Remember those 15 people who refused to repay their federal student loans? Their “debt strike” has picked up 85 more disgruntled borrowers willing to jeopardize their financial future to pressure the government into forgiving their student loans.The amount of student loan debt is now close to unsustainable. The current numbers aren't in yet, but for 2014 the totals were over $1.2 trillion. That would be $1,200,000,000,000. And since student loan debt can't be discharged in bankruptcy, the pressure is only going to grow to forgive more of these loans.
And the government is starting to listen. The Consumer Financial Protection Bureau has invited the group to Washington on Tuesday to discuss their demand for debt cancellation. Although the CFPB doesn’t have the power to grant that request, the agency’s overture shows that the strike is being taken seriously.
Wednesday, April 01, 2015
Striking
Watch this one closely:
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7 comments:
Exactly why the government needs to get out of the student loan business. I don't know what it is for recipients of student loans, but it's worth noting that recipients of Pell Grants have something like a 40% graduation rate. If the student loans are similar, you've got a huge portion of that $1.2 trillion owed by people with no useful degrees.
And that doesn't even count those with useless degrees--those who, in a just system, would have been faced by a green eyeshades guy asking "how do you think you're going to pay off a quarter million bucks in loans with a gender studies degree?"
But that said, they incurred the debt, not me. Exactly why should I be covering it for them when they should have known that that degree would be worthless? It's not like their engineering and science friends didn't warn them.
they were sold a bill of goods all their lives: go to college and you'll get a good job, with an office, a private line, and six figures.
let the Education Industrial Complex forgive their loans.
but the reality is, I will be paying them anyway...
I think these people should be looking at the "higher education industry" for overcharging them and for "tricking them" into taking out loans. You know, like the mortgage lenders did?
Let them declare bankruptcy. It doesn't ruin your life. It stays on your record for 7 years (during which time you can still get loans because the lenders know you can't declare bankrupty again for a set length of time).
Seven years isn't so bad; it might be the same amount of time these budding economists put into getting their degree in the first place, but the difference is that in this case they might actually learn something.
But you could lose a whole generation of "victims studies" graduates! Or community organizers! People might actually have to think about how their studies might prepare them for real work in the real world. Horrors!
RA, you can't discharge student loans in bankruptcy. Think about it; student loans are basically credit card debt, being unsecured (can't take someone's house or car back if it goes bad). So making them unforgiveable in banktruptcy is the only way to keep interest rates down, along with federal guarantees.
Even with that, the default rate is something like 15%. Very ugly already.
Obviously, we got into this mess by lending money that no sane lender would do. Let's go back to having college loans based on sensible expectations of the borrower being able to pay, rather than being "guaranteed" repayment, and the problem goes away (except for the $Trillion already out there, of course.)
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