
Americans fled the country to escape their giant student debt - gshakir
https://www.cnbc.com/2018/10/26/he-moved-to-a-jungle-in-india-to-escape-his-student-debt--and-hes-not-alone-.html
======
Kephael
This is because of distortions in the student loan market. Risk is not being
properly assessed and loans are being made when they should not be. Philosophy
majors at non-top schools should not be given loans since it is unlikely they
will be able to pay them back and the philosophy majors are hurting themselves
in the process.

A fix to this distortion is unlikely since the end result would be the closure
of hundreds of schools and thousands of faculty and staff being laid off as
there would be significantly fewer students.

~~~
TazeTSchnitzel
There's a lot of assumptions here about the value of degrees. It's not just
liberal arts people who have trouble getting work, and no degree is a
guaranteed ticket into work.

Education shouldn't be treated as a problem to which the solution is free
markets. If anything the US could learn from other countries and “distort” its
loan “market” more.

~~~
bluedevil2k
His example is talking in aggregate, not specific students. Sure, you might
have an art history major find a job quicker than an engineering student, but
who will end up getting more jobs, 100,000 art history majors or 100,000
engineering students?

The loan market in the US IS improperly distorted right now - it treats all
loans as having the same repayment risk...which is absurd. What we need is a
loan system that offers interest rates based on majors. Computer science
major? 4% interest. Comparative women’s studies major? 25% down and 12%
interest.

“That will just make it MORE difficult for liberal arts majors to repay their
loans!” — Yes, exactly. It’s a market signal to re-evaluate their decision, or
skip college entirely.

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robertAngst
>Philosophy

>Comparative literature

Then gets a job as a Medical Courier.

>Communications and History

Then gets a job as a pizza deliveryman and says "I lost faith in my country"

\---

I find it very hard to relate to such people. They get a college degree, but
never learned critical thinking skills. Maybe the issue is colleges producing
low quality students.

I have friends with similar degrees and they found soulless sales jobs.

It seems like a responsibility/thinking problem. These arent your best
students, these are bottom barrel.

Who is to blame? Maybe our high school teachers for telling everyone to follow
their dreams instead of learning.

~~~
lazypenguin
High school counselors for mass-funneling students into university.
Corporations for demanding college educations for unskilled labor. Creditors
for lending to young-adults predominantly 18-20 years old. Universities for
inflating social experience to the detriment of academic quality and increased
tuition. Parents for the cultural peer pressure.

Ultimately, I tend to agree with you but I have a hard time criticizing the
naive 18-20 year old rather than the multitudes of enablers who allowed this
situation to arise. Is it really fair to blame the victim of an elaborate and
complex system designed to extract the perfect amount of present and future
value from them while leaving them with just enough (or in the extreme case,
not enough) to survive?

"I've designed the perfect device. It can extract just enough usable meat from
a cow while still keeping it alive." -Paraphrase of a quote that I can't
attribute at this time.

 __EDIT __Actual quote thanks to leetcrew and andygcook: "I invented a device
called Burger On The Go, it allows you to obtain 6 regular size hamburger, or
12 sliders, from a horse without killing it."

~~~
rectang
No matter how predatory or even fraudulent the lender, in U.S. culture the
individual takes the blame in the name of "personal responsibility". After
all, if we were to acknowledge that vendors influence consumer choice,
uncomfortable ethical questions would arise.

~~~
qeternity
Nobody disputes that people are influenced. But it still comes down the the
fundamental right of self determination, which is a pretty core principle in
Western Democratic society. It's my right to try to influence you to do
something (within reason) and it's your right to do whatever you please.

------
anoncoward111
This is actually really excellent reporting. The people and stories in this
article are very real, and I bet there are thousands more people just like
this and potentially millions who want to be like this.

I did the expat thing for 2 years. Sleeping on mountains, on couches, in
airports, in cars, everything. It's a lot of fun and really cheap. You feel a
lot of freedom.

But, it is still hard to get things going "legitmately" in any country, and by
that I mean finding a job and getting a visa and, if desired, having an
apartment or a family/spouse.

I came back to the USA and luckily found what seems to be a more permanent job
than sales. I'm making $2,000 a month and splitting expenses with my gf.

Ultimately that math works better than being a nomad on $500 a month. But I'm
wondering if someday I will give it another shot :)

------
Someone1234
While immoral I am hardly one to speak, right after the Brexit vote when the
Pound Sterling was unusually low against the US dollar (Oct 2016), I cashed
everything in to pay off my loans at a stark discount (15% off). Is it wrong
to benefit from your home country's misfortune? Is it wrong to leave your home
country to avoid repayment?

I will say that while I consider the morals of things, the wealthy and ultra-
wealthy seem to have no such compunction. They will happily move money off-
short to avoid tax, re-work income to pay lower capital gains tax rates, or
have an official residence in a lower tax location.

Somehow I think they will clamp down on this a lot more than they do the
ultra-wealthy.

