equality and liberty, but one that remains is that generally minors cannot be bound in contract – which is to say that a contract with a minor is voidable.

  60. 2nd take: When I attended San Jose State “College” (now University) in the 1970’s my tuition was about $108.00 per semester. My son and daughter attended Southern Oregon University in the early 2000’s and the tuition (SOU is on the quarter system) was about $9,000.00 per year. I believe that our country should look at funding higher education as an “investment” and not some sort of profit center. Why is it possible/OK to bailout Wall Street and the Banksters, but is not OK to Bailout our sons and daughters, and for that matter all the folks who were given toxic mortgages that the the lending industry knew were going to go south? The Banksters “privatized” all the profits, but “Socialized” the loss. We, the US taxpayers paid for the “cleanup” of this financial toxic waste site. Wells Fargo just pleaded guilty to financial fraud and have to pay a 1.2 Billion dollar fine; Goldman-Sachs just got an even larger fine for their hand in the great crash. We should just strike a new “New Deal” and have the Fed print up whatever is necessary to bailout America…Its our turn. Does it really matter if we add another Trillion dollars to the National debt? The 19 Trillion dollar National Debt will soon be 20 before long anyway, no matter what happens.

    • Replies: @RadicalCenter
  61. Anonymous • Disclaimer says:
    @TomSchmidt

    “I do not promote the gaming; he is one of 20 students, and I get paid no more money for 20 than 19. I am amused by it, as I am amused by all the ways creative, adaptable people get around bureaucratic legalism.

    That this student’s behavior amuses you is an indication of your corruption. This student is largely stealing taxpayer dollars through devious and manipulative means.

    • Replies: @TomSchmidt
  62. “political establishment looked the other way while the mortgage industry cranked out trillions of dollars of “toxic” subprime liar’s loans that Wall Street bundled into garbage bonds that wound up blowing up the entire global financial system and plunging the world into a severe recession from which we still haven’t recovered”

    let me guess you believe in the “hands up don’t shoot” meme as well??

    subprime was a tiny little piece of that puzzle but the main cause was FRAUD…..all the way thru the chain, from the borrower to the appraiser, to the mortgage broker, to the lender, to the banks and all points in between.

    you can use the “poor people” crashed the economy meme if you like.

  63. @bill ziebell

    Grow the fuck up, Bill. You “had no choice” but to co-sign loans for your kids? You had the legal right and the moral duty to say NO.

    Neither George Bush nor any other politician or banker is to blame for your stupid decision to co-sign, for your children’s foolish decision to borrow to attend schools they couldn’t afford, and for your failure to teach your children about the evil and folly of debt.

    A sensible, responsible parent tells his children not to pick universities they cannot afford to attend without debt. Specifically, don’t apply to a private or out-of-state university when all you can afford without debt is an in-state public (state government) university. Attend a school near home and live at home if you would need to borrow to afford your own housing.

    Read Zack Bissonnette’s book “Debt Free U” and tell me how your kids couldn’t possibly have completed college without debt.

    I am just now IN MY FORTIES finishing paying off my massive student loans, and I never expected anybody to “forgive” them or pay them for me. It was my mistake to borrow the money rather than picking more affordable schools, both undergraduate and especially graduate. And it was my parents’ mistake, and lack of experience and knowledge, to encourage me to pick a school that required me to take on a lot of debt. Unlike you, though, we’ve never whined about OUR dumb decisions and I’ve lived with the consequences as I should.

    You are exactly what is wrong with our country.

    And may I add, keep your hands out of my family’s pockets. We don’t want to be robbed to pay for your kids’ college education.

  64. @bill ziebell

    So, bankers are allowed to steal our earnings through government, so you and your kids should be able to steal from us too? How about NEITHER.

    You are one disgusting, entitled, unmanly piece of shit, Bill, but I mean that in a good Christian way.

    Stop the government stealing our earnings for bankers, for stupid or lazy students, and for their illogical, short-term-thinking parents. Like you.

  65. @Seneca44

    Thank you, Seneca, for actually doing the work of being a father, guiding and teaching your children and not encouraging them to impair their entire life with massive student loans.

    You are right to be proud.

    And you and your children now do not have loans burdening them, and unlike Bill Z here, you aren’t whining and demanding that the government forcibly take my earnings to pay off student loans.

    (If Bill’s response is that only the lending banks will be hurt, he’s even more clueless than we already realize. Banks will not simply absorb such a huge loss but rather will raise their fees and interest rates as needed to recoup the hit. All of their customers will pay for the much smaller group of indebted people to be bailed out.)

