cross-posted from: https://lemmy.ml/post/21841560
Student loans shouldn't be guaranteed by the government.
this post was submitted on 27 Oct 2024
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In all fairness though, those industry bailouts were generally recovered
Early estimates for the bailout's risk cost were as much as $700 billion; however, TARP recovered $441.7 billion from $426.4 billion invested, earning a $15.3 billion profit (an annualized rate of return of 0.6%), which may have been a loss when adjusted for inflation
https://en.wikipedia.org/wiki/Emergency_Economic_Stabilization_Act_of_2008
Ok, that last part about still being a net loss after inflation is fair, but we're talking about a possible rounding error here, not a 12-figure loss for the Treasury.
also, don't forget, pre-covid: "you should have enough money set aside in savings to live without income for SIX MONTHS!!!"
covid lockdowns: "our $ multibillion corporation is going to DIE if we don't end the lockdowns RIGHT NOW!!!!"
Related: 75% of Americans don't have enough money in savings to cover their bills for six months. That's why a recession--which leads to a shrinking number of jobs and decreased consumer demand--is such a huge, dramatic siren for the fed and government. A recession for a nation where a large majority are basically flying without a safety net has an even bigger effect on the recession feedback cycle.
In general our entire economy right now has the knob labeled "high-risk/high-reward" turned to 11. With that many people only a few months from not being able to pay car loans, rent, mortgage, and all their other bills, with huge consumer debt, with car loan defaults already rising, and therfore without the means to maintain robust consumer economy, things would go south in the US very fast and with increasing velocity.
They gave all the power to those with money and they know, deep down, that those people are nasty and horrible. They’re afraid of them and so they give them tax breaks and bailouts like one would give sacrifices to eldritch god in the hopes they don’t get punished for existing.
They aren’t afraid of their neighbour, though. Why do you think all conservative humour punches down? They’re all pant-shitting coward suck-ups.
Friendly reminder that Joe Biden, despite being advised that he should cancel student debt under established provisions, chose to make it a brand new covid program. It was his unauthorized new covid debt cancellation program was cancelled by SCOTUS (AKA setup to fail). Biden still has the ability to cancel under the original terms his lawyers suggested. Instead he screams a legal provision be made out of thin air wasn’t respected so he is not gonna do anything except take credit for cancellations that were in effect before he was in office. You seen how he acts about Israel, you think he really fighting student debt earnestly?
They're cancelling debt right now! It's income driven, so not everyone qualifies, but given the comments I read on this site, I think most people here do. Go file for relief and get it! It's available.
Where? How? Help!
You: Conservative SC shot down student debt relief
Also you: How could the democrats do this!?!?
It wasn’t a case of him creating a “COVID program” bound to fail. Biden used the HEROES Act—a post-9/11 law meant for emergencies—to address debt issues exacerbated by COVID. The Supreme Court's conservative-shit-stain bloc shut him down. This wasn’t a Biden "setup." It was an intransigent conservative court doing what they always do.
After the ruling, Biden didn’t abandon debt relief either. Instead, he did exactly what you're implying he didn't: he pivoted to the Higher Education Act, which allows debt cancellation but only through a lengthy rule-making process. He can't just use the HEA to "cancel" student debt in the way he was trying originally. This route takes longer and still faces legal obstacles, as you might have noticed, but it shows he’s exploring every option available within legal limits, not just “giving up.” He’s also rolled out specific programs for groups like public service workers and adjusted repayment options to reduce debt burdens in the meantime.
Blaming Biden’s actions on lack of commitment ignores the layers of legal and rule-making shit-fuck layers at play. He's pushing for debt relief within what’s legally possible, starting with the faster attempt that was killed by Republicans, and now a slower and less sweeping manner as required by the HEA—which continues to be contested by Republicans.
While nothing is perfect and could be better. Latest relief under Public Service Loan Forgiveness (PSLF) Program brings total loan forgiveness approved by the Administration to over $175 billion for more than 4.8 million Americans. So he has done something. Idk if you expected a magic wand for everyone but something is better than nothing.
As for Israel we have a former president actively tanking any policy for a ceasefire. Who do you think if elected would be more likely to negotiate a ceasefire with Israel? Tbf America is a single policy for Israel in general that fact there is even a waver on the democrats side is amazing
Biden tried to take credit for the PSLF is bullshit. Those learned loans were guaranteed to be dismissed back during Bush.
