Student Debt - And Response (4)

Saturday, May 14, 2022

“And so we come to commencement, that glorious moment of achievement when a high school or college graduate will be awarded a hard-earned diploma and venture into a complex world full of promise and fright.”

Uh-huh. Except for over 40 million young Americans who are saddled with a collective debt of well over $1.5 trillion, and who are being “blamed” by conservatives like Roy Exum for having made hasty, immature decisions to rack up so much debt in the first place. Now, I have never read or heard Mr. Exum’s personal stance on this issue, and I don’t want to be presumptuous in that regard, but I have yet to see any conservative who did not take a hardline stance against student debt forgiveness.  

But consider: Young people fresh out of high school are among the most financially naïve people in our society. Yet, predatory loan sharks, both in our government and the private sector, made available to them loans of limitless amounts, regardless of their ability to pay them back in a timely fashion. But those predatory agencies are not being held accountable in any way. They acted, and still are acting, very much like the crooked banksters who intentionally loaned out money to credit-unworthy people during the housing bubble, which led directly to the crash of the stock market and the recession of ’08. And who got bailed out, even though their actions were deliberate and self-serving? Those banskters and Wall Street shysters! Not only did they get bailed out; they handed out fat bonuses to their CEOs! And who came to the rescue of the 5 million+ homeowners who were upside-down on their mortgages or who lost their homes altogether? Nobody. Obama said he would, but he failed to deliver, as he only verbally slapped the wrists of those who were doling out bonuses with tax-payer money.

And consider this: I am 72. When I went to college (a state university), I was able to afford it by working a full-time job in the summer, and a part-time job of no more than 15 hours per week during the school year. I paid for everything – tuition, books, lodging, and meals – and came out with zero debt. Plus, Pell Grants were rather easy to come by, even into the early 1990s. That is as it should be. But college tuition, over the years, has risen exponentially, to such a degree that the students from low-income families cannot afford it, even by working in addition to going to school. And Pell Grants have become extremely rare and not nearly adequate to cover the overall costs. And while college costs have risen, the pay rate for low-income workers has been stagnant for decades, lagging far behind ever-increasing inflation.

And finally, consider this: That $1.5 trillion dollars of debt is keeping over 40 million young people from contributing anything meaningful to our society and our economy, as they are unable to buy a home, start a business, or do anything but play the role of an indentured servant. They are having to devote the vast majority of their time to paying off a debt so large that many of them will be a lifetime paying it off. That debt is not just a drain on them, it is a drain on our entire economy.

Notice that conservatives don’t bat an eyelash when it comes to our government doling out relief money or bailout money or huge annual subsidies to corporate monopolies and billionaires, but when it comes to government doing anything whatsoever for the benefit of the people who desperately need some assistance, they scream like a stuck pig and yell “socialism!” or “communism!”  Go figure. 

But such is the nature of an oligarchy, in which the rich make the rules for their own benefit, and have the audacity to say that anyone who does not aspire to their level of greed is a loser and a slacker.  

Rick Armstrong

* * *

So conservatives never help lower and middle income families obtain an advanced degree? Well Rick, have you ever heard of the Tennessee Promise program?  Maybe this will help.

"What is Tennessee Promise? Tennessee Promise is a scholarship, mentoring and community service program that began fall semester 2015. It provides students a last-dollar scholarship, meaning the Tennessee Promise will cover tuition and fees not covered by the Pell Grant, the HOPE scholarship, or TSAA funds."

The Promise was passed in 2015 by an overwhelmingly Republican Legislature and signed by a Republican governor. I would point out that this is a "last dollar," scholarship which basically pays for everything. There is no reason any student in Tennessee cannot obtain at least an associates degree and find a well paying job. And many scholarships are available for these grads if they want to obtain a BA or BS.

The government and their academic supporters have a great scam going. You actually mentioned it when you stated, "college costs have risen exponentially," in your letter. Academia increase costs (especially salary) and the government guarantees loans to these unsuspecting high school grads who then borrow $100,000 to get a degree in some worthless Liberal Arts program. Then they are shocked when they graduate and either can't find a job or get one paying half of what the students who used the Promise program to learn how to do something make (with no student debt).

Harvard paid Elizabeth Warren $400,000 over a two-year period to teach one class a semester. This is a woman who has never had a real job in her life, leaching off of academia and government.

I will have to say I agree with you 100 percent about both parties letting the Wall Street banks get off after the financial crisis. Banks are just legalized mafia.

Doug Jones

* * * 

Student loan debt and student loan crisis has been in the news for several years and has been very much a topic of conversation during the Biden administration. I agree with the financial analysis of Mr. Armstrong and am glad Mr. Jones shot holes in his cheap shot at Republicans.

Given the vast amount of publicity and discussion surrounding the “student loans” I expect that the student loan industry should all but die off going forward, with all the newly informed young people that qualify to attend an institution of higher learning. Surely with all the publicity, these high level, high achieving students will read and comprehend the loan agreement if they are still considering using a loan for attending a university, and perform a basic financial risk/reward analysis. Put simply, if your job prospects don’t pay enough to repay the loan in addition to everything else you would like spend your future earnings on, don’t take the loan. If you do accept the loan then you are obligated to repay it according to the terms of the agreement. The stupid tax is a real thing.

Michael Craig

* * *

Some of the institutions peddling student loans are certainly predatory. Let us not pretend that most high school students are in a position to fully understand the sort of obligation that they are being pushed and/or cajoled into when they sign that dotted line.  This is done by people with a financial interest in sealing the deal but no accountability for the end result.  They have a conflict of interest. Add the fact that many of these young people are living close to the edge, financially, and they have loan officers and sometimes financial advisors telling them it is perfectly acceptable to borrow more money than they need for tuition and books.  This is common practice.  

In recent years some lenders have settled multi-billion dollar lawsuits regarding unfair practices.  One in particular made loans to people very likely to default, because they knew the government would pay if the borrowers didn't.  They also made loans for students to attend institutions they knew to be inflating graduation rates and job placement rates.

This is a complex issue.  I don't profess to have a perfect solution.  But if we allow education to be dependent upon means, we aren't going to like the results.  Likewise, if we do not protect students from being the latest crop for Wall Street to consume, we all lose.

Student loans should not have been a replacement for Pell grants and other need-based financial aid.  But that has become the situation.  At the very least, there should be robust oversight and fair terms for these loans.  No person should pay on a loan for years, only to find that they owe more than the original loan amount.

College has become another way for banks and other financial institutions to take advantage. 

We should all have an interest in making education attainable for those who desire it and work toward it.

If individuals should be held accountable for their financial obligations, that should mean all individuals, not just those with student loan debt, and not just average joes. This should extend to banks and other financial institutions, automakers, oil companies, tobacco companies and all others deemed too big to fail.  Corporate welfare comes from taxpayer money, and I would venture to say that it costs us a whole lot more than people defaulting on student loans.  Where was the call for accountability when corporate America fleeced the COVID relief funds and used the money for feathering their nests to the detriment of average Americans?  Where is it now when they continue to artificially inflate prices while people live without necessities?  

Spare me the righteous indignation.  It rings very hollow.

Darlene Kilgore

* * * 

Take money from hard working responsible taxpayers and give it to people who make poor choices.

May make sense to liberals, but not to me.

Steve Campbell

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