This would destroy not only my life but the future of my children. I am on idr for the last 10 years. I am within view of forgiveness through the pslf program (approximately 1 yr left). I pay $1300 a month in student loans. Without idr my payment would be $2500. A month. Someone please tell me how that is even remotely possible as a middle class earner! I came from modest means, went to state schools, worked as much as I could, have lived frugally, delayed buying a home, having children until I was financially stable enough to do so. We decided to move ahead with our life once Obama paved a way for us and we felt secure climbing the ladder of opportunity. That ladder is being ablaze from above and all these clueless GOP men say we are abusing these programs. I needed loans to subsidize my education, because I did not come from wealthy parents. But pursuing advanced degrees in this country gets you $250000 worth of student loans.
6
It's very easy to put an end to student loans.
Step 1 : split highschoolers in three thirds based on their house income.
Step 2 : ensure each third receives its fair share of public college seats, i.e. one third.
Step 3 : no scholarship fee for the lowest house house, half scholarship fee for the median house income, full scholarship fee for the top house income.
Pro : no student needs a loan to enter college
Cons : this will put an end to the middle class privilege
As a student loan borrower and now a re-payer, the problem is the interest. Some loans are at 2.3%, while others are as high as 6.8%. If you want to help get out of debt faster, give me a break on the interest rate. One plan I proposed to my local Congressman was to freeze a portion of the interest on my overall balance and permit me to pay a portion plus interest. Needless to say, it was shot down. Yet, during TARP major financial institutions paid the government back at next to 0% interest.
8
Don't worry. Failure to motivated citizens without burying them in debt they can't escape is being accomplished everywhere except the United States. Just look at China--boasting the most college grads in the world, students frequently enjoy free college education. You can quibble about the differences in quality and career outcomes, but like it or not, China is increasingly soaking up talent from all over the world as well, notably Africa, Asia, and Westerners who want to immerse themselves in Chinese language and business practices. They offered me a full-ride to a graduate medical engineering program at one of their top institutions. In the meantime, my American loans continue gathering interest while I struggle to make payments. So, don't worry--the future has already been ceded to China and other countries by our inability to take strong steps to provide for our people, as a people.
3
All purpose headline: 'Don't let the GOP dismantle...'
Just fill in the blanks. Consumer protection and financial regulation. Environmental standards and enforcement. The Department of Education. Affordable Care Act. Food stamp programs, arts funding, national parks. Medicare, Medicaid, Social Security. Unless it's expensive military hardware or roving bands of thugs rousting cooks, dishwashers, servers and busboys out of restaurant kitchens and tossing them into indefinite detention (at for profit detention centers),they're going to 'dismantle' until voters stop them.
They're busy little buggers... like termites chewing away at the social fabric, democratic institutions and the health, welfare and standard of living of 99% of the American population. Like parasitic worms.
6
I wonder if anyone ever looks at the big picture and thinks about how these people with crushing student loan debt will be able to save for retirement. There's the next big crisis looming - a generation or more of poverty-stricken seniors with insufficient savings to live on and no social security system left to support them.
9
Apparently the G.O.P. works for foreign governments, not the American people. Why is it they want to keep penalizing people who are trying to move up? Do they feel threatened? Most importantly, why are student loans NOT TIED TO THE PRIME RATE and are almost THE ONLY THING NOT COVERED IN BANKRUPTCY? This is neither a democracy, nor a republic. The United States is a plebiscite where the majority has no voice in government. You rack up tens of thousands in student loan debt only to enter an absurd economy where minimum wage is the new normal. How the bloody Hell can you be a consumer when you cannot afford rent, food, medical care, and student loan interest? I'm no economist, but these Republican Bozos are destroying this country piece by piece, and no sane person would want to live here after they've finished the job...
7
leave it to Republicans to do whatever they can to keep those uppity kids from getting an education and getting ahead. another Republican contribution to ever widening income gaps in furtherance of their plan to turn back the clock to the Middle Ages and the profitable serfdom economy. fie!
3
Republican here and I just got off the phone with Congresswoman Virginia Foxx' office that would not take my message because I am not a constituient in her district. I may not be, but do you know what I am Congresswoman?? I am a federal taxpayer that pays actual income tax, which is used to support all the losers in your district who under 65 yrs of age and have been grifting off the system via Disability and Medicare as a way of life. I am also someone who along with paying a mortgage, providing for a family like most other Americans, works, pays my debts and thanks God everyday for the income driven repayment plan that helps reduce the graduate loan debt so I can still live and provide for my family. How dare you Congresswoman, whom has a PhD reduce opportunity for low income people to get advanced degrees so they can get better jobs to provide for all the Disability and meth head losers in your district that haven't worked in years. Want to save taxpayers money? Start cracking down on the millions of rural folks under 65 yrs of age who use government entitlements as a salary instead of working. I resent the arrogance. And I am a Republican.
5
why? shouldn't students get gouged by capitalism - like everyone else - it will build character.
