First free access to higher education should be a cornerstone of a
democracy as it is in many countries.
(Private institution can still exist and be popular but a -decent-
public option should be available).
This whole issue deft political stunt by Biden.
I believe Biden and his advisers knew there was little chance
to no chance of it being implemented.
Thus, they did not have to worry about the real-life consequences.
The republicans and/or the supreme court would knock it down.
Then the Biden administration can then make a big issue out of
how the evil opponents stopped the handouts.
If it wasn't for SCOTUS and congress/senate, you would all have
less student debt.
Vote for me and I will do my best to have it passed.
Normally I'm not too cynical about politics (or most things), but in this case the policy was so obviously spectacularly bad that I find it hard to disagree.
And to be very clear: an extremely expensive short-term half-arsed fix that doesn't do a single thing to fix any systemic issues (and, in fact, will likely make them worse) is profoundly bad policy, no matter what you think about education policy in general. I was very disappointed at all people in favour of this, as it's just so obviously the wrong approach to fix anything as we'll be in the same (or worse) situation in 10 to 15 years.
Fix college tuition fees first. Then you can start doing something about the existing debt if you want.
We could go back to pre-1998 and allow student loan debt to be discharged in bankruptcy. The law signed by Clinton was a gift to the banksters and college administrative head count.
> First free access to higher education should be a cornerstone of a democracy as it is in many countries.
I can somewhat agree with this in principle, but unfortunately, the way it's worked so far in these USA is that the federal government jacks up their assistance in terms of grants and loans, and then all the colleges and universities jack up their tuition to be commensurate for everything the government just put in their pockets. So it's a zero-sum game and it's an ouroborous where the populace keeps voting free stuff for ourselves, and the cost of "free" just gets higher, and higher, and higher. The same thing happens for medical costs (even after the "Affordable" Care Act), so surely some sort of price controls could prevent these folks from bleeding Uncle Sam completely dry.
For colleges I personally favor an all or nothing fixed tuition policy for student aid. Either they accept the amount given as payment in full, with no tuition raises or sneaky fees xor they take a hike and go full private. That would prevent double dipping and have a fairly graceful failure mode. If the ammount offered is actually too low you would expect to see growth in rejection of federal tuition and more private market as a share.
> Vote for me and I will do my best to have it passed.
That was a 2020 message.
I find this “incompetence is ok if it’s not my fault” thing to be a weird conscious decision. If this was purposely done for political points then that is really dumb.
Everybody thinks it's this big conspiracy without any proof.
Could you ever think that maybe people tried forgiving loans because borrowers were truly screwed over?
The PPP loans and the billionaire tax breaks both past the Republican filters, and were 'warp-speeded'.
Suddenly you want to put the same amount of resources towards struggling students who tried to reach for a better future? Republicans will find Patsys to sue on their behalf.
>Could you ever think that maybe people tried forgiving loans because borrowers were truly screwed over?
It would be easier to believe if effort was put in to pass the policy via the proper legal channels. And if the government didn't keep writing these loans at higher and higher interest rates at the same time. Regardless of whether or not the borrowers are screwed over, this was clearly political maneuvering and a token gesture at "solving" the problem rather than an honest attempt.
> Could you ever think that maybe people tried forgiving loans because borrowers were truly screwed over?
The businesses which where shutdown/severely limited by government weren't screwed over?
Students with loans were appropriately compensated by pausing the loans. The forgiveness was not about anyone who truly were screwed over. There is no pause button for businesses. They can't just stop paying employees, distributors, utilities, etc. and expect to comeback months later and restart like nothing happened. Government did not force students to take out loans. Government forced some businesses to close. Government restricted some businesses' operations. Businesses had no choice in the matter.
Biden was going for a Hail Mary on this one. I suspect that even he thought it was a big-if. I'm sure there were a truckload of attorneys telling him why his executive order was overreaching.
But the problem remains, what do you do about a problem that is stifling a whole generation? It's leading many to postpone buying a home and even starting a family. I suspect it's affecting the size of the next generation too. They never should have gotten into so much debt. But they did. Now what?
Make student loan debt dischargeable through bankruptcy, like every other type of debt. This was the original corruption that's responsible for most of the horrible dynamic - the all too common pattern of congress trying to have its cake and eat it too.
Practically, this shouldn't make those who already paid off student loan debt regret having done so, as going through bankruptcy instead would have given them a much different life path. But it would give a way out to those hopelessly underwater.