~~~
qeternity
Why is this immoral in the least? At worst, it's lucky. At best, very shrewd.
The UK held a referendum which impacted the value of the currency against
another that ended up being beneficial to you. Literally nothing you did
impacts any of this. In fact, by doing what you did, you helped support the
pound (i.e. selling dollars to buy pounds). It's not even close to what's
being described here.

~~~
Someone1234
> Why is this immoral in the least?

I'm personally financially benefiting from other's misfortune.

> In fact, by doing what you did, you helped support the pound (i.e. selling
> dollars to buy pounds).

Good point, I hadn't considered.

~~~
gruez
>I'm personally financially benefiting from other's misfortune.

and why's that bad? honest question. you're not the cause of the misfortune. I
see it as no different than a roulette game where you bet on red, someone else
bets on black, and you end up winning.

------
panzagl
Time for the weekly thread where CS majors call anyone who is not a CS major
stupid and worthless.

~~~
qeternity
Red herring. I am not a CS major and I think people taking out huge loans to
major in communications are just as much a problem as bloated school staffs,
federalized loan programs, etc.

It's not zero sum. People who bash CS majors for no reason are douchebags, as
are people who irresponsibly borrow.

~~~
panzagl
Communications majors work in HR, advertising, PR, etc. Most liberal arts
majors are the same way- there are jobs, just no recruiters throwing
themselves at you. CS is unusual in that there's a huge demand for recent
grads, most other jobs have the experience/no experience paradox.

------
skh
My wife has $400,000 of medical student loan debt. We are on PSLF but are
nervous about the program and question if her student loans will really be
forgiven. If they are not forgiven at the end of our 10 years of qualifying
payments we plan to leave the country. If you can find a job outside the U.S.
and don’t mind learning a new system I think leaving the U.S. is a great
option. Will people do this over medical debt in the future? As the world
becomes more integrated this option becomes easier. Especially since speaking
only English is not as limiting as it used to be.

~~~
anothergoogler
Silly me thinking I couldn't afford medical school, I wasn't shrewd enough to
take out the loans anyway and then skip town.

~~~
gizmo686
It sounds like she took the loan because the government promised a particular
repayment scheme. I don't get how you can be mad at the individual in this
case, when the government is the one that renneged on its promise.

------
sovietmudkipz
It's interesting to me that the people highlighted in the article are creative
enough to do things to avoid repaying their student loans but aren't creative
enough to turn their education into a higher paying job. It strikes me as
misdirected energy.

The heart of the article is the debt of student loans are getting so great
that more people are taking drastic measures to avoid repayment. The article I
wish I had read was how some people aren't entrepreneurial enough to turn
their college education into cash. More people should learn how to negotiate
their employment lives better. I renegotiated my salary immediately after
graduating because (A) I knew the market values college grads higher and (B) I
wanted to try to raise my pay just to see what happened. Why don't others see
their degree as a bargaining chip to be played when negotiating? Why aren't
some people willing to employ riskier plays?