1
Yes, let's layer on even more moral hazard. I suppose if you believe college should be "free" (someone IS paying) it makes perfect sense. But how many more millions of our young people are we going to bamboozle with the sadly mistaken idea that a degree in bitterness studies from some third rate "university" is the key to a golden future?
4
Presumably you like driving on roads? Going to the dentist? You do know that the people whom provide these services YOU need attend college? I’m sorry you’ve convinced yourself that students aren’t actively learning valuable skills. Or that it is only possible to live in a thriving community when we see one another as integral to the whole. I’m sorry that you don’t recognize that it is YOU whom will be hurt by the shrinking of our tax base, our economy, and our shared future by failing to invest in and value our fellow community members.
Do we really want EVERYONE to go into banking? Or would we like some rural doctors or some teachers whom can afford to get the educations they need without having to exploit people in order to earn enough to pay back the costs of their loans?
So many disgruntled angry people who direct their ire at the wrong people. Blaming the victims of those whom rigged our society to be unfair, unjust and unsustainable. We are truly the only developed nation that behaves this way. These lenders turn into rentiers whom provide little value and hamper those they are supposed to be aiding. If you borrow money, the terms by which you repay it shouldn’t be allowed to be changed after-the-fact. They borrowed money to better themselves. That shouldn’t obligate them for the rest of their lives. It certainly doesn’t serve us as citizens in any way for this to be the case.
4
Perhaps we should stop calling the Republican party G.O.P. which stands for Grand Old Party, a name given to them many years ago, when they might have been "Grand".
Today, they could be called the S.O.P.
and you can use your imagination as to what the letter "S" stand for!
2
REPAYE is heaven-sent when illness strikes a young college graduate. It's been a tremendous relief to our family to know our son could set aside the worry of default while he recovers, adjusts to a new normal, and prepares to re-enter the workforce with challenges he never dreamed of facing when he graduated. Please, stand with young people as they negotiate all that life throws at them while shouldering historic levels of debt.
11
The access to federally backed money has blown up a huge bubble in higher ed. Universities are in the end subject to the same empire building instincts for expansion to the limits as are all human institutions. It has become a racket. In the final analysis, the only solution is to accept the pain of ceasing the things that dug the hole: generous access to public backed loans and excessive unnecessary credentialism in employment. If this is done, the bubble will break, some schools will go under, and the cost of learning Boyle’s Law will stop escalating at three times the rate of inflation.
4
It's very progressive which I like but it also makes very little sense. And is basically a huge subsidy for really expensive private colleges. Maybe they should change it so it only applies to the amount of debt that would have been accrued at a typical state college paying the in-state rate.
9
Graduate students are not the students who are struggling to pay back their loans.” From a burden sharing perspective, graduate and professional education degrees are almost always worth their cost. Moreover, since the lifetime earnings of students with graduate and professional degrees average 2-4 times that of high school graduates with no postsecondary education, these students, in particular, should not be looking to their neighbors (70% of whom do not have a college degree), to shoulder their self-created student loan burdens. Since nearly 92% of traditional graduate and professional students are successfully managing their federal and private student loans, where is the proverbial “disturbance in the force” that validates a rational need for continuing federal intervention in the graduate and professional student loan market? The imperfections in the graduate and professional student loan market that would constitute the only legitimate reason why government should intervene in this market simply do not exist.
1
The whole concept of a student loan program is upside down. America needs to be investing in education up front, not shackling people to mountains of debt, then maybe forgiving some of it at the back end if their careers weren't high income.
To be competitive, our economy requires an educated workforce with skill sets that enable people to adapt as the marketplace evolves. To be effective, our political system requires an educated citizenry with the historical and scientific perspective, the understanding of government, and the skills of analysis necessary to evaluate complex issues, dissect divergent opinions, and make informed choices. An educated population also has lower health care costs. Etc.
In the early 19th century, this country lead the world by making secondary as well as elementary school free, recognizing the societal benefits of an educated citizenry. This was revolutionary. However, even though our society and economy have become vastly more complex, now we have been passed by just about every developed country: they have recognized that post-secondary education is essential and therefore must be a public good, publicly funded.
What people with post-secondary certifications and degrees contribute to the economy through taxes paid and economic self-sufficiency should more than offset the public's investment in their education. Paying for post-secondary education is a minimal investment in our nation's future success.
10
We live in a country that tells people that they need a college degree to be a $ 12/hr bank teller. The problem is that overwhelming amount of profits flow to tiny percentage of owners and investors at workers expense. Do some live beyond their means or have useless majors ? Sure
But that’s not the primary problem. Being forced to take out equivalent of a home mortgage to get even a below average job is
6
People are being suckered into it, not forced.
This is insane stupidity. Will the GOP be establishing debtors' prisons as well with this bill? Because you will have made millions of Americans essentially indentured servants. No surprise though... it is in their best interest
and their goal to have an illiterate populace. I can't wait to be an indentured servant or better yet a serf, wonder what Trump family member I'll be assigned to.