  66. Word Up Radical Center: I live in Oregon; my kids went to one of the lowest cost State Universities in Oregon….not out of State

    • Replies: @Wally
  67. Oh boy, here we go again.. Let’s blame the “greedy banks” for the folks who took money and cannot or will not repay. The ultimate costs will be paid, as always, by the ever shrinking portion of the population that is productive and pays taxes. So this is just another proposal to fleece the responsible for the benefit of the layabouts and shirkers. Forget the fact that government strong-arms the banks into making obviously bad loans just like they did in the minority mortgage meltdown.

    Currently less than half of America’s population is footing 100% of the bill. Forget that each year the number of tax-eaters rises while the number of taxpayers shrinks. Forget that government is deliberately allowing importation of virtually unlimited third world tax-eaters. Forget that the shrinking supply of taxpayers is already facing an impossible to repay national debt along with comically insane unfunded liabilities. Why not saddle the taxpayers with another trillion or two?

  68. Technomad says:

    One big part of the problem is that colleges have increased the cost of getting a degree in every way they could—more luxurious campuses, larger faculties, whatever they could think of.

    Another part is that, particularly with the economy what it is, a college degree is no longer a nearly-ironclad guarantee of employment. I know quite a few graduates who’d love to work but can’t find work for all sorts of reasons (being stuck in the wrong part of the country, in my own case).

    The students themselves bear a lot of the blame—too many of them go off to college thinking they have to live up to that goddamned Animal House movie. Or that college is a support system for sports teams for them to cheer for and get raucously drunk over.

    But conning students is old behavior at colleges. When you have a world-famous coach talking with some star-struck kid from the ghetto about coming and playing at his school, who has the advantage?

  69. Jeff says:
    @TomSchmidt

    Isn’t it common knowledge that these loans are not dischargeable via bankruptcy? I certainly knew that when I took out a loan in the early ’90s.

    Personal responsibility – what an antiquated concept.

    • Replies: @TomSchmidt
    , @Adoll
  70. @Anonymous

    Let’s quote from a more learned hand than I, Judge Learned Hand: “Anyone may arrange his affairs so that his taxes shall be as low as possible; he is not bound to choose that pattern which best pays the treasury. There is not even a patriotic duty to increase one’s taxes. Over and over again the Courts have said that there is nothing sinister in so arranging affairs as to keep taxes as low as possible. Everyone does it, rich and poor alike and all do right, for nobody owes any
    public duty to pay more than the law demand.” This is tax AVOIDANCE, not tax EVASION, and is perfectly legal. I assume you have no problem with people using every means within the law to avoid paying taxes. That would seem to me to be “getting around bureaucratic legalism.”

    this student is largely stealing taxpayer dollars through devious and manipulative means.
    Some definitions for you:
    Steal: to take another’s property without permission or legal right
    devious: showing a skillful use of underhanded tactics to achieve goals
    underhanded: acting or done in a secret or dishonest way
    Manipulative: characterized by unscrupulous control of a situation

    So, stealing is definitely wrong; he is within compliance of the law and has a legal “right” (probably, privilege) to the money; he has met the rules for the program. Surely you are not arguing that the GI BIll was mean to pay only for universities in the local area? In fact, the people getting deprived of their only here are rapacious NY landlords, who are probably liberals in any case.

    Devious fails; his actions are neither secret nor dishonest. He is open about what he is doing and in compliance with the law. By the way, do you ever exceed the speed limit?

    Manipulative is so far afield as to render my judgment of your ability to speak English as questionable.

    Will you accept the full complement of Social Security dollars, even though the poorest generation in America is the young, and the richest is the over-65 group? Oh, but are you “entitled” to that money by virtue of birth and having paid? He’s entitled by virtue of fighting for the USA, or at least the Federal Government. Ida May Fuller collected 1000x times what she paid into Social Security, and the generation born 1926 to 1942 will pay no net taxes to the Federal Government. All “legal.” Protested that recently?

    You doubtless own some companies whose stock is owned by Berkshire Hathaway, controlled by billionaire Warren Buffett. Have you ever made a motion for your shares to pass a resolution requesting that Buffett give up his Medicare entitlement so poor and working class people don’t have to subsizdize him? Have you requested that Medicare and Social Security become means-tested?

  71. @Jeff

    It wasn’t until 2005 that ALL student loans became non-dischargeable. grad school loans became non-dischargeable in the early 80s, after early Boomers like the Clintons had had the chance to go to law school and perhaps borrow the tuition and go bankrupt with a clean slate but also a law degree.

