8 ms·

>Federally subsidized student loans need to GO AWAY. They've allowed students to enter into debt, the only long term contracts kids under 18 can legally sign, f

by swebs 6y ago

>Federally subsidized student loans need to GO AWAY. They've allowed students to enter into debt, the only long term contracts kids under 18 can legally sign, for something they can never declare bankruptcy on. I think that's something that many people would agree with, but how do we go forward with making that happen?

deleted 6y ago
[deleted]
lotsofpulp 6y ago
Running for federal office with that platform, and supporting others that do. Only problem is you will lose to other politicians that are able to promise lower taxes because giving out federal loans to students is cheaper for taxpayers than giving money to schools directly. People will vote for the person “helping” students by lending them money, rather than the person that has to help students by giving schools money, and therefore raising taxes.
leecb 6y ago
Introduce a ceiling on the total amount of federally subsidized student loans that a person can get in a year. The ceiling steps down every year, until the loans have completely gone down. Start the first ceiling 2 years from now, so students and institutions have time to plan for the change, and complete the phaseout 8 years from now. That's how I'd do it. As for how you would do it, you'd have to convince your congressional representative that reform is worth doing, and is worth the inevitable political cost to them. Making loans somewhat harder to get will inevitably make universities upset with the politicians (as universities are the ones that actually receive the bulk of the financial benefit from these loans). For this reason, I see this reform as unlikely to happen, at least as I described it. You would have to pair it with more direct funding for universities.
randomdata 6y ago
Continue to remind people that incomes have held stagnant with the rise of post secondary education – Meaning that the promise of higher incomes as a result of higher education from decades ago never materialized. The vast majority of students are only taking on these loans because they have been lead to believe that their income will increase, more than offsetting the cost of the loan. But we know very well now that it doesn't play out in practice. As we educate away those flawed ideas from history, those with profit motive will be scared away, leaving those who are there for education's sake. When only they are left, costs will start to align with what education is actually worth. Then again, a diamond remains forever, so perhaps you cannot educate the educated.
- deleted 6y ago
  [deleted]
- sct202 6y ago
  It is detrimental to an individual to decide to sit out the whole educational arms race of degrees and credentials. I agree it would be better overall if people didn't have to go thru it. But for a single person to decide to sit it out, they're shutting themselves out of a lot of high paying jobs that only recruit college graduates. You can be successful as a high school graduate, but it's a lot easier to get your foot in the door of a lot of places if you went to the hiring manager's favorite college.
  - randomdata 6y ago
    It is detrimental to an individual to have disabilities that prevent going to college. Those people will statistically earn less than, for lack of a better word, normal people. And normal people will earn less than the outliers on the other end of the spectrum. If you have the capability of graduating with top honours from Stanford, there is no benefit to actually doing it. It is beneficial to be born as the kind of person who can achieve that goal. There is no arms race, simply a misunderstanding of the data around the filtering that takes place with increasing levels of academic rigour. Those who fall down to that rigour also fall down to the rigours of the working world, statistically.
  - imtringued 6y ago
    If the degree is economically useful it will be easy to acquire.
    - randomdata 6y ago
      And funded by investors seeking to capture the economic gains made from it. That students are resorting to having to take out loans to fund their hobby shows it is only that.
manfredo 6y ago
Make student loans no longer exempt from bankruptcy. The rationale for making student loans persist through bankruptcy is that students could just declare bankruptcy after graduation, since they probably have no assets. Maybe make the exemption only last 10-15 years. The permanence of student loans means lenders have no qualms against writing loans for people who will likely not be able to pay them off for decades, or ever. Reducing ability to default makes the loans more accessible, yes, but in effect it's shifting the burden to students - students who are often young people not well equipped to make long term financial decisions. Yes, this will mean lenders will be much more reluctant to issue student loans. It will likely prompt lenders to offer loans contingent on certain majors. This is a big, big reason why universities are heavily opposed to student loan reforms. The uncomfortable reality is that many universities are funded through what essentially amounts to predatory loans, and halting the practice will cut into university funding.
- WaitWaitWha 6y ago
  >The permanence of student loans means lenders have no qualms against writing loans for people who will likely not be able to pay them off for decades, or ever. Worse, lenders write, and universities accept applications for people they know statistically 99.999% they will not get past the first year.
  - throwaway0a5e 6y ago
    >And universities accept applications for people they know statistically 99.999% they will not get past the first year. Universities do this on purpose because between 500 student lectures and on-campus housing requirements undergrad freshmen and sophomores have a massive profit margin per body whereas juniors and seniors are in classes that have much more resources spent per student and often don't live on campus.
  - Melting_Harps 6y ago
