
Student loan programs are too expensive to forgive - vorpalhex
https://fivethirtyeight.com/features/student-loans-are-too-expensive-to-forgive/
======
User23
My first thought on student loans is this: Why can't I as a retail investor
get a taste of that federally guaranteed 7% return?

Oh right, because it's a racket meant to favor insiders who are already
fabulously wealthy. It must be nice to be so rich that you can make it
effectively illegal for anything to make you less rich or even to make you get
more rich more slowly.

------
linuxftw
The debt isn't forgiven, the private companies that made the loans are paid by
the feds. These programs are windfalls for banks that make what would
otherwise be highly-speculative loans. There is a large economic incentive for
students to take out loans they'll never repay and shift the burden onto the
tax payer.

If universities were 'loaning' the tuition money to students directly, that
perhaps could be 'forgiven' as no money has actually changed hands.

The whole system needs an overhaul, same with secondary education. Make the
education free to all by eliminating the 'nice to haves' and focus on the
'need to haves.'

~~~
downrightmike
And then they could directly change their acceptance criteria and drop degree
programs that don't match students with decent jobs. I don't say good jobs,
just decent ones where they could get by not having to kill themselves and
still afford the loans.

------
sjg007
I mean this will force salaries to increase to attract workers b/c they won't
have loan forgiveness as an implicit benefit. This will also reduce workers in
those occupations driving wages even higher. That or the non-profit/gov't
agencies will have to go without (and maybe that's the reason for this
effort). It may also cause schools to drop tuition or make it easier for rich
people to get into schools since there will be less competition.

------
neilwilson
No it isn't. See [http://www.levyinstitute.org/publications/the-
macroeconomic-...](http://www.levyinstitute.org/publications/the-
macroeconomic-effects-of-student-debt-cancellation)

~~~
ambernightcrush
A fellow MMTer!

------
anfilt
If they do that they should put bankruptcy back on the table.

I find it ridiculous that someone can't file bankruptcy for student loans.