5
Get a passport before having student loan debt keeps you from being able to exit the asylum...
We need to exterminate this foolish idea that it is okay to continually attend school as a full-time job, paying for it by rolling over loan after loan with no end-game. It is essentially giving the green light to these to never conduct original work, just walk on a treadmill on the government dime. Doctors are done in less time and less money than journalists and general-studies majors.
5
The student debt problem is a direct result of University administrators raising the cost of college education by an obscene amount.
The cost of college was $8,000 a year in 1980 & is now $65,000.
No one will lend that type of money to someone on an uncollateralized basis.
The Nationalization of student debt is $1 Trillion Dollars and US tax payers will be forced by default bail these delinquents out.
The Government has to limit the amount that an individual can borrow per year to $15,000.
If not US tax payers are essentially providing free college education to the delinquents.
But, this is what the liberal Big Government, Academia & media wanted to do all along !!!
Thanks Liberals! We already pay obscene taxes & are now on the hook for student debt & the debt continues to grow exponentially!
This is the reality.
7
This is an ingenious tactic of Secretary DeVos, the Republicans, and President Trump to solve the intellectual property issue with China.
The more burdensome that they make student loans, the more likely that there will be fewer graduates to create intellectual property. When the US creates less intellectual property (patents, etc.), there will be less intellectual property for China to steal. Therefore, intellectual property theft by China will go way down.
Republican problem-solving--ya gotta love it!
MSGA! (Make America Gag Again!)
3
Students and recent graduates would have done themselves (and everyone else) a huge favor if they had bothered to get off social media or out of bed in 2016 and actually voted for a candidate who (while not promising Utopia) had a plan to improve the student debt situation. Off course they either decided to stay on Facebook or in bed or vote for a candidate promising Utopia. Hopefully there was a lesson learned in that but given the record of students voting, I doubt that will happen.
3
No...the students are geniuses !
They can go to college by borrowing money from the Big Government and then simply not pay it back!!
What could be better for the students then to simply leave US Tax payers picking up the tab !!!
Everything Republicans do is to line the pockets of their paymasters even if it is at a great cost to the economy. They are myopic and mean spirited in their policies. Millennials are already delaying or forgoing purchasing houses due in large part to burdensome student death. This will invariably negatively effect the real estate market for decades. Instead of making it easier for students to borrow for higher education they want to turn it into a profit center for their cronies or to offset the enormous increases they have just added to the deficit to benefit the one percent. This pleases their base as college graduates are “elites” so give them a good kick. Never mind that these are also the people who are the backbone of the economy and drive much of the spending. Go ahead and undo all the good Obama did to shore up the economy destroyed the last time Republicans had the White House. But realize this: it will all come back to harm the economy as a whole. After a few more years of these policy reversals we will be back in a recession.
6
Liberals are crazy !
The solution is what California just announced for Medical Care.
The Government should simply limit college costs to $15,000 per year.
Tuition and Room & Board !
What will the liberal academia say then ???
2
Sorry to break it to you, but if student loan reforms are in any fashion precluding BIG business from getting BIGGER and RICHER...this GOP Congress will consider it a nuisance whose continued existence endangers the trust funds of the wealthy. The day for expecting the GOP to put country before party and think about something, anything, other than the wealthy is in the distant past. If this GOP was played in the theaters as a psychological-thriller...we wouldn’t believe people could be so misguided, aloof and evil.
5
Everyone seems to have forgotten the GI Bill. My father went to Berkley for free. He also received free housing and $99 a month for living expenses (with a wife and child). But I guess this was back when a well educated populace was considered a good thing. Even when I was in high school in the 70's, the California state system was $77 per semester. Again, this was when California was the jewel of education. Now far less money is given by the state to keep tuition costs down. We can go back to affordable college--it just depends on the priorities of our society and our government.
8
the priority was Prop 13, guaranteeing penury for the state. it was deemed much more important to protect aging property owners from paying taxes on the appreciating value of real estate than to maintain and expand infrastructure... including an increasingly educated population. a destructive policy that looked only backward.
the very definition of penny wise and pound foolish, and even today when we're doing well, we skate on thin ice, just a financial shake away from sliding back into catastrophe.
2
He hardly went for "free" if he was on the GI Bill. He earned that money the hard way.
1
The idea that financial institutions make a profit off young people trying to get an education is reprehensible. All student loans should be government-backed because the government can change the terms of the amount of loan payments if the economy tanks and people have no money.
2
The author claims that the student loan program "could still net as much as $50 billion for taxpayers." In fact, the Congressional Budget Office estimates that the loan program will likely cost taxpayers $170 billion over the next decade. This is appalling.
I sympathize with students, especially as states have taken the absurd action of slashing funding for public universities (this is probably the worst "investment" decision that a state government could make with its tax revenue).
But the answer to this problem is not to incentivize people to ignore education cost. The average university has become a bloated administrative bureaucracy, and fiscal discipline is necessary. The states have gone too far in slashing aid to universities, but private higher ed needs to do much more to contain costs or to justify their costs... which they know they can't.
