the problem with education in this country

[ua_guy]

Queue all the conservative, anti-college whining. Cancel the debt. (And I don't even owe anything!)

[QuarterMillionMan]

What, no accountability from one who has no student loan debts? Keep kicking the can down the road and eventually the road will end.

[jenn_jenn]

Conservative here and not anti-college at all. (I’ve actually never heard the two connected before??)

That woman hasn’t learned her lesson. She is going back for her PhD while drowning in student loan debt from her first two degrees. She’s an adult and she is free to make poor life decisions but that doesn’t mean it’s the tax payers’ responsibility to bail her out.

We don’t need to cancel student loan debt. We need to limit the amount of loans that are non dischargeable so young adults can’t take out $150k for degrees that land a job making $30k/year.

I will never support student loan forgiveness or cancellation after witnessing several people not work their way through college and take out inflated loans for living expenses and spent multiple nights a week partying. Taxpayers shouldn’t be on the hook for that. People need to be held accountable for their decisions.

[QuarterMillionMan]

Conservative here and not anti-college at all. (I’ve actually never heard the two connected before??)

That woman hasn’t learned her lesson. She is going back for her PhD while drowning in student loan debt from her first two degrees. She’s an adult and she is free to make poor life decisions but that doesn’t mean it’s the tax payers’ responsibility to bail her out.

We don’t need to cancel student loan debt. We need to limit the amount of loans that are non dischargeable so young adults can’t take out $150k for degrees that land a job making $30k/year.

I will never support student loan forgiveness or cancellation after witnessing several people not work their way through college and take out inflated loans for living expenses and spent multiple nights a week partying. Taxpayers shouldn’t be on the hook for that. People need to be held accountable for their decisions.

Amen to that! Thank you, thank you, jenn_jenn.

[QuarterMillionMan]

I don't understand some of you people. You are so good with your money but when it comes to the government's money you say spend it freely and forgive $10,000 of student loan debt. It boggles my mind.

[kork13]

Queue all the conservative, anti-college whining. Cancel the debt. (And I don't even owe anything!)

I don't understand some of you people. You are so good with your money but when it comes to the government's money you say spend it freely and forgive $10,000 of student loan debt. It boggles my mind.

Neither statement is helpful in any meaningful dialogue.

That said, I agree principally with jenn_jenn --- a one-time debt forgiveness is 100% treating the symptoms, and it isn't going to do anything to fix the actual problem. Something foundational to higher education funding needs to change, or else people will be in the exact same position just a few years down the road.

Options abound for exactly what/how to change, but a few various forms of the following would all make sense.
- Make student loans dischargeable in BK (or as jenn suggests, loans above a certain total amount)
- Enforcing legitimate lending standards for student loans
- Enforcing work/service requirements in exchange for discharge of SL debt
- Restrict the allowable tuition costs for students receiving federal student aid
- Limiting federal funding to universities with high student debt loads
- .... Get creative.

As I see it, the problem is not the debt itself -- it's (1) the amount of SL's that students are allowed to take on ..... which drives (2) the tuition that universities are charging to support generous "nice-to-have" amenities and other excess spending, all of which is enabled by the massive availability of almost limitless student loans ...... which (3) in turn drives up the need for even higher student loan debts. It's the proverbial self-licking ice cream cone, and it's breaking our society.

[ua_guy]

Sometimes it's just easier to call things for what they are. If we look to the mortgage industry in the last 20 years, we see the same thing repeating itself in educational realms.
Why did banks ultimately choose to eat so many bad mortgages? My own example - in 2013 I bought a short sale and Bank of America and one other lender took a combined $200k++ loss, and the original borrowers walked away with the equivalent of a rock chip on their credit report. The borrowers should have never taken out that mortgage, it was too much, too risky. Yep. They should have never been allowed to borrow that much...didn't the banks see the writing on the wall? Uh-huh. People shouldn't do that, it's wrong! Banks shouldn't be allowed to enable that kind of bad behavior! What's wrong with the world?! RRRRAHHHH!!!!!! ....uh-huh... We're talking finance, not morality.