    > Worse, lenders write, and universities accept applications for people they know statistically 99.999% they will not get past the first year. Sounds like the subprime mortgage scam by the banks, given that they know the US government is going to subsidize the 'losses' and they will have extracted their profit one way or another. Anyone who thinks Socialism is some de-facto virtuous ideal needs to see that collusion between State and X happens in just about every Industry already for private largess. And often is sanctioned, regulated or at least likely to have light to no punishment if caught: see banking fraud. I honestly want COVID to make the University model obsolete, it will have been worth it if people see how nebulous and impractical the absurd expenses when in reality you can do 75% of courses online anyway; its entirely a predatory model. This is such a drag on young people's lives to have 50k+ in debt in your 20s and are some how sold the idea that you are 'making it' by working to pay that off just to get some entry level position you could have done with a 1-2 year apprenticeship by the time you were 16 like they do in many Germanic Countries. It's absurd to think this model can go on, and as you mentioned the pernicious statistic rates they are worse because not only is it short sighted thinking that doesn't add value to Society, it can only extract it from those least likely to afford it. I got honors and letters of recommendations while I was in my undergrad and the only time I ever too them out were to show employers when I applied/interviewed for jobs, and most didn't care either; otherwise they sat in a desk in an envelope as they're reminders of time poorly spent in something I had no interest in by the time I was a sophomore and would come to hate entirely but couldn't get out of until I was 26 due to the debt.
analog31 6y ago
Consider the debt burden on society, whether that burden is borne by the students themselves, or by the government, may be roughly equal. If anything, the government pays less interest. My thought is that in the future, privatizing higher education will seem like a quaint historical anomaly, like privatizing health care, both of which have made themselves at least twice as expensive as necessary. If we can't force private colleges out of existence, we could concentrate on solving the education funding crisis starting at the level of state and regional colleges and trade schools. Preferentially direct research funding toward those schools, to build or expand on research institutes in areas where a few extra jobs would be welcome. Ironically I believe we could destroy the private colleges by eliminating all government oversight of the admissions process, and letting them compete with one another with no restraint.
- react_burger38 6y ago
  I really think you need to reconsider your stance on private colleges.. For example, BYU and BYU-Idaho provide affordable education for tens of thousands of students every year. Sure they're religious, but they serve as price competition to state schools in the area, keeping prices down across the state of Utah. Secondly, the reason things are so expensive is because the federal government gives loans to everyone, driving up prices. Why would public colleges ever cease their continuous tuition increases if the government gives unlimited loans to anyone, regardless of the price? The federal government should just give a set amount per year to states that the states can allocate among their universities, so that they can continue operating, and then get rid of government funded loans. With the government funding the schools directly, they will have enough to set up lower cost programs and then be forced to compete for the lower amount of dollars provided by students, driving down prices. Also, the federal government should put a condition on this money that if a college takes it, they have to charge the same for in state and out of state tuition, creating a more national, competitive market for students in order to bring prices down. Maybe we'd see more schools go to a partial or full online model, which could really drive prices down. Honestly part of the federal money could be conditioned on creating online programs which are even cheaper for students.
  - 6y ago
NortySpock 6y ago
Income Sharing Agreement - You go to school, possibly with a small stipend, and in return the school gets (say) 10% of the first 7 years of your income, possibly capped at a max repayment amount. https://www.purdue.edu/dfa/types-of-aid/income-share-agreement/index.html https://www.purdue.edu/dfa/types-of-aid/income-share-agreeme...
- manfredo 6y ago
  I think this is another good model. Purdue is one relatively well-known university that offers this. What's crucial about an ISA (especially an ISA that only collects on income beyond a threshold) is that the university then has a direct incentive to actually improve students' employment prospects. Then again, the Lambda school ISA selling issue demonstrates the potential to eliminate this alignment of incentives. In universities, there's also the issue that colleges might only accept ISAs with students interested in majors with good employment prospects. But if we view university as an investment where the return is better employment, then this is working as intended.
iguy 6y ago
Here's one idea: Cap the amount that all student loans can collect at something like 15% of taxable income, for max 20 years after signing. After that they are written off. But let the lenders see everything -- school, major, test scores. This ensures loans can never become a crushing burden. But more importantly, it incentivises the banks to provide very useful information to the potential students. Unlike colleges who, since they get paid up front, are strongly incentivised to let marginal students study expensive things.
- dragonwriter 6y ago
  > Here's one idea: Cap the amount that all student loans can collect at something like 15% of taxable income, for max 20 years after signing. After that they are written off. Make it the 10% of discretionary (not gross), and up the limit to 25 years of any of the loans covered graduate or professional study, and you'd have an existing option for current federal student loans. Make this the only option for federal loans, remove private loans from the protection against bankruptcy discharge, and you the job is done. > But let the lenders see everything -- school, major, test scores. Private lenders can, AFAIK, already put terms like this in contracts if they want.
LockAndLol 6y ago
Honestly, vote for people like Yang, Bernie and Warren. Talk to people and try to get it into their heads that voting for the well-being of everybody - not just a select group you belong to (ethnicity, sex, social status, job, region, etc.) - is better for the country. That might include you taking a hit e.g higher taxes, but it's group think and individualism that brought the country to its current state. So voting for: - free public education - higher teacher salaries - higher taxes on the wealthy - forgiving all student loans

