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Why is the GOP and Joe Biden against cancelling student debt? (1 Viewer)
- Thread starter wazoo11
- Start date
IvanKaramazov
Footballguy
Biden is a smart enough politician to know that "Let's hand a financial windfall to people who graduated from the nation's most elite universities" isn't a winning play.
Rich Conway
Footballguy
If your business was big enough, you'd get a bailout.FairWarning said:
djmich
Footballguy
djmich
Footballguy
Manster
Footballguy
How bout we change the requirements for teachers education, do away with the unions, and pay teachers based on merit, instead of bailing them out on the back end?
E Street Brat
Footballguy
Thanks Biggie,
Lots of talk about those that paid their loans, but there are a lot of working people that never went to college because they couldn't afford it. It's just not right to make them pay for someone else's luxury.
Of Course, renters got screwed in the housing crisis, so this will probably happen also,
The Commish
Footballguy
Not sure if anyone's paying attention, but it seems like a good majority of us (from several different sides) agree that blanket forgiveness is not a good idea. We going to continue with the narrative of "sides" on this topic or can we acknowledge that a great many things aren't A/B in reality and are boiled down to such by lazy people who don't want to have meaningful discussion?
djmich
Footballguy
Also, there an element of "lets encourage people to take out loans from schools that don't deliver enough returns to justify the expense to begin with". All that does is exacerbate the future problem (bloated tuition, subpar schools)
djmich
Footballguy
Yes.
I think its important we step back and think about how the world has changed the last few decades and the education of our populace. Hard to argue that continuing education beyond high school is not now more "basic" than it was 30 years ago.
Personally I think we should tackle the problem future oriented and gradually (no forgiveness). Before getting into the details of what sort of schooling makes sense, financially I would support gradually increasing available funding for post HS education. So if a 2yr degree is $30k of value I would support graduating into reimbursing that with a goal of saying getting to 100% over time (not sure exact call but sort of 10-15yrs magnitude. Just spitballing.
The Commish
Footballguy
Personally, I don't think this does anything to solve the core problem of the debt being completely guaranteed to the lenders in a majority of cases. To me, that's one of the biggest, if not the biggest variable in the whole equation. I think allowing bankruptcy options into the mix help a good bit and I'd like to see that before we mess with the other variables. I think this adjusts a good many of them. Yes, fewer loans will be provided meaning fewer people getting them. Yes, it means interest rates would likely go up, but that's what's supposed to happen, no? They are ONLY down because they are treated completely different from other loans etc.
djmich
Footballguy
Yes, bankruptcy treatment was brought up earlier in the thread. I'd support re-evaluating the treatment. I think it is a bit more difficult because you are talking about writing loans to folks who literally have no assets at that stage in their life and the education has no resale value to the lender.
So to your point depending on the rules that would mean somewhere between fewer loans or the disappearance of loans if graduates could auto-bankrupt.
The Commish
Footballguy
Probably by me
These situations exist with other loans too and we address that with co-signers. Can do the same thing here...basically DO the same thing here when parents file for the loans for dependent children. And yes, I would absolutely assume the number of loans goes down significantly. That would expose one of the other core issues that exists in how we provide education to our society as a whole. The pay for play part starts getting clearer as you remove a lot of this noise people are currently focused on.
djmich
Footballguy
If you are saying that the co-signer route is not a real solution then I'm with you.Probably by me
These situations exist with other loans too and we address that with co-signers. Can do the same thing here...basically DO the same thing here when parents file for the loans for dependent children. And yes, I would absolutely assume the number of loans goes down significantly. That would expose one of the other core issues that exists in how we provide education to our society as a whole. The pay for play part starts getting clearer as you remove a lot of this noise people are currently focused on.
One of the biggest drivers of the out of whack increases in tuition is government involvement in the loan process so I'm not sure MORE government involvement there is going to improve things. Also, I'm not sure how you come up with a value for levels of education. How much monetary value a specific degree creates is determined more by what field of work the person ends up in than how many years of school they attended or the degree level they achieved.
jm192
Footballguy
I agree.
We’ve treated college as a must for so long. And in doing so it’s almost as if the loans are the product we’re pushing and if you get a usable degree in the process, cool deal, good for you. If not, thanks for taking out a loan.
We simply can’t have low interest rate loans for 18 year old kids and “sure just cancel ‘em whenever you want. Lenders can’t go from no risk to unlimited risk.
We also can’t just let kids take out low interest loans and bail them out every 20 years when enough people have student loan debt. Because it will be a never ending cycle.