Where are those banks today? They're fine. Most of them are better, even more profitable and stable versions of their former selves. Where are the borrowers who got to walk away from huge debts? Well, they're doing the same thing they've always done, borrowing money, paying taxes, buying junk, and making the economy go round. What they didn't do: Spend the last 15 years of their ~78 year average lives immobilized and trapped by a single debt which totals much less than their value of economic activity, if only they weren't saddled with that debt. Look at the same thing with bailouts to automakers. Saving them cost a lot, but was ultimately worth more in the long run.

Here are some points about canceling student debt which I doubt many of you have fully considered. This is copied from this source (link). I don't agree with this list 100% but it makes some excellent points and paints a better picture of what student debt looks like in the US. Kork has some good points above about needed reform and I agree, but I think it comes with "and student debt gets canceled one time". In the same way banks said no, maybe it isn't a good idea to let a stripper buy a 5th house in Vegas on a 5/1 ARM with HELOC for the down payment, the system of federal loans managed by for-profit services and debt collection agencies should be held to a higher fiduciary standard since this is mostly "public" money we are talking about and the human and intellectual capital that comes out of college programs is an asset to our country. I'm very much in favor of the public service student debt forgiveness programs, if you can't already tell.

Ok, two more things. You can't get hung up on the newsworthy examples. Most people repay their student loans, and most people pay their mortgages. We're talking about people who can't, shouldn't, or won't.

The other thing is you have to believe in the financial concept of spend or lose some, to ultimately make some. I'm sure there's a better word for that, but it's escaping me. Calculated risk?

Here's that list:

https://files.eric.ed.gov/fulltext/ED610484.pdf

This comes from CLASP - The Center For Law And Social Policy

Fact Sheet January 2021 | Asha Banerjee

Ten Reasons to Cancel Student Loan Debt

Student debt cancellation must be a federal priority for the new administration. As the devastating health and economic toll of the COVID-19 pandemic deepens, millions of student borrowers are held back by high levels of debt on top of job losses and the struggle to cover their basic needs. The pause on payments is only a temporary fix. Since student loan debt disproportionately impacts Black and Latinx borrowers, especially women, cancelling student debt is a racial and economic justice issue.

1. Student loan debt is a national crisis

In recent decades, especially after the 2008 Great Recession, outstanding student loan debt has skyrocketed, reaching $1.7 trillion. It affects over 45 million borrowers, households, and families nationwide.1 The price of a higher education has risen while wages and incomes have remained stagnant. Cancellation would bring much- needed relief to millions, especially because many people may also be struggling with lost income, food and housing insecurity, and a disrupted education due to the COVID-19 pandemic and economic recession.

2. Cancelling student debt would advance gender and racial equity

The burden of student loan debt is not borne equally. Women hold over two-thirds of all outstanding debt.2 Black borrowers also have higher average levels of debt and default.3 Systemic barriers, such as persistent discrimination in housing, employment, and access to educational opportunities, have kept many Black households from accumulating and inheriting wealth. As a result, Black students are overrepresented at for- profit institutions, many of which strand borrowers with astronomical levels of debt. Cancelling student debt can help close the racial wealth gap, and studies show that cancelling $50,000 in student debt would alleviate the debt burden for nearly three in four Black households and increase Black wealth by a third.4

3. Cancelling student debt is good for the economy

Cancelling student loan debt could also have a powerful stimulus effect on the economy, which will be crucial as we look to build a sustainable economic recovery. Research has shown that cancellation would boost GDP by billions of dollars and add up to 1.5 million new jobs, reducing the unemployment rate.5 Workers who are Black, Latinx, immigrants, women, and those in industries paying low wages are still facing a terrible economic situation with high levels of unemployment.6 Cancellation will help borrowers and the lagging economy, as well.

4. Cancellation is targeted and would benefit those who need it most

Student debt cancellation is a targeted, progressive policy that would benefit those struggling the most. While wealthier borrowers make larger monthly payments outright, student debt as a share of income is higher for lower income borrowers.7 Additionally, partially due to sky-high interest rates and misleading forbearance policies, most borrowers still owed more than half of what they borrowed for college even 12 years after enrolling, with Black students being the sole group that owed more than what they borrowed after 12 years.8 Therefore, lower income borrowers, especially Black borrowers, would benefit immensely from debtcancellation.


