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student debt

If Congress doesn't act soon, interest rates on federal student loans will double in July. The interest rates were cut from 6.8 percent to 3.4 percent in 2007, but will revert to their original level without action—action President Obama will be pushing hard for Congress to take. This is one of those issues that should be bipartisan, and was just a few years ago:

When the 2007 law was passed, 77 Republicans — most of whom are still in Congress — voted for it. But in the current climate of fractious partisanship, new legislation introduced by Representative Joe Courtney to extend the lower rate has 127 co-sponsors, all of them Democrats.
But while the New York Times' Tamar Lewin finds some observers who think there may be Republican votes to keep interest low, in the Senate at least, House Education and the Workforce Committee Chair John Kline (R-MN) is having none of it:
“We must now choose between allowing interest rates to rise or piling billions of dollars on the backs of taxpayers,” he said. “I have serious concerns about any proposal that simply kicks the can down the road and creates more uncertainty in the long run — which is what put us in this situation in the first place.”
A word of explanation: College students are taxpayers, too, you asshole. Or they will be when they graduate, if they aren't already working their way through college. Keep the interest rate low or raise it, taxpayers are paying for this either way. The question is whether the taxpayers who are paying for it are students who can't afford to cover their ever-increasing college tuition in cash and need loans, or all the taxpayers, including the rich ones.

This is only an issue in the first place because of America's radical failure to invest in higher education. A credential that is a virtual necessity to have even a shot at a middle-class life—which is what a college degree is these days—should not be something that only the upper middle class and the wealthy can afford without a lifetime of debt. It's just beyond absurd that not only is that lifetime of debt now required, but Republican leaders are trying to drive a wedge between "college students" and "taxpayers." Good for President Obama for pressing this point.

Originally posted to Daily Kos Labor on Fri Apr 20, 2012 at 06:49 AM PDT.

Also republished by Daily Kos.

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Comment Preferences

  •  The Republican push for higher interest for (11+ / 0-)

    student loans is a political death wish.

  •  This is the difference between Dems & Republicans (10+ / 0-)
  •  Perhaps we should point out that many of (3+ / 0-)

    the 1% have kids in college.  That should keep interest rates low.

    Tracy B Ann - technically that is my signature.

    by ZenTrainer on Fri Apr 20, 2012 at 07:12:15 AM PDT

  •  Huh? (17+ / 0-)

    I mean, excuse me?

    At 3.4 percent, the taxpayers are getting a 2.5% better rate of return than they would if we simply used the money to buy T bills ("reduce the deficit"). How is that screwing the taxpayers?

    If the rate were .75% or less, they'd have an argument. As it stands, I don't see it.

    (Disclaimer: I'm not the brightest bulb in the marquee).

    Fair's fair. I don't vote in your church; don't go preaching in my government New video: "The Future Just Ain't What It Used to Be"

    by Crashing Vor on Fri Apr 20, 2012 at 07:16:15 AM PDT

    •  Reality means nothing... (3+ / 0-)

      ...to John Kline.  The only thing he has done in his ten years in Congress is to get some post offices renamed...

    •  The dramatically increased price of default (2+ / 0-)

      explains the difference. A student loan is far less likely to be paid back, so it probably has a negative return at that rate.

      But I 100% agree with the thrust of your point, that the cost of borrowing for the government is so low right now that it is the perfect time to finance investments for the future with government debt. The government is extending discounted student loans to help students pay for education, not to make a profit.

    •  Nope. You are right. (3+ / 0-)

      My 30+ years in finance tells me so. As long as you can lend it at a higher interest rate than you borrow it, you are golden (not counting overhead, but that's pretty damn low here.)

      •  As I mentioned above, factoring in loan default (1+ / 0-)
        Recommended by:
        Crashing Vor

        would result in a significantly lower effective yield and large tail risk for the lender during a period of elevated unemployment. The government isn't going to make a profit on 3.5% interest on student loans after the 9% or so two-year default rate on them, not even adjusting for 1.5% 10-year bonds or 2% long term inflation. The real point here is that our government is not an investment bank or hedge fund and should consider the social benefits of an educated populace and opportunity for the disadvantaged in the return on investment, if we're looking at it that way. But yes, borrowing money at a low interest rate to accomplish important functions is a good idea for our government.