4
College has gotten incredibly expensive in the US. I think we should be investing more in our students it will help everyone in the long run.
1
Or we could give everyone a course in Econ 101 which will teach them that as long as loans are available, costs will spike.
3
Why not talk about the profit that lenders (e.g., the federal government and taxpayers) get due to onerous interest rates? My monthly payment is entirely interest. Research has shown that high student debt is a drag on entire economies. But then, this country is headed down a path where "wealth" is the only thing of value, and even more valuable is inherited wealth.
5
Onerous interest rates ?? Are you serious.
In the real world the rate of interest needs to ALSO cover the defaults of principal!!
3
In 1987, the avg inflation-adjusted cost of tuition and fees at a 4-year private college was $15,160. Today, it is $34,740. Public school tuition is usually about half that.
That means that in 1987, a poor student at a public university could work his or her way through college with little to no debt. And a poor student at a private college could get through with very manageable debt.
Today's student loan problem is really a cost of college problem. And the high costs of college are driven almost entirely by federal student loans. The solution is not to make it less painful for students to pay back super-high loans (that they accepted of their own free will, by the way). The solution is to stop funding these inflated college prices.
6
I agree wholeheartedly with your frustration over college tuition, but until there is a reasonable solution in place to allow people to make a better life for themselves without paying college tuition (apprenticeships, more diverse trade schools), it simply won't happen. College education is essentially a monopoly.
And until we can break it, the solution is not telling a whole economic class of people they cannot pursue post-secondary education because they don't have the capital. That will simply divide our country even more...
1
Tuition costs rise in proportion to the availability of grants. This is how universities and lenders profit at the expense of the student. The need is to address all these issues at the same time: penalize the universities for extortionate tuition, criminalize predatory lending, devise some form of reasonable loan repayment schedule while closing the loopholes that allow some students to game the system (by attending schools they cannot afford, and by planning to never repay). It is possible to do all these things, but takes investment.
4
"Tuition costs rise in proportion to the availability of grants." You've nailed the cause. But I disagree with your solutions. The solutions are much simpler. Simply begin the process of getting the fed out of the student loan process.
If the fed draws back, colleges will be forced to back student loans themselves, and they will in turn be forced to both (1) lower their prices, and (2) tie the loans to an ability to repay them (which for students with no collateral, means taking courses likely to lead to high paying jobs).
Sometimes the answer really is to reduce the government's involvement in something.
4
I think that expecting a voluntary "trickle down" lowering of tuition cost is optimistic. What will happen under this scenario is further restrictions to middle class access to college while incentivizing the universities to double down on the myriad affirmative action programs that provide access to the favored minority du jour - at the expense of everyone else.
Responding to "Econ191" from Dallas: what makes you think getting the government out of student loans would make colleges take on the loan risk? What would really happen is we go back to how things were before: a separate, highly privatized loan industry. Tuition stays high but we'd have higher rates for students and more predatory lending practices.
These private lenders would be a drag on our economy by skimming off of - and holding back - the most promising new prospects joining our economy each year.
2
The real solution to the student debt problem is to STOP.
Making these loan programs less onerous is not going to help much. The main problem is that they are indentured servitude, debts that cannot be dismissed. The structure and execution of these loan programs is shameful. Those responsible for them should be embarrassed.
Trapping students in debt for most of their adult lives deprives these citizens of much of the benefit of their education, the best path from working to middle class mobility.
The pigs feeding at the student loan trough include bond holders and the education industry that wants to monetize the college graduates into a stream of payments. This is the path to Third World status.
5
Sending your children to a competitive college in the U.K or Canada has never seemed more attractive!
3
More doubling down on what doesn't work. Regardless of the finances any program that aims to get even more people involved in the college scam should be canceled. Academics are for those who can benefit from them, which is 15% of the population at best. The rest of the college intake are just looking for a four year extension to high school, with all the pernicious social vibes that go with it. How can you justify any system that leaves 50% of its participants with a huge debt and nothing to show for it?
4
In my opinion these types of loan modification programs discourage rather that encourage students to pay back their loans and set a bad example for future borrowing.
I know from the experience of guaranteeing student loans for my daughter that as a father it is disheartening to hear from one's own daughter that "I don't have to pay back these loans, nobody else does." These programs encourage students to run up big bills and then take advantage of lenient repayment programs or to default. Students need to plan to take courses that will allow them to get a good job after graduation and give them the ability to repay a loan rather than the attitude the government and ultimately taxpayers owe me a free ride.
6
We need government mandated transparency in private and public undergraduate and graduate education. How much do your classmates really pay in tuition and fees net of all “deals”. High. Low and averages. A nice easy to read weighted distribution. What does it cost to run the undergraduate and graduate program(s) with and without bloated administrative overhead.
Lastly real hiring results for graduates by program. With actual compensation packages for the first year. High, low and averages. A nice weighted distribution. You get the idea.
