Tag Archives: Student Loans

Student Debt Forgiveness Won’t Cure Higher Ed’s Disease, by Bruce Abramson

Higher education is on an insane treadmill in which the product gets worse and worse while the cost, subsidized by the government, gets increasingly outrageous. From Bruce Abramson at realclearwire.co

On February 28th, the Supreme Court heard arguments on President Biden’s plan to extinguish an estimated $400 billion in student debt. Biden deserves credit for highlighting a debilitating federal program in desperate need of reform. His proposal, however, would make the problem far worse, not better. Any serious reform would force academic institutions to take some responsibility for the education they provide—and to show some responsibility to the many young Americans they induce to go deeply into debt. 

The problems run deep. American higher education has become a hollow bubble of an industry coasting on brand equity and past glory. 

Notwithstanding pockets of world-class excellence, the industry does little well. Universities are top-heavy and inefficient. Their complex products bundle education, research, and campus life for many students who need—and can afford—only the first of the three. On campus, classrooms teach neither critical thinking nor employable skills. The return on research dollars is pitiful. Antisemitism and segregation thrive at levels unseen elsewhere in American society. Internal procedures fail to provide due process or equal protection. 

American academia is a sham suffering from disastrously flawed structures and incentive systems.

Continue reading

Meet Todd, A Total Chump Who Did The Responsible Thing And Worked His Way Through College

From The Babylon Bee:

Article Image

BALTIMORE, MD — Local PC Technician Todd Manfroy was singled out as a chump by his local community Wednesday after it was discovered he worked his way through college to avoid taking on student loan debt. As a result, the 32-year-old fool was unable to take advantage of President Biden’s recent student loan forgiveness plan.

According to sources, Manfroy worked full-time as a telemarketer while taking night classes at the University of Baltimore where he studied Computer Science.

“It wasn’t easy,” said total loser Todd. “Telemarketers don’t make a lot but I was able to get a second job as a waiter to help supplement my income.”

“I was really committed to having zero debt by the end of my student career,” he added.

“What an idiot,” said his father. “We told him we weren’t going to pay a cent for college because one day a brave Democrat would abolish debt forever. Now he’s really missing out!”

“Shameful,” agreed Todd’s mother. “I’m embarrassed to call him my son. He always was a little slow.”

Todd isn’t letting naysayers get him down, however. “Having zero debt was hard work but I’ve been able to put aside money into savings and hope to be able to afford a house soon where I can raise a family.”

Experts agree that Todd Manfroy is an imbecile and that if he tried being a little lazier he might get to take home some free government money one day.


Student Loan Forgiveness Proves All Those College Degrees Really Are Worthless, by Tyler Durden

Should the government be subsidizing student loans when the economic return from the underlying degree is less than its cost? From Tyler Durden at zerohedge.com:

What is a college degree actually worth?  We know what secondary schools charge for the “opportunity” to study with them, but this does not really tell us much about the value of the services they offer.

On average, college tuition costs around $10,000 per year for a person studying in their home state, and $25,000 a year for those studying out-of-state.  Federal student loans can cover these costs, but this is the application of public tax dollars with the expectation of returns; it is not supposed to be free money.  And to be clear, NO ONE is entitled to a secondary education, let alone for free.

The average interest rate on a student loan is around 5% these days, and such loans include stipulations that they cannot be erased through bankruptcy.  The argument among people who support loan forgiveness is that the cost of a degree is too high and the loans are impossible to pay or escape.  On top of that, many of these graduates can’t even get a job once they leave college.

Surveys over the past couple years show that at least 45% of college graduates are unable to find a job once they enter the private sector.  Those that can find a job usually end up working outside the scope of their field of study.  Keep in mind this is happening during a period of very low official unemployment.

Continue reading→

Biden To Forgive $10k In Student Loans — In Unrelated News, Nation’s Colleges Raise Tuition By $10k

From The Babylon Bee:

Article Image

CAMBRIDGE, MA — President Biden announced plans today to forgive $10,000 in student loan debt for anyone making less than $125k per year. In completely unrelated news, the nation’s colleges and universities announced plans to immediately raise tuition by $10,000.

“Look, Jack! Here’s the deal! No malarkey at all! Not a joke!” said Biden before an aide had to step in and explain he was signing an order to forgive student loan debt.

Dr. Charles Moneybags, director of the National Association for the Advancement Of College Professors (NAACP), said he applauds the president’s decision to cancel student debt for so many borrowers. “We’re very excited that a college education will be more affordable for the next generation of art history majors,” he said.

Moneybags then went on to explain why immediate tuition increases were necessary. “Due to an unfortunate concurrence of high inflation, global warming, and, uh, the upcoming solar eclipse in 2024, we’ve all had to raise our tuition by $10k,” he noted. “Plus, we’ve had to spend a ton of money building safe spaces and bathrooms for all the new genders.”

Shelia Johnson, a 45-year-old Harvard student working on her ninth degree, said she is excited for her loans to be forgiven, but worries about the ever-increasing cost of education. “I’m nervous that I might need to leave school one day to get a job and start paying my loans,” she said. “Hopefully President Kamala Harris can find a way to solve this problem.”

At publishing time, Moneybags had invited the press corps to his summer home in the Hamptons to show off the new helipad he had installed next to his swimming pool.


Trillion-Pinchers Lacking Empathy, by Tim Hartnett

The whole college finance system ends up supporting a well-heeled elite of professors and administrators, some of whom do nothing to justify their sinecures and salaries. From Tim Hartnett at lewrockwell.com:

Regular readers of the Washington Post opinion section should give credit where it is due. An enormous divergence of views is presented on their pages. Ideas in 100% opposition often appear on the very same day. That said, how the editors decide if an essay makes enough sense to arrive in print can leave the public overwhelmingly underwhelmed.

