White House proposes caps on student loan borrowing

[LadyFunkenstein]

Simple solution to ending enslaving teenagers with excessive student loan debt for the rest of their lives: Make the loans dischargable in bankruptcy court, in the same manner as debt such as car loans, home loans and credit cards. It's notoriously hard to discharge a student loan, so it is a no-brainer to extend loans to teenagers. Early to mid oughts excepted (for reason we all know), when you buy a home they review the ability to pay it back. Offering a five to six figure debt for a useless degree to a mediocre student will stop quite quickly if said student could file for bankruptcy at 25 when they learn their degree is shit and won't find them a job.

 

[Que]

Your idea and Rightguides are both viable. Either way people making the loans take what they should have in the way of lender liability.

If they end up taking a haircut because they're making bad credit decisions so be it.

The other option is for the schools that have put in 20 trillion dollars worth of something in the way of assets for all those student loan monies can leverage that borrow the money loan it out to students and get the students to pay it back. If the students don't pay it back they don't get their diploma recognized.

 

[LadyFunkenstein]

Your idea and Rightguides are both viable. Either way people making the loans take what they should have in the way of lender liability.

If they end up taking a haircut because they're making bad credit decisions so be it.

The other option is for the schools that have put in 20 trillion dollars worth of something in the way of assets for all those student loan monies can leverage that borrow the money loan it out to students and get the students to pay it back. If the students don't pay it back they don't get their diploma recognized.

I can't agree on making the colleges cosign. Makes no sense, it isn't their job and isn't their expertise. Lenders, on the other hand, know exactly what they are doing. And they do it because it is so hard to get out of that debt.

 

[Que]

I can't agree on making the colleges cosign. Makes no sense, it isn't their job and isn't their expertise. Lenders, on the other hand, know exactly what they are doing. And they do it because it is so hard to get out of that debt.

Well I'm sure your ride also because it would be a boondoggle for the reasons that you suggest.

If it wasn't so hard to get out of it they would demand parents co-sign and if parents are co-signing then suddenly parents are making sure that Juniors taking something that's actually going to result in the ability for junior to pay the loan back.

The family business at one time was full recourse finance contracts. The way that work is you are a service station or an appliance store in a small mining town or on the Indian reservations. It wasn't necessary to know the strength or capacity of the borrower because those decisions were made locally by those Merchants. The merchants knew who in town was good for the money and who wasn't good for the money. It's a merchant made a mistake they got charged back if the borrower did not pay.

Somebody in the equation needs to have some sort of an understanding about money and value. As it stands nobody does and nobody cares. It's not actually reasonable to assume that 18 year olds understand what it's like to pay back tens of thousands or hundreds of thousands of dollars.

It's just Monopoly money to them.

 

[LadyFunkenstein]

Well I'm sure your ride also because it would be a boondoggle for the reasons that you suggest.

If it wasn't so hard to get out of it they would demand parents co-sign and if parents are co-signing then suddenly parents are making sure that Juniors taking something that's actually going to result in the ability for junior to pay the loan back.

The family business at one time was full recourse finance contracts. The way that work is you are a service station or an appliance store in a small mining town or on the Indian reservations. It wasn't necessary to know the strength or capacity of the borrower because those decisions were made locally by those Merchants. The merchants knew who in town was good for the money and who wasn't good for the money. It's a merchant made a mistake they got charged back if the borrower did not pay.

Somebody in the equation needs to have some sort of an understanding about money and value. As it stands nobody does and nobody cares. It's not actually reasonable to assume that 18 year olds understand what it's like to pay back tens of thousands or hundreds of thousands of dollars.

It's just Monopoly money to them.

Funny you just hit upon a recent conversation I had with somene doing the old Capitalism vs Socialism debate. My point was, both are very new and are highly unnatural to the human condition. We aren't meant to be so centralized. Bartering is the most natural way IMO. I present as evidence the number of English surnames relating to doing something that earned an income. I am pretty confident years before Capatilsm and Socialism existed, Bob Farmer traded wheat he grew, with Bill Baker who grinded it and made bread all year long for Mike Smith, the blacksmith who made the scythe for Farmer and Knives for Baker.

People don't understand money and value by design. It's a way to trap people into debt and feed the system. I make a good living, and people were perpleed as to why I bought a 2005 toyota a few months ago, instead of leasing a new car whi is "such a good deal."