        •  Aren't student loans exempted (3+ / 0-)
          Recommended by:
          BritLaw, Crashing Vor, LostBuckeye

          from loan forgiveness through bankruptcy?  I thought they closed that loophole years ago.

          I'm a fucking retard.

          by Helpless on Fri Apr 20, 2012 at 11:56:28 AM PDT

          [ Parent ]

          •  Bankruptcy and default are not identical (1+ / 0-)
            Recommended by:
            Crashing Vor

            It is true that bankruptcy is no longer sufficient to discharge (wipe off the balance books) student loan debt, but discharging debt is different from defaulting on debt repayments.  It is still entirely possible for a debtor with student loans to fail to fully make their payments on time, or for the debtor to fail to make payments at all, or for the loan to require restructuring so that debtor can afford to pay it, or for the debtor to meet certain hardship exemptions that allow loan payments to be deferred, reduced, or canceled.  There are provisions for garnishing wages in order to collect student loan payments, but for someone who is unemployed or earning very little, that doesn't amount to much.  This is especially likely in periods of high unemployment like what we have now.  It is also possible for a debtor to die, or become permanently disabled, or leave the country, or any other number of things that make the debt difficult or impossible to collect or absolve the debtor's household of responsibility for the debt.  Further, the United States government can change its policies on student loan forgiveness at any time.  I'm certain this all amounts to at least a few percentage points ROI.  Contrast that with federal government debt, which has been paid back on time and in full and without any change in the structure or size of the loan 100% of the time in the entire 250-year history of the US government.

            Again, I strongly believe that financing student loans at a loss is both justifiable and commendable for the government, but I am fairly confident that 3.5% is financing at a loss.

            •  Compared to cars/homes (0+ / 0-)

              I find the logic, difficult.

              The argument of risk has been pushed around quite a bit.  I don't know that I can agree with it.  

              If I take out a home or car loan, there is only so much that a creditor can do to me.  They have some inherent risk that I could file for bankruptcy and have a chance to diminish or write off the amount owed.

              It is true they can take back the house or car.  

              If I take out a loan for my education, then I can't declare bankruptcy, and I can have my wages or tax returns garnished to pay it back.  I can only refinance the debt once.  I can be paying on the same debt for as long as a house at a fixed rate that is more than some current mortgages.  And it can hurt my chances at OTHER credit for cars and houses in the future too.

              My education can not be taken back, I'll agree.

              But the rates for auto and houses have been lower than the student loans, and they don't have as robust a method for pulling the blood out of a turnip.

              So I really wonder about the risk argument.

        •  Increased default rate... (1+ / 0-)
          Recommended by:
          Crashing Vor

          All that presumes that the increased default rate at the higher interest rate does not swamp any extra money made by the increase in interest.

          •  Maybe, but it seems unlikely (0+ / 0-)

            In light of the facts that student loans aren't discharged in bankruptcy, wages can be garnished from those whose student loans are in default, and there are already provisions for debt restructuring under hardship, I think it's unlikely that we could collect more from students at 3% interest than at 6% interest.  I suppose there are likely scenarios wherein that would be the case and it would be convenient if this was one of them, but the CBO says it isn't.

    •  lalala-facts-lalala (2+ / 0-)
      Recommended by:
      Crashing Vor, a2nite

      You're right but the Rs aren't listening.

      Warning: That light at the end of the tunnel just might be an oncoming train.

      by history first on Fri Apr 20, 2012 at 08:02:17 AM PDT

      [ Parent ]

    •  Not sure on this (1+ / 0-)
      Recommended by:
      Crashing Vor

      but this must implying some amount of rate subsidy by the federal government to the banks that are providing the loans.  Works out as a great deal for the banks (subsidized return  from the federal government, and little to no risk in the loans because they are not dischargable in bankruptcy), but does ensure debt peonage for the middle class, or god forbid working class, kids who make it to college.  