2

5. The public broadly supports—on a bipartisan basis—student debt cancellation

Polls show that cancelling student debt is broadly popular. A bipartisan May 2020 poll from the Center for Responsible Lending and Americans for Financial Reform found that “a majority of Americans across all regions of the U.S. support permanently reducing student loan debt by $20,000 for all borrowers.”9 Similarly, another poll found that 56 percent of registered voters—even those who had never had loans—supported Senator Elizabeth Warren’s proposal to cancel student debt.10

6. Student debt holders are not only young college graduates

Student loan debt does not just harm young millennials or college graduates. It is a multi-generational problem, and one that hurts people who faced insurmountable barriers to completing their degree. Over 8 million borrowers are aged 50 or older and, the fastest-growing age group of borrowers are people over 60 in some states.11 Furthermore, a staggering 40 percent of all people who hold student debt did not finish college or attain a degree.12 These borrowers often face the most hardship repaying their loans. Students of color, first generation students, and students with low incomes are also likelier to drop out due to the high costs of college and the lack of financial and institutional support. Cancellation would promote college affordability, access, and completion.

7. The benefits of student debt cancellation are life-changing

Cancelling student debt will significantly improve borrowers’ lives.13 Without the burden of student loan payments, borrowers will have more money to cover their basic needs and build wealth for their families.14 Many borrowers have had to delay significant life events, such as starting a family or buying a house, due to the burden of student loans.15 Studies show that when student debt is cancelled, people are more able and likely to create or invest in small businesses, attain more advanced degrees, and move to where they want to live or work.16

8. Cancellation would have significant intergenerational, anti-poverty effects

Student debt is not an individual burden but one that strains entire families. Many borrowers take on student loans while also caring for their parents. At the same time, millions of parents are still repaying Parent PLUS loans they borrowed to pay for their children’s education. Struggling to pay off debt can cause serious generational consequences, as going into default can be financially devastating. Penalties can include wage garnishment or having critical benefits and tax credits withheld, such as the Earned Income Tax Credit. Loan cancellation would allow for more financial security for future generations.

9. Institutional failures have worsened the student debt crisis

Student debt has skyrocketed as college tuitions have risen while state funding on education and financial aid has fallen. At the same time, predatory for-profit institutions have lured students of color into expensive, low- quality programs, leading to higher debt levels and default rates.17 Student loan servicers have been sued for misleading borrowers and preventing them from accessing vital programs and benefits. Even the U.S. Department of Education has been investigated for failing to administer the Public Service Loan Forgiveness program fairly.18 Borrowers deserve relief because factors such as skyrocketing tuition, debt-financed education as the norm, and deceptive behavior from institutions meant to uphold the system have deepened the crisis.

clasp.org

10. Higher education should be a right, not an expensive privilege

Student loans should be cancelled because higher education should be a right to all, not a luxury only accessible to those who can afford it. Student loans for higher education should not be the second most expensive purchase a person will make after buying a house. Along with other affordability measures such as investments in community colleges, debt-free college, and increased Pell grants, student debt cancellation can help all students access, complete, and flourish in higher education.

Endnotes

1 Federal Reserve Board, Consumer Credit, December 7, 2020, https://www.federalreserve.gov/releases/g19/current/. 2 Asha Banerjee and Rosa Garcia, “The ‘Great Equalizer’: Women in Higher Education,” CLASP, March 25, 2020, https://www.clasp.org/blog/great-equ...her-education; American Association of University Women, Deeper in Debt: Women & Student Loans, 2020, https://www.aauw.org/resources/research/deeper-in-debt/.

