US student loans grotesquely high

[Metaphor]

Nonetheless, that is the legal drinking age. In the US, one is allowed to obtain a drivers’ license at an earlier age compared with many/most other countries.

Student loans are typically federal loans, meaning that they are borrowing from themselves and are paying —or not paying themselves back.

Arguing that other people had to pay is about as sensible as saying that people used to die of polio so why do kids today deserve to be vaccinated?

No, it is nothing like that. If you and I took out a loan in 2000, and I paid it back over ten years and you didn't pay any of it back, why should you get your debt forgiven? Why should your education and living costs effectively be free but mine not, because you didn't pay back your debt?

Do you realise how perverse that is?

I realize that you are opining about things that happen in the US that you neither understand nor are affected by.

I well understand the implications of forgiving student debt.

It means tax payers will be giving lots of free money to people who incurred debt and didn't pay it back, whilst the people who did pay it back are given nothing. It is screamingly perverse.

Why not let tax payers pay half the mortgage of people who bought a house that was too costly for them to manage on their own?

No one can qualify for a mortgage at age 18.

Disingenuous. You are not proposing that the US does not forgive the student debt of students who first started university at age 25.

 

[Toni]

Nonetheless, that is the legal drinking age. In the US, one is allowed to obtain a drivers’ license at an earlier age compared with many/most other countries.

Student loans are typically federal loans, meaning that they are borrowing from themselves and are paying —or not paying themselves back.

Arguing that other people had to pay is about as sensible as saying that people used to die of polio so why do kids today deserve to be vaccinated?

No, it is nothing like that. If you and I took out a loan in 2000, and I paid it back over ten years and you didn't pay any of it back, why should you get your debt forgiven? Why should your education and living costs effectively be free but mine not, because you didn't pay back your debt?

Do you realise how perverse that is?

I realize that you are opining about things that happen in the US that you neither understand nor are affected by.

I well understand the implications of forgiving student debt.

It means tax payers will be giving lots of free money to people who incurred debt and didn't pay it back, whilst the people who did pay it back are given nothing. It is screamingly perverse.

Why not let tax payers pay half the mortgage of people who bought a house that was too costly for them to manage on their own?

No one can qualify for a mortgage at age 18.

Disingenuous. You are not proposing that the US does not forgive the student debt of students who first started university at age 25.

Disingenuous. You have no idea what I do or do not think about student loans incurred by more mature students.

 

[Metaphor]

Nonetheless, that is the legal drinking age. In the US, one is allowed to obtain a drivers’ license at an earlier age compared with many/most other countries.

Student loans are typically federal loans, meaning that they are borrowing from themselves and are paying —or not paying themselves back.

Arguing that other people had to pay is about as sensible as saying that people used to die of polio so why do kids today deserve to be vaccinated?

No, it is nothing like that. If you and I took out a loan in 2000, and I paid it back over ten years and you didn't pay any of it back, why should you get your debt forgiven? Why should your education and living costs effectively be free but mine not, because you didn't pay back your debt?

Do you realise how perverse that is?

I realize that you are opining about things that happen in the US that you neither understand nor are affected by.

I well understand the implications of forgiving student debt.

It means tax payers will be giving lots of free money to people who incurred debt and didn't pay it back, whilst the people who did pay it back are given nothing. It is screamingly perverse.

Why not let tax payers pay half the mortgage of people who bought a house that was too costly for them to manage on their own?

No one can qualify for a mortgage at age 18.

Disingenuous. You are not proposing that the US does not forgive the student debt of students who first started university at age 25.

Disingenuous. You have no idea what I do or do not think about student loans incurred by more mature students.

DO tell me.

Is your student loan forgiveness advocacy dependent on the student being under a certain age when they started university? If so, what is your proposed cutoff age?

 

[bilby]

Education is infrastructure. It benefits all of society, so should be funded from taxation revenue.

To the extent that it increases the incomes of its recipients, it also increases their tax burdens; And paying for it from tax revenues means that non-recipient beneficiaries, such as the employers and employer's shareholders, also carry their fair share of the load.

Treating education as though it were an asset from which only the recipients benefit, and which they should therefore fund themselves in addition to the taxes levied on whatever income that education allows them to command, is stupid and ignorant, and typical of conservative misunderstanding of the purpose, or even existence, of society.

