Student loan payments to be deducted from Social Security!

Re: Hmmm.

Back in the 1980's we couldn't. The Social Security Act prohibited it, I believe. Since then there has been quite a bit of legislation. There have been laws (whose details I haven't followed) specifically addressing child support. And more to the topic of this thread, there was a comprehensive Debt Collection Improvement Act in 1996 that made it possible to garnish SS benefits for a variety of purposes. That law plays a big part in this student loan case, it seems.

 

Here's the oral arguments before the supreme court concerning this case, 'Lockhart vs. US':

www.supremecourtus.gov/oral_arguments/argument_transcripts/04-881.pdf

And here's the text of the Lockhart decision:

http://caselaw.lp.findlaw.com/scripts/getcase.pl?court=US&vol=000&invol=04-881

It seems that the Dept. of Education submitted Lockhart's name to the Treasury as a debtor and SS deductions were begun. Instead of seeking to have his debt discharged on the basis of disability and inability to pay (an option open to him, see below), Lockhart sued and made a much different and rather technical argument that there is a 10 year statute of limitations on the use of Social Security offsets to collect student debt. The Court of Appeals found against him. So he appealed to the Supreme Court who decided to hear it, ultimately upholding the circuit court decision.

If we look at the arguments and at the decision, it's all very technical stuff about the precise wording of laws and amendments, about what implication subsequent legislation had for earlier provisions, and stuff like that.

In particular, at no time did the Supremes deliberate the pros and cons of screwing an elderly disabled man. That was NOT what this case was about, even though it looks like virtually every newspaper presented the case that way.

The oral arguments do contain this exchange between the Supremes and the attorney for the US Solicitor General:

MS. BLATT: -- and just because it -- the limitation period was in one section -- but, now, here's where I think the policy does come into play. A legislature would think that a 10-year limit would never come in to offset Social Security benefits on student loan, except in a rare case of an old debtor who -- and also defaults close in time to age 65. And, like I said, 90 percent of all the student-loan defaults are by debtors who are
under age 55, and over -- about 83 or 84 percent of all Social Security payments are under the retirement system, not the disability system. And if a person is disabled, there's no reason to think that they can't get a discharge of that loan.

So, all we're talking about is basically
rendering a dead letter Social Security offsets to collect student-loan debt, if Petitioner's position were to prevail.

JUSTICE SCALIA: Why can he get a discharge if
he's disabled?

MS. BLATT: You can get a discharge of your loan if you have a disability of indefinite duration that prevents you from working. The rationale is, sort of, a changed-circumstances rationale. If you took out a loan, you signed a promissory note, you intend to pay it back. But if you later become disabled, and that disability is going to prevent you from ever working, they'll discharge it. Now, about 30 percent of all people who do apply for this disability discharge do get it, and about 80 percent get a conditional discharge, what
gives them -- it gives them a 3-year grace period. And the only difference between -- I mean, there are some small differences, but the main difference between a Social Security disability determination and an Education Department disability determination is the Department of Education wants you to be disabled of an indefinite duration, and not just 12 months, because it's a complete and total walkaway from the loan. And Social Security will actually do a lookback after 12 months. But Education will never go back and ask for the money. Once they've discharged it, it's a permanent discharge.

 

Re: Just pay more!

And why should the government be immune from the law of supply and demand?

 

Instead of seeking to have his debt discharged on the basis of disability and inability to pay (an option open to him, see below), Lockhart sued and made a much different and rather technical argument that there is a 10 year statute of limitations on the use of Social Security offsets to collect student debt. The Court of Appeals found against him. So he appealed to the Supreme Court who decided to hear it, ultimately upholding the circuit court decision.

Maybe I'm just not a "take a stand" kind of person, but if faced with two options:

1--Petition to have the debt discharged on the basis of disability
OR
2--Drag it through several court systems taking who-knows-how-long

I'm going take the most expeditious route--petition to have it discharged.

Unless I'm not really disabled to the point I can't work.

Trying to dodge a debt with the knowledge that, if I can just hold out for ten years or until retirement, I'm home free--isn't that just one step above stealing?

IMHO, society in the long run doesn't benefit when what is essentially charity comes to be viewed as a right. Because an act of charity is the moral obligation of one person doesn't, and shouldn't, make it the right of another.