"I couldn't believe I couldn't find a job in America." \-- Albright, from
article

Creativity and entrepreneurial spirit is especially needed for people who get
degrees that don't have obvious market potential. For example, some people say
a history degree isn't worth much However; entrepreneurial individuals with
history degrees have gone on to make a great living making educational content
for online media. The job didn't exist so the individual created it. Sure,
it's a risky proposition for the individual but they're already playing risky
from a market potential standpoint. I feel like Albright from the article
could have used this framing to his benefit; but instead, he fled his debts.

~~~
Thriptic
> More people should learn how to negotiate their employment lives better. I
> renegotiated my salary immediately after graduating because (A) I knew the
> market values college grads higher and (B) I wanted to try to raise my pay
> just to see what happened. Why don't others see their degree as a bargaining
> chip to be played when negotiating? Why aren't some people willing to employ
> riskier plays?

You have no bargaining power if you have no differentiating skills or
knowledge.

------
gedy
I wonder if these news stories intentionally pick weak examples of people to
highlight. 20k and 30k debt, for communications and history degree, so now you
have to flee the country? Okay.

~~~
gk1
The people who bought homes in 2000’s that they couldn’t afford were acting
irrationally, too. It’s easy to dismiss this and think “wow these people are
dumb, serves them right...” (my first reaction), but then I think: wait, these
are just a few examples they found who are willing to share their story. How
many people are out there defaulting on their loans that we don’t know about?

~~~
foobarian
Why do you say they were acting irrationally? They were broke and they saw
they could still live in a 1/2M house--sounds pretty rational to me,
especially if you can just drop the debt via bankruptcy.

With colleges, there is a nasty effect that student loans are inflating
tuition prices and punishing the financially responsible people who save money
for tuition. It's almost more rational to make sure to have no savings and
benefit from the free government money.

------
wiradikusuma
In Malaysia, those who default on their student loan are barred from traveling
overseas. Since it's taxpayer's money, people are not happy when you are free
to travel overseas without settling your responsibility. At least that's the
impression from asking around (I'm not local).

"Can't find a job" won't fly here, as you can literally get burger-flipping
jobs easily—you can't walk to a mall without seeing dozens of
"Admin/sales/waiter staff needed". Also, most uni graduates have a family
(rent-free stay).

What makes US different? Student loans not from taxpayers money? Low-paying
jobs impossible to get? Parents don't let their kids stay until they can
afford their own place?

In Indonesia, the govt doesn't even have money to give loans to students.

~~~
zamalek
It's the cost. Tertiary education in America is unrealistically expensive, so
you're locked into higher payments for longer (typically life). Even if a
lower paying job is enough to pay up, your entire life purpose becomes paying
off a student loan. Without the college and loan you would have had a shitty
job but $300 more, nothing else would be different.

In South Africa the banks finance students, so the government doesnt hand out
loans there either. You can pay off a typical degree in less than a decade.
That system is completely unlike what Americans experience.

------
qeternity
> He then went back to school to pursue a master's degree in comparative
> literature at the University of Colorado Boulder.

You graduate with a degree that has little market value and can't pay your
load, so your solution is to accumulate more debt for another degree with
little market value?

------
apo
There are many sources of this problem, but I suspect the three that get the
least attention are:

\- parental pressure to attend college

\- guidance counselors and school administrators pushing for college

\- the wholesale destruction of vocational schools

As a result, the US K-12 education system produces a never-ending deluge of
students who believe their only life option after high school is to get a four
year degree. Or joining the military, but that's a different discussion.

Like the people in this story, many HS grads study subjects with little
economic viability.

Why?

That's the story I'd like to see. What motivated the choice to waste four or
more years and tens or hundreds of thousands of dollars on a credential that
will never pay for itself?

------
boomboomsubban
Two of the three have become teachers in other countries, and one wanted to be
a professor here. So they have at least some desire to teach, some ability to
teach, but would rather move to a new country than teach K-12 here. And
somehow we have a teacher shortage.

From my experience, quite a few people getting the degrees being criticised in
this thread want to become a professor in that field. Teaching is what they
want to do, but they just saw how terrible being a high school teacher would
be.