    •  Aren't these loans sold by private companies (1+ / 0-)
      Recommended by:
      Crashing Vor

      but federally subsidized? In that case, it would cost the government more because the rate the private company gets is the same. If the student pays less interest, the government pays more to make up for it.

      The real problem here is the whole idea of federally guaranteed but privately sold student loans. It's guaranteed profit for these banks, with next to zero effort on their part, especially because bankruptcy is no escape. It's a scam to siphon off federal bucks to corporate owners.

      If the feds are going to guarantee the loan, they should just issue it themselves. It's more honest that way, it saves student and taxpayer dollars, and it doesn't reward fat cat freeloaders.

      Government and laws are the agreement we all make to secure everyone's freedom.

      by Simplify on Fri Apr 20, 2012 at 11:45:01 AM PDT

      [ Parent ]

    •  Yes, bankrate.com says (2+ / 0-)
      Recommended by:
      Egalitare, Crashing Vor

      1 year T-bill rate is 0.18%.
      10 year rate is 2.04%  link.
      Either way the Treasury is making money on these loans.

      Why does anyone listen to ass-hat Republicans regarding anything to do with accounting, taxes, or governance.

      I'm a fucking retard.

      by Helpless on Fri Apr 20, 2012 at 11:53:49 AM PDT

      [ Parent ]

  •  It frustrates me that the college loan issue (8+ / 0-)

    focuses in the wrong places.  

    The problem is not the traditional, state four-year universities.  

    The main problem is the so-called "for-profit" colleges, that recruit students primarily for the purpose of getting the federal aid to pay for the student's education.

    •  For-profit colleges are huge, you're right. (1+ / 0-)
      Recommended by:
      cany

      Very good point.

    •  Well, no, I have to disagree (4+ / 0-)
      Recommended by:
      Aquarius40, BritLaw, nextstep, Helpless

      We have seen phenomenal price increases at both private and public colleges too.  Even if we fix for-profit colleges, going to a real college requires a giant loan.

      I think all three are connected, and all driven by the same surge in demand for college.  Private schools can raise their prices out of simple demand for their school.  State schools don't raise their prices in response to demand, but if a private school costs 40K/year for tuition, a state government will feel more leeway to cut state subsidies, turning a 3K/year tuition to a 6K/year tuition or even a 12K/year tuition if a state's economy is crashing.

      The for-profit college mostly exists to suck up all the kids who are convinced they have to go to college but cannot get admitted to one.  You therefore create the for-profit college of Founded Last Tuesday, and you can charge out the nose because kids can't go anywhere else.  Then you flunk out almost all of the kids, to guarantee that the graduates meet the program outcomes of the accreditation board.  

      Of the three, the for-profit colleges are the real scam, but all three are making money off of our insane obsession with universal college, and all college students everywhere are being cheated out of a crap-ton of money.

      Linking to a news article is journalism in the same sense that putting a Big Mac on a paper plate is cooking.

      by Caj on Fri Apr 20, 2012 at 08:44:39 AM PDT

      [ Parent ]

      •  The difference is that (3+ / 0-)
        Recommended by:
        Sparhawk, peptabysmal, orestes1963

        the traditional four-year colleges do a far better job of actually getting the students to degrees and a better chance of getting a job that can pay back the loans.

        The for-profit colleges have a much more profound record of getting the students the loans and then not getting the student to a marketable degree or certification, and so a much, much higher rate of default on student loans.  

        (And, being a mother, I am all too painfully aware of the costs of college.)

        •  Note the the population of students (2+ / 0-)
          Recommended by:
          peptabysmal, Caj

          at for profits schools are very different than those who go to traditional 4 year colleges.  Generally speaking, those at the for profit colleges would not get into traditional 4 year colleges.

          The bigger problem with for profit schools is the high cost of marketing for them.  Limiting their ad expense to 10% would be a great step forward.  If the school cannot get filled based on its reputation and 10% marketing, then it should close.

          The most important way to protect the environment is not to have more than one child.

          by nextstep on Fri Apr 20, 2012 at 11:39:55 AM PDT

          [ Parent ]

          •  Exactly (1+ / 0-)
            Recommended by:
            Caj

            for-profit schools are generally "trade schools" that take high school drop outs working on their GED for as long as they have money or will take out more loans.

