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50% of student loan debt is going into default. Uh oh.

Hmmm...I would suggest free higher education for anyone who scored in the 90th percentile or better on a standardized aptitude test (ACT/SAT). We cannot afford to not develop our smart people into useful smart people.

How about free trade/associate degree level school for people that have a talent with their hands? Plumbers, HVAC techs, Mechanics, Carpenters and woodworkers, welders...etc.
 
So???

People are going into debt that they didn't need. Is anything new there?
The education they got didn't help them. Shown by the fact they can't pay the cost of it back. They got tricked by the Education Department, Teachers, Parents, etc. to go into debt that they didn't need and couldn't pay back. It's a business risk. On both sides. You take money you can never pay back there are consequences. If you loan money to people who are never going to pay it back there are consequences also.

More likely they were tricked by diploma mills (for profit colleges and trade schools) that run the scam of helping you fill out your student aid / loan forms so you can buy their overpriced "education." For a little while we were working with one such college that was introducing us to Certified Medical Assistants, a relatively low paying job ($12/hr), but charging them $40,000 for the certification. We stopped working with this school as only about 10% of their graduates could pass our employment test.

The guaranteed student loan program is one of the great federal programs... and, in general, has more than paid for itself by providing the means for many of our best and brightest to get degrees from legitimate colleges. I, for one, have greatly benefited from this (as has the government from me going through it).... The difference in my income (and taxes paid therefrom) between being a college grad and not, by multiples of multiples of multiples, have more than repaid my loans, interest, cost of administration, etc.

It is unfortunate that for every good public program there are hundreds of individuals willing and able to set up companies to run scams to exploit the program.
 
More likely they were tricked by diploma mills (for profit colleges and trade schools) that run the scam of helping you fill out your student aid / loan forms so you can buy their overpriced "education." For a little while we were working with one such college that was introducing us to Certified Medical Assistants, a relatively low paying job ($12/hr), but charging them $40,000 for the certification. We stopped working with this school as only about 10% of their graduates could pass our employment test.

The guaranteed student loan program is one of the great federal programs... and, in general, has more than paid for itself by providing the means for many of our best and brightest to get degrees from legitimate colleges. I, for one, have greatly benefited from this (as has the government from me going through it).... The difference in my income (and taxes paid therefrom) between being a college grad and not, by multiples of multiples of multiples, have more than repaid my loans, interest, cost of administration, etc.

It is unfortunate that for every good public program there are hundreds of individuals willing and able to set up companies to run scams to exploit the program.

Congratulations on your education and career choices. Unfortunately, it would seem your experience is becoming the exception, rather than the rule.

From what I have witnessed, it seems the exclusivity of those exploiting the fed program is not limited to the diploma mills that you describe. It seems quite evident the tremendous increase in college tuition has a direct corralation to the "easy" money that has come from the student loan program. This relates specifically to main stream colleges and universities across the country.

With a reported 50% of outstanding student loans in technical default, it's quite obvious there is far more to the story than diploma mills exploiting students.
 
Hmmm...I would suggest free higher education for anyone who scored in the 90th percentile or better on a standardized aptitude test (ACT/SAT). We cannot afford to not develop our smart people into useful smart people.

For the highest scorers there are always grants and scholarships. Those aren't the people that need help.

By the way who would pay for the free higher education if even for the 90th percentile?

Does the fact that they scored high on some tests mean they will not squander their college education?
 
I haven't done extensive research, but that doesn't seem to be the case. Again, the entire UC system publishes every salary. That may vary from state to state.

In terms of "hiding:" Given the privacy issues of releasing the name and salary of every employee in a state university system, I'm actually surprised anyone publishes those details. It's certainly not something we normally expect to see.

So, allow me to clarify and expand on the objection.

1) We don't apply this standard to private education, which is significantly more expensive. E.g. UCLA (which is in an expensive city) charges $12,000 a year for tuition; USC, a private school also in Los Angeles, charges $46,000 per year for tuition.