This isn’t very difficult to do and should be mandated by law. The education industry is getting away with fraud in many many cases. If they can’t produce these figures they should lose accreditation and close shop.
Kevin
1
Here's an idea since the GOP desperately needs the juice on these loans. Drop all student loans to 0.9% (like a new car) and give people a CHANCE to pay them off. That, plus the income-driven payment would be very effective. Unless the goal is for former students to pay until they die?
6
The goal of the new one per centers and their lackeys is to keep the majority uneducated . They can then control the masses much easier. It’s happening already. Look at the majority of knownothings who vote on their emotions. Facts and history means nothing to these people.
2
Dismantling IBR for existing repayers would be nothing short of a financial disaster for countless people (and the economy). And for what public benefit?
6
This is just another example of the GOPs plan to keep the masses uneducated. And as we know, the ignorant and uneducated vote for the GOP.
3
We should be doing more to help struggling Americans with their college/university debt load not less. And I say this as an old codger with two daughters who, fortunately, have modest student debt.
The problem is that most Americans don't know about the Obama administration financial aid reforms, and an uninformed electorate has always benefitted the GOP. Let's hope the GOP effort to increase the financial burden of college on ordinary Americans fails in the Senate.
2
"The old system included big government subsidies to private lenders."
Taxpayer alert: Every time you hear the phrase "public-private partnership", reach for your wallet. You are about to get heisted.
The old system sounds vaguely familiar. The taxpayer provides subsidies to take care of losses and defaults. The profits go to the well connected members of the investor class in the private sector.
Socialism for the rich. Capitalism for the rest of us.
2
Taxpayers remain on the hook so students can attend overpriced schools where tuition has greatly exceeded inflation for decades. Students receive nondischargeable debt and a degree that is not a guarantee of a better life. The majority do not benefit from this arrangement.
Remember, these schools are tax-exempt under the theory that they benefit the general public. Their exclusionary admission policies show otherwise.
If a school takes federal money, it should be open to all students who can complete the work (no application necessary). Make the courses available online with the same materials for everyone, but at a fraction of the cost (the cost neccessary to pay TAs to grade).
The real losers in this scenario are the Harvards of the world who lose their exclusivity. The winners are anyone who can perform at the same level. Based on my experience, there would be many more winners than losers.
4
Student loans should be at 2% interest, max.
4
Unfortunately dismantling everything that Obama accomplished is a fetish of Trump's and supported by the feckless Republicans in Congress. The former Steve Bannon had an even greater agenda to deconstruct government at every level. Thus we have in every agency and every cabinet post Trump-appointed directors who abhor the missions of those same agencies and departments and are doing everything possible to reverse any progress we have made in the past 200 years. Trashing of student loan programs is sadly just the tip of the iceberg.
4
I understand the need to support higher education, but Mr Brooks' blatantly misleading comments corrupts the integrity of his argument. "And most of this cost is just lost interest — the government anticipates that it will still get back more than it lends to these borrowers" So why not lend $100,000 to everyone at age 21. Put it into an investment account in their name at say 6 % annual return that is given to them at age 66. They could then take $1.4 million dollors, and give back the $100,000 with a small 'profit' for the government. No need for Social Security, a giant savings for taxpayers ! This of course is ridiculous.
3
The statement in this article that higher education remains a good investment for most students is simply not true today. That is a very dangerous assumption for the author to make. I have three twenty-something children and they all are struggling terribly to pay back their student loans. One of them wasn’t even able to finish college but still amassed $40,000 in student loans for which he is ill-equipped to pay. Colleges & Universities have raised tuition prices through the roof in the past 20 years because of that ‘college is necessary’ truism which isn’t really true. It is truly sad that in the 21st century in the wealthiest country in the world, education is not free to all. Instead, just like healthcare, it has been monetized and systemized in order to enrich only the wealthiest citizens.
6
I'm a teacher in a poor school.
I tell my students that if the degree does not require multiple math classes and if they are not willing to work hard enough to finish in the top 10% of their college class for that rigorous degree, they're better off not taking on debt.
I tell them to pay as they go or start their own business.
1
Removing the IBR program simply can't happen. It will destroy the next generation of students.
Both my wife and I worked throughout our college tenure, and we still came out with debt.
Both my wife and I work now, and we are still in debt. We will be for at least another 10 years.
Why? Housing is expensive, schooling is expensive, daycare is expensive. Jobs appear to pay well, but in order to receive that paycheck you need... schooling, daycare, and housing.
As a middle-class young American, you are stuck between a rock and hard place: would you like to not go to college and be relatively poor because you don't receive a decent wage, or would you like to go to college and be relatively poor because you are saddled with student debt?
The IBR program is our government's (and by extension, our society's) way of minimizing the effects of the latter.
If our society will continue to make it a necessity to go to college to receive decent jobs, our society must continue to help the next generation mitigate the cost of that training.