            My son went through an aircraft mechanics school and it's administration was quite surprised that he didn't need to take out student loans.  Seemed to be common there.

            Taking out student loans for the potential of a $15/hour job is just nuts!

            Drove one former nursing student here to a killing rampage recently.

            I'm a fucking retard.

            by Helpless on Fri Apr 20, 2012 at 12:03:40 PM PDT

            [ Parent ]

    •  Absolutely, the "forest" here is (0+ / 0-)

      that some/many 4 year undergraduate programs cost $240,000 in this country.

      THAT seems to be the problem, not haggling over the exact amount of interest that will be charged on the huge ensuing debt . . . .

    •  Regarding for-profit colleges (0+ / 0-)

      please see my comment below.

      The bourgeoisie had better watch out for me, all throughout this so called nation. We don't want your filthy money, we don't need your innocent bloodshed, we just want to end your world. ~H.R.

      by chipmo on Fri Apr 20, 2012 at 12:09:26 PM PDT

      [ Parent ]

  •  None of this does anything for (3+ / 0-)
    Recommended by:
    Odysseus, vadorbell5, Mindful Nature

    those of us with consolidated loans from years ago at 9.7%

    Obama is always a dollar late, a day short, and subject to changing his mind.

    First, Serve the People - Second, Defend the Community - Always, Organize to Take Power

    by mpjh on Fri Apr 20, 2012 at 07:53:21 AM PDT

  •  In Idaho (2+ / 0-)
    Recommended by:
    peptabysmal, Krush

    Where I attend college, some college students are against the lower loan rate. Even though they have loans themselves. That is how far the Republicans have brainwashed portions of the population. To get them to oppose something that is directly in their own best interest.

  •  As most here probably know student loan debt (4+ / 0-)
    Recommended by:
    Thornrose, OldDragon, BritLaw, peptabysmal

    cannot be eliminated through bankruptcy, and most of it is subsidized by the government. This means that there is almost no way for a lender to lose money.

    The reason to allow interest is so that the lender can make a profit and protect themselves against money through defaults. In this case they don't need to protect themselves from default by a borrower so there is no need to allow them to extract value to make up for losses. This means there should be little, if any, interest allowed on student loan debt. They should be allowed a very small amount of interest to generate a profit, or they should be allowed to charge a small flat fee. Since it is subsidized allowing a small fee would still attract a ton of lenders just like other safe low yield investments do, i.e. treasuries.

    It would be better if student loan debt was completely non-profit, or government financed, but in American that isn't possible.

    Sell student loans as federal bonds, offer 2% interest, which is higher than treasuries for the last few years, and China or other foreign governments can help pay to put our kids through school.

    Oh yeah it's the USA, how about we just load the students with crushing debt for the rest of their lives instead because a few congress people were lucky enough to go to school when tuition for a semester cost about what a single class costs now.

  •  It comes down to intergenerational warfare (3+ / 0-)
    Recommended by:
    peptabysmal, a2nite, Helpless

    Those in power got the benefits of cheap school AND cheap rates, but now they are perfectly happy to rip that away from the next generations, leaving them with more costly education and more expensive ways to pay for it.  See this esquire article for more thoughts on how this is about far more than just student loans.... http://www.esquire.com/...

  •  My personal experience (5+ / 0-)

    I have about $95,000 in current student loan debt.  

    My loan payment is $490 a month.  That's on a 30 year consolidation.

    As someone who went to public school, then college, then graduate school, I can attest that the state of our education, and it's COST, is bordering on the absurd.  I wanted to get more education post-high school, and I felt it was a solid investment in my future.

    So far, I'm happy with my decision, but the idea that you have to burden students with debt to enjoy higher education is ridiculous.  

    State/Federal governments should be paying for higher education in the same fashion that they pay for roads.  We'll all contribute a little, but in the end it's an investment in our infrastructure.  And in the digital age, education IS infrastructure.

