Economic Stimulus: Student Loan Forgiveness?

[maat55]

Get the XXXX government out of student loans. Problem solved. People that truly want an education will get them, the rest will learn a trade.

[bjl584]

Here is a thought. What if a four year degree were "free", the way that a highschool diploma is? The only college people would have to pay for out of their own pocket would be Masters Degrees, Doctorates, etc.? I believe that some European countries do something like this. What are its effects on society and on an individuals finances? I don't know, but looking at a country that has a setup like this may answer the question that was originally posed.

[BuckyBadger]

Here is a thought. What if a four year degree were "free", the way that a highschool diploma is? The only college people would have to pay for out of their own pocket would be Masters Degrees, Doctorates, etc.? I believe that some European countries do something like this. What are its effects on society and on an individuals finances? I don't know, but looking at a country that has a setup like this may answer the question that was originally posed.

Local taxes would double at least. It would lead to a mass exodus of childless people from places with high school taxes. I grew up in a place that had one of the best high schools in the country -- and local taxes to support it. The day I graduated my parents started looking for a condo in a nearby town where the school taxes were a third of what they were where I grew up.

That four year degree isn't going to be "free" any more than public school is "free." The taxpayers are paying for it one way or another.

[disneysteve]

Local taxes would double at least. It would lead to a mass exodus of childless people from places with high school taxes. I grew up in a place that had one of the best high schools in the country -- and local taxes to support it. The day I graduated my parents started looking for a condo in a nearby town where the school taxes were a third of what they were where I grew up.

That four year degree isn't going to be "free" any more than public school is "free." The taxpayers are paying for it one way or another.

It always saddens me when all of the empty-nesters complain about local taxes. "I don't have a kid in school any more. Why should I have to pay for it?" The answer is very simple: Those who came before you paid their taxes so that your kids could have a good education. Now it's your turn to give back to the community. What's in it for you? Living in a town with good schools and high-achieving kids rather than a bunch of juvenile delinquents hanging out on the street corners smoking and doing drugs.

[BuckyBadger]

It always saddens me when all of the empty-nesters complain about local taxes. "I don't have a kid in school any more. Why should I have to pay for it?" The answer is very simple: Those who came before you paid their taxes so that your kids could have a good education. Now it's your turn to give back to the community. What's in it for you? Living in a town with good schools and high-achieving kids rather than a bunch of juvenile delinquents hanging out on the street corners smoking and doing drugs.

I'm not sure that I agree with you. The people who bought our old house had three kids. If my parent's HADN'T moved out, those three kids wouldn't have been able to move in and go to a great school. If the empty nesters didn't move OUT, people with kids couldn't move IN. It was an established community. They weren't building any more houses. If you wanted in someone else had to move out.

[bjl584]

Local taxes would double at least. It would lead to a mass exodus of childless people from places with high school taxes. I grew up in a place that had one of the best high schools in the country -- and local taxes to support it. The day I graduated my parents started looking for a condo in a nearby town where the school taxes were a third of what they were where I grew up.

That four year degree isn't going to be "free" any more than public school is "free." The taxpayers are paying for it one way or another.

I understand what the implications on taxes would be, but the original question posed in this thread was concerning if students' lives would be different/better if the graduated without student loan debt.

[disneysteve]

I'm not sure that I agree with you. The people who bought our old house had three kids. If my parent's HADN'T moved out, those three kids wouldn't have been able to move in and go to a great school. If the empty nesters didn't move OUT, people with kids couldn't move IN. It was an established community. They weren't building any more houses. If you wanted in someone else had to move out.

Certainly, there is some truth to that, too, but it doesn't really negate my point either. The people who moved to a certain community because it had good schools and remain there after their kids are out of school don't really have the right to complain about the taxes. It doesn't work that way. If you don't want to pay the taxes, move as your parents did. I've got no problem with that. If you don't want to move, don't complain. You can't have it both ways. If you want the nice community with good schools and good public services, you need to be willing to pay the taxes. If you constantly vote against the school budget just because your kids are grown, your community will stop being the place it was that attracted you in the first place.

[BuckyBadger]

I understand what the implications on taxes would be, but the original question posed in this thread was concerning if students' lives would be different/better if the graduated without student loan debt.

Sure, but you can't suggest "free" four year colleges without considering the tax implications. Sure, your hypothetical student might not graduate with student loan debt, but he/she will be paying twice as much in property taxes for their entire adult life. If my school taxes doubled for 50 years I'd be paying an extra $100,000 to $150,000. So my student hypothetical loan savings would be pretty significantly offset.

Certainly, there is some truth to that, too, but it doesn't really negate my point either. The people who moved to a certain community because it had good schools and remain there after their kids are out of school don't really have the right to complain about the taxes. It doesn't work that way. If you don't want to pay the taxes, move as your parents did. I've got no problem with that. If you don't want to move, don't complain. You can't have it both ways. If you want the nice community with good schools and good public services, you need to be willing to pay the taxes. If you constantly vote against the school budget just because your kids are grown, your community will stop being the place it was that attracted you in the first place.

Then we agree. Since you quoted my post when you talked about empty nesters leaving high tax school districts, I assumed you were grouping people like my parents into that category. I absolutely agree that if you choose to stay in a school district you shouldn't start complain just because you don't have children reaping the benefits of your tax dollars. Stay and enjoy the benefits, or move and live with whatever you can get.

[Scanner]

I believe that you should be allowed to fail and recover on your own

Greenback,

The problem with that philosophy, as applied to student loan debt, is you can never "fail and recover" with student loans. You only fail and remain in failure. There is often no success.