The challenge of bankruptcy as others hve states: with other loans, there’s something tangible they can take and sell. Mortgage? They take your house. Car note? Theirs. That lets the lender recoup some of that investment.
They can’t take the education back. If you took out 20,000$ for 2 years of partying and go no degree, they can’t somehow take the partying experiences back.
Additionally, with the rise of lenders like So-fi that are going to buy your student loans at lower rates: all of the people that care about their credit will re-finance for the better rate. The higher interest rates meant to subsidize the bankrupt loans are never realized gains.
We need to stop treating college as “the next step.” We need to stop lending money to 18 year old kids with no understanding of money if we’re all going to turn around and feel guilty if they have debt. Either we’re ok with them having debt or we’re not. And if we’re not let’s stop letting them take it on.
Being 18 makes you an adult in the legal sense, but in no other way are you an adult. Kids need financial literacy courses. We need to better prepare them for what the loans mean. Not “oh you didn’t know you couldn’t get a job majoring in pop culture? Let’s bail you out.”
jm192
Footballguy
I didn’t think of co-signer’s. Maybe that’s the answer.Probably by me
These situations exist with other loans too and we address that with co-signers. Can do the same thing here...basically DO the same thing here when parents file for the loans for dependent children. And yes, I would absolutely assume the number of loans goes down significantly. That would expose one of the other core issues that exists in how we provide education to our society as a whole. The pay for play part starts getting clearer as you remove a lot of this noise people are currently focused on.
The Commish
Footballguy
So this is where I waffle. I am stuck between this and this notion that "we have to do all we can to help businesses compete on the global stage" that's offered up as reasons for tax breaks to the really rich and businesses. I don't know if we should stop treating it as "the next step" or start supporting it like it's a necessary step to be competitive in a great many areas like science, technology, business, engineering etc. This is where the liberal arts people get pissy with me, but I think there can be tremendous value in supporting people going into these areas if we treat it as a necessary step similar to the way we look at businesses.
Sand
Footballguy
While most should not get any forgiveness I fully support such for those proven to have been defrauded, those on military disability, those on SSI.
djmich
Footballguy
If co-signers was a real solution of any magnitude why are we having this conversation now about all this terrible debt (cant the folks we are proposing to be co-signers...parents....just pay it off).
The Commish
Footballguy
They are rarely used today unfortunately.djmich said:
MAC_32
Footballguy
Co-signors? They're very common in student borrowing. They aren't necessary for federal loans, but the max most undergrads can borrow in fed loans is $27k. Most of those in too deep had to pursue private owns too and most of those require co-signors.
The Commish
Footballguy
Sorry. Was speaking of federal loans. Under 10% of them had co-signers. Well, that was the number from approx 15 years ago...my dad was a financial aid director for 30+ years and he retired, so that specific number is a bit stale from my memory
I shouldn't be so certain in that comment.
MAC_32
Footballguy
Oh, that number is probably accurate for federal loans - most don't require a co-signer. The ratio of private vs federal is quite a bit different vs 10-20 years ago though. It's less obvious when reviewing macro level data because private loans are generally prioritized before federal when paying them down because the interest rates are obscene.Sorry. Was speaking of federal loans. Under 10% of them had co-signers. Well, that was the number from approx 15 years ago...my dad was a financial aid director for 30+ years and he retired, so that specific number is a bit stale from my memory
I shouldn't be so certain in that comment.
MAC_32
Footballguy
The average person does not understand half (?) of the scope of the student debt problem. And I don't blame them for it. I just wish so many wouldn't be so opinionated about it. Hell, it's (part of) my profession and I don't even have an informed opinion on all the components of it.
Any solution must be a forward thinking one though. That I am sure of.
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The Commish
Footballguy
It's guaranteed period....doesn't really matter who in terms of solution. If one falls on hard times, there is no way to get out of it. That's the primary problem IMO. I know people like to pretend that all these billions are ALL people scamming the system and getting in over their heads, but that's not been my observation. I don't know how many times my dad had conversations with people on what they should do because they lost their job, had an accident, had some unforeseen medical issue etc that caused them to pause or even drop out of school as they were right in the middle of their education. I don't know if it's been mentioned in this thread or not, but I did bring it up in the Education thread, but the majority of debt is held in small amounts by a large number of people. It's a much smaller number of people who have large amounts. Even a relatively "small" $5K debt can feel like a ton of bricks that someone will never be able to get out from under.
djmich
Footballguy
Not sure I'm tracking you here. How is this different from any other loan? Somebody is going to pay for the loan and generally the order of priority would look something like this:
Person taking the loan
Person co-signing the loan
Underwriter (in this case some may be citizens of the US)
In terms of the amounts and the burden you are describing...yes. Yes, debt is a burden. Mortgage, car loan, student loan Yes, life circumstances can make that debt even a bigger burden and feel like a ton of bricks. Not sure anyone is disputing that.