2
Does this mean they are planning on reneging on the terms that were already set up or is this going forward? It is a cruel breach of trust to promise to forgive loans and then not do it. I have been working and paying loans for 15 years. Still owe a bunch. I didn't create the system that allowed tuition to go up so high and wages to go so low. Please don't make me the boogeyman. If my payment goes up higher, I seriously could lose my house. This isn't a matter of doing what's right or scrimping. I have scrimped to pay off credit debt, so I know what I am talking about.
3
When I graduated college in 1999, I was promised a wide-open field of high paying jobs. This did not happen! In the 2 decades since, my generation has seen rising unemployment after 9/11 and the wars (not mention we are the ones who had to fight them), then the great recession. This is all while Baby Boomers have stayed in jobs longer, wages have stagnated, and prices have risen higher and higher. The 2% raises I have received in a few years of working private companies have not done much to help with this. That's why I am still paying student loans a million years after college.
3
Lamar Alexander's statement that it is becoming “standard” for students to expect their debt to be forgiven is, sadly, accurate. It is part of the way universities market themselves. Especially graduate programs in historically low-paying fields like social work. The well-known private university where my daughter got her MSW has been telling prospective students for years, in effect, not to worry about the sticker price and those huge loans, because they most likely won't have to pay it all back. This is no secret; various versions of this message have been on their website for several years.
However, making loans more burdensome does not solve the problem. It might shift some students from social work and teaching into finance and law. Great, but then don't complain that we don't have enough good teachers and social workers and librarians.
Instead, we need a path toward reducing or eliminating unnecessary educational credential requirements for many occupations, and/or allowing relevant work experience to substitute for credits, and/or incentivizing universities to reduce costs.
3
It seems like the immense student debt is caused by student attending expensive schools, in many cases for careers that don’t pay enough to justify the debt.
The concept of cost /benefit analysis should be taught in high school using colleges and trade schools as an example. They can also be taught to research what careers really pay. They can learn the useful fact that people who have skin in the game may lie to you.
In addition, student loan contracts should mention annual college costs as well as potential debt repayment costs on debt accumulated so far. (that will increase every year) and based on Handbook of Occupational Outlook, the potential salary range. It doesn’t have to actually be in contract, it can be an information sheet in consumer friendly language. It would b signed by the college, student, parents if necessary and loan issuer. This is not complicated, everything is computerized. If the college enters inaccurate pay info, they can now be sued.
College departments offering majors in poorly paying fields might lower their tuition for those areas. I
2
I have taken on a substantial amount of student loan debt and without the IBR program (as it stands) my future is bleak. From the pool of IBR recipients I know, the story will be the same for them too. The people I know are public servants in various fields. We are the people who take care of your parents when they get sick. We provide primary care services to the underserved. We spend extra time with your children at school when they are struggling with math and english. We work 50-70 hours a week and are not paid high salaries, but love what we do. We value community service and paying it forward so future generations have a better life than we do now. Rather than blaming and shaming, I hope members of congress will reach out to the people for whom this program is serving well and get to know us. We are smart, driven, and responsible citizens. If IBR is dismantled, you not only destroy our future, but will also remove life-saving safety nets for all of the people we serve.
2
Let's invest in our children and our future and stop investing in wars, increasing spending for military and regime change abroad. Even Iraq and Syria have free higher education with merit based admission.
2
This program is perhaps the largest contributor to the runaway cost of a college education. Students and parents are pitched half million dollar degrees with the empty promise of minimal repayment and loan forgiveness. The groundskeeper at the public pool has a masters degree in something but is trapped working for twelve dollars an hour until their loan is forgiven. Democrats still believe in slavery by any means possible.
4
The IDR is not a scam and was created to help students who have just graduated to help pay back what they borrowed. People tend to forget that May brings out thousands of new employees, many of which don’t get that high paying job. It is important to give these new employees breathing time to get established. Keep in mind that student loans become payable six months after graduation when they are just starting a new job. The statistics point out that the majority of students pay back their loans. They idea that they are getting something for nothing is an insult. Congress needs to read up on the programs they want to eliminate before they act. This is one program that needs to stay on the books.
3
It is the loan forgiveness program coupled with IBR that generates a problem. New graduates with excessive debt engage in a program of minimal payments, accruing more interest, in a gamble that they can cross a finish line of loan forgiveness.
1
I have a suggestion: let's fix the underlying problem BEFORE we start creating programs for people to avoid their loan obligations.
The underlying problem is this: the federal student loan program separates loans from the ability to pay them back. That has resulted in 40 years of students taking loans of whatever amount they need to pay for whatever classes they want, at whatever price the colleges choose to charge for them. And, surprise, surprise, that has resulted in the costs of college skyrocketing.
Anyone notice how much this student loan default problem is centered around millennials? It is because earlier generations didn't have to take out such huge loans to pay for college, or any loans at all. Maybe ... just maybe ... we should stop feeding the problem rather than continue to increase its portion sizes.
5
It astounds me that supposedly educated people can’t grasp that federal loan availability DIRECTLY caused a giant spike in college costs.