    You and I know that, Jeff. I paid off my own loans, in full. But I am not talking about reasonably bright people here. I’m talking people who were sold a swindle, and they weren’t bright enough to figure out that it was a swindle. That the government supported and fueled this swindle made it even worse, and bigger.

    Would you insist that an elderly widow who got swindled by a con man pay the loan that he wrote for the con, if the note was held now by, say, Fannie Mae?

  72. Yak-15 says:
    @Alec Leamas

    Interesting. The European mechanism is nearly free college. Here it is debt serfdom.

    • Replies: @Wally
    , @biz
  73. Wally says: • Website
    @bill ziebell

    So what? You took the money, pay it back & stop whining.

    Or better yet, have your slacker kids pay it back.

    If they are even employable.

  74. Wally says: • Website
    @Yak-15

    Free? Don’t make me laugh. There is no such thing as “free”.

    You are obviously economically illiterate.

  75. @Stephen R. Diamond

    It’s not “debt forgiveness”. It’s Welfare.

  76. Anonymous • Disclaimer says:
    @Wally

    Wally, that’s unfair and insulting. Not all students are slackers. One I know of took a $15,000 loan for a technical school, expecting the training to pay off in better job opportunities and higher earnings, and then was not able to earn enough to keep up payments, so now his meager earnings are being garnished. The bottom line is that after 20 years of paying, he has paid back more than the original loan and still owes $20,000. How does that figure? The obscene amount of compound interest!!

    Any student who has paid back the full loan and a reasonable amount of interest should have the balance wiped out. It is not the students’ fault that government policies have created an economic situation where jobs are lost and employment opportunities blocked that had been the very promises on which they were scammed into taking the loan in the first place. It’s the escalating interest on the interest on the interest, an inescapable trap for life. Obscene. THAT needs to change.

  77. edNels [AKA "geoshmoe"] says:

    Sorry to break the news, but school, that is, K through 12, is purposed as a combination of Prussian regimentation and propaganda with the huge selling point to most Hoi Paloi folks, that it is considered legitimate… prepaid Child care/ Baby sitting.

    College, or used to be Jr.College, was extended High School… (with ash trays).

    Nowadays, with more population and less work to do… I mean seriously LESS WORK! No kids are needed to do chores, help on the farm or home business, nor nothing, it’s just might as well be a crop of Veal calves themselves for all there is to keep them busy with constructive enterprises.

    Inner city, forgetabout anything constructive there, and same in nearby too. Consumerism reigns supreme, and then they believe the BS, like they been raised to do, that there is huge need to go to some more worthless passive indocrination in doing… Gay Macramay and a minor in economics.

    Economics is my forvorite because, it is corporates favorite! Because, the corps know that anybody that is convoluted and innately corrupt enough to endure that course of study, really is totally maleable stock, and be ”trusted” to be anykind of ”putty” in their hands.

  78. Anonymous • Disclaimer says:

    Don’t do the crime if you can’t do the time. It’s just like people who file bankruptcy because they don’t want to pay back what they borrowed even though they can afford it.

    Don’t get the loans to begin with if you can’t pay them back. It’s not our fault you’re 26, living in your parents basement, smoking pot all day with a BS in liberal arts.

    • Replies: @Anonymous
  79. Adoll says:
    @Jeff

    @TomSchmidt

    Once again, we need to change the law to allow people to bankrupt out of the loans. The creditworthiness of people who made bad choices with credit must be impacted, for their own sake if for no other. Giving them tax money and letting them free unscathed and they will have learned nothing in real life in addition to art school.

    Also, just because I could make it whether they hand out my tax money or not, does not mean I should suffer a needless handicap.

    @Jeff

    A loan is a two way street. They charge you in interest for the risk of the loan defaulting (or they should, no idea what government student loans are up to)

  80. Anonymous • Disclaimer says:
    @Anonymous

    This said from a person who takes the handle of the most corrupt banking family of all time. If college were free in the US like a lot of Western Europe then there would not be this problem. OH wait! I forgot the banks always have to get their chunk of Flesh. Oh well.

  81. The sissies are out in numbers spouting nonsense as usual – nervous nellies (lol). I have personally dealt with many of these so called executives that run private student loans. Shooting fish in a barrel. Major lucrative. Imagine every oily, shit kicking hustler and every wussy amoral accountant. Put’em together and you’ve got the clueless govt. handing out massive contracts to these low lifes. I say let the students unleash a shitstorm on all those c***suckers.
    Those of you here protecting these high interest loan sharks keep whining and talking about your awesome delayed gratification and your ability to read contracts. You honestly crack me up. I paid for both undergrad and grad school at U Michigan in 50’s and 60’s. Worked part-time. Piece of cake. Today? These kids are absolutely screwed. Continue your rants! Lol.