If I take a loan on a house, or a car, or some other tangible good it can be taken back. I can't take back the education you never paid for. The government should have never gotten into backing college loans, house mortgages or any of those things. The free market should do it, it should be competitive and there are simply some people that don't deserve to go to college on someone else's dime...
Many debts are collateralized, and many are not. Pointing at some common collateralized debts doesn't really have bearing on the argument.
I agree that the government shouldn't be loaning money for college, but I also don't think the government should be loaning money for housing, nor loaning money to banks at ridiculously low rates to bid up the everything bubble - listed in increasing order of importance.
But OP asked what we can concretely do right now, to address the problem that has already been created. Stopping student loans cold turkey isn't going to make colleges magically downsize their bloated layers of administrators and lower their tuition - it's just raging at what has already occurred. Just like how raising interest rates a little bit didn't unroll the screwed up housing market, but rather just caused it to lock up and remain in the inflated state. So the first stab at a practical middle of the road approach is to end the poorly thought out legislative subsidy of non-dischargeability, and start letting the already-created financial situations be resolved through the standard processes. Bonus points if some of the money can be clawed back from the colleges that received it, but the basic dynamic has to be defined before that can happen.
From the individual perspective, going through bankruptcy isn't instantaneous and has effects that last a significant amount of time for someone who just graduated from college. Courts do look at things like ability to generate income. The option is only going to be practical for those with little hope of actually benefiting from their degree.
If colleges had skin in the game the system would work much better.
Who are we to declare that they're bloated? If they provide massive value, great.
When a student cannot pay back a loan that is not their fault. It is the fault of the college who claimed their education was worth x dollars when it was clearly not.
Software engineers that routinely dig through layers of abstraction to grok how systems function. Not everything needs to be treated as a black box. Like I know very little about medicine, and I'm certainly not capable of diagnosing medical problems. But when I try to ask a doctor a question, and get confronted with a phone tree in front of an answering service in front of a receptionist in front of a nurse in front of the actual doctor, with days of delay in between some of those layers, I can confidently say the place has organizational cancer.
At which point the banks would respond by not writing pie in the sky loans for 18 year olds with median income earning prospects. And then colleges would respond by cutting back costs to reflect something more approaching reality instead of an artificially inflated market.
In Canada you can discharge them by bankruptcy and this doesn't happen. Less than 15% of federal loans are even on a repayment plan, never mind in bankruptcy.
which is, iirc, why it was even made to be this way ("un-bankruptable") in the first place.
The "risk premium" on these loans likely would've been FAR higher (or rather, people might've just stopped making loans altogether) if people were just allowed to declare bankruptcy right after getting the education.
The “risk premium” is already jacked. I’m paying 6% on 10 year old debt that cannot be discharged. Shouldn't the risk be very low to lenders and have a much lower rate?
Why would the most secure debt have such a high interest rate? (Treasuries at the time were 2-3%)
I'm arguing that the current rate is without the additional percentages that the insane risk premium that would be attached to these loans, if they were made at all.
> is already jacked
If you're arguing why it's not the same rate as treasuries, I'm not sure what more I can say. There's more that goes onto pricing loans than just the risk premium. It's a part of it, but not the whole story ("why are government-backed MBSes not the same interest rate as treasuries?").
Furthermore, just look around: you sure there's no "risk" with these loans? You cannot in honesty argue otherwise.
I’m arguing that the rate is already artificial and borrowers are paying more than they should. So increasing lender costs would not necessarily increase rates since rates are set by something other than the market.
When I took out student loans in 2013, I got a 6.5% rate for 25 years. It can’t be discharged and any default is guaranteed by US Department of Ed (eg, I die, or use income based repayment for 25 years and discharge the balance). So to the borrower, the “risk” is that the USG defaults.
For comparison, I bought a house that year and got a 4.25% 30-year mortgage that has my house as collateral.
Why would a student loan that can’t be discharged have a higher rate than a mortgage?
I once had an undergrad tell me directly that her strategy for financing college was to get through on loans then declare bankruptcy right after graduation. Good grief, what could I say to that?
For a time, this was actually my health insurance plan - if something happened to me, I'd go into a lot of debt to take care of it, and then declare bankruptcy. Not saying it was a good plan, but you do what you have to I suppose.
I'd say this is basically everyone's healthcare backup plan, even if they have "insurance". The only thing that varies is the scale of what would be considered catastrophic.