On the other hand, some takes on reality are so deluded and deranged publishing them can serve valuable purposes. First, they save detractors from the accusation of attacking straw men. Second, they can act as ideological springboards for launching crackpot notions high enough to get more scrutiny. Third, they provide a lode of asinine quotations that drive home the opposite point that was intended.

Christine Emba splashes A-19 on the Friday, May 6 WP with a belly-flop that soaks every onlooker. Why such a lack of compassion on student debt, barely wastes a word covering what’s wrong with education and economic justice overall from a standpoint guaranteed to make things worse. It starts with the title and continues spectacularly in the first sentence: “Why can’t we let good things happen to other people?” A “good thing” in her reckoning is handing over a sum that could feed roughly 300 million lavishly for a year so the kids can celebrate gender euphoria.

Continue reading→

Just Say No

Political Cartoons by Pat Cross

h/t The Burning Platform

Student Loan Forgiveness: Who Pays? By SchiffGold

Why, the taxpayers pay, of course, just like they directly or indirectly pay everything the government does. From SchiffGold and schiffgold.com:

Student loan forgiveness has been in the news lately. There are a number of different plans being floated, from blanket debt repudiation up to various amounts, to more limited income-based schemes. But nobody ever talks about a key question: who is going to pay for it?

Well, you will.

I think most Americans think Joe Biden or Congress can just wave some kind of magic wand and student loan debt will just disappear. Poof! No harm, no foul. In fact, I think a lot of people believe student loan forgiveness will stick it to the evil banks who lent out all of that money.

But it doesn’t work that way.

Continue reading→

The Trillion-Dollar Lie, by Matt Taibbi

Who says student loans can’t be discharged in bankruptcy? It’s not easy, but it happens. From Matt Taibbi at taibbi.substack.com:

Universities built palaces and financiers made fortunes in part through a lie: that student loans can’t be discharged in bankruptcy. But a series of court cases is helping unravel the scam

Stefanie Gray explains why, as a teenager, she was so anxious to leave her home state of Florida to go to college.

“I went to garbage schools and I’m from a garbage low-income suburb where everyone sucks Oxycontin all day,” she says. “I needed to get out.”

She got into Hunter College in New York, but both her parents had died and she had nowhere near enough to pay tuition, so she borrowed. “I just had nothing and was poor as hell, so I took out loans,” she says.

This being 2006, just a year after the infamous Bankruptcy Bill of 2005 was passed, she believed news stories about student loans being non-dischargeable in bankruptcy. She believed they would be with her for life, or until they were paid off.

“My understanding was, it’s better to purchase 55 big-screen TVs on a credit card, and discharge that in a court of law, then be a student who’s getting an education,” she says.

Still, she asked for financial aid: “I was like, ‘My parents are dead, I’m a literal fucking orphan, I have no siblings. I’m just taking out this money to put my ass through school.”

Instead of a denial, she got plenty of credit, including a slice of what were called “direct-to-consumer” loans, that came with a whopping 14% interest rate. One of her loans also came from a company called MyRichUncle that, before going bankrupt in 2009, would briefly become famous for running an ad disclosing a kickback system that existed between student lenders and college financial aid offices.

Continue reading→

Unpaid Federal Student Loans Top $435 Billion, by Adam Andrzejewski

$435 billion is not chump change. From Adam Andrzejewski at realclearpolicy.com:

As President Joe Biden considers forgiving $10,000 in student debt per borrower and ending tuition for many students at public colleges, it is worth noting that college graduates already have not paid $435 billion back to the federal government.

That’s right, of the government’s $1.4 trillion student loan portfolio, almost one-third is unpaid.

That $435 billion is compared to the $535 billion that private lenders lost on subprime mortgages during the 2008 financial crisis.

The figure comes from FI Consulting, hired by the Department of Education, and whose work was checked by accounting firm Deloitte, and is a total of losses over the life of the loans in the federal government’s portfolio.

People in income-based repayment programs pay the loans based on how much they earn, and the government forgives loans that haven’t been paid back after 10, 20 or 25 years.

The findings estimated that on average, borrowers in income-driven repayment plans will repay 51 percent of their loans, while those in other repayment plans will repay 80 percent.

As the debate over implementing free college tuition and canceling student debt continues, policy experts, journalists and the public should keep this $435 billion figure in mind.

The #WasteOfTheDay is presented by the forensic auditors at OpenTheBooks.com.


The Trustees Have Failed, by Techno Fog

The older generation, the boomers, hasn’t done too well for future generations. From Techno Fog at technofog.substack.

Brown and Black Wooden Chairs Inside Room

A Story of Generations

I often reflect on the concept of generational responsibilities. That each generation, whether mine or yours, has the same type of supportive role to the other for the common good, although the obligations may be different. Let me put this another way:

Every generation is the caretaker of the generations that came before, and the trustee of those who will come after. 

To explain by example: a child enters this world under the care of their parents. And the parents leave this world being cared for by their children. These are general observations (and aspirations) that leave out everything in between and all those little moments that define care.

To be more specific, and to hopefully state the obvious, caring for a child isn’t just a roof over their head and three meals a day. It’s teaching them values, being an example for them to follow, making them feel safe. It is making a marriage work for the benefit of the children and not divorcing for the convenience of the adults. Ensuring, as best we can, their future.

Then as we age, we see our parents start to fight with the parts of their daily lives they once did with ease. Their struggle is our struggle, though the struggles are different. Each day a brush more diminished until we say goodbye.

Continue reading→