    GOD! Save me from your followers.

    by adversus on Fri Apr 20, 2012 at 11:30:10 AM PDT

  •  What does that d-bag Norquist (1+ / 0-)
    Recommended by:
    yoduuuh do or do not

    think about this?  He calls anything else that raises costs for business or the 1% a tax increase, even if it isn't a tax.  Call it a tax increase and sick the baggers on them.

  •  Student Loans Operate As A Warning For (2+ / 0-)

    those entering adulthood. The financial industry wants to tap into every aspect of your life to bleed you.

  •  Not only are college students taxpayers (1+ / 0-)
    Recommended by:
    a2nite

    They will be taxpayers for many years to come.

    If more kids can get a college education, then they will be more likely to have productive employment later in life at higher wages.  Higher wages means that they pay more in taxes (unless they're fortunate enough to hit the 1% level).  

    So, is the real point here that the Republicans are so desperate to de-fund the US Government that they're willing to reduce people's wages over their lifetime so that they pay less in taxes?

  •  Let us hope that this will help to distinguish for (0+ / 0-)

    students the difference between the GOP and the dems.

    We need to get out their vote and this should be a MAJOR emphasis in doing so.

    I am glad about the timing because it might help to consolidate some of that vote sooner v. later and get people on board to WORK on the ground during the summer.

    202-224-3121 to Congress in D.C. USE it! You can tell how big a person is by what it takes to discourage them. "We're not perfect, but they're nuts."--Barney Frank 01/02/2012

    by cany on Fri Apr 20, 2012 at 11:41:13 AM PDT

  •  The Republican capacity for gobbling seed corn (0+ / 0-)

    is flabbergasting.  

    We must, indeed, all hang together, or assuredly we shall all hang separately. B. Franklin

    by Observerinvancouver on Fri Apr 20, 2012 at 11:45:40 AM PDT

  •  Interest Rate Makes no Sense (0+ / 0-)

    Since my kid will be attending college in the fall, I am in the process of learning about loans. The financial aide my kid was offered (which I understand is pretty standard) is on a semester by semester basis. It includes per semester a $1750 in a Federal Direct Subsidized Stafford Loan and $1000 in Federal Direct Unsubsidized Stafford Loan.

    The subsidized loan means that the Federal government pays the interest as long as the student attends school. The interest does not start accruing on the loan until six months after leaving school. The Unsubsidized loan works like a standard loan with the interest just piling up.

    Now I wonder what raising the interest rates would mean to the Subsidized Stafford Loans. Since the government pays the interest is this just a huge giveaway to whoever the government borrows the money from?  The thirty year T-Bill is 3.3% and the five year only 1.3 % so where on earth are they getting the 6.8% interest rates? Is the Federal goverenment actually going to  try and turn a profit on the backs of students borrowing for college?

    •  also going through this fun process, but something (1+ / 0-)
      Recommended by:
      weneedahero

      struck me about what you wrote:  loans are not technically aide.  

      They should not be packaging that as part of your "financial aide," just in case you're comparing other financial packages from other schools.  

      You take out those loans, they are not from the school.

      If the plutocrats begin the program, we will end it. -- Eugene Debs.

      by livjack on Fri Apr 20, 2012 at 01:59:44 PM PDT

      [ Parent ]

      •  I'm not Sure (0+ / 0-)

        Part of the package included the loans and also Work Study. I don't know if the school had to file some paperwork or if we qualified when we filled out the Federal Financial Aide. I do know that all aide packages include the assumption that you will take out loans if you can't pay out of pocket. The school my kid is going to do did give us a huge grant, but when they figured out how much money we could contribute they assumed loan and Work Study would be cover part of the costs.

  •  Why is the government enticing folks to go into (0+ / 0-)

    the debt?

    The government should either pay for education outright, or do nothing at all.

    Pushing these loans raises the cost of education and puts folks into debt.  Both bad outcomes.

  •  So the banks get *free* money from the Feds (1+ / 0-)
    Recommended by:
    The Angry Architect

    so they can loan it to you with interest.

    But now there's a fight on student loan debt.

    So the 0.01% borrow money for free and want to raise the debt on the other 99%.

