
Social Security Garnished for Unpaid Student Debt - esturk
http://www.wsj.com/articles/social-security-checks-are-being-reduced-for-unpaid-student-debt-1482253337
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achievingApathy
Maybe someone just needs to explain this to me like I'm 5, but no one forces
someone to take out $125,000 in loans to go to a private college. I graduated
from community college and then went to a state four-year for my degree, and I
came out relatively debt-free.

I don't want to force people into a lifetime of poverty because they made one
bad financial decision at the age of 19, but I took out loans, too. I also
think it's part of the college experience to eat Ramen every night for a three
weeks and scrounge for beer money so I might be a bit biased.

The money that I borrowed, that I paid back to my school (as promised) didn't
go sit in some fat cat's bank on Wall Street. My school turned around and
loaned that money back out to the next round. So it's incredibly selfish I
feel for anyone to think they are free from any responsibility to pay back
their loans because they were duped at the expense of someone else who now
might not get the chance to go at all.

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mulmen
Where I went to school my student fees went straight to the state board of
education. This money was then used to pay for all schools across the state
including grade schools, middle schools and high schools. The university
received a portion of the fees I paid but ended up losing a few hundred
dollars a year per undergrad. The difference was made up by grants, land and
inventions created by the university, most of which existed only because of
grad students.

Effectively the people of the state were unwilling to pay for their children
and the future of their state and they made the university students pick up
the difference. Add to that the fact that many degrees are unemployable
because the economy is/was in shambles and you end up with students paying tax
multiple times on their education.

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hidden_forest
Every time I see news on the student loan crisis, I thank God I graduated
college in the 90s. I left school $12k in debt, paid it off in 2 years.

~~~
generj
It's not impossible to have a low debt degree today.

I've worked interesting jobs part-time during the school year and full time
during breaks and will graduate without a dime of debt. I've met many students
with a similar financial background.

~~~
twoquestions
I'd be very interested in the details on how you were able to accomplish this.
What kind of part-time job will both pay enough to fund college while being
flexible enough to allow for both class time, and leave you with enough mental
energy to study and do homework?

I worked through my college education yet still graduated with a modest amount
of debt. There were choices I could have made to improve my financial
situation, but no amount of penny-pinching would have completely mitigated the
debt I would have had to take on, save a rich relative bankrolling me.

~~~
generj
I've been very lucky. I don't want to say everyone can get through college
without debt, because that simply isn't true. I also was blessed with a good
job and some good timing. Mostly it comes down to my university being so
inexpensive.

I went to community college first. In community college I found it was really
common for people to be doing both full-time school and full-time work. My
present university (BYU) also charges very low tuition - almost as cheap as my
community college. I've also done some full-time work with part-time summer
classes in order to keep my graduation on schedule.

I work for a web analytics consultancy, which has allowed my hours to be
somewhat flexible. I started at about $10/hour which was enough to meet my
expenses at the time (because I was going to community college while living at
my parents). Within a year I was making about double that, which was perfect
as it coincided with graduating from community college and moving 2000 miles
to university (meaning I had to cover my living expenses). This is because the
particular type of consulting we do is quite specialized - if I only got two
or three real hours of work done in a week out of 20 hours worked the company
was still massively ahead at the hourly rates we charge. The work (mostly
coding) is different enough from my major (Economics) that I maintain interest
in both.

My major is also taught by professors who apparently all prefer roughly the
same schedule for classes. As a result, semester to semester time shifts in my
work schedule are minor. I work in the morning and then do some work in the
evening.

I won't say everything has been perfect. I don't spend as much time on
homework as I ought to. If I procrastinate, a client's work might pop up in
the morning before an assignment is due. So I've had to be much more
structured in my classwork and often try to get a good chunk of it done on
Saturday afternoons.

~~~
twoquestions
Thank you for the details!

It also speaks very highly of you to acknowledge how lucky you are to be in
your situation, in addition to the effort you put in.

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aphextron
This doesn't even make financial sense for the government. If you are
guaranteeing that federal student loan debts will be deducted from social
security payments, why not let me make those payments pre-tax before
retirement? Why would you take one third of my paycheck into social security,
which may or not pay out for me in decades, rather than just sending it
straight to my loan balance?

