9 ms·

The U.S. would do itself a huge favour by allowing student debt to be bankruptable. College prices can rise infinitely because there is an unlimited supply of A

• deleted 8y ago
  [deleted]
• kryogen1c 8y ago
  Used to be. Doctors and lawyers would go through a decade of school on loan and then discharge it all and start a lucrative practice. That's part of how we got here.
  • azemetre 8y ago
    Where are you getting this information from? Because nothing I am able to see points to people discharging their loans happening on a massive scale. The only "news article" [1] I can find that references this mentions 0.3% of student loans were discharged through bankruptcy in 1977 [2]. [1] https://www.linkedin.com/pulse/history-student-loans-bankruptcy-discharge-steven-palmer https://www.linkedin.com/pulse/history-student-loans-bankrup... [2] http://harvardlawreview.org/wp-content/uploads/pdfs/vol126_student_loan_exceptionalism.pdf http://harvardlawreview.org/wp-content/uploads/pdfs/vol126_s... Seems be to be some serious revisionist history going on...
    • reaperducer 8y ago
      Seems be to be some serious revisionist history going on... Just because it’s not a link on the internet doesn’t mean it isn’t true. It was pretty much common knowledge when I was in school. I only knew a few pre-meds, but it certainly came up as a discussion topic more than once.
      • SketchySeaBeast 8y ago
        Just because someone talked about potentially doing it doesn't mean it's true either. If it was three quarters of all 20 year old's would have quit school and worked on their band full time.
      • Bjartr 8y ago
        And just because something is common knowledge doesn't mean it's true, especially when you start taking about common knowledge within a group. You don't have to link to a source on the internet either, citing a book or newspaper article would be sufficient.
    • st26 8y ago
      Purely anecdotal, but I have a friend who went to veterinary school. The school had a literal class teaching all vet students to use IBR forgiveness to get their debt discharged. It's not quite as abusive as what could have happened when student loans were dischargeable in bankruptcy- it takes 20 years and you're taxed on the forgiveness- but I thought it was quite perverse that the institution charging towering sums of money is teaching the students in blanket fashion how to avoid paying it off.
      • deleted 8y ago
        [deleted]
    • ameister14 8y ago
      >The only "news article" [1] I can find that references this mentions 0.3% of student loans were discharged through bankruptcy in 1977 [2]. It actually says something much stronger - it says that 0.3% of the value of all federal student loans given before 1977 had been discharged through bankruptcy, not in 1977. In 1977 wouldn't make sense because the amendments making it impossible to discharge student loan debt through bankruptcy were made in 1976.
    • bitL 8y ago
      Some time ago I was dating an American med student - filing bankruptcy was basically her plan once she is done with studies and residence. She mentioned it's fine to take a hit for ~7 years as she won't be earning much during that time period, and then it should pick up quickly.
      • ameister14 8y ago
        It's been effectively impossible to do that since 1976, so while that may have been her plan, I'm not certain she would have been able to follow through.
  • arcbyte 8y ago
    The doctors in my family all graduated from med school with less than 20k total student loan debt. School was much cheaper 30 years ago
    • glenneroo 8y ago
      Adjusted for inflation: $20,000 in 1988 → $42,601.69 in 2018
      • crysin 8y ago
        42k in student loan debt isn't crippling though. That's still a small amount of loan debt for getting an MD.
      • johnmaguire2013 8y ago
        Today, you can expect at least $200,000 for 4 years of medical school.
        • RightMillennial 8y ago
          And that's just for tuition. That doesn't including living expenses.
  • ble 8y ago
    Can you substantiate this claim? "Doctors and lawyers who strategically go bankrupt to avoid paying student debt" sound like made up boogeymen... boogeymen who perfectly justify parts of the US' 2005 bankruptcy reform.
  • sandworm101 8y ago
    Bankrupcy is no way to start a legal career. It may even get you disbarred should you do it in bad faith.
• mkirklions 8y ago
  (I think) I'm a fan of getting rid of subsidized loans for education. It has only made the cost of education go up rather than make college affordable. But on the flip side, what can be expected from people with no ability to afford college at the new price? Ive been told over and over that my personal situation working full time on the midnight shift and going to college is 'unrealistic' for everyone to do. So whats the solution? Get rid of the loans until college cut the cost? What happens to the first few years of lower and middle class kids who cant afford to go to college?
  • douglaswlance 8y ago
    The solution is to stop orienting our society around institutional learning. We have a global information network. We need to orient society around individual learning, not academia. Kids living at home and taking (mostly) pre-programmed online courses should be the norm. It is vastly cheaper, and can deliver more consistently better results.
    • mkirklions 8y ago
      I like this mentality, but there needs to be education around fact finding and logic. (Formerly the scientific method, but I think that got hijacked with PhD politics) Me and my brother are building a dishwasher but he seems to jump into solutions rather than determining the necessary inputs and equations to prove them outputs will meet our design specifications. And my brother is an engineer. In a few weeks/months I feel like I can learn any subject with enough googling and hard work. However, without this ultra critical mindset, I can imagine a child would get lost among too much information.