 

Supply and demand

TH:

Well...partly because the legal and medical professions are themselves not free markets but rather powerful guilds who can (in general) control HOW MANY lawyers and doctors are created and WHO can be a lawyer or doctor.

Believe it; the ABA and AMA wield enormous power over their respective areas. And you might also remember that the legal system is a separate, coequal branch of GOVERNMENT ITSELF.

 

From the original version of the Hippocratic oath, http://www.bbc.co.uk/dna/h2g2/A1103798


...I will pay the same respect to my master in the Science as to my parents and share my life with him and pay all my debts to him. I will regard his sons as my brothers and teach them the Science, if they desire to learn it, without fee or contract. I will hand on precepts, lectures and all other learning to my sons, to those of my master and to those pupils duly apprenticed and sworn, and to none other.


Now, I copied this from a web page, but when taking my mother-in-law to the doctor the other day, the long version with the same verse was in big print, framed, on his door.

Perhaps it could be broadened, or other clubs could adopt the same precepts...

 

All I know is that if I have to pay for my student loans so does everyone else. Deadbeats do not deserve any special treatment. As for student loans not been dischargeable in bankruptcy proceedings, neither are IRS debts, child support and alimony, etc. In other words debts to the state or those that would substantially affect the wealth fare of society at large.

 

Re: Supply and demand

Sorry, nosborne, but I'm not buying the arguement that there is any obligation to sell onesself more cheaply to the government than one would sell to private enterprise. Nor do I think it is right for the government to try to be a bunch of cheap you-know-whats, because you get what you pay for.

BUT maybe you're saying that we should not only abolish a certain clause that appears in both the Fifth and Fourteenth Amendments and revise it so as to say that government should have the right to sieze whatever it wants, including the right to enslave people. Talk about Naboth's vineyard!

 

The notion that Social Security income should be sacrosanct is odd. Why those dollars and not others?

That said, there should be--and are--provisions for forebearance due to poverty, disability, etc. These conditions should be subject to review periodically, if only to re-justify the forebearance. This would seem a small burden to receive such consideration.

So, take this guy's Social Security dollars? Sure. Does he meet the burden of proof for forebearance? I don't know, but that would be fine if he did.

Providing him forebearance is irrelevant to his Social Security income, and vice versa. Two issues. It seems the Supreme Court sees it that way, too.

All the preening about on this thread about "I had to pay my loans...." is lame and irrelevant.

1. The source of income doesn't matter.
2. There are provisions for forebearance.
3. He should get to place his loans in forebearance if he qualifies.

 

TH:

I think perhaps that I expressed myself in too "shorthand" a fashion to be entirely clear.

I am not suggesting that the government has a RIGHT to require lawyers and doctors to provide free services (though more and more Bar associations DO impose at least an "aspirational" requirement for 50 hours of pro bono work each year or a cash payment of $350 to a provider of free legal services.)

I AM suggesting that my profession receives a monopoly from society at large and that this monopoly carries with it at least or moral obligation to see to it that everyone has access to the Courts regardless of personal wealth.

But the high cost of earning a J.D. degree is making it harder and harder for young lawyers to provide pro bono services or accept public sector positions.

My law license IS my private property in some ways but it carries a social obligation. Law practice is a profession, not just a business and one of the hallmarks of a traditional profession is that the individual practitioner has just such an obligation.

 

And I'm suggesting that, even though the law is a profession, law firms are businesses and each individual lawyer, whether an employee of someone else or a proprietor of a law firm ought to think of himself as the owner of "Me Incorporated." And, as he thinks about putting his services up for sale and he hears prospective buyers yelling "I bid 25" and "I bid 45" and "I bid 60" and "I bid 100," who do you think that lawyer ought to go with? Most likely, I'd say, the high bidder, unless there is some other thing offered by one of the lower bidders that sweetens the deal. Now, if the monthly payments on $100,000 worth of law school loans are a bit too high to allow one to support onesself on the mid20s to mid40s salaries offered by the government positions, then by all means, go for the private positions paying 60 to 100. As far as government finding ways of making it possible for young lawyers with lots of debt to be able to take positions as government lawyers, that's simple: do like the Army, offer to repay 15% of your student loan balance for each year you remain in government service.