Individualism is a cognitive error, and leads to harmfully stupid policies such as student loans.

 

[Jarhyn]

So, here's what at least someone thinks about student loans taken by older people:

Education is a public service. I would give up 10% of my money every month, every paycheck towards funding education not just for myself, but for EVERYONE, made available to return after leaving or retry, all failures forgotten after failing out, at some regular period of years.

I doubt it would cost that much. I spend about 10% of every paycheck towards student loans as it is!

Because I see this as a more equitable state of nature, it also strikes me that the current state of nature is not and never has been fair, even to older people seeking an education.

It's exactly the fact that these loans are usurious that we recognize that the young people entering into them ought not be held to them. So if they are usurious (and I contend they are), why would we accept their existence or "necessity" or drain on ourselves, either?

I understand now that such loans are usurious. Why would I allow them to stand at the gate even for continuing education? For anyone? I shouldn't EVER be expected to pass through a usurious loan, not when I was a kid and NOT NOW!

Cancel those too. People being leveraged into debt for access to education at public institutions is not, has not been, and never will be OK.

Those of us who CAN pay taxes, on our income, in guarantee that we have enough to support ourselves, SHOULD.

This means that the best tax for such would be progressive: pay no taxes on first $X, 5% on second $X...

Nobody should pretend for one goddamn second that we don't benefit when every last person has as much education as they can get, and we shouldn't pretend that anyone should be expected to be owned by rent-seekers for it either, not young folks, not older folks.

 

[Toni]

Education is infrastructure. It benefits all of society, so should be funded from taxation revenue.

To the extent that it increases the incomes of its recipients, it also increases their tax burdens; And paying for it from tax revenues means that non-recipient beneficiaries, such as the employers and employer's shareholders, also carry their fair share of the load.

Treating education as though it were an asset from which only the recipients benefit, and which they should therefore fund themselves in addition to the taxes levied on whatever income that education allows them to command, is stupid and ignorant, and typical of conservative misunderstanding of the purpose, or even existence, of society.

Individualism is a cognitive error, and leads to harmfully stupid policies such as student loans.

I agree wholeheartedly with all of this except the last sentence. I understand the myth and the limitations of individualism but I also understand the benefits of individualism in terms of being independent and self reliant. I obviously recognize that all of us stand on the shoulders of those who came before us and all of us rely on those who came before us and those who are here now, and owe a debt that can only be paid by doing our best to ensure the best prospects for those who come after us.

 

[Jarhyn]

Education is infrastructure. It benefits all of society, so should be funded from taxation revenue.

To the extent that it increases the incomes of its recipients, it also increases their tax burdens; And paying for it from tax revenues means that non-recipient beneficiaries, such as the employers and employer's shareholders, also carry their fair share of the load.

Treating education as though it were an asset from which only the recipients benefit, and which they should therefore fund themselves in addition to the taxes levied on whatever income that education allows them to command, is stupid and ignorant, and typical of conservative misunderstanding of the purpose, or even existence, of society.

Individualism is a cognitive error, and leads to harmfully stupid policies such as student loans.

I agree wholeheartedly with all of this except the last sentence. I understand the myth and the limitations of individualism but I also understand the benefits of individualism in terms of being independent and self reliant. I obviously recognize that all of us stand on the shoulders of those who came before us and all of us rely on those who came before us and those who are here now, and owe a debt that can only be paid by doing our best to ensure the best prospects for those who come after us.

Where I stand as well. "Mutually Compatible" is good and all but if it's not directed somewhere it is pointless. I would also hazard part of the debt we owe to those who came before is to make the most of those prospects now, too to be and shine. We are those who came after someone and they wanted to see us shine and be all that we may, or at least they SHOULD have wanted that.

So ultimately there has to be some individual/self interest. It just ends in justification at the point where it would take such interest from others against their consent in the moment, for the moment.

The rest of it is spot on.

 

[ZiprHead]

From Sputnik To Sallie Mae: A New History Of Federal Student Loans

The Wall Street Journal's Josh Mitchell pens an engaging history of the federal government's role in the ongoing student loan debacle.

www.forbes.com

But the program soon morphed into what Mitchell calls “the quintessential form of crony capitalism. It privatized profits and socialized losses.”

