Student Loan Fiasco (1 Viewer)

Steve R.

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A very good review concerning the idiocy of cancelling student loans.
The monologue was a bit short on the concept that one needs to save money before buying. That used to be one of the concepts underpinning our culture. Now its borrow first whether you can afford the debt burden or not. Instant gratification over responsible preparation.

Forgiving student loans also creates an extreme moral hazard. You are helping some at the expense of hurting others. Why should a person who did not save money to go to college have their debt cancelled, but a person who did save money gets no benefit?

Link to a prior post on student loans.


Two under-reported themes:
  • The federal government nationalized the student loan programs. Essentially removing these loans from the capitalistic system. Those loaning the money have no incentive to verify if the person getting the loan can pay it back. Additionally those making the loans bare no financial risk resulting from a default. Liability for loans that are defaulted or forgiven become the responsibility of the taxpayer.
  • The institutions of higher learning, where the students (revenue units) go, are receiving "free" money. They have no incentive to control costs or to even reject students who may eventually fail. Consequently they can raise tuition with little negative repercussions to them. There has been some increasing recognition that the institutions of higher learning should have a degree of responsibility and even liability for student loan defaults.
 
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The_Doc_Man

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A general loan amnesty undercuts the financial system badly and is a back-door method of redistribution of wealth. It is yet another step towards heavy-handed socialism, where people who have worked like hell to build up the capital implied by having a loan institution must be second-class business-people. Yet another reason why the pendulum needs to swing very far right in the next election.

Having said that, I would forgive one class of student debt - loans to fly-by-night institutions that have poorly structured classes with no added value to the students. The inexperienced students don't always know how to tell that a particular school is just a facade, a sham, a fraud. It would perhaps give incentive to the loan companies to investigate the schools a bit more before offering loans. It would also make it worth their while to file charges and send out bounty hunters. (Sic 'em, Dog!)
 

Steve R.

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Having said that, I would forgive one class of student debt - loans to fly-by-night institutions that have poorly structured classes with no added value to the students.
This reinforces the thread: Massive Government Spending Means Fraud. Whenever the government tosses money to supposedly helpful programs, such as student loans, the shady opportunists are there to immediately sell "opportunities" to the gullible.
 

NauticalGent

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Just another act in the Shit-Show. Good God, what is going on?
 

Steve R.

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Might as well defund the police while you're at it! :D
A tremendous irony in that. Help the criminals (those who corrupt the system, besides the obvious physical thug) with enhanced opportunities and neuter those citizens who are responsible. The Covid mandates are punishing the law-abiding, but the liberal prosecutors don't file criminal charges for theft or left wing rioting. I suppose you were leading up to that. ;)
 

Pat Hartman

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Cancelling student debt makes as much sense as preventing owners from evicting non-paying tenants. I think we can all agree that almost NONE of the left's programs any longer make any sense at all. There was a time when I disagreed but at least thought their heart was in the right place but not any more. It makes no sense to have a welfare state and open borders. We have more than enough Americans who need our help. We don't have to invite the world in too. These people aren't stupid. Of course they want free stuff and are willing to risk their lives and the lives of their children to cross the border any way they can. Just look at where people are coming from. The "wetbacks" used to be from Mexico and Central America. Now they come from Africa, Asia, Europe, and South America as well. Pretty much everywhere except Australia and the South Pole. But given the way Australia has gone off the cliff, I'm guessing we'll see an influx of Australians too.

Our children no longer understand that the government makes NOTHING. It earns NOTHING. It only TAKES. It takes from the hardworking, honest, industrious people and gives to the nar-do-wells and special interest groups, and people who enter the country illegally to get the good stuff. Nothing the government does is charitable. It STEALS from me at gunpoint and gives MY money to others it thinks are more worthy. That is not the same as me willingly contributing to the overhead of running a country and maintaining a standing army and international relationships, etc. and me willingly giving to charities I feel are worthy.

I really have no (OK not much) problem with government (me) supporting people who actually cannot care for themselves but I seriously object to supporting people who don't feel like working which is what the system has devolved to. This is the slippery slope we always talk about. The government should NEVER have EVER gotten into the "charity" business. Charity used to be provided willingly by those who could contribute and the recipients used to be grateful and anxious to pay it forward. Once the government got in, they took it over. But, since it isn't their money, they do not spend it wisely the way you and I would and waste is rampant.
 

Isaac

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concur with all of the above. like i've said before, a new class of lazy citizens.
when you make a decision / calculation to take on a certain amount of debt, ya better be sure it's worth it. everyone has the chance to make thoughtful decisions before investing.

a lot of people thought maricopa az would be the new big thing as a fast growing suburb and bought houses there 10+ years ago.
it never took off (relatively speaking). but chandler, goodyear, gilbert, the opposite, some of the fastest appreciating real estate in the USA.

should the maricopa investors' debts be forgiven, but not the other ones? heck no.

i mean gee, if you screw up BADLY enough, we already have a system where you admit your fault, take a major hit to your credit, and get the chance to start new. It's called CHAPTER 7
maybe throw Student Debt in there instead of excluding it - that's as far as I would contemplate going
 

Pat Hartman

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Student debt used to be dischargeable during bankruptcy. That was changed when the government took over the debt and cut the third party lenders out of the equation.
 

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