 

[Pocketshaver]

a graphic arts degree, a degree that will LET you draw posters and if your lucky a magazine cover like say MAD magazine,,,, will cost you about 120,000$ in tuition but at best pay 25-28,000 a year.

They are trying to stop unlimited money. and unlimited debt


there are people like teachers, who have been in college for 20 years and never accomplished a damn thing with it

 

[sharingfantasies]

I think that one of the biggest problems, besides the outrageous cost of tuition, is the mindset of the student. Many parents push their child into going to the university when the child has no goal. Because the child has no goal, they spend years taking out loans while they change their majors repeatedly. When asked, I always recommend children go to community college if they have no goal, or take off a year and work while they try to decide what they want to do. They can take a variety of classes at the CC to try to figure out what they want to do without running up huge loan debts. I don't know the actual numbers, but I would bet they are pretty high, of students that enroll in the university and drop out in their senior year (which can take years to reach) because they have been in school for six to seven years and still don't have a goal. One of the biggest problems is that most vocational schools are privatized and extremely expensive. Students might only have to go for a year or two, but, unless their job is going to be high paying, they will be in debt for many years.

It is always interesting to me when people blame teachers for students lack of study skills. Most kids would rather be with friends or play video games than work on their study habits i.e. doing homework. Without strong study habits, kids can qualify for the university but still fail. Being smart doesn't mean you will be successful at the university. The people that are most successful are those that have strong study habits and a goal.

 

[bellisarius]

Simple solution to ending enslaving teenagers with excessive student loan debt for the rest of their lives: Make the loans dischargable in bankruptcy court, in the same manner as debt such as car loans, home loans and credit cards. It's notoriously hard to discharge a student loan, so it is a no-brainer to extend loans to teenagers. Early to mid oughts excepted (for reason we all know), when you buy a home they review the ability to pay it back. Offering a five to six figure debt for a useless degree to a mediocre student will stop quite quickly if said student could file for bankruptcy at 25 when they learn their degree is shit and won't find them a job.

Yes and no on that Funk. The US government is underwriting the loan so the banks just don't care what the course of study is or what the ability to repay might be. On a failure to repay, or in the case of bankruptcy as you suggest, the taxpayer foots the bill. From the banks POV its a risk free loan.

The thought in the legislation was that by making it virtually impossible to bankrupt out of the loan the student was then free to pursue any course of study but there would be consequences for that freedom of choice and making a bad choice.

If the student could bankrupt out of the loan it would virtually be the same as 'free' college. The strategy would shift to get the degree, bankrupt out immediately (taking the hit early in the working career), and in 11 years the blot falls off your record and you're home free. Employers would be faced with a new paradigm in that NOT hiring some one because of a recent bankruptcy would no longer be a consideration because under those circumstance damn near everyone would have a bankruptcy on their record and quite frankly taking that path would be the smart thing to do............and who wants to hire stupid?

 

[SpeareChucker]

While I don't have the time right now to read the entirety of your link, I will. That being said, you will accept an opinion piece like this one by a journalist, Mr. Henry Hazlitt as gospel, but refuse to believe a study that proves a rise in the minimum wage does not effect job availability? Isn't that just a wee bit bias? Just a little maybe? A tiny bit? No? Yea I thought you'd say that.

The problem is that his book, while giving a broad view of economics in his opinion, doesn't explain, or uphold, the idea of doing away with loans and grants to stop the out of control growth of college costs. It does give those who read it a basis to form an opinion on economics and this the problem. However I would like a more balanced and intelligent one then yours, which I hold to be worth less then nothing, to judge this by.

it will stop many who have no other way to obtain a college education from going to college, but not all. It will however clear the field for those with money who can buy a diploma rather then earn it. So if this stays in effect you won't have to worry about things like the current college admission scandal, for it will be the common thing to buy a college spot while others who can't and are much more qualified won't get a chance.
Locking out intelligent, driven people for the lack of funds to acquire an education, while allowing those who have no other qualifications then oodles of money to fill the ranks of colleges, will be a poor choice for our nation.

I take it your opinion is that it was the governments fault for being free with student loans and the students (borrowers) by borrowing the money to get an education, but not the colleges for taking advantage of it? So you target those who have the least culpability in the student loan crisis, while ignoring those who have the most? Rather then take those who built a boat that sank to task, you shoot the passengers before they can drown? Figures.