For most of the loan program’s history, the federal government did not lend directly to students. Congress outsourced that task to banks, but covered banks’ losses when students defaulted. While banks earned profits when students paid back their loans, taxpayers shouldered the losses when things went south.

Congress also created a new entity, Sallie Mae, with the right to borrow at rock-bottom interest rates. Such a creature was unprecedented: until then, only the United States government could borrow so cheaply. In an eerie foreshadowing of the subprime mortgage crisis, Sallie Mae flooded banks with cheap cash, purchasing student loans directly or lending to banks using student loans as collateral. The system gave banks the incentive—and the ability—to make as many student loans as possible.

Everyone involved—from politicians to banks to universities—convinced themselves they were heroes. It’s true that the convoluted system enabled many young people of limited means to attend college. But at the same time, student loan defaults soared. So did college tuition.

Sallie Mae and the banks earned tremendous profits from the scheme. But universities also became a rent-seeking interest group every bit as ruthless as the financial sector. Mitchell points out that “today, universities employ more lobbyists than any other industry except pharmaceuticals and technology.”

In the decades after Congress created the modern loan program, tuition rose well in excess of inflation. Elite universities colluded to fix prices. Thanks to cheap federal loans and a general mentality that college was a “golden ticket” to economic prosperity, universities found that students were willing to pay even as they raised tuition year after year. Rather than vying to offer education at the lowest price, schools started competing on rankings, reputation, and campus amenities. It was a vicious cycle that drove costs higher and higher.

 

[lpetrich]

Finally, finally, finally, it happened.

The Biden-Harris Administration's Student Debt Relief Plan Explained

Part 1. Final extension of the student loan repayment pause - to December 31, 2022, the end of this year

Part 2. Providing targeted debt relief to low- and middle-income families

To smooth the transition back to repayment and help borrowers at highest risk of delinquencies or default once payments resume, the U.S. Department of Education will provide up to $20,000 in debt cancellation to Pell Grant recipients with loans held by the Department of Education and up to $10,000 in debt cancellation to non-Pell Grant recipients. Borrowers are eligible for this relief if their individual income is less than $125,000 or $250,000 for households.

In addition, borrowers who are employed by non-profits, the military, or federal, state, Tribal, or local government may be eligible to have all of their student loans forgiven through the Public Service Loan Forgiveness (PSLF) program. This is because of time-limited changes that waive certain eligibility criteria in the PSLF program. These temporary changes expire on October 31, 2022. For more information on eligibility and requirements, go to PSLF.gov.

Part 3. Make the student loan system more manageable for current and future borrowers

The Admin proposes a rule that would:

• Require borrowers to pay no more than 5% of their discretionary income monthly on undergraduate loans. This is down from the 10% available under the most recent income-driven repayment plan.
• Raise the amount of income that is considered non-discretionary income and therefore is protected from repayment, guaranteeing that no borrower earning under 225% of the federal poverty level—about the annual equivalent of a $15 minimum wage for a single borrower—will have to make a monthly payment.
• Forgive loan balances after 10 years of payments, instead of 20 years, for borrowers with loan balances of $12,000 or less.
• Cover the borrower's unpaid monthly interest, so that unlike other existing income-driven repayment plans, no borrower's loan balance will grow as long as they make their monthly payments—even when that monthly payment is $0 because their income is low.

 

[lpetrich]

Rachel F. Ventura on Twitter: "The Biden admin’s student loan forgiveness plan est 20 MILLION borrowers debt-free, almost 1/3 of all student loan borrowers! The cost of education shouldn’t be a barrier for anyone, and this plan to reduce the student loan burden is a huge step toward true equity in education. (pic link)" / Twitter

Sawyer Hackett on Twitter: "“Pay off your own debt!” says a generation of pundits that went to school when classes were $100 and the minimum wage could finance a mortgage on a 2-bedroom home." / Twitter

JM Rieger on Twitter: "REPORTER: Is this unfair to people who paid their student loans or chose not to take out loans?