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nickff
The reason that the government takes your money up front instead of letting
you use it against your debt is because the government has liquidity/solvency
issues.

Social security is a wealth transfer program, not a retirement saving program.
Social Security takes money from the young, and gives it to the old; this is
exacerbated by the fact the 'current old' did not 'pay-in' as much as they
will be taking out, so they need your money right now.

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rqebmm
The Social Security Trust Fund has no looming liquidity issues for the next 20
years or so[1]. Solvency is a different issue, and has nothing to do with
student debt payments.

[1][https://en.wikipedia.org/wiki/Social_Security_Trust_Fund](https://en.wikipedia.org/wiki/Social_Security_Trust_Fund)

~~~
nickff
I said the government has liquidity/solvency issues, and it does; the SSTF is
supposed to peak in 2021, but its largest holding is US Treasury bills, so the
government will either have to 'run a surplus' by then (to pay off the
treasuries) or default on debt, in order to continue paying out Social
Security. Do you believe that the federal budget will be running a surplus by
2021?

None of this is directly due to student debt payments, I was trying to explain
why the government resists deferring Social Security taxes.

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kafkaesq
_WASHINGTON—The federal government is increasingly taking money out of
recipients’ Social Security checks to recover millions in unpaid student debt,
leaving thousands of retired and disabled Americans with below-poverty
incomes, according to a report set to be released Tuesday._

This is just pure, unadulterated evil.

~~~
new_hackers
Maybe? If it was money owed by the individual, then maybe not? The question
is, when do we absolve people of debit while still giving entitlements? If the
some of the money from the entitlement should be used to pay down the debt,
perhaps the government is just cutting out the middle man?

~~~
kafkaesq
_The question is, when do we absolve people of debit while still giving
entitlements?_

It's a thorny question, in the general case. But fortunately we can rely on
the time-honored constraints of common sense and general decency, in cases
like these.

For which the factors "Would this force the individual below sustenance level?
Are they disabled, or do they have disabled dependents?" are actually pretty
easy to assess, and verify.

~~~
civilian
"Common sense and general decency" my common sense and decency is pretty much
at odds with yours.

You took a loan? Good, repay it. You're an adult, you made a decision. Don't
expect any help from others.

My sense of decency says that we should probably not allow student loans,
since so many people aren't mature enough to understand their impact and
calculate the trade-off of taking one.

//EDIT: So, my main argument is against the idea that we should use "common
sense and decency" to make these decisions. That's stupid, because the
majority of people don't understand economics and have a hard time guessing
what the second and third order effects of a "nice" action would be.

My arguments are a red herring. We should throw out the "common sense" of
kafkaesq and I. We're both being stupid when we just poll our values to see
what our knee-jerk reaction is.

Let's just use a system that has the best outcomes. I'd like the policy that
provides the highest outcome of: ("Grows GDP" x "Does not fail it's
participants")

~~~
vkou
Actually, almost all of the time, when you take out a loan, you can choose to
repay it, or file for bankruptcy. In the case of uncollateralized loans
(Credit cards, utilities), the lender is quite likely to receive next to
nothing for it.

We just need to make student loans dischargeable through bankruptcy, and all
of these problems will be fixed. Lenders will stop lending children hundreds
of thousands of dollars to get a European history degree, tuition fees will
implode...

~~~
generj
I agree with this, but there has to be some kind of reasonable time limit
where bankruptcy doesn't apply. Otherwise every cunning student will just
apply for bankruptcy right after graduation (made very easy because they don't
yet have a job and have almost no assets).

I'd be OK with bankruptcy ending student debt after a time frame of 5-7 years.

~~~
new_hackers
Yup, and this is what was happening (AFAIK) and why they added the stipulation
that student loans weren't absolved in bankruptcy.

Otherwise, why not everyone become a neuro-surgeon? A couple hundred thousand
dollars wiped away right after collage, only so they can become paid far
beyond reasonable wages afterward and owe nothing.

~~~
brazzledazzle
So it stands to reason that if you create a special class of debt you should
have a special class of debt collection. If your income and/or assets are
greater than $X then collect. That would keep people from playing the system
and keep someone who depends on social security to survive from having their
checks garnished.

We're so obsessed with stopping cheats in this country we'll cut off our nose
to spite our face.

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tn13
Good reason why Government should stay out of both social security and student
loans.