by swebs 6y ago

deleted 6y ago

[deleted]

lotsofpulp 6y ago

Running for federal office with that platform, and supporting others that do. Only problem is you will lose to other politicians that are able to promise lower taxes because giving out federal loans to students is cheaper for taxpayers than giving money to schools directly. People will vote for the person “helping” students by lending them money, rather than the person that has to help students by giving schools money, and therefore raising taxes.

leecb 6y ago

Introduce a ceiling on the total amount of federally subsidized student loans that a person can get in a year. The ceiling steps down every year, until the loans have completely gone down. Start the first ceiling 2 years from now, so students and institutions have time to plan for the change, and complete the phaseout 8 years from now. That's how I'd do it. As for how you would do it, you'd have to convince your congressional representative that reform is worth doing, and is worth the inevitable political cost to them. Making loans somewhat harder to get will inevitably make universities upset with the politicians (as universities are the ones that actually receive the bulk of the financial benefit from these loans). For this reason, I see this reform as unlikely to happen, at least as I described it. You would have to pair it with more direct funding for universities.

randomdata 6y ago

Continue to remind people that incomes have held stagnant with the rise of post secondary education – Meaning that the promise of higher incomes as a result of higher education from decades ago never materialized. The vast majority of students are only taking on these loans because they have been lead to believe that their income will increase, more than offsetting the cost of the loan. But we know very well now that it doesn't play out in practice. As we educate away those flawed ideas from history, those with profit motive will be scared away, leaving those who are there for education's sake. When only they are left, costs will start to align with what education is actually worth. Then again, a diamond remains forever, so perhaps you cannot educate the educated.

