Lew Rockwell calls for repudiation of student loans

[heavenlyboy34]

LOL at kids that went to college and pursued worthless degrees like political science, communications, management (You think I want some fresh out of college punk managing me? Fuck you.), public administration, philosophy, etc. and now can't find jobs. Who studies this shit?

All of you complaining didn't get conned. The trap was right in front of you and you walked right into it. I ain't paying for yall.

They aren't necessarily "worthless" in the current environment. As I pointed out earlier, people get these degrees because employers are forced to require a degree in many cases.

 

[Danke]

Everyone is giving their personal opinion. You are the one, however, that chose to personally attack.

 

[heavenlyboy34]

I agree with the government getting out of the education business, hb. I just do not agree with bailouts for people who willingly borrowed money via student loans.

Fair enough. I agree with that. But no one else should be bailed out either-and the banks and various other folks who have gotten federal bailouts should reimburse taxpayers either directly or through tax refunds (or some other indirect form). No special treatment for ANYONE.

 

[LibertyEagle]

Fair enough. I agree with that. But no one else should be bailed out either-and the banks and various other folks who have gotten federal bailouts should reimburse taxpayers either directly or through tax refunds (or some other indirect form). No special treatment for ANYONE.

You won't get any argument from me on that. I don't agree with ANY bailouts, subsidies, or anything of the sort.

 

[amy31416]

Why are student loans so special that the debt can not be discharged via bankruptcy like any other debt? I'm sure it has to do with some special deal between the government and the banks. It'd make more sense to change the bankruptcy laws than it does to promote "forgiveness" of loans or some other weird crap. And for those who want to see those who declare bankruptcy wear a scarlet letter of sorts, I'm pretty sure they do. My sister-in-law had to declare years ago, and it's a stigma that will follow her around financially for the rest of her life.

I'm against child support in it's current form, but at least that makes some kind of sense that bankruptcy can't get you out of your responsibility to a child that you helped create.

I dunno...there's no right answer in this current climate of economic mayhem.

 

[heavenlyboy34]

Why are student loans so special that the debt can not be discharged via bankruptcy like any other debt? I'm sure it has to do with some special deal between the government and the banks. It'd make more sense to change the bankruptcy laws than it does to promote "forgiveness" of loans or some other weird crap. And for those who want to see those who declare bankruptcy wear a scarlet letter of sorts, I'm pretty sure they do. My sister-in-law had to declare years ago, and it's a stigma that will follow her around financially for the rest of her life.

I'm against child support in it's current form, but at least that makes some kind of sense that bankruptcy can't get you out of your responsibility to a child that you helped create.

I dunno...there's no right answer in this current climate of economic mayhem.

The student loan industry successfully lobbied congress for that law. Democracy in action.

 

[nobody's_hero]

The student loan industry successfully lobbied congress for that law. Democracy in action.

Are you sure it wasn't the banks? Remember, you don't pay interest on liquidated (erased) debt. It benefits the banks to keep people in debt, because they make their money on interest.

We can't just have people walking away from it all like they used to be able to do. Or could we? Should we? I think so. Maybe banks would be more cautious about who they lend to if they actually had something to lose in the deal.

Blame the drunks or blame the bartender, you know?

 

[heavenlyboy34]

Are you sure it wasn't the banks? Remember, you don't pay interest on liquidated (erased) debt. It benefits the banks to keep people in debt, because they make their money on interest.

We can't just have people walking away from it all like they used to be able to do. Or could we? Should we? I think so. Maybe banks would be more cautious about who they lend to if they actually had something to lose in the deal.

Blame the drunks or blame the bartender, you know?