My point is that its a Bush era program Source. Israel I am not even gonna touch ys seen them punk Biden’s redlines on tv enough
Claiming Biden did "nothing" with PSLF is way off. Under Bush, PSLF was a mess—only about 7,000 people got their loans forgiven, thanks to an insane 98% rejection rate. Since Biden took office and reformed PSLF, over a million borrowers have received forgiveness, with his administration introducing temporary waivers, fixing processing errors, and expanding eligibility to previously blocked borrowers.
You're saying that he both should have used existing means to forgive debt, but also criticizing him for using existing means to forgive debt. The fact that he did both and basically brought PSLF back from the dead in order to help borrowers after his initial attempt failed speaks to his significant commitment to this issue, so it seems like an odd issue to bring up to try to support the case that Biden has done nothing, and it's all theater. Tell that to the millions helped so far.
He basically picked up an old, rusty knife in the yard, hardened the metal, cleaned it, sharpened it, polished it, honed it, replaced the hilt, and put it to work slashing student loan debt. Why throw out a busted tool if it can be fixed?
Biden’s fixes also significantly overhauled and streamlined the entire process for current and future borrowers. Comparing what PSLF was under Bush to what it’s become under Biden is like night and day—Biden’s updates turned an empty promise into an actual effective tool to deal with the unsustainable student-loan burden. And that's only to speak of what he's done with PSLF, not all the things he's tried, the other programs he's implemented, and how consistent he's been on this issue since he took office.
There would have been nobody under Bush that would have qualified for a loan forgiveness while Bush was president. It was a 10 year program. He was already well out of office before the first ones were even eligible to be dismissed.
I didn't say the forgiveness happened under bush. The program began in 2007. Until Biden took office, there was a 98% denial rate and 7,000 borrowers had completed it. By 2023, that number increased to well over a million, partially by correcting unjustified denials and allowing for the retro-application of qualifying payments. You think there was just a coincidental 14,000% increase in PSLF loans forgiven in Biden's first two years? Or maybe it's related to the $175 Billion in loan forgiveness for the 4.8 Million Americans that received it? Incidentally, PSLF is less than half of the total student-debt burden eased under Biden.
Again, there's a lot to criticize about Biden. Why you all are digging your heels in about something for which, on the whole, he's proactively done a lot about (and with relative succes despite robust opposition), I'm not sure.
So this feels like alot of words to say he enforced existing laws from 2007, and did not in any way shape or form do what he said he would while on campaign. Did I miss anything? Oh that he could have done it the slow way, and after 3 years whats our progress? Oh he didn't even send in the application.
Nah, he tried to do what he said he would. Several states with absolutely no fucking standing sued on behalf of companies that stated they didn't wanna be part of the suit, and took the case to the SCOTUS, who said "oh, out of literally whole-cloth interpretations of the law that make no sense, we decide that large-scale loan forgiveness is not purview of the Department of Education, and can only be done with a law passed by Congress." Biden could've, and honestly should've, done it anyway after the immunity ruling, and said "it's an official act, you can't do shit", but saying "he didn't even try to do anything" is disingenuous.
Instead he screams a legal provision be made out of thin air
Thank you for revealing what you are so I can block you
I try and remain intellectually consistent.
I'm opposed to bailing out banks.
I'm opposed to bailing out any industry not just the auto industry
I'm opposed to bailing out farmers (and I currently live amongst corn fields).
And, I'm opposed to too big to fail.
I'm also opposed to student loan forgiveness.
When kids are conditioned from birth to believe that the only way they're ever going to improve their miserable lives is to go to college, and then the price of that college education is jacked up 600%, and graduation didn't actually do much for their overall financial situation or quality of life, hell yes I think it should be cancelled. The whole thing has been an elaborate extortion racket for decades, and it's been encouraged and backed by the government.
i don't mind it being your opinion and I agree its consistent without trying to dig in to find a gotcha, however being logistically consistent without exception does not resolve an evolving crisis that could have further, worse, knock on effects that affect even the most consistent of thought experiments.
If, in 30 years' time, we are at a point where the education system collapses, it'll be a lot worse than the "pain" of not being entirely consistent when reallocating government budgets.
In fact one might argue its more sensible - in many regards not just this - to maintain a flexible case-by-case policy should the need arise.