    • Replies: @Grandpa Jack
  82. Art says:

    Trump should be elected president because of this one promise – “too return power over school curriculum to local school boards” – end of story.

  83. grapesoda says:

    Tom –

    It’s immoral because the student is using the program for a purpose other than what it was intended for. He is abusing the system for his own personal gain.

    Gee look, I just wrote something more meaningful and truthful than all your sniveling little screeds. Congratulations on your 120 IQ. You can write huge pointless passages of sophistry justifying immoral behavior. It’s almost as if you take a perverse pleasure in it. To an honorable man you appear sick. It would be better for you to be an honest farmer than to be the morally bankrupt scheister that you are.

    Now go ahead and tell me which words I misused, while missing the point entirely.

    • Replies: @Jay
  84. Jay says:
    @grapesoda

    grapesoda,

    Your argument is exactly on target. I desisted from replying to T.S. because I perceived that he enjoys playing verbal games rather than searching for truth. It is also telling that his original comment was entirely gratuitous, i.e. he put forward his avaricious ex-serviceman as an example of a non-corrupt student. A certain ethnic group venerates sharp-dealing and highly self-serving behaviors. Perhaps T.S. has had too much contact with it.

  85. Uh no amnesty, please. These dumbasses defaulting signed the line to take out their loans, I didn’t do it for them. I took out what I needed and that was bad enough, but that’s almost paid off.

    I’m sorry, I just don’t see why I should have to bail out someone stupid enough to get a sociology or [insert subject here]-studies degree.

  86. There are two competing visions of the facts to determine which is the moral outcome – in the first telling, lazy ne’er-do-wells borrowed tens to hundreds of thousands of dollars to goof off for several years and pursue worthless fields of study; in the other, a predatory loan industry in bed with the Federal government lured doe-eyed children into indentured debt slavery. At stake in adopting one of the other narrative are two important principles – the first is that hobbling people with a debt for a lifetime that they have no reasonable prospect of paying is cruel and discourages if not inhibits those debtors from reaching the milestones of productive adulthood (and the economic activity attendant to it); the other principle is that debtors should pay back money that they have borrowed rather than sticking it to the government and innocent third parties who pay their own bills to make good on the guarantees.

    Perhaps the right path somewhere in the middle. From a practical perspective, someone $200K in debt with a nonsense degree probably has no reasonable means to pay the debt over a lifetime. We’re just not going to get much blood from those stones no matter how obstinate we are as debt collectors. These people meet the technical definition of bankrupts but can’t apply for relief, like an economic undead. In the commercial world, the lender would take a bath (this is why they’re much more thorough and circumspect before making loans) and would have no Federal guarantee. So I think it is fair that those people with existing debt must pay some, but not all of it. The answer in those cases is to write down the debt to something manageable and that allows them to work towards a productive adult life. Perhaps there should be some sort of significant part-time community service requirement for a term of years in exchange for retiring some of the debt. Now, the graduates of certain colleges and Universities will require more debt forgiveness than others – in cases with egregious academic programs, those worst offending schools should have their eligibility to receive Federal grants, aid and guaranteed loan proceeds greatly circumscribed.

    Prospectively, I think the schools themselves need to bear some risk of the lending. I would propose that the schools should lend (from their tax-exempt endowment portfolios) direct to the student during attendance. After a term of a few years (perhaps 5-7), the debt would be eligible to be sold on a secondary market under the aegis of the United States with reasonable but prudent underwriting requirements. In this case, the borrower would have established a track record of payments and an employment and credit history – better credit risks could then receive very good rates of interest and terms. The Federal guarantee and lifetime non-dischargeability would only kick in when the debt is sold on the secondary market. If a borrower cannot meet the underwriting requirements, the school simply hold the debt indefinitely or until they can meet the requirement. I think we should also modify the dischargeability of debt held by the educational institutions – at some part it becomes partially or totally dischargeable in bankruptcy. This way, the institutions that are marketing to the students, advising them in courses of study, and allowing some to muddle through would have an economic incentive to ensure that their middle class students are on a course for a remunerative career with manageable debt.

  87. Anonymous • Disclaimer says:
    @bill ziebell

    Did away with the Pell Grant? Funny, my son graduated in 2014, and he got one.