    The richer you are, the less your burden seems to be.

  •  Did you see this? (1+ / 0-)
    Recommended by:
    devtob

    Bipartisan Political Elite Implicated in For-Profit Education Fraud

    For-profit colleges are a kickback scheme where politicians enact favorable legislation and regulations that allow for-profit colleges to maintain access to student loans and grant money. The for-profit colleges then "give" a small cut of the federal money back to the politicians to enact favorable legislation.

    In the cases of Senator Snowe[(R-Maine)] and Sen. Dianne Feinstein (D-California), their husbands have operated under the cover of their wives as they directly benefited, and continue to benefit from, their positions as shareholders in for-profit college companies. Snowe and Feinstein are accomplices in the ongoing evisceration and defrauding of citizen taxpayers and students, which explains the pair's complete silence on this matter.

    The so-called ruling class of government officials and elected politicians, to which Feinstein and Snowe clearly belong, is little more than a gaggle of white-collar criminals which facilitates and benefits from the diversion of taxpayer money into private coffers. It all takes on the appearance of legitimacy. Unfortunately, this is not a victimless crime. Like Washington, thousands of students who attend these subprime institutions are left with tens of thousands of dollars of nondischargeable debt which ends up ruining their lives.

    There is a vast network of former and current government officials who actively participate in the for-profit college swindle. Some of the conspirators are well known, and include: Mitt Romney, Rep. Virginia Foxx (R-North Carolina), John Kline (R-Minnesota), Alcee Hastings(D-Florida), Trent Lott (R-Mississippi), Lamar Alexander (R-Tennessee), Steve Gunderson (R-Wisconsin), Virginia Democratic Party Chairman Brian Moran, Snowe, Feinstein, Nancy Pelosi (D-California), and John Boehner (R-Ohio). The group also includes Obama administration officials and supporters such as Lanny Davis, Anita Dunn, Hilary Rosen, Anthony Miller and Charles Rose.

    As I have previously written, you won't read about any of this in The Washington Post because the Post owns a predatory for-profit college outfit known as Kaplan University, nor will you hear much about it in the rest of the corporate press.

    This is what a bipartisan congress looks like.

    The bourgeoisie had better watch out for me, all throughout this so called nation. We don't want your filthy money, we don't need your innocent bloodshed, we just want to end your world. ~H.R.

    by chipmo on Fri Apr 20, 2012 at 12:06:10 PM PDT

  •  And what party do the ignorant masses glom on to? (1+ / 0-)
    Recommended by:
    devtob

    Mitt Romney's Like A Box Of Chocolates. You Never Know What You're Gonna Get!

    by kitebro on Fri Apr 20, 2012 at 12:19:39 PM PDT

  •  Why don't the universities lobby to pass this? (1+ / 0-)
    Recommended by:
    devtob

    Seems to me the higher the interest rates the less students will go to college.

    •  They don't care (0+ / 0-)

      They have a captive audience of students and parents that are convinced the only path to success is through a college degree.  Plus, loans aren't tied to the schools directly, so they can basically just take the tuition money and completely disassociate themselves from the outcome.  Student doesn't get a job after graduation, or does get a job, but doesn't make enough to repay his or her loans?  No skin off their backs.  Student defaults?  Doesn't matter there, either, since they got theirs long ago.

  •  what an odd coincidence.... (0+ / 0-)

    that this wasn't tied into the Obama Tax Cuts for the Wealthy....

    Imagine that: Linking progressive policy to those items the 1% craves.

    Good thing it wasn't....

    Good for the 1% anyway....

    There is a reason that Obama's Chiefs of Staff come from Wall Street Banks. And it has nothing to do with Change We Can Believe In.

    by Johnathan Ivan on Fri Apr 20, 2012 at 01:33:47 PM PDT

  •  Republicans know crap about business too (0+ / 0-)

    Besides being abysmally ignorant of how the American Constitutional government works, Republicans don't know how business should work.  If the government gave 3.4% loans to students it would be making a decent profit that could be used to lower the deficit.  Why?  Because Washington is borrowing 10 year money at 2% and 30 year money at 3.1% both less than the student loan rate.  