Corporations are allowed to discharge debt via bankruptcy. Let's give that to students. Does that satisfy your consistency?
I think we all know who prohibited students from discharging debt via bankruptcy.
As you can see in two further posts here I did say that student loans should be dischargeable by bankruptcy.
I also try to remain intellectually consistent:
- people matter
- corporations aren’t people
The law, in its majestic equality, forbids rich and poor alike to sleep under bridges, to beg in the streets, and to steal their bread.
University costs are also one of the few things that have far out paced inflation, and wages for decades. It's not about getting handouts, it's about not saddling an entire generation with debt they never should have had in the first place.
p.s., it's not "intellectual" to oppose this. You're just an ass.
Starting at the bottom...
I'm curious that it makes me an ass to believe that no matter who your are, you should pay your debts. That goes for banks, industries, farmers, and students.
As I mentioned in another comment. I do believe the law needs to be changed to make student loans dischargeable in a bankruptcy.
The rest of your comment will take a lengthy reply, so I hope you stick around.
You are correct that education has far outpaced the rest of the economy when it comes to inflation. I believe there are two factors at work there.
First, we have glorified education at the expense of the trades. I grew up in the 70s and the roots of that were already beginning to take hold. The adults around me praised and respected (though that's not quite the right word) the "educated". They would say things like "if you want to amount to anything you need a college education!" While at the same time complaining about what the plumber, or electrician, or mechanic charged them.
When I went to high school I went to a school that had been "boys only" (a bad thing) until shortly before I started in 1977. They taught the trades. In fact I had to take eight introductory courses in various trades my Freshman and Sophomore years (a very good thing).
But educators bit on the whole "if you don't go to college, you will suck as a human being" thinking. Parents of course want what's best for their children, so they pushed their kids into colleges. Many of those kids would have been far happier elsewhere.
As an aside, my high school still exists, but I don't think you'll learn the trades there anymore (I may be won't about that as I haven't paid attention in many years, but I think I'm on pretty solid ground with my claim.)
More customers competing for limited resources raises prices. That said, it's not the main culprit.
The main culprit is the fact that there is no means-testing for student loans. Need a loan to go to school? Here's a check.
There was no financial pressure for universities to constrain costs. They knew that lenders would pay for someone's schooling regardless of cost, because those lenders had absolutely no risk!
This created a horrible downward spiral. Too many highly educated individuals competing for too few jobs has created a morass that will take generations at least to resolve.
We have too many highly educated folk, and too few folk willing to do manual labor in the trades. I can't count the number of trades people who have told me that they just can't find good help!
Of course too few people working in the trades has created another sort of inflation. That in turn impacts all of society.
no matter who your are, you should pay your debts.
Do you honestly believe no debts are predatory?
Of course some are. Hell I'm married to a Soldier and I see predators preying on young Soldiers all the time. "Use your enlistment bonus to buy this cool Challenger! You'll only be paying 20%!" (I didn't believe those who take these loans should have them forgiven either).
I'm unsure that student loans can be placed in that category. Perhaps if you got a student loan for Trump University (or any other for-profit University) I'd consider it predatory. But most people know full well what they're doing when they choose to go to university, and choose to borrow to do so.
As I said in the post that you responded to, I think making the debt dischargeable in a bankruptcy would make lenders far more cautious about who they make a student loan to, and that would start solving the problem as university's would actually have some pressure on the price of the education they would like to sell you.
But as you pointed out above, children were (and are) being pushed into colleges whether it’s right for them or not. Hugh schools are measured by college admissions rates of their students, and so are pushing kids into this debt without any real voice on the other side telling the students they have other options.
Colleges are pushing new students towards financial aid without spelling out the true costs of those loans. All of this to people who often have almost no financial literacy or experience to understand the impacts. They are exactly like the soldiers you just mentioned. So by all means student debt is predatory.
Its clear you are not open to considering some debts as beneficial to discharge, so I won’t waste the time explaining the vast net benefits of infusing our younger and middle aged generation with cash flow that they would by every measure largely reinvest in their communities, making everyone better off. But can we at least agree that student debt is at least as predatory as shitty car loans to young enlisted recruits near bases?
Forget all the haters, I do not agree with you but can understand your viewpoint and respect it.
Thank you.
As I was thinking on this subject, I do have one significant proposal when it comes to student loan debt. It should be dischargeable under bankruptcy.