Posted on 11/29/2012 6:46:35 AM PST by jmaroneps37
Well THAT didn’t take long. The confetti thrown on college campuses has barely been swept up after Barack Obama’s reelection and reality has smacked more of his children in the face.
This is happened faster than any of these fools could have imagined. You will recall that Obama’s union children at Hostess found out what real life is about last week. This week his college student children got their dose of cold truth.
The stroke across the student loan crowd’s face is the news that in the 3rd quarter the number of student loans in default has skyrocketed. Student loans …. delinquent … 90+ days and 30+ days have risen dramatically.
The amount of outstanding student loan debt has reached $956 billion having climbed $42 billion in just the last quarter alone.
Obviously the effects of a 53% underemployed/ unemployed rate among those graduating from college last May is taking hold of these young fools. Fully eleven percent of all student loans is delinquent for more than 90 days.
Probably very few of Obama’s college children, who have outstanding school loans, understand that they can NEVER walk away from their debt because it is NOT dischargeable in a bankruptcy, but they will soon find out.
How they expect to live a life of their own in a country that offers them no jobs but demands repayment for their useless degree is a mystery.
Worse still is that this report is, “likely to understate actual delinquency rates because almost half of these loans are currently in deferment, in grace periods or in forbearance and therefore temporarily not in the repayment cycle” according to Zerohedge.com.
The explanation goes on to say, “This implies that among loans in repayment cycle delinquency rate are roughly TWICE as high.”…
(Excerpt) Read more at coachisright.com ...
His logic is as greatly flawed as the idea of forgiving student loans.
“But if you are saying that the only way to solve the student loan problem is to keep giving student loans’
Where did I say that?
We are talking about paying off an astromonical debt in a scenario where real incomes are falling.
I know we blame this one and that one - but realistically - we are only screwing ourselves w this mess since these people will be debt slaves their entire lives.
There are plenty of sound public policy reasons for student loan non-dischargability in bankruptcy court.
I don’t like to paint generations with a broad brush. There are hundreds of thousands from this generation currently serving in the military willing to put their lives on the line. There are thousands that have given the ultimate sacrifice for their country. I know many of these fine upstanding citizens and hold them in high regard.
“We are talking about paying off an astromonical debt in a scenario where real incomes are falling.
I know we blame this one and that one - but realistically - we are only screwing ourselves w this mess since these people will be debt slaves their entire lives.”
We will be screwing ourselves if we forgive student loans. Just how we screwed ourselves with T.A.R.P.
What those in our family experienced was that the "kids" could find jobs in those fields (these were engineering grads from well known and respected school), but the pay was abysmal compared with the usual "going rate" for that field a few years ago.
But that affects everyone looking for a job, even the older workers who had experience, and are out of work, probably will take a job where the pay is less than they made in their previous job.
Supply and demand, there's a glut of employees, and not enough jobs.
As to student loans, the payments must be crushing because I talked with one young man who had less than $10,000 in student loans...his interest rate was over 7% and his monthly payments were around $120 which he considered affordable. Just think of the size of payments for the kids who've financed 30 or 40K in debt.
I think they're in between a rock and a hard place...the fact is a degree is a prerequisite for many jobs, Our son's job required an MBA plus a BA for an entry level job in a particular department of a Fortune 100 company. The days of talking your way into a job even though you don't meet the requirements are over. It's a sad thing for many grads and workers who are out of work because of the economy. An acquaintance was just laid off after 17 years on his job...that's a hard blow to take, and the prospects of future employment are grim.
“We are the ones holding the bag. The Universities do not grant student loans, banks and the U.S. goverment does.”
We are holding the bag anyway.
Universities are the exclusive beneficiary of student loans. They make capital planning decision, faculty decision, administrative overhead decision based on the availability of loans to students to fund all of this.
If Student loans are allowed to be discharged, student loans will not be made to students who cannot pay them back - which will be most students in university that are financing them exclusively with loans. This will kill all marginal programs that leave students unemployable at the level that can repay extensive student loans.
Now I say screw the rules (all of them). This is about the survival of my kids, my grandkids and the nect generations. We are devolving into just two classes...those with just enough most of the time and those with more than enough all the time. I am using all my energies to put myself in the latter group and advising my kids to focus on doing the same.
Screw the left. Screw the middle. Screw the right. They are all useless to me now. We will now see Darwin's theory writ large in society.
Now I say screw the rules (all of them). This is about the survival of my kids, my grandkids and the next generations. We are devolving into just two classes...those with just enough most of the time and those with more than enough all the time. I am using all my energies to put myself in the latter group and advising my kids to focus on doing the same.
Screw the left. Screw the middle. Screw the right. They are all useless to me now. We will now see Darwin's theory writ large in society.
