Bankers issue student loans to 17-year-old kids. Who’s more irresponsible: the bankers who take a reckless risk? Or the 1 out of 7 impoverished students who default on their obligations?
The Student Loan Crisis
Ted Rall
Ted Rall is a syndicated political cartoonist for Andrews McMeel Syndication and WhoWhatWhy.org and Counterpoint. He is a contributor to Centerclip and co-host of "The Final Countdown" talk show on Radio Sputnik. He is a graphic novelist and author of many books of art and prose, and an occasional war correspondent. He is, recently, the author of the graphic novel "2024: Revisited."
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Well when you put it that way…funny.
Any quick data on the default rate for borrowers better, on paper, able to repay their loans?
BTW: the students are more irresponsible because the bankers know they will be bailed out by the US taxpayer.
THIS is a prime illustration of “the culture of dependency” that the 1% continuously project onto those without money nor power.
To put it another way: The 1% are the true thugs.
I remember a time when bankruptcy was a financial strategy allowing the uneducated borrower to get unencumbered with the more mundane version of odious debt. This is why it was so hard back then for people to get loans for property and such. Basically, it was the bank that carried the risk, so like Indiana Jones choosing a grail that wouldn’t melt his ass, they had to choose wisely.
Nowadays? The banksters can be horribly irresponsible with other-people’s money and then get bailed out with some more of other people’s money. Furthermore, banksters can simply create cash out of thin air (and a printing press) and then use it to purchase new, upgraded tyranny-licenses from suck-ass politicians. It’s a racket of political donations. Banks fail, but it’s the depositors who get impoverished. This paradigm needs to get turned back off of its head.
DanD
I agree with the lady in the third frame, Ted – and to this end I should like to put forward a modest proposal : that so-called «bounty hunters», of which I’m told your country has a plethora, should be engaged in the task. Opening this area to economic exploitation would no doubt increase the number of positions available to those interested in the profession – thus increasing gainful employment and benefiting the economy as a whole – and possibly decrease the number of defaulting students – thus leading to a greater willingness to pay debts among the population and a moral revival. What’s not to like ?…
Henri
Another example of how the U.$. is a barbaric country ruled by gangsters and sociopaths. Education up to a doctorate is free in socialist countries.
Nothing is free.
Could we agree on: “Education up to a doctorate is ‘pre-paid’ with taxes, since >50% of which are not wasted on ‘institutions’ of perpetual war and comprehensive domestic spying”?
Jack,
No, of course nothing is really completely free, but education is paid for by the society as a whole. You don’t have to come out of pocket to pay for education in socialist countries. I might have said what Falco said, but I was trying to be brief.
Do you mean to tell us, «Jack Heart», that you and your friends have now managed to devise a way to «monetise» the act of breathing so that the air inhaled is now monitored ? The Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel is yours for the fetching – see you here in Stockholm in December !… 😉
Henri
There was an op-ed in the New York Times about someone who never repaid his student debt in full. He says he had two job offers, one that paid a little more than his monthly minimum payment, and one that paid less. He took the job that paid less. His mother had cosigned. They kept coming after his mother until she died, and they’re still coming after him, but his monthly income is still far less than the minimum payment (which growed like Topsy with penalties and interest), so there is no way they will ever be able to collect in full. Of course, he can’t rent a flat in his own name, and he can only get the most usurious credit cards that only deadbeats would ever get, but he says he gets the grim satisfaction of knowing he’ll go to his grave with most of the loan still unpaid (except for the small fraction they have been able to garnish).
There is no way to get out of student loans. They are for life. The collectors are still harassing the person who wrote the op-ed (and will garnish all of his New York Times payment if they can). Student loans are not forgiven (or even reduced) if one declares bankruptcy.
Clearly, what’s needed is what they do to divorced men: if you can pay the amount the judge awards, the IRS will garnish it at source. If you cannot pay, you are put in debtors’ prison for civil contempt and you’ll stay there until you have paid the last penny. Debtors’ prison isn’t the way it’s portrayed in American novels about 19th century England where prisoners are stuck there, getting to sit idle in their cells and fed at the taxpayers’ expense. In a real debtors’ prison, the prisoners are forced to work at hard labour for the prevailing wage, all of which goes to their creditors (and, if the wage is less than the monthly minimum payment, the sentence is for Life without the possibility of parole).
Putting all these student loan deadbeats in debtors’ prison the way we do divorced men would finally fix the problem of the deadbeat who wrote that op-ed for the New York Times (he’ll be writing his future op-ed columns from his debtors’ prison cell).
In fact, all bankruptcy judges should have the power to set minimum payments with debtors’ prison for civil contempt for anyone who cannot make the minimum payment. The US abandoned the great and wise ways of our founding forefathers when we stopped having public executions and debtors’ prisons to show our children the penalty for not doing whatever the Great and Good American government asks them to do.
I’m not sure if michaelwme wishes to demonstrate the validity of Nathan Poe’s law, but for the interested, here’s the URL for Lee Siegel’s OpEd : http://www.nytimes.com/2015/06/07/opinion/sunday/why-i-defaulted-on-my-student-loans.html….
Debtor’s prisons sound like a great way to boost the economy of both those who contribute to the two major political parties in the United States and depressed rural areas in that country – moreover, as those imprisoned there are counted as (nota bene disenfranchised) residents of these districts, their representation at both the national and state level increases. A win-win (thanks, Mr Poe !)….
Henri