      • randomdata 8y ago
        > but there needs to be education around fact finding and logic. I picked up that mentality while being involved with the family farm as a young child. The elementary and secondary systems came of age when the vast majority of the population also had significant involvement in agriculture. One would imagine that kind of thinking would be pushed at those early school levels, long before one reaches the typical post-secondary age, but you are suggesting that is not the case. It may have been assumed that one would already pick that up at home given the circumstances of the time and we haven't looked back since? Has college become the replacement for agrarian exposure in our modern urbanized society?
• bedhead 8y ago
  Who is going to lend tens of thousands of dollars to an 18 year old with no income, no assets, and no credit?
  • PopeDotNinja 8y ago
    Then make college free!
    • AnimalMuppet 8y ago
      With whose money?
      • PopeDotNinja 8y ago
        Taxes.
  • weberc2 8y ago
    College shouldn’t cost tens of thousands of dollars to begin with; that’s part of the OP’s claim.
    • everdev 8y ago
      That's how supply and demand works though. When people don't think the ROI is there prices will drop. Admission to a to school seemed like the only path to wealth when I was growing up. I don't think I can make that same claim for my kids. For whatever I have saved for them I'll offer to put it towards college or give it to them when they turn 20 to start a business.
      • nemothekid 8y ago
        The supply/demand equation for college is broken precisely because student loans are can’t be discharged. Every student essentially has an infinitely deep pocket to borrow against so colleges continue to raise prices.
• ataturk 8y ago
  Actually, I'm a fan of accountability, so no. What should happen is the easy loans should be eliminated altogether, which would get Wall Street out of higher ed and return things to a more sane basis. These schools ran away so hard with all that money and put up outrageous numbers of buildings and ran other expensive projects that have led to out of control costs and diminishing returns for actual students. Bill Clinton presided over the changes that led to this mess. I know many of you are too young to know that, but Bill Clinton was not a great leader of the USA, he was a manipulator, interested in maximizing gains for his politically connected allies.
• dreamcompiler 8y ago
  Likewise healthcare. The fact that insurance companies exist who will pay for a $250000 procedure guarantees that those prices continue. If the customers of healthcare (patients) were the payers, those ridiculous prices would vanish.
  • aerotwelve 8y ago
    It's almost like our health system consists of a small collection of companies playing fast and loose with each other's money, trying to extract as much from each other as possible, and the output of all of this graft (not including co-pay and deductible) is average healthcare at sky-high prices.
• mcculley 8y ago
  It would require huge political will to go against the existing system. I'm excited about Lambda School (https://lambdaschool.com https://lambdaschool.com). If they are successful, there should be lots of investors trying out similar models and destroying the existing system.
  • keithwhor 8y ago
    One problem here is that, at least in my humble opinion, education should ultimately be (or trend towards becoming) a basic human right. Repackaging debt as wage garnishment while making job placement easier makes the job market more efficient, certainly. I can understand why people are excited. It doesn't fix the underlying structural issues in the American education system.
    • mcculley 8y ago
      I agree. I think the US system is terrible. We should not stop providing public education merely because someone achieves the age of 18 or 12th grade. But I don't see how it can be fixed politically.
      • randomdata 8y ago
        In a functioning education system (which the US system arguably isn't), 12 years of schooling is more than sufficient to produce a well rounded person capable of being a productive and engaging member of civil society. It is not clear to me what the societal benefit is beyond that. I can agree that college is becoming a band-aid to make up for the serious problems found in earlier years. To the point that, in recognition of this, many now call people who have not graduated from college 'uneducated', which is pretty sad when you think that 12 years of completed schooling hasn't provided an education. But the solution for healing a wound isn't to provide a more affordable band-aid. It is to address what is causing the wound in the first place. It need not be a difficult fix politically. Nobody, who isn't emotionally or financially invested in college being a band-aid, is going to argue against educating our youth in the K-12 system. The only roadblock is getting someone to think about the issue, as the advertising done by the colleges has left us believing that education simply isn't provided any other way other than through colleges.
• bradleyjg 8y ago
  It wouldn’t make much of a difference because the vast majority of student loans are issued by the federal government and not underwritten. This seems to come up fairly often. I don’t think many people are aware of the enormous size of the state banking sector in the US between educational loans and continued dominance of the residential mortgage market.
  • austenallred 8y ago
    This is true. About fifty percent of federal financial assets are student loans (which terrifies me). However on the margin it would make a huge difference. The most expensive programs require a mix of federal loans and federally subsidized loans. There are a few changes the federal government could make to not back loans data clearly show are going to be bad, and if those loans aren’t federally subsized they’re not happening. Or, perhaps, worst case scenario the interest rate becomes extreme. There are a lot of moving pieces.
• dragonwriter 8y ago
  > The U.S. would do itself a huge favour by allowing student debt to be bankruptable. Student loan debt is dischargeable in bankruptcy, it's just more difficult than other unsecured debt. But the US would do better to just stop having federal student loans at all, in favor of need-based and service-based grants, rather than tweaking the terms under which loans are dischargeable.