  •  TEMPORARY IS TEMPORARY? (1+ / 0-)
    Recommended by:
    weneedahero

    Republicans confirm that temporary benefits which provide temporary relief should expire on schedule, even if that raises costs to citizens ?

    Bush tax cuts anyone ?

  •  another middle class gouge (0+ / 0-)

    I graduated M.Ed. with $2,500 debt @1.5% interest and was making 5% interest in a passbook savings 1980's - so I just kept my money and paid the $50 / month until it became a nuisance and then just paid it off.
    Now my kid will graduate Bachelor's at least $25,000 in debt @6.8% loan interest, and less than 1% interest for savings account.

  •  "Are there no workhouse" for grads in debt? (0+ / 0-)

    Sadly, of course, with the state of education created primarily by Thugs, most voters probably have no idea who wrote that or why its protypically evil.

    •  how about debtors' prisons? (0+ / 0-)

      Honestly though, if I could go to prison for one year, with the promise that my $150,000 in federal and private student loans would be completely erased afterwards (and I wouldn't have a criminal record, heh) I think I'd do it.  I'd rather spend a year in prison than the next 30 years of my life being bled dry by my monthly loan payments.  

      •  No, stop victimizing yourself. Put the evil frakk (0+ / 0-)

        ers in prison, not you.

        And in the meantime, give them the fingrer by getting BO re-elected, a D Congress elected and then working to make Ds more liberal and brave.  It's likely the only way you can, unless you're a Buffett heir.

        •  excellent points :) (0+ / 0-)

          While I have been hugely disappointed with many of the things Obama has done (or failed to do), at the end of the day, he is still far, far better than a President Mittens.  I don't think we've reached critical mass yet for large scale action on student loans.  The magnitude of the problem won't become visible to the elites for another 4 or 5 years.  In the meantime though, the Dems at least have some inkling that there's a problem, and Obama created the CFPB, which has pledged to rein in private lenders.  A President Mittens and his cronies would never do that.  So I am hopeful.  :)  I just wish action would come sooner-

          And yes, I cannot wait to give the 1% the finger in any way I can!  

  •  this is waaayyy too little, waaayyy too late (0+ / 0-)

    Obviously a 6.8 percent interest rate on a student loan is ridiculous-especially when the average mortgage rate is around 4 percent-but the problem is so much bigger than this.   As others have said upthread, many ppl's loans are at a higher fixed rate, and since they consolidated once already, they can't consolidate again.  Why?!  That's f*cking ridiculous.  Obama needs to do SO MUCH MORE....fighting about the interest rate hike alone is rather insulting, frankly.  REAL representation regarding this issue involves interest rates, but also a discussion of the following:
    1) regulation of private lenders
    2) caps on tuition
    3) REAL bankruptcy protection for debtors
    4) realistic payment terms and rates, i.e. 10 year limit on repayment, and payments never more than 10 percent of your disposable income each month
    5) strict regulation regarding collection practices
    6) making schools the actual lenders, so they have "skin in the game" regarding employment rates and loan defaults.

    I could go on and on.  The current system is a disgrace.  The fact that the Education Industrial Complex (by which I mean both for-profit and non-profit schools) is not on the front page of every paper in this country on a continual basis is disgusting.  We are eating our young and no one in power truly seems to give a damn.  

    As a young person with a tremendous student loan debt myself, though, I can say this: the 1% are sowing the seeds of their own destruction.  Everyone I know my age, even if they lean conservative politically, is blindingly aware of this issue. They are inadvertently creating the most class-conscious, community-oriented generation in probably the past 70-100 years.  Those who have young children are raising their kids with this same class consciousness.  Things WILL be changing politically in this country in about 30-50 years.  Unfortunately, by then it will probably be too late for the environment, and a lot of former students will suffer tremendously due to their debt.  That is, of course, if the whole student loan system doesn't collapse under it's own weight before then.  

  •  This petition should go viral to all the student (0+ / 0-)

    newspapers (both college and HS) in the country.  Who knows how to do this?

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