So you tell me, why is a private university nearly four times more expensive than a public university?


2) Simply pointing at some salaries and saying "Look!" doesn't give the whole picture. You'd need to break down the annual costs for instruction, facilities, support staff etc over the course of the past 20 years, as well as changes in state and federal funding, in order to say "the increase in costs is due to X, Y and Z."

You also don't indicate competitive salaries for these rather elite positions


3) Again, pointing at some high salaries doesn't take into account what those professors and instructors actually do. A medical researcher who nabs a multi-million dollar study, for example, isn't bleeding the university; they're actually generating revenues.

Also, different departments have different tuition rates. E.g. medical students have to pay a $20,000 supplemental tuition.


At the very least, you haven't substantiated your claim yet. You're just getting shocked by big numbers, taken out of context for what those individuals do, or an awareness of competitive wages.
Just took a minute here - this is a little old, but it's the first I've found: Students, Faculty Want Disclosure On University Salaries - YouTube I'll get back with more, when more time is available. There's no particular reason California is so featured. I would also mention in response to your query regarding the difference in private vs public tuition that public colleges and universities are subsidized by the state - particularly for in-state students.
 
This is just too simple.

File here if you want your debt waived ( x )
Thank you we'll take 10% of your income until age 60

Done.
 
If it were not for the combination of working for the government and teaching in an impoverished area (which took care of part of my loan debt), I almost certainly would have defaulted.
 
Ahhh...the "ancient Latin" strawman....I was wondering when that would come up...I do credit you for originality though...usually it's Sociology or some other liberal arts degree.
Jesus, what is it with you liberals and generalizations? If I said "money doesn't grow on trees," one of you would make it your life's freakin' goal to find one just to go "ah-HA!!"

I seriously doubt that 50% of the student loans were taken out by liberal arts majors exclusively. If you have proof of that...by all means present it.
I don't have proof of that because I never said it, Captain Observant.
 
Jesus, what is it with you liberals and generalizations? If I said "money doesn't grow on trees," one of you would make it your life's freakin' goal to find one just to go "ah-HA!!"


I don't have proof of that because I never said it, Captain Observant.

Look man,(I like your nickname, BTW)....this is my third political message board, and I've heard this many times....that people choose majors that they can skate through....but the reality is that there are just way too many people disaffected for that to be accurate.

Sorry if I pissed you off....but it's just way too easy of a dismissal of people who worked their butts off to get through school.

Signed,
Captain Observant(like I said...I commend you on your originality)
 
Paying off a student loan is, unfortunately, about the last thing a lot of self-absorbed young people have on their list of things to do once they leave college/univeristy. New wardrobe, new car, vacations, new place to live, new furniture, yada, yada, yada, all come before paying off a student loan. Self-gratification is the primary goal of many people in this world today and responsibilities remain an afterthought until such time as the government steps in and takes back tax refunds and starts garnishing wages - then the crying begins.

This is not true and in fact if this generalization is true of my peers maybe its a select group of peoplw. Most of us young people care about finding jobs first before we think of luxury vehicles.
 
This is not true and in fact if this generalization is true of my peers maybe its a select group of peoplw. Most of us young people care about finding jobs first before we think of luxury vehicles.

Hard to define Most as any use of words like most/some/etc are a generalization just by the use of them.
Accourding to Artical that headlines this thread 50% of student loans going into default. It dosen't say if they had money to spend on other things, and just didn't pay the loan, that is just an assumption based on my personal bias.
But if its like I think a good number of people just treat student loan like alot of other debt and credit able to get and use it fine. But only vauge plans of how to pay it back. (I will pay it back when I: get done with school/get rich/have enough saved away/have too/never if I can get away with it.)
Which is just taken from my experance with certain group of people and just extrapolated out to the rest of the contry.
 
This is not true and in fact if this generalization is true of my peers maybe its a select group of peoplw. Most of us young people care about finding jobs first before we think of luxury vehicles.