  88. Yes he did….the Obama regime put them back in place, after BushCo left office.

  89. This article is a bit self-contradictory. If it’s true that:

    “‘It turns out that guaranty agencies average about 60 percent of their income from fees alone. If the default rate declines, so do the fees and income of the guarantors.” (CounterPunch)”‘

    “Get the picture? So the worse it gets for the students, the better it gets for the lenders.”

    Then the conclusion cannot be true:

    “The only way to defeat this cadres of racketeers is to stop paying. That’s it. No more money for you.”

    If the lenders’ income off these loans directly correlates with the default rate (as defaults go down, so does the lenders’ income) as suggested, then more defaulting would probably only serve to help the lenders, right?

    Defaulting on a sizeable loan, particularly if it’s done by a young person hasn’t yet established a strong credit rating, certainly doesn’t help them in starting out into the real world. They’ll be judged by their credit scores for a surprisingly large number of things: when applying to rent an apartment, when applying for a number of jobs, etc., not to mention the fact that any loans they need to take out (such as for a car, for example) would be on absolutely abysmal terms, which they can ill afford.

    In addition, student loans are a bit harder to cast off in default/bankruptcy than many other loans. So someone trying to do so is really only setting themselves up for more hardship, having to pay extra fees, etc (in addition to screwing up their credit).

    I know at this point in the US, taking personal responsibility for one’s debts seems downright antiquated, but the country was certainly a lot better off when people did.

    • Replies: @Grandpa Jack
  90. The government didn’t just “look the other way” while the housing bubble was inflated with insane loans to third-world savages. The government, under the egregious Bush, did everything it could to force lenders to do this in partnership with nonWhite racial advocacy groups. Obama has done everything he can to reinflate the housing bubble, but he has mercifully failed for the most part.

    Under Bush, lenders were threatened with lawsuits and other punitive measures in order to artificially increase the number of “minority homeowners” in the hopes that these parasites and invaders would somehow become White Republicans after being grateful for this taxpayer-guaranteed bribe.

    It’s true that many lenders were highly enthusiastic about the chance to become criminal usurers, but it was the government who blew the air into this destructive bubble.

    Please note that the vast majority of the loan defaults were in the more lively, vibrant and diverse parts of the former United States.

  91. @Grandpa Jack

    These kids need to get the Finkelstein kid treatment:

  92. @John Tanker

    ” I have personally dealt with many of these so called executives that run private student loans. Shooting fish in a barrel. Major lucrative. Imagine every oily, shit kicking hustler and every wussy amoral accountant.”

    ” I paid for both undergrad and grad school at U Michigan in 50′s and 60′s. Worked part-time. Piece of cake.”

    -Just another day on the internet with people spouting off all kinds of things about their experience and abilities, none of which anyone can verify.

  93. @TomSchmidt

    Right there is an example of a broken system. Flying weekly for a class? Where’s the remote learning? Where is the mighty internet in this?

    Education is ripe for complete disruption- had been for decades. Why is it not happening?

  94. Klokman says:

    I recently made contact with a classmate I first met in 1960. She seemed bright enough and moral then. When she caught me up on the intervening years starting with high school, I did not hear enough about her scholastic competence. Yet she couldn’t handle the California college environment of the 70s and ended up in a small, burgeoning college in the northwest. She soaked the government for the education expenses, and upon graduation could not hold down a job. Emotionally erratic, boastful of her IQ while her accomplishments from it are altogether missing, she laughed when she told me she had never repaid her education loan. Now she is back living in the Mojave Desert alone, subsisting off Social Security which she received early under the guise of disability. Last I heard from her she was making and selling wind mobiles out of pop cans to gather the cash required to move from New Mexico back to SoCal.

    Forgive her debt? That would be condoning her miserable life-style born of faulty decisions and massive irresponsibility. She had the capacity to out-accomplish me, but the moral fiber of Hildabeast.

  95. biz says:
    @Yak-15

    The European mechanism is nearly free college. Here it is debt serfdom.

    European countries indeed have free college…

    for the small portion of the population that can get in given their more rigorous standards and fewer slots. For everyone else it’s off to vocational school. It is a good system actually.

    Here in America, however, idiots are proposing that college be free and for everyone. In other words four or five or six more years of high school, but with more alcohol and at a massive cost.

  96. Anonymous • Disclaimer says:

    no one forced you too borrow . you could have learned a trade or go to Walmart and start your career . shut down the collage loan industry ‘ collage tuitions will drop and those seeking a education can work their way thru collage as many have in the past

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