------
Simulacra
This is ridiculous. I left school with $30k in debt and paid it down with my
$35k job. What we don’t hear enough about are the people who foolishly go to a
bank for their loans, and then take out massive amounts, avoiding all work and
scholarships, then get some degree that has little to know market value.
Student debt is not the problem. Banks, universities and the students are the
problem.

------
gk1
Where’s a good place to park money if you’re worried about an imminent student
loan collapse? Or, put another way, what’s a good hedge?

~~~
sct202
Most student loan debt is owned by the government so it wouldn't collapse
quite like how mortgages sank the housing market. If the pipeline for easy
loans dries up a lot of colleges and their dependent industries (publishing,
construction, education focused IT providers) will probably take a big haircut
or close.

~~~
Deinos
True, but there has been a large drive toward refinancing student loan debt,
which moves that risk into the private sector. I would be curious to see what
percentage of government financed loans have been converted to private debt.

~~~
sct202
Oh yeah I've seen a lot of ads for SoFi and Laurel--also weirdly extravagant
SoFi 'member' events. It seems like SoFi alone is probably fairly large.
They've been reporting billions of dollars in consumer and student loans
converted in a Q1 2018.

Also they've been issuing asset backed securities linked to their loans.

------
hourislate
I couldn't afford to go to college when I left HS. So I took my life savings
and certified as a CNE back in the day. I found a job and was able to attend
school part time. My employer ended up funding a lot of it. It took a while
but it worked out. I had no school debt and actually made a really good
living.

If you can't afford it, find another way....

------
sys_64738
The federal government shouldn't be in the loan business. Those are my tax
dollars being redirected for uses for which taxes should not be applied. I'm
not an ATM.

------
UncleEntity
Other than that time I payed off one of my student loans with a lump sum check
I've been perpetually in default and they never came after me (other than an
occasional letter) or garnished my wages...actually, now that I think about
it, I can't remember getting a letter in quite a while, years perhaps?

Admittedly, I did try to skip the country a couple times but it never stuck.

Now I just work as an "independent contractor" so have no wages to garnish, no
retirement plan and will have to work until the day I keel over dead from who
knows what (or get replaced by the robots).

And yet I blame nobody but myself...

------
hugh4life
I personally like to see loans during the first couple years capped and
community colleges more subsidized.

~~~
exabrial
Or scrutinized. I don't think it's ethical for the government to give $100k to
a music therapy student, as they'll never be able to pay it back with their
future wage.

------
jernfrost
I honestly think the mess the US is getting into here is just another example
of failure of capitalism just like the health care system.

Now everybody struggles to get education and health care right but few places
in the west does it seem to go as wrong as in the US.

People also choose dumb stuff in more socialized educational systems but
because the government regulates the school system they don’t make tons of
useless study places.

In fact we have seen this effect in Sweden as private enterprise started
taking over more schooling. The number of popular but useless studies shot up.
It is a classic case of market failure. It is one of those areas we’re
bureacrats actually do a better job than the market.

------
fenixtx
This article should be titled “How some dishonest people made bad decisions
and instead of fixing them ran away.” They blame others for their choices, and
take no responsibility. Nobody made them get those degrees, take out those
loans, or any of it. I get that the cost of education is a problem, but using
loans and then skipping town to avoid repayment isn’t only dumb, it’s
dishonest.

~~~
DennisP
And yet, in the corporate world there's no condemnation of businesses that
avoid paying back their debts by declaring bankruptcy.

Legally, that's not an option for student loans, but _morally_ is there really
any difference? Is there an ethical reason why student borrowers are less
deserving of the bankruptcy option than other borrowers?

------
pfschell
Preventing educational debt from discharge in bankruptcy is one of congress's
greatest crimes. The fact that they exempted their own children from the law
is just the icing on the cake.

~~~
gruez
>they exempted their own children from the law

source?

~~~
zipwitch
It's not true. The original source of the claim appears to be a
misrepresentation on Fox News years ago of Congress' student loan repayment
plan for staffers.

[https://www.factcheck.org/2011/01/congress-not-exempt-
from-s...](https://www.factcheck.org/2011/01/congress-not-exempt-from-student-
loans/)