BIDEN: Is it fair to people who, in fact, do not own multi-billion-dollar businesses if they see one of these guys getting all the tax breaks? Is that fair? What do you think? (vid link)" / Twitter

With responses
Ana Kasparian on Twitter: "More of this version of Biden please." / Twitter
and
Doyle Canning on Twitter: "Based." / Twitter

 

[lpetrich]

Jen Perelman on Twitter: "Politicians saying student debt cancellation is voter bribery while taking bribes from corporate donors is politics in a nutshell." / Twitter
and
Ronald Krinock on Twitter: "@JenChangeFL Been reading “…and forgive them their debts;” Michael Hudson examined cuneiform writings fr Sumer, Babylon, Assyria etc fr the 3 bronze ages &—spoiler—it turns out those societies canceled/”forgave” debt MORE—not less—than contemporary society. (link)" / Twitter
noting
...and forgive them their debts | Michael Hudson

In all eras – from antiquity to the present – debts have tended to mount up faster than the ability of most debtors to pay. That is a basic mathematical fact: Economic growth is arithmetic and can’t keep up with the exponential growth of debt growing at compound interest.

The big economic question is – and has always been – what will happen if debts cannot be paid? Will there be a debt writedown in favor of debtors (as has been done for large corporations), or will creditors be allowed to foreclose (as is always done on personal debtors and mortgage-holders), leading to their political takeover of the assets of the economy – and the government’s public sector?

The problem of debt backlogs was created with the invention of interest-bearing loans in agrarian 3rd Millennium BC Mesopotamia. The remedy of record was the royal Clean Slate proclamation or Jubilee Year of debt forgiveness. These proclamations had three functions: (1) They restored financial balance by annulling the backlog of crop debts that had accrued; (2) they liberated indebted bondservants (and their families); and (3) they restored land tenure rights, enabling debtors to continue living productively on the land, pay taxes, and be available for military service and corvée labor.

...
Historically, no monarchy or government has survived takeover by creditor elites and oligarchs (viz: Rome). In a time of increasing economic and political polarization, and a global economy deeper in debt than at the height of the 2008 financial crisis, …and forgive them their debts shows what individuals, governments, and societies can learn from the ancient past for restoring economic and social stability today.

 

[Playball40]

Does anyone know if this is just for Undergrad debt or does Graduate debt apply?

 

[Jarhyn]

Jen Perelman on Twitter: "Politicians saying student debt cancellation is voter bribery while taking bribes from corporate donors is politics in a nutshell." / Twitter
and
Ronald Krinock on Twitter: "@JenChangeFL Been reading “…and forgive them their debts;” Michael Hudson examined cuneiform writings fr Sumer, Babylon, Assyria etc fr the 3 bronze ages &—spoiler—it turns out those societies canceled/”forgave” debt MORE—not less—than contemporary society. (link)" / Twitter
noting
...and forgive them their debts | Michael Hudson

In all eras – from antiquity to the present – debts have tended to mount up faster than the ability of most debtors to pay. That is a basic mathematical fact: Economic growth is arithmetic and can’t keep up with the exponential growth of debt growing at compound interest.

The big economic question is – and has always been – what will happen if debts cannot be paid? Will there be a debt writedown in favor of debtors (as has been done for large corporations), or will creditors be allowed to foreclose (as is always done on personal debtors and mortgage-holders), leading to their political takeover of the assets of the economy – and the government’s public sector?

The problem of debt backlogs was created with the invention of interest-bearing loans in agrarian 3rd Millennium BC Mesopotamia. The remedy of record was the royal Clean Slate proclamation or Jubilee Year of debt forgiveness. These proclamations had three functions: (1) They restored financial balance by annulling the backlog of crop debts that had accrued; (2) they liberated indebted bondservants (and their families); and (3) they restored land tenure rights, enabling debtors to continue living productively on the land, pay taxes, and be available for military service and corvée labor.

...
Historically, no monarchy or government has survived takeover by creditor elites and oligarchs (viz: Rome). In a time of increasing economic and political polarization, and a global economy deeper in debt than at the height of the 2008 financial crisis, …and forgive them their debts shows what individuals, governments, and societies can learn from the ancient past for restoring economic and social stability today.

I recall a number of hymns sung about Jubilee. I recall asking about it a few times.

I also recall the subject always being changed quickly when I brought it up in church.

