5 ms·

Imagine if people tried to do that with their student loan debt.

by throwaway5959 4y ago

baggy_trough 4y ago
I imagine that if it worked, nobody would be able to get a student loan after that.
- CPLX 4y ago
  That’s not how anything works.
  - jojobas 4y ago
    At the very least, interest rates and selectivity would go way up. The current situation is basically the government saying "it's a net positive if everyone willing to do so learns something, however unsuitable they are and useless what they learn", by guaranteeing repayments for low income graduates.
    - Red_Leaves_Flyy 4y ago
      That’s an incredibly uncharitable take.
      - jojobas 4y ago
        Is it untrue though? Higher education used to be paid by the state for the brightest few, the rest just didn't have an option to pursue it. Some countries tried to forecast how many engineers/doctors they'd need and ensure there are enough state-paid spots in the respective schools, not sure if the US ever did that. Now it's pretty much available to anyone, you can bet your future income to your Egyptology study and the state still backs your loan in case you can't ever earn a decent wage. Unlike a medical bankruptcy it's not an accident that your studies aren't making you profit, unlike a home loan your knowledge can't be repossessed. You post-bankruptcy earnings would still benefit from your education, it's like keeping your collateral through the bankruptcy and then using it to earn money.
        Red_Leaves_Flyy 4y ago
        Got a point there or just complaints? Since there is no way to determine what fringe studies will become important it is beneficial to have as many people highly educated in as many disciplines as possible. State guaranteed education loans accomplished this. The same people also refused to address the perverse incentives opting to allow corruption, fraud, and waste to become endemic in higher education. Now I don’t want to be uncharitable, fraud, waste, and corruption are rampant across America and increases the closer one gets to vast hoards of wealth or cash.
  - refurb 4y ago
    Of course it does. Why do you think 20-something’s with no income or assets can get tens of thousands of unsecure debt at low interest rates? If suddenly it was easy to not pay it back, lenders simply wouldn’t let them borrow to begin with.
    - throwaway5959 4y ago
      So what did they do before 2005?
      - baggy_trough 4y ago
        It's always been difficult to discharge student loan debt in bankruptcy going back to the 1970s, and becoming increasingly strict with time. Before then, tuitions were much lower.
        naikrovek 4y ago
        i failed to get student loans because my mother still owed everything she borrowed for her student loans, plus interest. She never paid a cent and died owing that money. sometimes i am thankful for stupidity in the banking system. there is no way i could have sat still for 4 years at that point in my life. i have my father’s alcoholic rage to thank for not wanting to be at home, and preferring high school. at college the desire to leave home would have been met even if i didn’t attend class.
        chii 4y ago
        > She never paid a cent and died owing that money. and the taxpayer was hit with the liability of that debt, since the lenders are guaranteed by the gov't.
        naikrovek 4y ago
        yes, and how is that my fault? the only taxpayer that was directly affected was me, and I wasn't a taxpayer when the loan was issued.
- mullingitover 4y ago
  I think it's a game of chicken. The nation has a dire need for an educated workforce, but it knows that the workforce can't pay for the education with cash on hand. At the same time, those workers need education to get jobs with living wages. So we have this system of what amounts to a loose form of indentured servitude with onerous, inescapable debt burden. If that system of debt peonage were stripped away by legislation, I would wager that society would very quickly cobble together some scheme to continue receiving its supply of educated workers.
  - baggy_trough 4y ago
    Tuitions would have to be lowered by a gigantic proportion, which would hit the college administrations / bureaucrats very hard. Their interests are really at the heart of the student loan problem.
    - mullingitover 4y ago
      Not just administrators - expensive campuses and vanity college football programs (football is a solid money-loser for a firm majority of colleges, according to the NCAA[1]. This is especially apparent when you look at the highest-paid government employees - in nearly every state, it's a college football coach). [1] https://www.ncaa.org/sports/2019/11/12/finances-of-intercollegiate-athletics-database.aspx https://www.ncaa.org/sports/2019/11/12/finances-of-intercoll...
      - arlcode 4y ago
        From the outside that's just weird. One can argue that attracting scientists and teachers with high wages and expensive toys is beneficial for research and education but it's hard to see how "professional" sports teams factor into that. AFAIK in any country outside the US university sport teams are little more than hobby clubs for students and make do with little resources. Yet professional sports seem to be fine regardless. NFL Clubs for example should be able to build up their own youth departments and not outsource it to the public. Why would a university need a TV-ready football stadium for thousands of spectators with commercial exploitation of players? A "field", a few stands and a hot dog booth seems enough. Go sports team.
bradleyjg 4y ago
That doesn’t make sense. The plan was to pay the claims but to pay them using one bankruptcy court process, which is more streamlined and has no punitive damages, rather than many separate tort processes. How does that translate to student loans?
- throwaway5959 4y ago
  I incorporate myself before I become a student loan borrower.
  - bradleyjg 4y ago
    Still makes no sense. You might as well have said “imagine a beowulf cluster of these” or something about Natalie Portman and hot grits.
    - semiquaver 4y ago
      frist post
      - TedDoesntTalk 4y ago
        Nah man I was frist
    - throwaway5959 4y ago
      Great reply, thanks.
  - chii 4y ago
    Then the loans would be a much higher interest rate loan, and since the incorporated "student" does not have collateral to secure said loan against, i very much doubt that anyone would lend the money in the first place. Unless the gov't puts in a special guarantee to make the lender whole - aka, the current system. Aka, you cannot bankrupt yourself out of the loan.
- sangnoir 4y ago

Imagine if people tried to do that with their student loan debt.

baggy_trough 4y ago

I imagine that if it worked, nobody would be able to get a student loan after that.

