I'm against it. Dropping PSLF to 5 years for medical professionals? That's not going to go over to well.
I know you're not being critical, and frankly just being honest, but exceptions to every contract. First off, the tuition is too damn expensive in the first place, but what alternatives do you have? Secondly, in my specific case, I had to borrow way more than expected because my financial dependence was placed on my mother, who passed away during school. This accounted for me borrowing an extra 30-40k because I had no alternative. So, things happen right? Nothing is in the contract for that, and my unfortunate situation is no one's but my own.
While I agree with most everything already said here, what about people like me? I spent time in the military to help pay for school. I also worked for a few years to pay down bills and have a sizable savings before starting school.
So, if I leave with my PharmD and have no debt or minimal loans, then I am just screwed? This smacks of more class warfare and rewarding the people that do not or will not plan ahead (just like the mortgage "crisis"). I knew that it was going to cost me 200k to go to school so I started "paying" for school long before I enrolled.
I have 4 mortgages (2 of which are now underwater) and I have accounted for at least half my school money already without any loans. The government is not going to "forgive" any of this debt for me. Why am I being punished for being "responsible" while other people take no risk and get the same rewards that I get?
Because life isn't fair.
@KRPh, might want to tone down the mortgage crisis, you're lumping a lot of differing circumstances into a single group. Go read any of the independent work on the subject, you'll see a lot of corporate malfeasance regarding the situation.
I may be a diehard liberal, but I just can't back this. It removes all personal responsibility from the equation and provides no incentive for students to try to keep their loan numbers low and for schools to try to keep their tuition costs low.
Hmmm...yes! Another loophole in the system. Now along with potentially taking welfare and being on foodstamps and on medicaid, I can also get my loans disbursed! I love socialism! Yes, pay for meeee tax payers while I get a basically free education that will make ~100k! Oh wait...that didn't last so well for the Soviet Uni......
Oh, I agree. I suppose I should qualify my rant a little: I am just upset at the people that willingly signed mortgage documents and then walked away from their obligations when it "got too hard" to meet them (most of these are people that tried to speculate and lost). This is the overall prevailing attitude that I find wrong: no personal responsibility.
The problem is that student loans are extremely hard to disburse which creates no incentive for schools to keep tuition down or for lending agencies to do proper review of the applicant before handing out 100k.
Sure you can try to pin it on the students but when no employer will look at a resume w/o a 4 year degree and loan companies are hyper-eager to dole out unlimited money which schools are more than happy to take you run into the crisis we are going to experience
As an example of misspent money from my school: they are building a beautiful new fitness center now. It's amazing looking, but every student at the U has paid an additional $75 per semester since 2008 for this gym, which won't open for a few more years yet. It's not a huge cost, but this stuff adds up. The current fitness center is completely fine, but it's not fancy enough to woo students to come to the school if the gym is their main concern. Still, our school is located in between two large cities with more than enough fitness opportunities if students desire them. Tacking $150 onto the bill of every student every year is just unnecessary (and I love going to the gym, but why make my non gym-going classmates support my habit?). Of course, student loan offers increase by the same amount to offset the expansion of new fees every year...
Hmmm...yes! Another loophole in the system. Now along with potentially taking welfare and being on foodstamps and on medicaid, I can also get my loans disbursed! I love socialism! Yes, pay for meeee tax payers while I get a basically free education that will make ~100k! Oh wait...that didn't last so well for the Soviet Uni......
This bill won't fly, but I am definitly not against some relief for students of higher education. 6.8% on student loan debt when my mortgage is 3.8%? The Fed will get plenty from us in taxes, whats wrong with a little give back on student loan debt? I know I would be stimulating the economy a lot more if my loan payment wasn't so damn high.
The middle class needs a break, I have no problem with a little relief and I wont feel bad if I get some.
Ya and before Obama took office, that 6.8% interest was going to a private bank. A private bank that has no risk and was not even lending the money (the money is from the goverment), all they did was service the loan and collect the interest. This earned them billions for doing practically nothing. So your interest money was not even going back to the goverment, some bank was taking it all. Hmmmm.... maybe that's why the rate is so high. Pretty nice system we all inherited, not only has the cost skyrocketed but then we have to pay interest to some bank so that they can send us letters telling us how much we owe them.
At least now the interest is going back into the system.
I have no issues with the interest going back tot he fed, actually makes more sense really. I just have a problem with the rate....it sucks!
While debating this is fun I just want to be crystal clear for the starry-eyed pre-pharms and explain our system of government so they don't think all of their impending student loans will be forgiven.
For basics please watch "I'm just a bill on Capitol Hill"
http://www.youtube.com/watch?v=tyeJ55o3El0
This bill was introduced by a Democrat in the House. The House is run by Republicans. First the bill must get out of committee. All committees are chaired and majority Republican. It will die here. But if it didn't, it would then die on the floor by majority vote. Even if it passed (it never could) it would be fillibustered in the Senate because there isn't 60 votes for cloture for an unfunded mandate such as this, especially for a population that doesn't vote (ie: 18-29 yo).
Just realize this pups. I will make it crystal clear.