deleted 6y ago
[deleted]
sct202 6y ago
It is detrimental to an individual to decide to sit out the whole educational arms race of degrees and credentials. I agree it would be better overall if people didn't have to go thru it. But for a single person to decide to sit it out, they're shutting themselves out of a lot of high paying jobs that only recruit college graduates. You can be successful as a high school graduate, but it's a lot easier to get your foot in the door of a lot of places if you went to the hiring manager's favorite college.
- randomdata 6y ago
  It is detrimental to an individual to have disabilities that prevent going to college. Those people will statistically earn less than, for lack of a better word, normal people. And normal people will earn less than the outliers on the other end of the spectrum. If you have the capability of graduating with top honours from Stanford, there is no benefit to actually doing it. It is beneficial to be born as the kind of person who can achieve that goal. There is no arms race, simply a misunderstanding of the data around the filtering that takes place with increasing levels of academic rigour. Those who fall down to that rigour also fall down to the rigours of the working world, statistically.
- imtringued 6y ago
  If the degree is economically useful it will be easy to acquire.
  - randomdata 6y ago
    And funded by investors seeking to capture the economic gains made from it. That students are resorting to having to take out loans to fund their hobby shows it is only that.

manfredo 6y ago

Make student loans no longer exempt from bankruptcy. The rationale for making student loans persist through bankruptcy is that students could just declare bankruptcy after graduation, since they probably have no assets. Maybe make the exemption only last 10-15 years. The permanence of student loans means lenders have no qualms against writing loans for people who will likely not be able to pay them off for decades, or ever. Reducing ability to default makes the loans more accessible, yes, but in effect it's shifting the burden to students - students who are often young people not well equipped to make long term financial decisions. Yes, this will mean lenders will be much more reluctant to issue student loans. It will likely prompt lenders to offer loans contingent on certain majors. This is a big, big reason why universities are heavily opposed to student loan reforms. The uncomfortable reality is that many universities are funded through what essentially amounts to predatory loans, and halting the practice will cut into university funding.

WaitWaitWha 6y ago
>The permanence of student loans means lenders have no qualms against writing loans for people who will likely not be able to pay them off for decades, or ever. Worse, lenders write, and universities accept applications for people they know statistically 99.999% they will not get past the first year.
- throwaway0a5e 6y ago
  >And universities accept applications for people they know statistically 99.999% they will not get past the first year. Universities do this on purpose because between 500 student lectures and on-campus housing requirements undergrad freshmen and sophomores have a massive profit margin per body whereas juniors and seniors are in classes that have much more resources spent per student and often don't live on campus.
- Melting_Harps 6y ago
  > Worse, lenders write, and universities accept applications for people they know statistically 99.999% they will not get past the first year. Sounds like the subprime mortgage scam by the banks, given that they know the US government is going to subsidize the 'losses' and they will have extracted their profit one way or another. Anyone who thinks Socialism is some de-facto virtuous ideal needs to see that collusion between State and X happens in just about every Industry already for private largess. And often is sanctioned, regulated or at least likely to have light to no punishment if caught: see banking fraud. I honestly want COVID to make the University model obsolete, it will have been worth it if people see how nebulous and impractical the absurd expenses when in reality you can do 75% of courses online anyway; its entirely a predatory model. This is such a drag on young people's lives to have 50k+ in debt in your 20s and are some how sold the idea that you are 'making it' by working to pay that off just to get some entry level position you could have done with a 1-2 year apprenticeship by the time you were 16 like they do in many Germanic Countries. It's absurd to think this model can go on, and as you mentioned the pernicious statistic rates they are worse because not only is it short sighted thinking that doesn't add value to Society, it can only extract it from those least likely to afford it. I got honors and letters of recommendations while I was in my undergrad and the only time I ever too them out were to show employers when I applied/interviewed for jobs, and most didn't care either; otherwise they sat in a desk in an envelope as they're reminders of time poorly spent in something I had no interest in by the time I was a sophomore and would come to hate entirely but couldn't get out of until I was 26 due to the debt.