I note you didn't say that most young people think about finding a job first, SO THEY CAN PAY OFF THEIR STUDENT LOANS, before they think about luxury vehicles. Thanks for validating my point.

I would also point out that while the unemployment rate among young adults, 16-24, is an atrocious 16% plus, one has to note that the unemployment rate for new college/university graduates was 6% in 2012. So if 94% of new college/university graduates have found employment, how does one explain, as in the OP, that 50% of student loan debt has gone into default? I'll grant you that some of these graduates may be working in jobs outside their field of study and perhaps paying less than they anticipated, but they are working - so many of these working graduates are not even arranging to pay minimal amounts on their student debt and won't until they're absolutely forced to or until their wages are garnisheed.
 
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Paying off a student loan is, unfortunately, about the last thing a lot of self-absorbed young people have on their list of things to do....
1) You have zero evidence for this rather grand claim.


2) Regardless of where they rank it in priority, they don't really have a choice.

In the US, you can only defer student loans on a temporary basis, and only under certain circumstances, such as:
• Still being in school
• Being unemployed (but only up to 3 years)
• If you're in active military service

Unlike most other types of debt, you cannot eliminate student loans by declaring bankruptcy.


3) There is really no reason to presume that college graduates will treat their debts any differently than anyone else.

The claims of "self-absorption," by the way, make me laugh. The Baby Boomers were repeatedly decried in the media as the ultimate navel-gazers and the "Me Generation," remember? It's nothing more than a media meme, with little basis in any sort of evidence.


If 94% of new college/university graduates have found employment, how does one explain, as in the OP, that 50% of student loan debt has gone into default?
It's explained by not being true.

Whoever wrote the article has seriously flubbed the numbers. The actual number of people who have defaulted on their student loans is 12.8%. (A closer look at the trillion > Consumer Financial Protection Bureau)

This is still not good. But it's nowhere near 50%, nor is it likely to be due to made-up claims about a single alleged character flaw that mysteriously affects 50 million Americans. It's much more in line with the unemployment rates facing recent grads.
 
1) You have zero evidence for this rather grand claim.


2) Regardless of where they rank it in priority, they don't really have a choice.

In the US, you can only defer student loans on a temporary basis, and only under certain circumstances, such as:
• Still being in school
• Being unemployed (but only up to 3 years)
• If you're in active military service

Unlike most other types of debt, you cannot eliminate student loans by declaring bankruptcy.


3) There is really no reason to presume that college graduates will treat their debts any differently than anyone else.

The claims of "self-absorption," by the way, make me laugh. The Baby Boomers were repeatedly decried in the media as the ultimate navel-gazers and the "Me Generation," remember? It's nothing more than a media meme, with little basis in any sort of evidence.



It's explained by not being true.

Whoever wrote the article has seriously flubbed the numbers. The actual number of people who have defaulted on their student loans is 12.8%. (A closer look at the trillion > Consumer Financial Protection Bureau)

This is still not good. But it's nowhere near 50%, nor is it likely to be due to made-up claims about a single alleged character flaw that mysteriously affects 50 million Americans. It's much more in line with the unemployment rates facing recent grads.

So you're challenging American labor statistics that indicate college/university graduates had an unemployment rate of 6% last year? Considering that the unemployment rate in all sectors of the US economy was over 8% last year and the real unemployment rate was closer to 16%, I'd say the 6% facing recent grads was the envy of all those others on the unemployment rolls.

As for my claim about young people not considering paying off their loans as a top priority, I stand by my statements. For the perfect anecdote, I need only look at your current President and First Lady whom, according to the President himself, just recently finished paying off their student loans from decades ago. Yet they were quite able to purchase a $2 million home in Chicago and then scoop up some neighboring land adjacent to the property at a bargain price, all while having a net worth of between $2 and $7 million according to their report on finances. They were able to take out a $1 million mortgage on this house all while still having outstanding student loans.

So don't give me any crap about having "zero" evidence about priorities of young people these days - I see evidence of it daily.
 