COME HELL OR HIGH WATER, FORGIVENESS THIS AND THAT, PROMISES THAT WILL NEVER HAPPEN, LOAN FORGIVENESS THAT WILL DIE IN COMMITTEE OR BE CANCELLED. YOU WILL PAY THESE STUDENT LOANS. EVERY CENT OF EVERY DOLLAR. EVERY LAST PENNY. EVERY DOLLAR IN TUITION. THEY WILL GARNISH YOUR WAGES, TAKE YOUR TAX RETURN AND GARNISH ANY SOCIAL SECURITY. THERE WILL NEVER BE ANY ESCAPE UNTIL YOU PAY EVERY LAST PENNY AND YOU HAVE THE SATISFACTION OF LOAN STATEMENT IN YOUR HAND.
Done.
Ya not now, but what about when Democrats take back control of congress. Why can it not happen then. The percentage of the population with student loans is growing every year so this kind of idea is going to gain more and more support.
Where do you think this money comes from honestly? The answer: China.
2012 Federal Unified Budget
Deficit:
$1.327 trillion (enacted)
Some times I have to remind myself that the average age here is ~21.
Ya and what caused that deficit. The big three, Bush tax cuts, Iraq and Afghanistan wars, and the loss of tax revenue caused by the 2008 recession. End the tax cuts, end the wars, and fix the economy. Our budget problems are not unfixable, Clinton ended his presidency with the budget in surplus (in 2000, the predicted budget for 2010 was positive by a trillion!!!). Relieving student loan debt would also help the economy so doing that and fixing our budget can be done at the same time. And the idea that we borrow most of this money from China is wrong. We mostly owe the money to ourselves.
I have no issues with the interest going back tot he fed, actually makes more sense really. I just have a problem with the rate....it sucks!
Honestly, good question. The answer:
http://en.wikipedia.org/wiki/Filibuster_in_the_United_States_Senate
2012 is a defense year for the D's in the Senate. They had a lot of pickups in 2006. They will probably lose a seat or two. I honestly think Obama wins re-election. Furthermore, mid-term elections aren't good for sitting presidents so 2014 will be another "Republican Wave." They will have House/Senate for sure by then. I would say 2016 will be your next good chance for these free pony types of laws.
I would also like to point out, that our government is not proactive, it is very reactionary. Honestly the default rate on student loans is only ~10%. Not much different then credit cards.
Source:
The U.S. Department of Education today released the official FY 2009 national student loan cohort default rate, which has risen to 8.8 percent, up from 7.0 percent in FY 2008. The cohort default rates increased for all sectors: from 6.0 percent to 7.2 percent for public institutions, from 4.0 percent to 4.6 percent for private institutions, and from 11.6 percent to 15 percent at for-profit schools.
Most of the default is due to private, for-profit schools anyway. It would take massive defaults approaching ~50% for the government to do anything.
In addition, the economy does suck right now, truthfully when it improves, the default rate will go down further. The only hope for these free ponies is truthfully another Great Recession that forces a socialistic type European state. So it will pretty much take the failure of market capitalism for the United States to do these types of things.
Believe me when I say, you will pay EVERY CENT OF OF EVERY DOLLAR.
PS: It's not like I don't want a free pony, or like $102,000.00 of them. I am just realistic of our form of government. Also, at least we will get cheaper houses for the next decade. Look at the brightside
Here's something to ponder. If you were the US government/Treasury and people would readily lend you money at an interest rate of 1% for 5 yrs, 2.1% for 10 yrs or 3.25% for 30 yrs, would you take the money?Where do you think this money comes from honestly? The answer: China.
2012 Federal Unified Budget
Deficit:
$1.327 trillion (enacted)
Some times I have to remind myself that the average age here is ~21.
Here's something to ponder. If you were the US government/Treasury and people would readily lend you money at an interest rate of 1% for 5 yrs, 2.1% for 10 yrs or 3.25% for 30 yrs, would you take the money?
Here's something to ponder. If you were the US government/Treasury and people would readily lend you money at an interest rate of 1% for 5 yrs, 2.1% for 10 yrs or 3.25% for 30 yrs, would you take the money?
Am I a republican in this hypothetical situation? If I am then yes, I would take it and then give a tax cut to warren buffet. then complain about how high the debt is.
Let's follow your logic to its conclusion.
Let's just borrow $10T then. Pay off everyone's mortgage, student loans and credit cards. 1% interest and all. That will help the economy.
I may be a diehard liberal, but I just can't back this. It removes all personal responsibility from the equation and provides no incentive for students to try to keep their loan numbers low and for schools to try to keep their tuition costs low.
Our legislature also reacts to pressure put on it from its constituents doesn't it? Those default rates are only for students who started repayment in fiscal year 2009 and defaulted by september 2010. The default rate on government loans is actually 20 percent! Thats way higher then I thought it was. Those 20 percent cannot discharge those loans in bankruptcy either, so their lives are basically ruined. I think you are underestimating how big of a problem this is, and it is only getting worse as state governments slash their support to public institutions and they have to raise tuition every single year. I think its going to get to the point where it is just a disaster and the government has to do something.
Why borrow it? Just mint one ten-trillion dollar coin.
http://www.economist.com/blogs/freeexchange/2011/07/so-crazy-it-just-might-work