Like I said earlier, this isn't going to stop the borrowing. Those who want to go to college will. The difference is that now they will have to go to private lenders and thus be subject to a higher interest rate. But that's what you want right? A return to supply side economics? That was tried if I remember right and failed, miserably. Trying it again isn't going to improve the results.

Comshaw

The only study ever cited (pointing to your first paragraph) is an older limited study of the availability of 'government' jobs when government raised its minimum wage. What you need to do is look to some of the metropolitan areas that have more recently done this and what subsequently happened to the availability of jobs in their markets verses the availability of job gains in their immediate, unaffected, suburbs.

When you attack Capital, even with the best of intentions, two things happen. If it has mobility it flees and if not, it is not invested (as much) because investment is a gamble and once government gets to putting its thumb on the roulette wheel, people don't play roulette.

 

[bellisarius]

The only study ever cited (pointing to your first paragraph) is an older limited study of the availability of 'government' jobs when government raised its minimum wage. What you need to do is look to some of the metropolitan areas that have more recently done this and what subsequently happened to the availability of jobs in their markets verses the availability of job gains in their immediate, unaffected, suburbs.

When you attack Capital, even with the best of intentions, two things happen. If it has mobility it flees and if not, it is not invested (as much) because investment is a gamble and once government gets to putting its thumb on the roulette wheel, people don't play roulette.

Start with Seattle.

 

[SpeareChucker]

Hazlett was very well-educated when it comes to economics, as a reporter it was his beat, and he should not be simply dismissed as a new-age "blogger."

Some of these people would do well to also read another "not-economist" named Bastiat.

Then there is von Humboldt.

 

[jaF0]

WTF????

We need to address the cost of a college education so we'll do that by cutting funding to those who have no other way to get it?

Part of education in life is knowing NOT to borrow more than you can pay back. If you can't afford a class, don't take it.

 

[jaF0]

Simple solution to ending enslaving teenagers with excessive student loan debt for the rest of their lives:

Teach them not to overspend.

 

[SpeareChucker]

https://www.nationalreview.com/2019/03/elite-universities-ignore-merit-advance-progressive-agenda/
Victor Davis Hanson

An excellent rundown on the current state of college education.

It seems to cover all of the relevant points.

 

[bellisarius]

https://www.nationalreview.com/2019/03/elite-universities-ignore-merit-advance-progressive-agenda/
Victor Davis Hanson

An excellent rundown on the current state of college education.

It seems to cover all of the relevant points.

So far the sciences have managed to avoid the madness but that too is changing. Biology is under siege now.

 

[SpeareChucker]

So far the sciences have managed to avoid the madness but that too is changing. Biology is under siege now.

They were simply being saved for last since they would not speak up:

"Incoming and current faculty members at the School of Engineering and Applied Sciences are now required to report their involvement in promoting diversity and inclusion, which could then affect the assignment of faculty bonuses, Dean of SEAS Francis J. Doyle III said in a February interview."

https://www.thecrimson.com/article/2019/3/12/seas-faculty-diversity-reports/

 

[SpeareChucker]

Who do you want building that bridge?

The very best or the most diverse?

 

[bellisarius]

They were simply being saved for last since they would not speak up:

"Incoming and current faculty members at the School of Engineering and Applied Sciences are now required to report their involvement in promoting diversity and inclusion, which could then affect the assignment of faculty bonuses, Dean of SEAS Francis J. Doyle III said in a February interview."

https://www.thecrimson.com/article/2019/3/12/seas-faculty-diversity-reports/

Can't wait to see how that works out.

 

[schism666]

how many in this thread have ever actually had a student loan

 

[SpeareChucker]

Can't wait to see how that works out.

They are reaping the benefits of keeping a low profile...

 

[SpeareChucker]

A March Madness tribute to the cheaters...




https://spectator.org/heres-to-the-cheaters/

 

[Nicefella]

But what if you DO have the aptitude for the coursework, without dumbing it down? Should those doors be closed to you as well?

One thing that isn't clear to me: is this proposal to protect individuals from incurring excessive debt, or is it protect society from the students eventually defaulting on their government loans (although I supposed they are related)? It seems like it's the student's own responsibility to understand what they are getting into, and the responsibility of the lenders, guidance counselors to explain things accurately and help students realize objectively what they are really signing up for.

It absolutely is. Some of the students that signed up had no business being in those certificated programs. And of course the for-profit institutions took full advantage of taking on students that had no business being in certain programs.

 

[jaF0]

^^^^ Didn't learn about calendars did you?