So you're challenging American labor statistics that indicate college/university graduates had an unemployment rate of 6% last year?
No. I'm saying that a 6% unemployment rate among recent grads, and additional unemployment among less recent grads, since the US is still recovering from the worst economic downturn since the 1930s, isn't that far out of line with a 12% default rate.


As for my claim about young people not considering paying off their loans as a top priority, I stand by my statements. For the perfect anecdote....
Anecdotes are completely and utterly meaningless.

Consider your ridiculous citation of Obama as an example: He's 52. That's a completely different generation than someone who is 24. He's not a "young person," and he wasn't a "young person" when he was a Senator, married and with two children.

Plus, a few hours ago you were citing a "50% default rate" as evidence of self-absorption, poor financial skills and/or improper prioritization. Has that changed, now that you realize the actual rate is closer to 13%? (Evidently not.)

So yes, I will give you crap for making extravagant claims with absolutely no statistical basis.
 
No. I'm saying that a 6% unemployment rate among recent grads, and additional unemployment among less recent grads, since the US is still recovering from the worst economic downturn since the 1930s, isn't that far out of line with a 12% default rate.



Anecdotes are completely and utterly meaningless.

Consider your ridiculous citation of Obama as an example: He's 52. That's a completely different generation than someone who is 24. He's not a "young person," and he wasn't a "young person" when he was a Senator, married and with two children.

Plus, a few hours ago you were citing a "50% default rate" as evidence of self-absorption, poor financial skills and/or improper prioritization. Has that changed, now that you realize the actual rate is closer to 13%? (Evidently not.)

So yes, I will give you crap for making extravagant claims with absolutely no statistical basis.

Table A-4. Employment status of the civilian population 25 years and over by educational attainment

Above is the US Department of Labor Bureau of Labor Statistics data for the past year on the employment/unemployment rate for the US population at 25 years of age and older by level of education. The last line on the chart will show you the unemployment rate for those with a simple bachelors degree or higher - the highest level was 4.5% last July, is currently 3.8% and has been under 4% for the past 5 reportable months. Are you still going to stick to your unsubstantiated claims that the unemployment rate for this group is 12% or 13%? Guess so, that's your agenda.

Yes, Obama is 52. He is the poster child for young people who believe paying off your debt is not a big deal. Obama believes both in his personal life and his public life that incurring debt that will be paid off decades later, never, or by his and your children, is a great way to live your life. He is the role model for young, irresponsible, self-centered people today. He and his wife are a perfect example of the me-now, hedonistic mindset of today. What's your explanation for why student loans aren't being repaid in a timely manner?

I've seen no proof offered that the default rate is as you claim - you're great at stating "facts" without anything to back them up. - Even if I accept your claim, that's the rate of defaults, but doesn't reference at all my contention that paying off their student loans is the last thing on the minds of new graduates - they think first of what they want in their lives, not the responsibility they have to make good on the debt. What's your explanation for why the Obama's, as an example, took about 20 years to pay off their debts yet lived the high life in the meantime?

You want someone to believe your view? You want someone to accept your contention that young people are incredibly responsible and working hard to pay off their student loans as the first order of business even if it means they can't buy things they want? PROVE IT!!

And yes, you continue to "give me crap" and I keep asking for something of more value from someone so adamant that you're right.
 
Above is the US Department of Labor Bureau of Labor Statistics data....
Read my post. I am not disputing the claim that the unemployment rate for post-grads is in the 6% range. Nor does it make sense to suggest that the unemployment rate will have a 1-to-1 correlation with student loan default rates.

What I'm saying is that the default rate, which is 12.8%, is not out of line with that 6% unemployment range.


Yes, Obama is 52. He is the poster child for young people who believe paying off your debt is not a big deal.
No, he really isn't.