You can't discharge it in bankruptcy proceedings like business debt, consumer debt, and other debt so it follows you around the rest of yoru life.

Some people never recover.

I get the moral aversion to this idea. I really do. I paid off my student loans in 5 years and I had 53K.

The problem I have though, is the same people who have the aversion to this idea, are totally open to giving corporations tax breaks in an effort to stimulate job creation (which is a spurious assumption anyway).

I honestly don't see the difference.

In taht, I agere with Herman Cain - no matter if it's 9-9-9, or 25-0-25 (0 consumption tax), or whatever. . .no more deductions for this, special treatment for that. The only deduction: charity. That's it. Resist all temptation otherwise.

Pony up your share.

It's also funny from antoehr angle.

You would never hear a competitor of GE (let's say Philips) say, "We at our company all worked our butts off last year and we want to pay 25% corporate tax. It's a matter of honor."

Yet, propose student loan forgiveness. . .well, it's all the same thing in my head - special treatment to special groups.

[GREENBACK]

Scanner,

Fail and recover was probably poorly chosen words in terms of student loans. My meaning is that if you took these loans out it is absolutely yours and yours alone to settle. If you borrowed 75k to get a philosophy degree and it isn't working out for you that's your fault. I don't think the country or any individual benefits by bailing these people out of foolish decisions.

If you "remain in failure" then you need to go in another direction because what you attempted didn't work. It ain't my fault and I'm not willing to give a "mulligan" on it.

[Scanner]

GREENBACK:

I am not trying to be argumentative (but I guess I am being that). . .but if that's the case. . .shouldnt' that apply for all debt and we have a Debtor's Prison?

Why student loans?

Why, as a business owner, can I upstart, pay myself $100,000/year 10X, fail and restart over and over again?

"Sorry, GM, it didn't work out with those gas guzzling SUV's you thought would always be a top seller, and you always thought gas would be $.99/gallon, but now. . .we own your butt!"

I don't know. . .I just think Herman Cain is right. . .either everyone gets special treatment, or no one.

I don't care if you created a billion jobs last year.

No deductions/credits.

[neguy11]

Of course, you should have had your loans repaid by the 10-year mark so I'm not sure how helpful that is, unless you are able to defer payments during that time.

The Income Based Repayment plan ties your monthly loan payment to your AGI, family size, and the poverty level, NOT your balance/interest rate, so if someone is in a low paying job it's possible their payments would not be enough to payoff the loan in 10 years.

[maat55]

It always saddens me when all of the empty-nesters complain about local taxes. "I don't have a kid in school any more. Why should I have to pay for it?" The answer is very simple: Those who came before you paid their taxes so that your kids could have a good education. Now it's your turn to give back to the community. What's in it for you? Living in a town with good schools and high-achieving kids rather than a bunch of juvenile delinquents hanging out on the street corners smoking and doing drugs.

This is true, yet increasing public education to the college level would be extremely unfair. Not everyone is college material and should not have to pay for it. College is a comodity of choice and should not be a government program.

[GREENBACK]

GREENBACK:

I am not trying to be argumentative (but I guess I am being that). . .but if that's the case. . .shouldnt' that apply for all debt and we have a Debtor's Prison?

Why student loans?

Why, as a business owner, can I upstart, pay myself $100,000/year 10X, fail and restart over and over again?

"Sorry, GM, it didn't work out with those gas guzzling SUV's you thought would always be a top seller, and you always thought gas would be $.99/gallon, but now. . .we own your butt!"

I don't know. . .I just think Herman Cain is right. . .either everyone gets special treatment, or no one.

I don't care if you created a billion jobs last year.

No deductions/credits.

I'm not taking your discussion as an argument. Failure at buisness happens and failure in life(student loans) happens. I think it's the responsibility of the person or buisness to make it right. I have a problem with creating a safety net for everyone that makes bad decisions, whether it be GM or or some college student.

The jury is still out with me for Herman Cain's ideas but at least his ideas are a little different than the others who seem to be offering up the same old things.

[yugugelizer]

I am currently in school. Full disclosure: I do not pay for tuition or books. I do help my parent with these expenses through academic scholarships, and tuition reimbursement from the company I currently intern for. I do however pay living expenses. Since beginning my college experience 5 years ago (current grad student) I have worked on average, over 30 hours a week. If I had to pay for school, on even my prior server salary, I could have. I know some schools are more expensive than others, but like others have said that is the students choice.

While I agree that forgiving student loans would change spending patterns, so would increased income. While I understand that there may not be jobs for everyone, there are jobs for many top performers. It is a sad truth that in my experience, over half of the student population not put in obtaining a job prior to graduation. Universities have career centers to help students write resumes, practice interview skills, and even set up career fairs for students to meet employers and hopefully secure employment. Multiple surveys show that at our school, less than half of graduating senior have used any of these programs. I feel bad for those who spent years in school, only to work a low paying job, but I don't think the answer is to forgive their debt.

I know that not everyone without a job is in that situation solely from their actions, but in my experience, those with good grades, who are members of professional associations, and work hard to secure employment, do just that. In this, I am speaking from an accounting student's perspective, but I feel that this applies to any major. You get out of college what you put into it. A lot of students have this idea that having a degree means they will get a good job; like they shouldn't have to work for it. I personally am not willing to pay other people's "school loans" (I know many who use this money for new TVs, etc.) because they didn't do what it took to get the job they wanted.

To those (hopefully few) that worked hard, did everything right, and didn't get a job because none were available, I am sympathetic, but how do you weed out who tried and who didn't. Life is a gamble, you make decisions know what the consequences may be.