We've been fighting for the return of fundamental consumer protections for student loans since 2005. While our argument is rock-solid, and getting much stronger as events in the student loan industry unfold, I am finding that the press has gone scared, lame, and yellow on us.
Since early 2008, I've found that the press has suddenly stopped printing controversial stories on student loans, and those who do tackle controversial topics, such as those mentioned below, do so with a pro-lending system bias so strong, the resulting pieces are horribly misleading...it would be comical if there weren't so many citizens being harmed incredibly by the misinformation.
If this is happening in the media generally due to the economic "crisis", then we should all, as citizens, be massively concerned, doubly skeptical, and vehemently calling for the free press to immediately get it together, return to the tough journalism that we count on them to do, and redouble their efforts to cut through the spin, lies, and distractions to get the truth. This is what the media MUST do in times like these when trust is not something the public has in many of the nation's institutions. I am sorry to be pointing this out, because it should go without saying.
We did the research, and served as sources for the stories described below. See the original press releases/research reports on the main page of our website, Studentloanjustice.Org. (please donate to support our work). Also, If you have noticed similar trends, please send me an email:
Finally: please send this to any reporters/producers you know who might be interested in digging into these issues.
Media missing the real story on student loans.
The media is currently showering the public with stories about student loan debt, and rightfully so. For too long it has been a vastly under-reported issue. I expect that we will see this issue climb steadily along with the national student loan debt, which is likely surging past $1 Trillion...an unthinkably high amount even 20 years ago, but today, this is the reality,
I've noticed, however, that reporters on this beat haven't been able to dig through the "wall of spin" erected by the lenders, schools, and even the Department of Education (which is understandable). More than that, however, there is an obvious reluctance by the media to critically examine the facts that they are able to unearth, and no amount of external pressure excuses that.
Here are a few hard facts that almost never make it into print:
The default rate on student loans has been higher than that of subprime home mortgages for years, but the public was never told, and still doesn't know.More disturbing: both lenders and guarantors of these loans have a clear financial incentive for the loans to default, and this is by design.
The bombshell story that was recently quashed by lending system "experts": Even the Department of Education is making, not losing money on defaulted student loans, and has been for years. This last claim is controversial, but not if one only looks at the numbers.
This is what is interesting and different about student loans. These are the facts that get to the root of the student loan crisis, and all of its warts (inflation, corruption, oversight, etc.), and underneath is all lie the removal of consumer protections, and collection powers that are unrivaled by any other debt instrument in this country. Not to mention a stunning opportunity for Congress and the president to demonstrate the ability to provide "better, not more government" in a non-partisan fashion.
This may not be entertaining, but it is what the public needs to know. For example, don't you think your readers who are about to make borrowing decisions would appreciate knowing that statistically, there is a 1 in 3 chance they will end up in default, and all that entails? No?
C'mon, folks. The contrived plotlines (ie non-profit vs. for profit, private vs. federal loans, etc.), fear-mongering, omissions, handwringing, and so forth is obvious, and insulting to the readers, at this point.