 

[Politesse]

If you want a stupid country, making colleges unaffordable is a good way to get there. Nation-states should want an educated populace for the sake of the common good, and find ways to make that happen. Not just business degrees, either. The fact that most Americans scoff at the very idea of universal education is a harbinger of the death of this entire empire. When the competing nations we're trying to exploit for resources and labor realize that they now have a more talented, knowledgeable, and flexible population than we do, the entire American economic hegemony will swiftly collapse, as we quickly become clients to our former subjects. Simply forgiving a small portion of loan debt is a bandaid on a suppurating wound.

 

[lpetrich]

Rep. Alexandria Ocasio-Cortez on Twitter: "Student loan debt is immoral." / Twitter
noting:

From 2021 Dec 3, with some video of a House-floor speech by AOC
Rep. Alexandria Ocasio-Cortez on Twitter: "Let’s stop advancing this narrative that student loan debt is for the privileged. ..." / Twitter

Let’s stop advancing this narrative that student loan debt is for the privileged.

Do we really think a billionaire’s child is taking out student loans?

First-generation college students are twice as likely to report they are behind in making student loan payments.

Let’s stop these ridiculous articles that 'young people are killing diamond rings' and 'they're not buying houses' and 'they're killing this industry' or 'we're not having children.'

It's because we're being crushed by immoral debt.

No person should have to go into debt - crushing debt - in order to get an education. It’s wrong, it’s backwards, and it doesn’t help us as a country.

We have a moral obligation, an economic obligation, a political obligation to cancel student debt.

I like this. Paying for student loans means not paying for other things, like all those things that the younger generation is supposedly killing for no good reason. It seems to me that the same people who object to people having children that they can't afford also object to people not having children because they can't afford those children. I say that because of a curious lack of criticism of the other position. Like "Stop complaining about people having children that they can't afford. We need more people having children." Or "Stop complaining about people not having children when they are being fiscally responsible by not doing so."

 

[lpetrich]

I like these responses to Ana Kasparian on Joe Biden:

Jonathon Jones on Twitter: "@AnaKasparian Ah yes the "it's unfair to make anything better because others had to put up with it being worse" argument. Text book conservative logic." / Twitter

t harvey on Twitter: "@better_ph_jones @AnaKasparian Reminds of bullies at school. I got bullied so now I have to bully you." / Twitter

 

[lpetrich]

Jessica (Ka) L. Burbank, MPA on Twitter: "Regan was right " / Twitter
later
Jessica (Ka) L. Burbank, MPA on Twitter: "Reagan* whatever" / Twitter
noting
Jon Schwarz on Twitter: "As Biden cancels (some) student debt, remember why the debt exists. A key Reagan advisor warned in 1970 that free college was producing the dangerously explosive "dynamite" of an "educated proletariat," and "we have to be selective on who we allow to go through higher education": (pic link)" / Twitter

Later in 1970, Roger Freeman - a key educational adviser to Nixon then working for the reelection of California governor Ronald Reagan - spelled out quite precisely what the conservative counterattack was aimed at preventing: "We are in danger of producing an educated proletariat. That's dynamite! We have to be selective on who we allow to go through higher education. If not, we will have a large number of highly trained and unemployed people."30 The two most menacing institutional sources of the danger described by Freeman were obviously those two great public university systems charging no tuition: the University of California and the City University of New York. Governor Reagan was able to wipe out free tuition at the University of California ...

Source?
Jon Schwarz on Twitter: "@lwoodbloo @Monkey_Engineer It was in the San Francisco Chronicle on October 30, 1970" / Twitter

Brian Siano on Twitter: "@schwarz The real result was that the "educated proletariat" entered the ranks of the professional class, their politics shifted rightward into a belief in capitalism, and they _remained in the Democratic Party_. That's what shaped the DLC and the Clinton and Obama administrations." / Twitter
and
Brian Siano on Twitter: "@schwarz For sources on this, Thomas Piketty's _Capital and Ideology_ and Thomas Frank's _Listen, Liberal_." / Twitter

KD on Twitter: "@designmom Reagan assailed Free Speech & antiwar movements, promising taxpayers that if elected, he’d get college kids off picket lines and back in class. “They are spoiled and don't deserve the education they are getting” and that the state “should not subsidize intellectual curiosity,” (pix link)" / Twitter
then
KD on Twitter: "@schwarz @tify330 This part!!! Reagan promised to get college kids off picket lines and back in class. https://t.co/qOAzme5hu4" / Twitter

Ronald Reagan was not alone in running against the Sixties counterculture and student radicals. George Wallace and Richard Nixon did so also.

