Posted on 12/02/2016 12:18:12 PM PST by SeekAndFind
WASHINGTON, Dec. 1 (UPI) -- An estimated $108 billion in student loans will be forgiven in the next two decades as a growing number of borrowers seek income-driven payment assistance programs, the Government Accountability Office said Wednesday.
The GAO, in a report to Congress that analyzed the cost of income-driven repayment plans, found some $29 billion more in student loans will be discharged due to borrower death or disability. Overall, the sum is double the amount estimated by the U.S. Department of Education, the report found.
The GAO criticized the department for underestimating the cost of the repayment plans and significant accounting flaws that altered projected revenues.
The Obama administration has promoted five repayment programs, known as income-driven repayment plans, to slow the tide of student loan defaults. About 5.3 billion borrowers who hold an estimated $355 billion in student loans are participating in income-driven repayment plans that also extend repayment periods from 10 years to 25. Programs that include the public service loan forgiveness plan allow loans to be forgiven after 10 years of consistent payments.
Senate Budget Committee Chairman Mike Enzi, R- Wyo., who ordered the GAO study, criticized the Obama administration's use of executive authority over student loan repayment programs.
"This extensive investigation by an independent government watchdog found that the Department of Education relied on flawed data and methods to estimate program costs," he said. " This administration has been manipulating the terms of the student loan program without the consent of Congress, while shirking its statutory duty to carefully assess the cost impact of those changes."
(Excerpt) Read more at upi.com ...
So there are 5.3 billion borrowers. And $108 billion will be forgiven over 20 years. that’s $20 a borrower.
If the tax rate is 20% and those 5.3 billion borrowers earn $100 more over 20 years ($5 more a year) than they would have, then they will pay $20 more in taxes and it’s a wash. If they earn $1000 more a year than they would have, they will pay $200tax*20years=$4000 * 5.3 billion borrowers = $21,2 trillion more in taxes and government makes a 20000% return over what they took in losses.
It doesn’t seem that bad to me.
I’m not saying that government shouldn’t find ways to lower losses, or improve education and education funding programs, or lower the cost of education. But I don’t think we need to shoot ourselves in the foot over losses that are very small relative to the additional earning potential of the borrowers.
If you peal back the façade it is just a massive transfer of wealth from the tax payer (federal loans and insured lenders) the leftists (universities).
I’m busting my rear end to pay for my kids education .
Infuriating, now I have to also pay for kids that ran up debt and didn’t work?
I won’t hire anyone who has a loan forgiven.
We are all paying for it.
This may be the pols’ biggest vote-buying scam yet.
Your life seems like it goes like my life always has, bend over.
I am working solely to pay for my daughter’s education she isn’t a rigorous program and cannot work while she’s in the program I really resent people getting free rides when I work so hard.
My son just finished paying his off last month.
I can hear him now: “Now they forgive the payments?”
“Fortunate” to get a ROTC scholarship?
No, no. You (like I and my brother) WORKED YOUR LOVIN’ TAIL OFF all the way through high school TO EARN that scholarship! The YOU worked real hard to KEEP that scholarship by after-hours drill and summer sessions with the ROTC to keep it active.
Then for at least the next 6 to 10 years after graduation, YOU worked 80 and 120 hour weeks PROVING your scholarship's value by serving as an officer in the Armed Forces!
You would be shocked if you knew how many of the students live - subsidizing it all with student loans. No way will they live in a dormitory or share a room. They live in apartments with big screen tvs and swimming pools. They eat in restaurants, not cafeterias.
You’d be even more shocked if you knew how easy it is to get through some majors with honors. Professors don’t take attendance so one person takes notes while the other get much needed sleep. Exams? LOL No. You submit a paper - frequently downloaded from the internet. If a professor ever dared to have an unannounced quiz - the dean would hear about it.
I was prior enlisted and got it after doing well in the enlisted Nuclear program. I was a submarine officer. I actually liked being at see more than in the shipyard.
One thing I will remember about the Obama years is feeling stupid for working and paying my bills.
Totally agree. The snowflakes have no concept of $$$. They think they have to live in only the best apartment. Just checked and the average apt rental with 3 beds is $2140/mo. The contract is from August to August no matter if you take summers off or not. Oh, but, but that’s divided by 3 roommates! Uh, no bleepin’ way, kiddo. That’s still $2140 to you when your roommates move out or they don’t make their payments. When they don’t make their payments your parents, who cosigned for you, get hit with the full bill and get their credit messed up. And that’s the average. Precious fragile snowflakes think they have to live high on the hog while taking the bare min. 9 hrs/semester instead of the 18-21 hrs. we took back in the day.
“What the F happened.”
Everyone should have an apple a day. BUT - apples are 25 cents each, and not everyone can afford that. So the gov’t. steps in and gives loans to folks. Now everyone wants an apple, supply and demand kicks in, and apples get more expensive.
But not to worry - Uncle Sam will offer more and better loans....
Lather, rinse, repeat.
Back in the day, college students were poor. There was no such thing as all these government grants and loans. There were Pell Grants but our HS counselor never told us about them.
The campus lunchroom was closed on the weekends so Saturday it was a 45 cent can of spaghetti-o’s or a 25 cent box of mac ‘n cheese. I splurged on Sunday by walking (no car until Sr. year) to Golden Chicken for their $1.50 box with one piece of chicken fries and a roll and stopped by the coke machine for a drink. That was before microwaves and mini refrigerators in the rooms. The only appliances allowed were irons and popcorn poppers. I brought an ancient popcorn popper that had a burner in the bottom so I could pour the spaghetti into the popper part and heat it. Weenies could be heated on a foil wrapped iron but you had to have friends over to share the weenies because there wasn’t a fridge.
I sewed my clothes and remember making something new the day before dates. Our only twirler was a good friend so we’d rip apart whatever she wore to the football game last week and redesign it for that week’s game. Everyone thought she had tons of outfits, lol. Fabric and sewing notions were cheap back then. Can’t see kids doing that these days.
They were called 'Student Ghettos' for a reason.
Texas didn’t have ghettos. I never saw one until I was grown driving around Galveston. Even so, that’s not real inner city nasty ghettos.
And what about the suckers like us, who paid full price to get their children through college so that they could come out debt free?
And mine worked through school, contributing also!!!
We want a refund!!!!
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