3 The Institute for College Access & Success, Quick Facts About Student Debt, April 2019,https://ticas.org/files/pub_files/qf...udent_debt.pdf.
4 Federal Reserve Board, Disparities in Wealth by Race and Ethnicity in the 2019 Survey of Consumer Finances, September, 28, 2020, https://www.federalreserve.gov/econr...-ethnicity-in- the-2019-survey-of-consumer-finances-20200928.htm; Anna N. Smith, “Student Debt is a Racial Equity Issue. Here’s How Mass Debt Relief Can Address It,” Roosevelt Institute, October 29, 2020, https://rooseveltinstitute.org/2020/...bt-relief-can- address-it/.
5 Scott Fullwiler, Stephanie Kelton, Catherine Ruetschlin, and Marshall Steinbaum, “The Macroeconomic Effects of Student Debt Cancellation,” Levy Economics Institute, February 2018, http://www.levyinstitute.org/pubs/rpr_2_6.pdf.
6 Adewale Maye, Asha Banerjee, and Cameron Johnson, “How the COVID-19 Recession Deepens Racial and Economic Equality Among Communities of Color,” CLASP, November 19, 2020, https://www.clasp.org/publications/r...-and-economic- inequality.
7 Hillary Hoffower and Madison Hoff, “The case for cancelling student debt isn’t political—it’s practical. Here are the benefits of erasing $1.6 trillion, no strings attached,” Business Insider, December 5, 2020, https://www.businessinsider.com/econ...veness-2020-12.
8 American Council on Education, Race and Ethnicity in Higher Education, 2020, https://www.equityinhighered.org/ind...mount-owed-to- amount-borrowed/.
9 Julia Barnard, “New Bipartisan Poll Shows Strong Support for Student Loan Debt Cancellation During COVID-19 Pandemic,” Center for Responsible Lending, May 12, 2020, https://www.responsiblelending.org/m...ew-bipartisan- poll-shows-strong-support-student-loan-debt-cancellation-during-covid-19.
10 Annie Nova, “Elisabeth Warren’s plan to cancel student debt is popular with voters, survey finds,” CNBC, May 9, 2019,https://www.cnbc.com/2019/05/09/eliz...th-voters.html.
11 Higher Ed Not Debt Campaign, Higher Education Debt: The Case for Debt Cancellation, 2020,https://cdn.higherednotdebt.org/wpco...t_Week_of_Acti on_National-.pdf; Federal Student Aid, Federal Student Loan Portfolio, 2020, https://studentaid.gov/data- center/student/portfolio; Fiscal Policy Institute, The Rising Burden of Education Debt on Older New Yorkers, December 2020, http://fiscalpolicy.org/wp-content/u...bt_Dec2020.pdf.
12 Mark Huelsman, November 20, 2020, https://twitter.com/MarkHuelsman/sta...22197406453762.
13 Higher Ed Not Debt Campaign, Higher Education Debt.
14 Darrick Hamilton and Naomi Zewde, “Eliminate student loan debt and establish a right to higher education,” Washington Center for Equitable Growth, February 18, 2020, https://equitablegrowth.org/promote-...acial-justice-

clasp.org

3

eliminate-student-loan-debt-and-establish-a-right-to-higher-education-across-the-united-states/.

15 Federal Reserve Board, Consumer & Community Context, January 2019, https://www.federalreserve.gov/publi...rticle_inline; https://www.demographic-research.org...0/69/30-69.pdf.
16 Federal Reserve Board, Consumer; Marco di Maggio, Ankit Kalda, and Vincent Yao, “Second Chance: Life Without Student Debt, Harvard Business School, 2019, https://www.hbs.edu/faculty/Pages/item.aspx?num=56163.

17 Dyvonne Body, “Worse Off Than When They Enrolled: The Consequence of For-Profit Colleges for People of Color,” Aspen Institute, March 19, 2019, https://www.aspeninstitute.org/blog-...-enrolled-the- consequence-of-for-profit-colleges-for-people-of- color/#:~:text=According%20to%20the%20Federal%20Reserve, at%20all%20for%2Dprofit%20colleges; Judith Scott-Clayton, “The looming student loan default crisis is worse than we thought,” The Brookings Institution, January 11, 2018, https://www.brookings.edu/research/t...an-we-thought/.