Scott Santens on Twitter: "@schwarz @KatieHill4CA Interesting. They couldn't have known this at the time, but support for authoritarianism is decreased by going to college. The mechanism appears to be that authoritarian predispositions are partly the result of lack of ability to handle complexity, which college helps alleviate." / Twitter

Does going to college make one less authoritarian? Or is it the less authoritarian sorts of people who tend to go to college?

 

[lpetrich]

Emma Vigeland on Twitter: "I’m so happy Hannity said this out loud. This is the mentality of all the bosses who are wailing about student loan forgiveness today: "My employees might benefit from this and so now I have less coercive power over them!"
Student debt is worker discipline." / Twitter
noting
Brendan Karet on Twitter: "Sean Hannity: "We have a lot of young people that work on my TV show, they're not making a $125,000. They're now eligible to get in some cases up to $20,000 and in other cases $10,000. This is New Green Deal radical socialism." (link)" / Twitter

Ryan Mahoney on Twitter: "@EmmaVigeland “My employees financial futures are in tremendously better shape than they were yesterday and I hate it” is a very amazing take." / Twitter

Mac on Twitter: "Weird how cancelling student debt apparently benefits the wealthy and yet they’re the only people complaining about it." / Twitter

Fhtagn, Dark Brandon on Twitter: "@GoodPoliticGuy And weird how they didn't complain about PPP" / Twitter
Yes, they never complained about PPP loans being forgiven.

 

[lpetrich]

Pramila Jayapal on Twitter: "Let me get this straight: a $1.9 trillion tax cut for massive corporations and the ultra-wealthy is a-ok, but support for working families is a step too far?
The GOP is completely out-of-touch." / Twitter
noting
Ryan Struyk on Twitter: "MCCONNELL: "Biden’s student loan socialism is a slap in the face to every family who sacrificed to save for college, every graduate who paid their debt and every American who chose a certain career path or volunteered to serve in our Armed Forces in order to avoid taking on debt"" / Twitter

Jordan on Twitter: "Socialist Mitch McConnell’s millionaire wife got a $350,000 PPP loan for her family business" / Twitter
noting
Leader McConnell on Twitter: "Democrats' student loan socialism is a slap in the face to working Americans who sacrificed to pay their debt or made different career choices to avoid debt. A wildly unfair redistribution of wealth toward higher-earning people. (pic link)" / Twitter
and
McConnell's Wife's Family Business Appears on Trump Admin's List of Companies That Received Most PPP Money - Elaine Chao, former Transportation Secretary in the Trump Admin


Statman_Stu on Twitter: "@ryanstruyk One way to view this is as penance for yrs of the gov’t doing almost nothing to constrain higher education costs, or to incentivize students, across a generation, as the GOP stood by & said “nothing to see here”. Another way trickle down & supply side economics FAILED America." / Twitter


Secular Talk🎙 on Twitter: "The people trying to portray student debt forgiveness as elitist and anti-working class are either lying or have oatmeal for brains" / Twitter

Krystal Ball on Twitter: "Ppl need to stop pretending burying young ppl under a lifetime of debt is somehow a populist position." / Twitter

 

[lpetrich]

Even if it's not all that they might have wanted, activists have been celebrating. Like AOC and Pramila Jayapal and Ilhan Omar.
Ilhan Omar on Twitter: "It also can't be the end of this discussion. ..." / Twitter

It also can't be the end of this discussion. There are millions more who have so much debt that even $20,000 only puts a small dent in what they owe.

We won't stop fighting until we cancel every dollar of student debt for every American.

But let's also be clear about the material impacts this will have.

The Dept. of Education estimates half of all borrowers will have their debt wiped out.

Most of those who still have debt leftover - those on income-driven repayment - will no longer have to pay interest!

The plan includes Parent Plus loans, so borrowers whose families had to take out debt on their behalf will be included as well.

And it halves monthly payments for those on income-driven repayment.

Is it all we wanted? No.

Is it a very big deal? Absolutely.