“Some of the dumbest, most gutless, brainwashed pukes I have ever met”
True dat. Even an old codger like me knows it’s perfectly easy to put “free” music on an iPod. Not that I would ever countenance such a thing, myself. ;)
“If Student loans are allowed to be discharged, student loans will not be made to students who cannot pay them back - which will be most students in university that are financing them exclusively with loans. This will kill all marginal programs that leave students unemployable at the level that can repay extensive student loans.”
Exactly. If you want to make garbage, no-job majors like [fill-in-the-blank] studies dry up and go away, this is a perfect strategy.
“Where did I say that?”
You didn’t know that you said it, but you said it indirectly.
Let me explain:
Your premise is that the student loan bubble is “too big to fail” because it would “cripple the US economy”. Then by failing to continue to fund it, you would also cause it to fail.
So you are directly implying we should continue to fund the student loan program because failing to do so will cripple the economy.
You are wrong on both points, in my opinion. We should treat student loan debt just like any other debt, and we should not continue to fund it. It won’t cripple the economy any worse than it is now. Much will have to be written off, but it is only written off if it cannot be repaid as defined by the bankruptcy process.
There are distinct economic advantages to freeing people from debt they cannot repay. That’s why the bankruptcy code exists.
Remember the line from the Godfather, either your signature or your brains will be on that Contract?
Unless that happened in the College Admissions Office, I have no sympathy for people who get themselves into a hole that they expect me (and the Taxpayers) to dig them out of.
Bankruptcy Law is already too lenient IMHO. Somehow I survived for almost 60 years without getting myself in Debt that I could not, or had no intention of repaying.
I know that $hit happens, but willfully incurring Debt to attend an Ivory Tower bastion of Liberalism isn’t the way to get through life. Like John Wayne said, Life is hard, but it’s harder if you’re stupid.
The kids in our Family who went to College worked their way through with the help of Grants, savings or money from Family, not Loans. If none of those options are available, it might be time to find a new path.
I have always wanted a Ferrari, but the Mustang will do. I went to Community College intending to transfer to a University. I never made it that far because I started Working full time and made the decision to pursue opportunity there.
I live with my decision and I do not look back saying what if. Had I decided to further my Education at the time, I was brought up to be responsible. Signing on the dotted line for decades of indebtedness would have been a deal breaker. You reap what you sow.
In my Family, if you owe it, you pay it and quit whining. As my Father told me when I had a young head full of mush, nobody owes you a living so shut up and get back to work.
Oh boy, I’m such a meanie...
The universities get paid and have been paid up front. Discharging loans will have little to no affect on higher education.
We are holding the bag and that bag will be dropped on our heads if we forgive student loans, students included.
If you want to help future students limit the loan ammounts that higher learning institions can receive.
If you want to help present students have the universities pay back the student loans. As for the tax payers, we don’t have anymore to give.
“There are plenty of sound public policy reasons for student loan non-dischargability in bankruptcy court.”
BS. For every “sound public policy reason” you come up with I will come up with two or more reasons why it is not such a “sound public policy reason”
Wanna play? put up or quit running your mouth on a subject that you apparently don’t really understand.
I don’t think bankruptcy should be automatically granted for student loan debt. If the graduate can prove he made a really good faith effort to find work commensurate with his education, but can’t find anything better than barista etc., then bankruptcy is feasible. On the other hand, if he’s a law school grad with a big debt but a good job in a firm as a senior partner making high-five-figures or more, then, tough darts, pay the loan and shut up. Now if said junior partner is then laid-off through no fault of his own, and can’t find commensurate employment within a reasonable length of time, then, bankruptcy might be warranted. But no, not the kind of bankrupcy where you say, “OK, I’m graduated, I’m filing chapter 7, whee!” Can’t be that easy. Probably a whole new chapter of the bankruptcy code is needed for student loan bankruptcy. As for the bankruptcy code being lenient, perhaps the original 1978 code was, but it’s been tightened up considerably, maybe too much so.
“The universities get paid and have been paid up front. Discharging loans will have little to no affect on higher education.”
*face palm* Friend, I’m not saying we go back and reclaim money already spent. How many loans do you think will be made in the future if past loans are discharged in bankruptcy?
.......I’ll wait. keep thinking........It’ll come to you.......
VERY FEW is the answer
Now do you think that future spending on education will affect universities? (psssst. The answer is ‘yes’)
What if spending goes DOWN because people won’t loan money unless they are SURE it will be repaid - won’t that mean fewer people go to university? (yes)
So do you still think that discharging loans will have little to no effect on higher education? (if your answer is not “no” then you must have majored in economics)
“Your premise is that the student loan bubble is “too big to fail” because it would “cripple the US economy”. Then by failing to continue to fund it, you would also cause it to fail.
So you are directly implying we should continue to fund the student loan program because failing to do so will cripple the economy.”
You don’t know me very well and you are a terrible mind reader. By the way I am an electrical engineer that dabbles a little in RF at work.
T.A.R.P has and will cripple the U.S. economy. Forgiving student loans will do even more damage. I do not favor the present system of higher education funding. Adding another trillion to the U.S. debt is insanity.
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