School Debt -

Discussion in 'Political Discussions' started by Vonnegut, Jan 30, 2020.

  1. Vonnegut

    Vonnegut Active Member


    ....I'm guessing they are on a deferment plan? Won't they be amazed when they log into their account and see that it's now accumulated to $46 trillion!
  2. nosborne48

    nosborne48 Well-Known Member

    The whole student loan situation is appalling. I see young lawyers every day who will never pay off their debt. How can we attract these people into state positions when we can't even begin to pay them enough to repay their loans? The only glimmer of hope is that there are programs that forgive such debts after decades of perfect payment history but the approval rates run about 3%.
  3. Kizmet

    Kizmet Moderator Staff Member

  4. Kizmet

    Kizmet Moderator Staff Member

  5. nosborne48

    nosborne48 Well-Known Member

    The idea is terrifying. Massive civil disobedience is something I've seen in my long life. Well do I remember the Vietnam era draft dodging protests. They ended in violence and bloodshed at Kent State and other places. Such mass movements gain strength as they go and no one can stop or direct them. I have to say that such a movement, if large enough and broad based, can topple a government and even a governmental system. It nearly happened in the early 1930s in the U.S. It DID happen in other countries.

    The Presidency of Donald Trump might be seen as an expression of growing dissatisfaction with a financial and legal system that appears to rob the poor to make the rich richer. There is rage in the countryside against the elite financial and political classes, something the Democrats don't seem to understand. Dissatisfied groups sometimes coalesce to make their movements even stronger.

    It struck me during the 2008 Crash that the Occupy movement and the Tea Party agreed on a great many things. Luckily for the government of the day, neither group saw the commonalities. They did not join forces.

    Revolution, genuine revolution, follows few rules but there does seem to be a greater tendency toward open revolt when things are a bit better than rock bottom. I would HOPE that the Congress and President would see the urgent need to address this crisis ($1 TRILLION in student loans, much of which can never be repaid). Hopelessness is a powerful enabler.

    A government faced with mass action has three choices. It can move quickly to address the core concerns of the movements. It can attempt to suppress by whatever means the clear challenge to its authority. It can fail to govern, allowing governance to pass into other hands.

  6. Rich Douglas

    Rich Douglas Well-Known Member

    Ironic. We hate robber barons so much we elected one.

    As for student loans, I don't see how you avoid paying them. Their like tattoos: you have to die to get rid of them. You can't default on them. (You can be "in default," which means you're behind on payments.) You can't discharge them in bankruptcy. Student loan lenders can garish wages and tax refunds, put liens on properties, get court judgments, etc.

    Navient owes $23M? No problem. They're my lender. They'll be good for it after collecting my monthly payment on the 15th.
  7. nosborne48

    nosborne48 Well-Known Member

    Do not assume that the people in their distress choose wisely.
  8. Kizmet

    Kizmet Moderator Staff Member

    That's a good point. As a general principle, people choose poorly under stress. As for avoiding student loans, they can be whisked away forever with the flourish of a pen. Donald Trump's pen. Either him or some Governor or whoever signs a new law of that sort.
  9. Rich Douglas

    Rich Douglas Well-Known Member

    Here's a couple of reasons why I think the whole thing is broken:

    First, there is an incredible imbalance of information between consumers and providers. It's like buying a car in the old days when dealers knew everything about what cars cost and what they were selling for, and buyers knew almost nothing. Remember how scummy it was to go into a car dealership and deal with a salesman? Ten times worse at a used car lot in the days before Edmunds and Carfax.

    This dynamic occurs with higher education, too. Many consumers go into a great amount of debt without any idea what they want their degrees to be in, much less what they want their degrees to do. Because it's a developmental process, it is hard for them to know. Some do, of course, but hard data are difficult to acquire and even more difficult to apply to each person's situation and outcomes.

    Second, there is a lot of money chasing the product. I firmly believe the reason why higher education tuition rises faster than inflation. That money is being spent in ways sometimes not wise (see above); universities sell people's futures to them without a guarantee--or even a return policy!

    Remember the housing bubble last decade? A lot of that was due to lenders giving mortgages to almost everyone who could write their names. You could even get a mortgage without proving your income (a "no doc" loan). All that money drove up housing prices to a point where the bubble burst.

    Will higher education's bubble burst? I don't think so. As long as we lack a national qualifications framework where people can earn industry-recognized credentials, and as long as employers and employees shy away from lifetime employment (and, thus, all the internal training and development that goes along with it), the demand for degrees will continue. As will the excessive money chasing them and the information imbalance that muddies it all.

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