CPLX 4y ago
That’s not how anything works.
- jojobas 4y ago
  At the very least, interest rates and selectivity would go way up. The current situation is basically the government saying "it's a net positive if everyone willing to do so learns something, however unsuitable they are and useless what they learn", by guaranteeing repayments for low income graduates.
  - Red_Leaves_Flyy 4y ago
    That’s an incredibly uncharitable take.
    - jojobas 4y ago
      Is it untrue though? Higher education used to be paid by the state for the brightest few, the rest just didn't have an option to pursue it. Some countries tried to forecast how many engineers/doctors they'd need and ensure there are enough state-paid spots in the respective schools, not sure if the US ever did that. Now it's pretty much available to anyone, you can bet your future income to your Egyptology study and the state still backs your loan in case you can't ever earn a decent wage. Unlike a medical bankruptcy it's not an accident that your studies aren't making you profit, unlike a home loan your knowledge can't be repossessed. You post-bankruptcy earnings would still benefit from your education, it's like keeping your collateral through the bankruptcy and then using it to earn money.
      - Red_Leaves_Flyy 4y ago
        Got a point there or just complaints? Since there is no way to determine what fringe studies will become important it is beneficial to have as many people highly educated in as many disciplines as possible. State guaranteed education loans accomplished this. The same people also refused to address the perverse incentives opting to allow corruption, fraud, and waste to become endemic in higher education. Now I don’t want to be uncharitable, fraud, waste, and corruption are rampant across America and increases the closer one gets to vast hoards of wealth or cash.
- refurb 4y ago
  Of course it does. Why do you think 20-something’s with no income or assets can get tens of thousands of unsecure debt at low interest rates? If suddenly it was easy to not pay it back, lenders simply wouldn’t let them borrow to begin with.
  - throwaway5959 4y ago
    So what did they do before 2005?
    - baggy_trough 4y ago
      It's always been difficult to discharge student loan debt in bankruptcy going back to the 1970s, and becoming increasingly strict with time. Before then, tuitions were much lower.
      - naikrovek 4y ago
        i failed to get student loans because my mother still owed everything she borrowed for her student loans, plus interest. She never paid a cent and died owing that money. sometimes i am thankful for stupidity in the banking system. there is no way i could have sat still for 4 years at that point in my life. i have my father’s alcoholic rage to thank for not wanting to be at home, and preferring high school. at college the desire to leave home would have been met even if i didn’t attend class.
        chii 4y ago
        > She never paid a cent and died owing that money. and the taxpayer was hit with the liability of that debt, since the lenders are guaranteed by the gov't.
        naikrovek 4y ago
        yes, and how is that my fault? the only taxpayer that was directly affected was me, and I wasn't a taxpayer when the loan was issued.
mullingitover 4y ago
I think it's a game of chicken. The nation has a dire need for an educated workforce, but it knows that the workforce can't pay for the education with cash on hand. At the same time, those workers need education to get jobs with living wages. So we have this system of what amounts to a loose form of indentured servitude with onerous, inescapable debt burden. If that system of debt peonage were stripped away by legislation, I would wager that society would very quickly cobble together some scheme to continue receiving its supply of educated workers.
- baggy_trough 4y ago
  Tuitions would have to be lowered by a gigantic proportion, which would hit the college administrations / bureaucrats very hard. Their interests are really at the heart of the student loan problem.
  - mullingitover 4y ago
    Not just administrators - expensive campuses and vanity college football programs (football is a solid money-loser for a firm majority of colleges, according to the NCAA[1]. This is especially apparent when you look at the highest-paid government employees - in nearly every state, it's a college football coach). [1] https://www.ncaa.org/sports/2019/11/12/finances-of-intercollegiate-athletics-database.aspx https://www.ncaa.org/sports/2019/11/12/finances-of-intercoll...
    - arlcode 4y ago
      From the outside that's just weird. One can argue that attracting scientists and teachers with high wages and expensive toys is beneficial for research and education but it's hard to see how "professional" sports teams factor into that. AFAIK in any country outside the US university sport teams are little more than hobby clubs for students and make do with little resources. Yet professional sports seem to be fine regardless. NFL Clubs for example should be able to build up their own youth departments and not outsource it to the public. Why would a university need a TV-ready football stadium for thousands of spectators with commercial exploitation of players? A "field", a few stands and a hot dog booth seems enough. Go sports team.

bradleyjg 4y ago

That doesn’t make sense. The plan was to pay the claims but to pay them using one bankruptcy court process, which is more streamlined and has no punitive damages, rather than many separate tort processes. How does that translate to student loans?

throwaway5959 4y ago
I incorporate myself before I become a student loan borrower.
- bradleyjg 4y ago
  Still makes no sense. You might as well have said “imagine a beowulf cluster of these” or something about Natalie Portman and hot grits.
  - semiquaver 4y ago
    frist post
    - TedDoesntTalk 4y ago
      Nah man I was frist
  - throwaway5959 4y ago
    Great reply, thanks.
- chii 4y ago
  Then the loans would be a much higher interest rate loan, and since the incorporated "student" does not have collateral to secure said loan against, i very much doubt that anyone would lend the money in the first place. Unless the gov't puts in a special guarantee to make the lender whole - aka, the current system. Aka, you cannot bankrupt yourself out of the loan.
sangnoir 4y ago