18 Student Borrower Protection Center and American Federation of Teachers, Broken Promises: Employer Certification Failure, August 2020, https://protectborrowers.org/wp-cont...F-Failures.pdf.

clasp.org

4

[myrdale]

I don’t think it said which degrees she got but probably one of the worthless degrees (you know which ones I’m talking about).

The article states she obtained a Master's Degree in Public Health, Google suggest jobs range from $60 to $90k per year.

The article states $150k debt is what the degrees cost, the other $100k is interest. Which means she hasn't been paying on it at all. Give it another 7 years and maybe she will have $500k in debt. And to start with I am not sure $150k debt for $75k salary is a good deal.

[myrdale]

Queue all the conservative, anti-college whining. Cancel the debt. (And I don't even owe anything!)

I am a conservative (probably more libertarian that anything else) and I am not the least bit anti-college. Go get all the schooling you want that you can afford, just don't expect me to buy your lunch!

[myrdale]

I don't understand some of you people. You are so good with your money but when it comes to the government's money you say spend it freely and forgive $10,000 of student loan debt. It boggles my mind.

And that's just it, people don't realize the government's money comes from our taxes.

How sick is it that people expect someone who came from nothing who works their butt off every day with only a high school degree to pay for the college debt of someone to lazy to pay it themselves.

[myrdale]

The borrowers should have never taken out that mortgage, it was too much, too risky. Yep. They should have never been allowed to borrow that much...didn't the banks see the writing on the wall?

The government forced banks to issue those loans. The government should have stayed out of the free market.

1. Student loan debt is a national crisis

Nope. It is a personal choice for those who chose to take it.

2. Cancelling student debt would advance gender and racial equity

Suggesting one group should get preferential treatment is the definition of racism.

3. Cancelling student debt is good for the economy

I don't think you understand inflation is directly tied to printing money. That is not good for the economy.

4. Cancellation is targeted and would benefit those who need it most

See #2.

5. The public broadly supports—on a bipartisan basis—student debt cancellation

"The public" are morons. "Average" is pretty bad. Democracy is two wolves and a sheep voting whats for dinner.

6. Student debt holders are not only young college graduates

For which of you, intending to build a tower, does not sit down first and count the cost, whether he has enough to finish it—lest, after he has laid the foundation, and is not able to finish, all who see it begin to mock him, 3saying, ‘This man began to build and was not able to finish’?

Know the cost and pay your bill.

7. The benefits of student debt cancellation are life-changing

Strong armed robbery will also radically improve your life.

8. Cancellation would have significant intergenerational, anti-poverty effects

False. Money flows towards those who can command it, and away from those who can not.

9. Institutional failures have worsened the student debt crisis
.....Borrowers deserve relief.......

That ain't bull ****, that's horse ****.

10. Higher education should be a right, not an expensive privilege

ANYONE can afford higher education. All you have to do is work for it.

[ua_guy]

Keep proving me right.

[QuarterMillionMan]

Biden's student loan forgiveness plan is a 'horrible idea,' says Kevin O’Leary - YouTube

This today on CNBC but I'm hearing the current administration will likely approve the $10,000 loan forgiveness so ua_guy will probably have the last laugh. But I'm with Kevin O'leary.

[james.hendrickson]

Loan forgiveness isn't a new idea. Every century or so the Babylonians would declare a jubilee year and forgive everyone's debts.

The policy does create some twisted incentives. People won't have any incentive to economize if the government will simply erase their debt.

However, the broader reality is that debt fuels wealth inequality. Inequality is a known risk factor for a number of detrimental social outcomes - like revolutions and wars. Its also hard to have a functional democracy if half the population is struggling with large amounts of debt. So, my take is debt forgiveness is a great idea from a sociological/social health standpoint.

[mumof2]

Our student loans as you would call them, are much cheaper and when you go to work your employer will take a percentage and put it onto the loan and when you do your taxes they will take some and put it on the loan (unless you owe on taxes) as of that you can choose to pay as much or as little as you want during the year but you don't have to make any repayments till your pay is above $46,620...it is interesting to see the difference in different countries