analog31 6y ago

Consider the debt burden on society, whether that burden is borne by the students themselves, or by the government, may be roughly equal. If anything, the government pays less interest. My thought is that in the future, privatizing higher education will seem like a quaint historical anomaly, like privatizing health care, both of which have made themselves at least twice as expensive as necessary. If we can't force private colleges out of existence, we could concentrate on solving the education funding crisis starting at the level of state and regional colleges and trade schools. Preferentially direct research funding toward those schools, to build or expand on research institutes in areas where a few extra jobs would be welcome. Ironically I believe we could destroy the private colleges by eliminating all government oversight of the admissions process, and letting them compete with one another with no restraint.

react_burger38 6y ago
I really think you need to reconsider your stance on private colleges.. For example, BYU and BYU-Idaho provide affordable education for tens of thousands of students every year. Sure they're religious, but they serve as price competition to state schools in the area, keeping prices down across the state of Utah. Secondly, the reason things are so expensive is because the federal government gives loans to everyone, driving up prices. Why would public colleges ever cease their continuous tuition increases if the government gives unlimited loans to anyone, regardless of the price? The federal government should just give a set amount per year to states that the states can allocate among their universities, so that they can continue operating, and then get rid of government funded loans. With the government funding the schools directly, they will have enough to set up lower cost programs and then be forced to compete for the lower amount of dollars provided by students, driving down prices. Also, the federal government should put a condition on this money that if a college takes it, they have to charge the same for in state and out of state tuition, creating a more national, competitive market for students in order to bring prices down. Maybe we'd see more schools go to a partial or full online model, which could really drive prices down. Honestly part of the federal money could be conditioned on creating online programs which are even cheaper for students.
- 6y ago

NortySpock 6y ago

Income Sharing Agreement - You go to school, possibly with a small stipend, and in return the school gets (say) 10% of the first 7 years of your income, possibly capped at a max repayment amount. https://www.purdue.edu/dfa/types-of-aid/income-share-agreement/index.html https://www.purdue.edu/dfa/types-of-aid/income-share-agreeme...

manfredo 6y ago
I think this is another good model. Purdue is one relatively well-known university that offers this. What's crucial about an ISA (especially an ISA that only collects on income beyond a threshold) is that the university then has a direct incentive to actually improve students' employment prospects. Then again, the Lambda school ISA selling issue demonstrates the potential to eliminate this alignment of incentives. In universities, there's also the issue that colleges might only accept ISAs with students interested in majors with good employment prospects. But if we view university as an investment where the return is better employment, then this is working as intended.

iguy 6y ago

Here's one idea: Cap the amount that all student loans can collect at something like 15% of taxable income, for max 20 years after signing. After that they are written off. But let the lenders see everything -- school, major, test scores. This ensures loans can never become a crushing burden. But more importantly, it incentivises the banks to provide very useful information to the potential students. Unlike colleges who, since they get paid up front, are strongly incentivised to let marginal students study expensive things.

dragonwriter 6y ago
> Here's one idea: Cap the amount that all student loans can collect at something like 15% of taxable income, for max 20 years after signing. After that they are written off. Make it the 10% of discretionary (not gross), and up the limit to 25 years of any of the loans covered graduate or professional study, and you'd have an existing option for current federal student loans. Make this the only option for federal loans, remove private loans from the protection against bankruptcy discharge, and you the job is done. > But let the lenders see everything -- school, major, test scores. Private lenders can, AFAIK, already put terms like this in contracts if they want.

LockAndLol 6y ago

Honestly, vote for people like Yang, Bernie and Warren. Talk to people and try to get it into their heads that voting for the well-being of everybody - not just a select group you belong to (ethnicity, sex, social status, job, region, etc.) - is better for the country. That might include you taking a hit e.g higher taxes, but it's group think and individualism that brought the country to its current state. So voting for: - free public education - higher teacher salaries - higher taxes on the wealthy - forgiving all student loans