This is not some obscure branch of Newtonian physics; it is timed-tested, heavily researched, proven beyond a shadow of a doubt reality. Yank the loans and after 1 semester of empty seats, college costs will plummet.
I seriously wonder what the Ivies teach.
9
It is obscene that we give tax cuts to billionaires and corporations that will increase the deficit by trillions --with no strings attached and let the banks, we bailed out with no strings attached, borrow money at almost zero interest. Then charge students higher interest on loans needed to get an education to become the taxpayers we need to sustain this system. Repeal the tax cuts and expand the Obama adminstration's efforts on student loans.
4
EPMD: See my responses:
"It is obscene that we give tax cuts to billionaires and corporations that will increase the deficit by trillions --with no strings attached" -- It is not insane. The tax cuts mean the job creators have more money to spend on capital projects, adding employees, raising wages, cutting the costs of goods, etc. Any companies that simply pad their own pockets will be at a competitive disadvantage.
"It is insane to ... let the banks, we bailed out with no strings attached, borrow money at almost zero interest." -- I think we should have broken up the big banks. But having not done so, this policy made perfect sense because it allowed the banks to cut interest rates on loans to private citizens (including mortgage rates), which allowed the housing market to rebound and added much needed capital to the post-recession economy. It also lowered student loan interest rates.
"Then charge students higher interest on loans needed to get an education to become the taxpayers we need to sustain this system." -- Who is charging students higher interest rates than what they agreed to pay when they took the loans? This is not happening.
If you were to factor in the benefits to society of the additional education that results from this program you would surely see substantial return on investment.
Cutting back on this program would be just another example of "your tax savings at work", meaning yet another way for rich people to stay rich by maintaining low taxes for themselves, despite foregone benefits. It is unfortunate that to Trump and his hacks, this is a "win".
First, the loan forgiveness program does not result any "additional education" -- it is aimed at people who have already completed their education.
Second, to the extent is encourages new students to take out bigger and bigger loans on the hope that the government will bail them out -- something it almost certainly does -- it still does not result in any better education. It only results in more expensive education. It allows colleges to charge as much for an education degree as a medical degree. It funds ever-improvement academic facilities, dorms, athletic facilities, etc. It funds higher salaries for professors who spend more time writing books and less time teaching.
4
The Democratic Party's tolerance for undocumented workers has lowered wages for the country's lower income citizens and legal immigrants.
So for the sake of consistency, why not open the floodgates to allow for an increased labour pool for university and college instructors?
With increased competition, the universities and colleges will be able to hire teachers for fewer wages and benefits. The savings would be passed on to lower the tuition rates for students.
1
This sort of loan forgiveness is bad in two respects:
1. It forces taxpayers to fund other citizens' bad economic decisions and failures to accept personal responsibility for those decisions.
2. It ignores and exacerbates the underlying problem, which is that government funded loans result in over-priced educations. Higher education was not always this expensive. College students of all economic means used to be able to work their way through college and avoid taking out any loans at all. But after 40 years of the federal student loan program enabling students to fund annual tuition increases of more than double the inflation rate, college is unaffordable to almost everyone without at least some student loans.
This is insanity. When are we going to finally start cutting off the source of the madness - federal funding - rather than continue to feed it and expect better results for students?
4
Having a college professor touting student loans is like asking your realtor if mortgages are a good idea.
8
"Don't let"
As if American voters have any power to "not let" our "elected officials" do anything.
Should I call or write my "congressman?"
How many crooks in Washington went to Georgetown? How many had this professor?
Just go ahead and perpetuate the myth of democracy.
1
The American Dream now appears to be Perpetual Debt in order to permanently enable the wealthy. The so called Prosper bill smacks of the false religion known as the Prosperity gospel.
3
Many of us already work 2jobs(6-7days a week) for a decade or two. Even re-join the military(includes two overseas tours- total 5deployments) which in my case didn't contribute one penny to my debt. So I had to start over again. Been working since I was 17years old NONSTOP!!!!! ...probably be paying for it from my Social Security check.
Before you judge HARD WORKING PEOPLE ...please know all the facts. Stop criticizing if you Don't Fully Understand what you're talking about.
2
"Estimates vary, but the Department of Education puts the cost for all loans outstanding at about $36 billion."
I'm wondering where the $36 billion figure comes from. This report puts the subsidy for a single year's loans (2015) at $11 billion:
https://www2.ed.gov/about/offices/list/oig/auditreports/fy2018/a09q0003.pdf
I am not an actuary so I can't extrapolate from a single year's loans to the entire projected amount of loans over multiple years, but surely the number for all years will substantially exceed $36 billion.
The author misses another point. The skyrocketing cost of attending college is driven by government subsidies. Debt forgiveness is another subsidy, so it is not clear at all that government subsides reduce the net cost of attending college (just like the mortgage interest deduction, by driving up the cost of homes, does not reduce the net cost of purchasing a home).
