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Hillary Clinton proposes student debt deferral for startup founders

1 points by scarmig 10y ago

scarmig 10y ago
"Clinton proposed allowing startup founders to defer student debt payment for up to three years. The deferrals would also be available to a new company’s first 10 to 20 employees." So many things are broken about the student debt racket. At some point, I think it's maintained just so politicians can come up with stupid proposals to throw to the masses. Reasons this is dumb: 1) The obvious: the people who are having repayment issues aren't startup employees. 2) Doesn't solve the underlying issue, which is that cheap college loan debt is fueling spiraling college costs, which absorbs any subsidy the government throws at it. 3) This also has bad effects on the labor market. It effectively makes it even cheaper for new startups to employ recent college grads. Sometimes this will manifest in more hiring; more often it will manifest in choosing cheap callow youth over experience. 4) It's probably pretty gameable. And I just have to note: it's all-too-typical of Hillary Clinton to make a tone-deaf mistake when trying to perform what should be an easy pander.
- nibs 10y ago
  On the note of 1 and 4. I have met two different people (different situations) who funded their company through student loans and then failed and defaulted. I have met several people who would start companies but are buried in student debt, so instead of using their money to start a company, got a degree they were not sure of, and then worked at a company instead of starting one to pay the debt back. So it is really an 8-year path, four of which in school, and four of which at a start-up making their tuition back in order to then pay it off, save up and start a company. Seems like if you just started the company, you would be financially in a similar position and eight years ahead. That being said if you fail and need a job, you no longer have the insurance of the degree. But could it be possible that the company you started gave you more relevant skills, not only in general, but to your employer too? That is the question. And if the answer is that the startup came even close to the degree, saving all that time seems like a good deal. I am assuming college is entirely rational, which it is not and it offers other things, but for certain people it is. This policy seems nice in theory, but is probably pandering in process. Here in Canada, the government has become the carrot and stick mechanism for businesses, driving increasing dependence. First you get regulations that make it harder to do business, but then the government pays for you to fund the project(s) to meet the regulations. Many companies here basically only exist because all change/innovation is funded by the government, out of guilt for imposing such restrictive regulation in the first place. It is strange, but a different issue. I suspect Hillary would prefer this model for USA.

1 points by scarmig 10y ago

"Clinton proposed allowing startup founders to defer student debt payment for up to three years. The deferrals would also be available to a new company’s first 10 to 20 employees." So many things are broken about the student debt racket. At some point, I think it's maintained just so politicians can come up with stupid proposals to throw to the masses. Reasons this is dumb: 1) The obvious: the people who are having repayment issues aren't startup employees. 2) Doesn't solve the underlying issue, which is that cheap college loan debt is fueling spiraling college costs, which absorbs any subsidy the government throws at it. 3) This also has bad effects on the labor market. It effectively makes it even cheaper for new startups to employ recent college grads. Sometimes this will manifest in more hiring; more often it will manifest in choosing cheap callow youth over experience. 4) It's probably pretty gameable. And I just have to note: it's all-too-typical of Hillary Clinton to make a tone-deaf mistake when trying to perform what should be an easy pander.

nibs 10y ago
On the note of 1 and 4. I have met two different people (different situations) who funded their company through student loans and then failed and defaulted. I have met several people who would start companies but are buried in student debt, so instead of using their money to start a company, got a degree they were not sure of, and then worked at a company instead of starting one to pay the debt back. So it is really an 8-year path, four of which in school, and four of which at a start-up making their tuition back in order to then pay it off, save up and start a company. Seems like if you just started the company, you would be financially in a similar position and eight years ahead. That being said if you fail and need a job, you no longer have the insurance of the degree. But could it be possible that the company you started gave you more relevant skills, not only in general, but to your employer too? That is the question. And if the answer is that the startup came even close to the degree, saving all that time seems like a good deal. I am assuming college is entirely rational, which it is not and it offers other things, but for certain people it is. This policy seems nice in theory, but is probably pandering in process. Here in Canada, the government has become the carrot and stick mechanism for businesses, driving increasing dependence. First you get regulations that make it harder to do business, but then the government pays for you to fund the project(s) to meet the regulations. Many companies here basically only exist because all change/innovation is funded by the government, out of guilt for imposing such restrictive regulation in the first place. It is strange, but a different issue. I suspect Hillary would prefer this model for USA.