The reason he mentioned it was not to encourage anyone to slack off paying their loans. It's to point out how student loans are a huge burden, and to tell the audience that he was once in their position. To wit:

"I just want everybody here to understand. I didn’t just read about this. I didn’t just get some talking points about this. I didn’t just get a policy briefing on this.... Michelle and I, we've been in your shoes. We didn't come from wealthy families. So, when we graduated from college and law school we had a mountain of debt."

Nor was this common knowledge until last year. How could he be a poster child, if no one knew about it? :roll:


Obama believes both in his personal life and his public life that incurring debt that will be paid off decades later, never, or by his and your children, is a great way to live your life.
Where is this nonsense coming from? He never suggested that you shouldn't pay your debts, or that he defaulted. Nor is it "self-centered" to pay your debts on time, even if you can afford to pay off the entire debt in one shot.

For example, my parents -- children of the Great Depression -- bought a home in the early 1960s, with a 30 year mortgage, for around $20,000. They could have easily paid off the balance in the late 70s or the 80s; they were not being "self-centered" because they paid it off on time. Nor was it "self-centered" for them to take out car loans while they still had a mortgage -- or to have kids, buy clothes, go out to restaurants, take vacations....

The obligation is to take out debts you can handle; and to pay your debts on time, not in advance.

Either you don't understand basic family economics, or you're inventing a standard out of whole cloth to try and back up a claim that basically has no evidence. It's rather unpersuasive.


He is the role model for young, irresponsible, self-centered people today. He and his wife are a perfect example of the me-now, hedonistic mindset of today.
So, let me get this straight. If you take out loans to go to Columbia, then work at a bunch of non-profit community organizations, then take out more loans to go to Harvard Law, where you get on the Harvard Law Review, then go to work at a law firm and then teach at U Chicago for a few years before getting into politics -- i.e. pursue a years-long path to enter a competitive and demanding career -- that's evidence of a "me-now hedonistic mindset?"

You're obviously insulting Obama because he's Obama. Again, not persuasive.


What's your explanation for why student loans aren't being repaid in a timely manner?
1) Yet again, the rate of default is only 12.8%.
2) Some are unemployed.
3) Many are underemployed.
4) Some got screwed by worthless online colleges.

I'm sure that some are financially irresponsible. But there is no evidence that all 12.8% are irresponsible, or that these individuals are running out and buying Jaguar XJ's.

I might add, if the recent grad doesn't pay their loans on time, they're going to face much harsher consequences than if they can't pay for the Jag.


I've seen no proof offered that the default rate is as you claim...
That's because you didn't bother to click the link. Here it is again.

A closer look at the trillion > Consumer Financial Protection Bureau

Scroll down to "Number of recipients in millions" and do the math. Amusingly enough, that site was the source for the article in question.


Even if I accept your claim, that's the rate of defaults, but doesn't reference at all my contention that paying off their student loans is the last thing on the minds of new graduates.....
1) Again, you have zero proof of this claim, and have offered none.
2) As already noted, it doesn't matter if it is the "last thing" on their minds. It's the same as any other debt, except that you can't get out of it by bankruptcy. If you can't pay on time, there can be some pretty stiff penalties.


What's your explanation for why the Obama's, as an example, took about 20 years to pay off their debts yet lived the high life in the meantime?
Reasonable explanations include:

1) They had to take out huge loans to pay for private universities and law school.
2) At some point, they deferred their loans for a few years when their incomes were still low.
3) Long-term (20- or 25-year) student loans are fairly typical, either with extended-payment or income-dependent plans.
4) Yet again, it is perfectly normal to pay off a loan on time, even if you have the wherewithal to pay it in a big lump.
 
It only looks like a race to the bottom because you're on top. I think the Liberal ideology would love this--the poor Chinese man now has an opportunity to rise from his $2/hour job to a $7/hour job. Of course, when you're currently making $20/hour and it gets cut down to $15, you would see it as a "race to the bottom." I assure you that Chinese man sees it as a race to the top!

Yea, and funny how US Policy is for the Chinaman and not the US CITIZEN that lives in USA................kind of a mix up there.............LMAO
 
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