The banks may have been part of it, but it is well known that the loan industry played a key role:
http://www.declineoftheempire.com/2011/10/enshrining-student-debt-slavery-into-law.html

SIEGEL — And I gather, this change didn't just happen in the bankruptcy law. There was a lot of lobbying that went into it.
Mr. BURD — The student loan industry lobbied hard to put this exemption into the bill. For example, between 1999 and 2005 - the years in which the bill was under consideration - Sally Mae, the nation's largest student loan provider spent $9 million lobbying Congress.
In addition, during that period of time, Sally Mae's PAC provided more than $130,000 in campaign contributions to members of the House and Senate Judiciary Committee, the key panels in charge of legislation.
SIEGEL — And their agenda was essentially to make this kind of student loan a non-dischargeable debt, as they say in…
Mr. BURD — Right, to make sure that private loans could not be discharged through the bankruptcy laws.
SIEGEL — Now, before 2005, there were federal loans that did enjoy that kind of protection from the bankruptcy laws. So this was extending a protection that existed?
Mr. BURD: Yes, that's correct. Since 1998, students haven't been able to discharge their federal loans through bankruptcy, lawmakers have been tightening it up these restrictions since the 1970s, when there were reports of deadbeat borrowers who are taking out student loans without having any intension of repaying them. So there has been this restriction on federal loans. The loan industry, I believe, argued that all educational loans should have the same restrictions on them.
SIEGEL — The story though of students who would take out student loans with no intention of repaying them and declare bankruptcy where relatively early in their adult lives they didn't have many assets at stake. I haven't found any actual data describing how common this was.
Mr. BURD — No, there isn't [any] data. A lot of these restrictions have been put on because of anecdotal information...
...with the private loan program, this isn't the case. And it's almost as if the government has given a blank check to the lenders to say, you know, charge whatever interest rates you want and we'll make sure that borrowers will have to repay you. So there's a lot more - I think there's a lot more anger and frustration about the fact that students can't get their private loans discharged. The government doesn't have a stake in it.
​

Well! I think this story speaks for itself. Let's fast-forward to 2011. Quoting Post-Gazette reporter Tim Grant again—

With the average debt for all four-year college graduates this year at $27,200, according to the nonprofit organization Project on Student Debt, and graduates facing what economists describe as the worst job market since the Great Depression, there is a higher likelihood many of them have not found work or are not earning enough to repay their loans.
It's no wonder the college loan default rate is on the rise.
This year's student loan default rate stands at 8.8 percent, compared to 7 percent last year, according to Mark Kantrowitz, publisher of financial aid websites finaid.org and fastweb.com. That translates to about 320,000 borrowers owing $2.4 billion who have made no payments on their student loans since last September.
​

And yet today, the majority of Americans can not understand why young people are occupying Wall Street and other city centers. Those in service to the financial elites ridicule the protesters, or compare them to Nazis. I hope you're keeping score, because now is an excellent time to separate the wheat from the chaff, the lap dogs from the quality human beings. Now is an excellent time to see the Empire for what it truly is.

 

[amy31416]

Well, I'm not surprised. Thanks for the link, HB.

 

[Danke]

Why are student loans so special that the debt can not be discharged via bankruptcy like any other debt? I'm sure it has to do with some special deal between the government and the banks. It'd make more sense to change the bankruptcy laws than it does to promote "forgiveness" of loans or some other weird crap. And for those who want to see those who declare bankruptcy wear a scarlet letter of sorts, I'm pretty sure they do. My sister-in-law had to declare years ago, and it's a stigma that will follow her around financially for the rest of her life.

I'm against child support in it's current form, but at least that makes some kind of sense that bankruptcy can't get you out of your responsibility to a child that you helped create.

I dunno...there's no right answer in this current climate of economic mayhem.

If the banks lent real money, students would have a real debt.

 

[TCE]

First, the couple of people who claimed we're idiots for going to college and are only looking out for ourselves and so we're statists. As for me, I will have a degree and no debt by next year. I have worked for the past five years and went to a school I could afford without becoming a debt slave. So that is an incorrect stereotype of our position.

Essentially, my position is that bankruptcy laws should not be only for credit card debt, but student loans as well as it was before 2004. No bailouts, forgiveness, etc. The banks lobbied Congress and got a sweetheart deal. Thus, the entire system is wrought with moral hazard. Now banks can give insane amounts of loans without worrying about the consequences because they know the students cannot escape their debts. They turn around, use funds for any kind of risky investment, then cry to the Federal Reverse for a bailout when it fails. Part of the problem is the new bankruptcy law and it piles on the bailout dilemma.

 

[TCE]

EDIT: Double Post. Please delete.

 

[Warrior_of_Freedom]

Good thing I was a responsible individual and actually worked to get the money to pay for college. I'll rage if I have to subsidize people who can't pay loans they signed up for.

 

[ZanZibar]