12 ms·

I never understood why the government role in higher education is fixated on the financing. Pay cash for school, live modestly - no bailout. Get a loan for sc

I never understood why the government role in higher education is fixated on the financing. Pay cash for school, live modestly - no bailout. Get a loan for school, use cash for immodest lifestyle - free money! If college loans are a problem, then the cost of college is the real problem. Let's not use government to selectively reward individuals based on how they paid rather than the price they paid. I oppose any student loan reform or student loan bailouts for this reason. Do not believe the magician's misdirection, focus on the real issue.

HPsquared 5y ago
If anything, student loans are already too subsidized, and their prevalence pushes up the cost of education. If student loans were on similar terms to a standard loan, most people wouldn't take them.
- hermannj314 5y ago
  Fair point. Reversing the mess the government created through subsidized loans would help address prices. For several years the press has reported "government bailout for student loans is coming" and you add to this historically low interest rates. And then we are surprised when people take out lots of student loans and defer repaying them as long as possible. And now the press uses that as evidence of why we need a bailout.
Ekaros 5y ago
Reform is clearly needed. Possibly moving toward more market based approach, allowing bankruptcies or hugely limiting allowed amounts. Bailouts just look like rewarding poor decisions...
wolverine876 5y ago
> use cash for immodest lifestyle Do you have evidence of this? Most students I know who have borrowed are struggling. Many can't afford books, housing, food. People are living on ramen. > free money Loans aren't free money. Do we say the same about loans to wealthy people and corporations? I think there is often (I don't know about you) a bias against students or the poor as inherently untrustworthy or just unworthy, and therefore credit to them will just be used for bad things. That is, the issue is the preconceived notions, not the economics or policy. > If college loans are a problem, then the cost of college is the real problem. Let's not use government to selectively reward individuals based on how they paid rather than the price they paid. Education is essential to the general welfare. We can't wait for the perfect system and lose another generation of talent to waste (not developing) or bankruptcy; we need to address that is happening now.
- hermannj314 5y ago
  > Most students I know who have borrowed are struggling. Many people that didn't borrow money are also struggling. No reason to make the existence of a loan a pre-requisite to receive a bailout. Why isn't the fact that you paid for college sufficient? Why is the conversation only about debt? > Loans aren't free money Yes, bailing out student loans is free money. That is the conversation we are having. And considering only bailing out student loans without a provision for reimbursing students with similar backgrounds that didnt finance college or did but paid off loans early is incredulous. There is no reason the solution to the price of college is to selectively bail out people that choose not to repay their student loans and ignore everyone else.
  - gravypod 5y ago
    > And considering only bailing out student loans without a provision for reimbursing students with similar backgrounds that didnt finance college or did but paid off loans early is incredulous. There is no reason the solution to the price of college is to selectively bail out people that choose not to repay their student loans and ignore everyone else. This is a very crabs in a bucket mentality. From the perspective of a society we should ask: what is the effect of removing this debt burden? Many people are repaying loans at a very high monthly amount. My loans are currently >400/month. If that debt "poofed" I'd be spending that in my local economy (instead of going to a bank to then issue another student loan for). Much better for the economy.
    - hermannj314 5y ago
      Your reasoning has nothing at all to do with college, student loans, etc. Anyone that has any debt at all could also benefit from free money. People with no debt could also benefit from free money. Why should the government give you money to pay off your debt when for less administrative burden they could drop money out of a plane instead? Both would help the economy the same, so you haven't made it clear why people with student loans helping the economy and no one else is the antidote we've been missing.

HPsquared 5y ago

If anything, student loans are already too subsidized, and their prevalence pushes up the cost of education. If student loans were on similar terms to a standard loan, most people wouldn't take them.

hermannj314 5y ago
Fair point. Reversing the mess the government created through subsidized loans would help address prices. For several years the press has reported "government bailout for student loans is coming" and you add to this historically low interest rates. And then we are surprised when people take out lots of student loans and defer repaying them as long as possible. And now the press uses that as evidence of why we need a bailout.

Ekaros 5y ago

Reform is clearly needed. Possibly moving toward more market based approach, allowing bankruptcies or hugely limiting allowed amounts. Bailouts just look like rewarding poor decisions...

wolverine876 5y ago

> use cash for immodest lifestyle Do you have evidence of this? Most students I know who have borrowed are struggling. Many can't afford books, housing, food. People are living on ramen. > free money Loans aren't free money. Do we say the same about loans to wealthy people and corporations? I think there is often (I don't know about you) a bias against students or the poor as inherently untrustworthy or just unworthy, and therefore credit to them will just be used for bad things. That is, the issue is the preconceived notions, not the economics or policy. > If college loans are a problem, then the cost of college is the real problem. Let's not use government to selectively reward individuals based on how they paid rather than the price they paid. Education is essential to the general welfare. We can't wait for the perfect system and lose another generation of talent to waste (not developing) or bankruptcy; we need to address that is happening now.

hermannj314 5y ago
> Most students I know who have borrowed are struggling. Many people that didn't borrow money are also struggling. No reason to make the existence of a loan a pre-requisite to receive a bailout. Why isn't the fact that you paid for college sufficient? Why is the conversation only about debt? > Loans aren't free money Yes, bailing out student loans is free money. That is the conversation we are having. And considering only bailing out student loans without a provision for reimbursing students with similar backgrounds that didnt finance college or did but paid off loans early is incredulous. There is no reason the solution to the price of college is to selectively bail out people that choose not to repay their student loans and ignore everyone else.
- gravypod 5y ago
  > And considering only bailing out student loans without a provision for reimbursing students with similar backgrounds that didnt finance college or did but paid off loans early is incredulous. There is no reason the solution to the price of college is to selectively bail out people that choose not to repay their student loans and ignore everyone else. This is a very crabs in a bucket mentality. From the perspective of a society we should ask: what is the effect of removing this debt burden? Many people are repaying loans at a very high monthly amount. My loans are currently >400/month. If that debt "poofed" I'd be spending that in my local economy (instead of going to a bank to then issue another student loan for). Much better for the economy.
  - hermannj314 5y ago
    Your reasoning has nothing at all to do with college, student loans, etc. Anyone that has any debt at all could also benefit from free money. People with no debt could also benefit from free money. Why should the government give you money to pay off your debt when for less administrative burden they could drop money out of a plane instead? Both would help the economy the same, so you haven't made it clear why people with student loans helping the economy and no one else is the antidote we've been missing.