The fact that most of the debt is owed by many people in smaller amounts I did not know...intuitively that seems like not as big of a problem.
The Commish
Footballguy
djmich
Footballguy
You mean the bankruptcy conversation we hit on earlier? If yes, I understand, think was discussed that an area to look at but high potential for unintended consequences.
jm192
Footballguy
I think there is a wide variety of cases.
There are tens of thousands, hundreds of thousands, maybe millions of kids that go and party and do poorly and don't go back. When I was in college, I think the statistic was 1/3 wouldn't be back for sophomore year.
There are people that want to buy fancy cars, every new iphone and don't want to pay their bills.
There are people that do just fall on hard times. BUT, most of the student loan carriers have income based repayment plans. I refinanced my loans through Laurel Road and finished paying them off in August. But they had a hardship program. You're not usually locked into a 500$ a month payment if your circumstances change.
jm192
Footballguy
It is nice to see people from both sides closer to the middle on this.
The thing seems to be a big spectrum. As someone else so elegantly put it: some people see student loan debt as cancer that we're immoral if we don't get rid of. Some people don't think there's a problem at all. And then a lot of people seem to be somewhere much closer to the middle of those 2 view points.
The thing seems to be a big spectrum. As someone else so elegantly put it: some people see student loan debt as cancer that we're immoral if we don't get rid of. Some people don't think there's a problem at all. And then a lot of people seem to be somewhere much closer to the middle of those 2 view points.
The Commish
Footballguy
I was more referring to the contingent that makes up this community at FBG. But I know its a tough ask to acknowledge. We have people here who call it hypocricy to act the same way in two different situations. Whatever it takes to drive the narrative and avoid admiting they might just be wrong sometimes. Oh and BOF SIDES!!!!!
djmich
Footballguy
There are endless ways to be creative about helping people going through hardships other than "we just need to get rid of it for everyone". I'm still puzzled on the Commish's point that the bulk of the debt is small amounts across large population. I mean why are we forgiving 5k. 30yr amortize it. $14/mo. Build in a 2yr no pay period. I''ve been paying my wife grad school loan for 23yrs, comical that I have 7yrs to go...but thats what we decided worked for us.
Tie some level of debt relief to community service.
I'm surprised with such seeming broad support for no just wiping debt out that there is such as rush to forgive $10k and folks like Pelosi and Schumer pushing for $50k
Manster
Footballguy
How bout we make parents and guidance counselors pay back student loans for kids who get crappy degrees with no marketable job skills? Seems like someone needs to be held responsible for bad financial decisions, and Ive got to guide my own kids in their decisions..... I shouldn't have to help pay for Jimmy and Jill's sociology degrees
KarmaPolice
Footballguy
Lovely, so we just raise a bunch of doctors, lawyers, and CEOs? We don't need sociologists, teachers, artists, etc..
Since you feel this way would you agree to a scaled tuition based on what their probable incomes would be? Maybe instead of 25K for tuition for everybody at a school maybe pre-law should be 40K and that lit degree should be 10K.
djmich
Footballguy
They’re adults....and now “we’re” raising them? I think the point is if you want to go to college for ballet that’s cool but are you really saying that I should pay for that too?
I’m 42 with no savings who’s paying for my fantasy football post doctorate?
shadrap
Footballguy
KarmaPolice
Footballguy
I didn't say you had to pay for anything.
Manster seemed to be upset about people getting degrees in fields that don't pay well and struggling to pay for that schooling.
djmich
Footballguy
Yah I was trying to be funny. I don’t think Manster is upset that people get degrees that financially are not justified. I think he’s upset that they get them AND want Manster to pay for them.
dawgtrails
Footballguy
Just a point of reference. I have a sociology degree and while not working anywhere close to that field, it has served me well and been a bonus in job interviews I have had.
Manster
Footballguy
Sure, a college degree still can mean something. If they make college free and/ or relieve student loan debt, that sociology degree won't mean squat.
Manster
Footballguy
How bout you do your due diligence when choosing a career path.....or better yet, how about your parents help you understand what your choices as an adult mean.
Why are colleges going to lower tuition for majors if people line up for em? If there wasn't demand, it would take care of itself.
So no, I don't want the gub to swoop in and make regulations....and I don't want them to bail people out for bad financial decisions....I want people to take responsibility for themselves....why is that so wrong?