Democrats dissembled about the costs of their student loan takeover in 2010, and now they’re deceiving Americans about their drive for student debt cancellation. But South Carolina Rep. Jim Clyburn, a member of the House Democratic leadership, gave away the game over the weekend.
Progressives seem to have figured out that sweeping student loan forgiveness isn’t popular with Americans who didn’t go to college or who repaid their loans. Hence they now say that canceling $50,000 per borrower will be a boon for the working class. Sen. Elizabeth Warren says 40% of borrowers with student loan debt never completed college. If she were a company, the Federal Trade Commission could sue her for false advertising.
Progressives also claim that President Biden has legal authority to cancel debt. He doesn’t. But they want him to do it anyway and dare courts to stop him. As Mr. Clyburn explained, “So my whole thing is, use your executive authority and let the courts have at it.” This seems to be the Administration’s guiding legal principle. Do what you want until the courts say it’s illegal. Recall its illegal eviction moratorium and vaccine and mask mandates.
Congress in 2013 slashed interest rates on student debt after Ms. Warren howled that the feds were making money off student loans by charging borrowers higher interest than federal borrowing costs. This was another sham. Lower interest rates merely served as another subsidy for colleges, allowing them to load borrowers with more debt.
Now the feds are losing tens of billions of dollars because many borrowers have taken on so much debt they can’t make even the smaller interest payments. So now Democrats want to bail out the underemployed borrowers they and colleges duped.
To avoid the appearance of helping the affluent, Mr. Biden is considering limiting loan forgiveness to borrowers making up to $150,000 ($300,000 for couples). Yet this would still cover 97% of all borrower debt, including most recent law and medical school grads. The student loan con goes on and on.
Not a usual source, but I found this to be hilarious:
In short, mom split responsibility for a daughter’s student loans, doesn’t pay, then dies. Daughter then finds the $15k had grown to $80k.
Queue the outrage about how unfair such loans are, the need for reform, yadda yadda yadda.
But then…
The company forgave it immediately
So, at least to me, it appears that mom knew exactly what she was doing all that time.
We have outrage over being stuck with a large loan balance that is forgiven without issue. And the desired solution being demanded to correct such a terrible situation is to forgive the loan.
When I went to college, my dad promised to pay for it. He had a great paying job and could afford it, but not a lot in savings, so he couldn’t pay the lump sums each semester, so I took out loans. Had he not made that promise, I probably would have been more diligent about applying for scholarships. I had no idea at the time how much is out there, but now that I’ve been around, I will definitely do that for my kids if they decide to go to college.
When I graduated, I consolidated and got a great fixed rate for a 15 year loan, something like 2.5% plus an auto-pay discount on top of it. It was around $17k I think, so somewhere around $125/a month. Thank goodness I didn’t do what this girl did and actually split the loan with my dad. For maybe 6 months, he was good about sending me $125ish a month to make my payments. Then after that, I had to keep reminding him. Then it sort of became a hassle, so I just stopped. He never mentioned it and I just paid them for the remaining 14 years. I figured it would have been nice for him to keep up his end of the agreement, but it was my loan and I was the one that went to college, so it really was my responsibility. I bet the exact same thing would have happened to him as the mom in this story if we had split it or transferred it to his name, just because that’s how he is about paying off debts even though he makes good money. After reading this story I realize I shouldn’t look at what I did as saving my dad $17k. I should look at it as saving him $80k!
Having little savings, you didnt save him anything. You only cost yourself $17k. Had you let him handle financing the debt himself, it would’ve went unpaid until it was eventually written off upon his death, no matter how large the balance had grown in the meantime. (Although if he had a good paying job, I dont know how quickly they would’ve pursued wage garnishments.)
I received no financial support for college. So all my decisions were made for me, as soon as one school came back with a full-ride scholarship.
I’m so very impressed glitch99. I don’t know anyone personally that has won such an honor scholarship.
I guess I’ve been reading your posts for a couple years now. You’re generally always right there with a good proper response to all topics. Now I understand , you’re “one smart dude”.
Kidding aside, many of the people who follow along here are very interesting. So different, so diverse in their responses to the various topics.
AN: You have an issue with the term “student loan forgiveness.” Can you explain why?
AT:Millions of debtors have paid off the original amount they borrowed, and yet are still in debt thanks to compounding interest, and many of them somehow owe more than their original balances. That’s the classic definition of a debt trap. It doesn’t make sense to say these people are asking for “forgiveness.” That word makes it seem like debtors have done something wrong. We are talking about a system-level problem — not an individual moral failing.
No, that means those borrowers have not been paying the loan in accordance to the loan agreement. If you dont pay as agreed when the loan was taken out, you are still going to owe money beyond the original repayment terms. Common sense says that while making a smaller payment today may seem desirable, there will be long term consequences. And those consequences are no one’s fault but the borrower’s.
So weird isn’t it. I had a 15 year loan and I made every payment exactly as the agreement said every month for 15 years and poof, magically after I made the 180th payment, the loan was paid off.
Difference b/t Uncle Biden and other regimes is how they approach “buyer beware” which is the crux of all the anti forgiveness arguments. I was ~18 when I made these decisions. cue Shawshank Redemption - Redemption - YouTube. I feel like hope which is a good thing! Get busy living!
I am now and was in public service, Just wasn’t in the right type of repayment IDR plan and FFEL, now it counts if I consolidate over to the feds. And per the email they’ll even add in past periods!
I was mislead by UHEAA CSR multiple times over the years about being able to move to direct loans (“Can’t consolidate consolidated loans”) . Again “buyer beware”, or let the regulators do their duty like they are now. or let Uncle Biden do mass forgiveness to make up for all the sins.
Either way i need to be with Direct Loans vs the quasi private money making (for the servicers) I just might have to deal with higher interest rates till they’re forgiven.
So are you thinking you’ll have all your past payments count towards the 240 required payments on an income based repayment (IBR) plan (which then allows forgiveness for what’s left) in a similar way that people who have been working in public service but have been paying on the wrong type of loan will have their payments counted toward the PSLF program?
No, just the 120 for PSLF, but while I had FFEL thru UHEAA
Working in public health policy now, it’s interesting how sausage is made in the exec. branch. This waiver is huuugge!
key difference is FFEL and any payment plan (not just “vow of poverty IBR”) . My wife has been a state school prof. for over 15 years so she’ll be good too.
Normal PSLF Requirements
Included in Limited PSLF Waiver Until Oct. 31
Direct Loan payments only
Payments on Direct, Perkins, or FFEL Loans
Payments through Standard or income-driven repayment plans only
Payments through any repayment plan (including Graduated, Extended, and others)
The funny part is how all for those sob stories we hear about, those with $100k loans that are being highlighted to try to justify the obvious necessity of loan forgiveness, $10k isnt going to be a blip on their debt’s radar.
$10k forgiveness helps the people who really really want to buy the newest iphone instead of having to make their loan payment.
$10K is only the beginning. Kicking the door in to justify bigger giveaways later on.
BTW, who is going to eventually fund these full scholarships for Chicago high school grads and their parents, whether or not they’re legally in the country?
There’s a whole lotta “generational poverty” in the world outside our borders, and surely we’re responsible for all of it. Free citizenship and free education is the least we can do.
