5 ms·

Not allowing people to discharge crushing debt, incurred under false pretenses, is the far more terrible precedent.

luckylion 6y ago
Is it? If you take a loan from the government or a bank in order to buy a car, the car turns out to be a pile of trash and the seller defrauded you, should the loan be forgiven?
- wildrhythms 6y ago
  Do you honestly believe all the debt in the world can be repaid?
  - luckylion 6y ago
    That's very meta and not very relevant to the question of who should repay some specific debt.
- TedDoesntTalk 6y ago
  Your analogy is poor. Cars depreciate in value. A higher education with a degree supposedly increases your earnings, thereby enabling you to repay debt. Cars don’t do that. When the school lies about how many graduates are placed at SV tech companies, when they lie about who teaches and designs the courses, when they lie about their “connections” to employers, enticing students to take debt for their false product, the problem is with the school... not the victim. Do you also forgive rapists who say, “but she was wearing a miniskirt! She enticed me to do it!” The schools are the rapists here. The students are the victims.
  - splithalf 6y ago
    That is the fraud. A higher education degree doesn’t increase earnings for most people once you factor in the costs. There was a nice econ paper on this sometime in last year. Student loans of any sort are on average a bad choice in terms of lifetime wealth accumulation. Bad for student borrowers and bad for taxpayers, one should ask themselves whom it is exactly that benefits from all this carelessly issued debt.
    - TedDoesntTalk 6y ago
      > A higher education degree doesn’t increase earnings for most people once you factor in the costs The average tuition & fees for public, in-state college in 2021 is $9687 [0]. Adding room & board increase it to 20,050 [1]. So you could, theoretically, get a 4-year degree at a decent school for under $100,000. Considering that a 4-year degree increases earnings, on average, from $38,376/year to $59,124/year (and also decrease unemployment from 5% to 2.4%), that's $20,748 per year increase. Over a 40-year career, that's $829,920 extra assuming no raises. All of these figures can be adjusted for margins of error and you'll still be ahead with a 4-year degree. [0] https://nces.ed.gov/fastfacts/display.asp?id=76 https://nces.ed.gov/fastfacts/display.asp?id=76 [1] https://nces.ed.gov/fastfacts/display.asp?id=76 https://nces.ed.gov/fastfacts/display.asp?id=76 [2] https://smartasset.com/retirement/the-average-salary-by-education-level https://smartasset.com/retirement/the-average-salary-by-educ...
      - lovich 6y ago
        If you take $100k in debt, you are not paying back $100k. You are going to be paying back more than double that when paid back over the 20+ years most student loans are repaid over
        TedDoesntTalk 6y ago
        Yep. But how does that compare with the difference in wages over 40 years? Just do the math. Now if you take on $500,000 in debt because you choose to go to a private college with no grants or scholarships, that's a different problem. And maybe it's not a good choice. But that's a different story than a 4-year public, in-state university.
      - splithalf 6y ago
        Couldn’t find the paper but I believe it was from NBER or one of the feds. It looked at how graduate school impacted wealth accumulation over the lifespan and found that graduate school, this is from my fuzzy memory based on a quick skim, decreased wealth because of debt burden and delayed peak earning years. It didn’t apply to undergrad or associate degrees both of which have very good roi, on average. So I agree with you, but I also feel like much of the value of an undergrad degree is signaling, not the acquisition of specific skills that makes people more employable, leaving aside associate degrees and certificates which are essentially vocational training.
- 8note 6y ago
  I'd say yeah. At least if it was from the government. They're supposed to make sure people aren't being defrauded
- TheOtherHobbes 6y ago
  Are you a bank or a senior bondholder and are considered "too big to fail"? Then yes, you should be bailed out. Ordinary people? Clearly no. "Pile of trash" indeed.

Is it? If you take a loan from the government or a bank in order to buy a car, the car turns out to be a pile of trash and the seller defrauded you, should the loan be forgiven?

wildrhythms 6y ago
Do you honestly believe all the debt in the world can be repaid?
- luckylion 6y ago
  That's very meta and not very relevant to the question of who should repay some specific debt.
TedDoesntTalk 6y ago
Your analogy is poor. Cars depreciate in value. A higher education with a degree supposedly increases your earnings, thereby enabling you to repay debt. Cars don’t do that. When the school lies about how many graduates are placed at SV tech companies, when they lie about who teaches and designs the courses, when they lie about their “connections” to employers, enticing students to take debt for their false product, the problem is with the school... not the victim. Do you also forgive rapists who say, “but she was wearing a miniskirt! She enticed me to do it!” The schools are the rapists here. The students are the victims.
- splithalf 6y ago
  That is the fraud. A higher education degree doesn’t increase earnings for most people once you factor in the costs. There was a nice econ paper on this sometime in last year. Student loans of any sort are on average a bad choice in terms of lifetime wealth accumulation. Bad for student borrowers and bad for taxpayers, one should ask themselves whom it is exactly that benefits from all this carelessly issued debt.
  - TedDoesntTalk 6y ago
    > A higher education degree doesn’t increase earnings for most people once you factor in the costs The average tuition & fees for public, in-state college in 2021 is $9687 [0]. Adding room & board increase it to 20,050 [1]. So you could, theoretically, get a 4-year degree at a decent school for under $100,000. Considering that a 4-year degree increases earnings, on average, from $38,376/year to $59,124/year (and also decrease unemployment from 5% to 2.4%), that's $20,748 per year increase. Over a 40-year career, that's $829,920 extra assuming no raises. All of these figures can be adjusted for margins of error and you'll still be ahead with a 4-year degree. [0] https://nces.ed.gov/fastfacts/display.asp?id=76 https://nces.ed.gov/fastfacts/display.asp?id=76 [1] https://nces.ed.gov/fastfacts/display.asp?id=76 https://nces.ed.gov/fastfacts/display.asp?id=76 [2] https://smartasset.com/retirement/the-average-salary-by-education-level https://smartasset.com/retirement/the-average-salary-by-educ...
    - lovich 6y ago
      If you take $100k in debt, you are not paying back $100k. You are going to be paying back more than double that when paid back over the 20+ years most student loans are repaid over
      - TedDoesntTalk 6y ago
        Yep. But how does that compare with the difference in wages over 40 years? Just do the math. Now if you take on $500,000 in debt because you choose to go to a private college with no grants or scholarships, that's a different problem. And maybe it's not a good choice. But that's a different story than a 4-year public, in-state university.
    - splithalf 6y ago
      Couldn’t find the paper but I believe it was from NBER or one of the feds. It looked at how graduate school impacted wealth accumulation over the lifespan and found that graduate school, this is from my fuzzy memory based on a quick skim, decreased wealth because of debt burden and delayed peak earning years. It didn’t apply to undergrad or associate degrees both of which have very good roi, on average. So I agree with you, but I also feel like much of the value of an undergrad degree is signaling, not the acquisition of specific skills that makes people more employable, leaving aside associate degrees and certificates which are essentially vocational training.
8note 6y ago
I'd say yeah. At least if it was from the government. They're supposed to make sure people aren't being defrauded
TheOtherHobbes 6y ago
Are you a bank or a senior bondholder and are considered "too big to fail"? Then yes, you should be bailed out. Ordinary people? Clearly no. "Pile of trash" indeed.