> Make student loan debt dischargeable through bankruptcy, like every other type of debt. This was the original corruption that's responsible for most of the horrible dynamic
> Biden was going for a Hail Mary on this one. I suspect that even he thought it was a big-if. I'm sure there were a truckload of attorneys telling him why his executive order was overreaching.
It’s a political stunt. It’s not like he is someone who just got into politics and just wasn’t aware how the system works.
This kind of grandstanding happens all the time. Representatives propose radical bills knowing full well they would never pass. But they can then turn around and say “Oh no, I was going to do all these nice things for you, but $otherside got in my way. Thanks for believing me and voting for me, though”
Not a chance. Look at the timing. He was going for driving young college educated voters to the polls for the midterms. It worked exactly as planned.
Since the Democratic Party has abandoned the working class as a whole, they rely on mobilizing the college-educated minority, which is loyal in spirit but unreliable when it comes to actually placing votes. Until something changes, the Democratic Party will drum up a new cause every 2 years (based on their available resources at the time) targeted at this demographic, and it won't always work, but it did this time.
I disagree, but most importantly you're confusing the difference between exciting people who already vote vs. mobilizing non-voters. The Democratic Party is a tad more sophisticated than that.
This is actually true. What's the SCOTUS going to do? Start a coup?
This has happened before: the SCOTUS ruled that the Indian Removal Act was illegal and struck it down. Andrew Jackson did it anyway, yielding the Trail of Tears. SCOTUS is powerless to enforce its rulings on the executive branch; only Congress can actually act against the President.
>By that logic, Congress is powerless against the President as well, as the President has the guns.
No, he doesn't. The military does. The military is sworn to uphold the Constitution, so if the President is impeached and his powers removed by Congress, the military has to follow Congress's orders, not the President's. Of course, the military could ignore the Constitution, which would be a coup, but then it seems unlikely that all the officers and enlisted would go along with it because they'd all be breaking their oaths as well, not just the top brass.
>This whole thing works due to the consent and demand of the people and the people they ultimately put in the government.
The people by and large supported debt forgiveness. The people by and large want health care and labor reform. The people by and large supported Roe V. Wade.
The Federalist Society controls SCOTUS and the will of the people no longer matters.
The people and their government accept that having a stable rules-based system does not always mean that policy outcomes match the vague preferences that pollsters sketch out.
The people voted for Trump who installed 3 conservative justices, and they vote for many GOP Congresspeople giving the GOP control of ~1/2 of Congress. Either the people are doing a horrible job of voting according to their interests, or there isn't as large a majority supporting those issues as you think.
Not to beat a dead horse but the majority of people didn't vote for Trump.
A rural minority of white conservative Christians are doing a good job of voting according to their interests in a system biased in their favor. But they're still a demographic and cultural minority overall.
There was less than 2% difference in the popular vote results. It wasn't some small minority that elected Trump, it was almost half. It's really strange how Democrat voters constantly, after all these years, try to downplay just how much of the nation supported and elected Trump; it's like they believe that by making people (and themselves) believe that it was some tiny minority, that almost half the American people actually like that con artist and support the awful things he and his party stood for.
Edit: ... it's like they believe that by making people (and themselves) believe that it was some tiny minority, rather than the fact that almost half the American people actually like that con artist and support the awful things he and his party stood for.
The only reason this would be a hail Mary would be if you have a cynical (and correct) view of the conservative majority of the supreme court that they are willing to completely debase themselves and the law in order to get a desired outcome.
The law clearly states that the president can "waive or modify" any provision of the federal student loan program. Justice Roberts argues that forgiving some student loans is not waiving or modifying provisions, it is rewriting it from the ground up. Which I don't think any honest assessor would agree with. You could literally add one line to the existing provisions to accomplish the loan forgiveness.
But more importantly, you must have standing to bring a lawsuit and this was one of the weakest cases the court has ever approved for standing (possibly with the exception of the 303 creative case) because there was zero evidence of harm to the plaintiff.
This whole issue deft political stunt by Biden.
I believe Biden and his advisers knew there was little chance to no chance of it being implemented.
Thus, they did not have to worry about the real-life consequences.
The republicans and/or the supreme court would knock it down.
Then the Biden administration can then make a big issue out of how the evil opponents stopped the handouts. If it wasn't for SCOTUS and congress/senate, you would all have less student debt.
Vote for me and I will do my best to have it passed.