We need bigger thinkers. You don't just throw good money after bad and pretend that the college cost problem is solved.
3
I'm all for supporting subsidies for lower-income students.
The problem with the prior system (i.e. private loans) is that it allowed colleges to get fat and happy. Schools simply raised their 'costs' and 'tuition' in line with the amount of monies available, then play the cynical game of saying they 'give' support to kids.
My Ivy alma mater sits on a $5 BILLION endowment, then has the nerve to ask me for money to support their grossly inflated 'tuition'.
This is a problem with our education system at large.
Better for the government to INSIST that colleges provide REDUCED tuitions for subsidized students, or receive ZERO public funds whatsoever, whether through grants or student loan support. That single change would turn around this insane tuition explosion.
4
This is a very tricky situation. Just to name a few sticky points, why should loans have been made in the first place to pay for schooling at expensive private institutions for degrees that would never have allowed students to earn what they needed to pay these loans back? Why should loans be forgiven for students who come from families of sufficient means to pay the loans back should the student choose to take a low paying job? Why should schools be off the hook having seduced students into educations student could not afford? And finally, why should poor students have to pay at all if higher education is the means out of poverty and is alleged to put them on the road to pay it forward in the form of tax revenue to State and Federal governments? There is no "one size fits all" solution here, so we have to decide if we will help the many and at the same time reward the undeserving few while letting the real culprits off the hook.
1
If market forces instead of gov't interference were to set college tuition, salaries at Georgetown would be a lot lower and folks like Mr. Brooks would be more fairly compensated.
2
I am always intrigued by the euphemisms the GOP uses to label legislation that is aimed to harm people - like the Prosper Act and Right to Work or the disastrous healthcare bill called the Choice Act. If the politicians act like this, then people bear full and total responsibility of blame by keeping them in office. Lets get out our echo chambers and for once do good to our kids and grandkids. Investing in people is the best way to lead our society to future greatness, not just making only a handful great. That does not give us America, that gives us... you know there are many countries like that.
2
My daughter has an income driven repayment plan, works at a non-profit municipal museum, is married to a teacher (with a similar repayment plan) and is the mother of a preschooler. I've done the math. If she keeps paying at the current rate until the loan is forgiven (25 years), she will have paid the government more than twice the amount of her original loan. The government will have lost only a portion of the interest originally set at 6%, (higher than mortgage interest on a home). These debts should not be regarded primarily as a source of revenue to the government but rather as a fair-minded support for striving Americans. And keep in mind that these plans require students to repay their debts plus interest, just less interest than called for by the original obligation. Graduates in low-paying jobs, especially jobs that serve the community, should not be unfairly burdened throughout their adult lives because they sought to better themselves through education. Instead of giving a financial break to corporations, why not give a financial break to educated Americans working in low-paying careers. Republicans looking to dismantle this program should spend some time looking at how the repayment programs support the growth and success of Americans who make significant contributions to our society through their low paying jobs, rather than looking for more ways to get the biggest financial return from those struggling at the low end of our current economy.
10
This is almost exactly my husband’s and my situation.
Interesting editorial. However ,I am finding it hard to reconcile "Even if income-driven repayment did erase the loan program’s profit margin, would that be such a bad thing?" with "Reinvesting the loan program’s profits in relief for struggling borrowers pays both financial and social dividends." I don't understand how no longer making a government profit allows for reinvesting the profits?
3
The GOP thrives on an uneducated -- thus malleable, prone to superstition and "gut" calculus -- electorate. Anything, be it starving K-12 or discouraging young people from attending college by making it financially disastrous, that's grist for their mill.
3
Republicans don't want an educated population, it works against them retaining power.
4
The GOP is consciously trying to discourage higher ed and dumb down the electorate.
It is much, much, much easier to con uneducated people.
This administration, with the help of the state propaganda machine called Fox, has even branded critical thinking and knowledge itself as "elite" mannerisms.
To date we have - a whole generation so saddled with debt that they can't participate in building their lives ( buy a car; get married; buy a house); recent unprecedented tax cuts for the Uber-wealthy at the expense of things like education; the appointment of an ill-qualified, foolish idealogue (De Vos);
And, alas, a POTUS who really did say, while on the campaign:
"I love the uneducated."
Who needs voter suppression when you have an uninformed, ginned up electorate that believes whatever toxic snake oil Faux News is selling.
3
Making higher education prohibitively expensive is one of the dumbest thing we can do. In truth, given the eventual return in productivity and creativity many times over the initial costs, higher education should be free if not paid for all (look at illuminated countries like Finland). Just don't expect any reprieve from a closed-minded republican party, usually anti-science, and certainly too arrogantly ignorant to admit that climate change is not a Trumpian hoax, a real menace instead, in spite of the empiric evidence biting their 'behinds'.
1
Starting life in your twenties in debt for tens of thousands of dollars is stupid. The students and the parents that co-sign these loans need to get smart that this is a huge scam that sets them back financially by decades.
2
This is "How to build an Idiocracy 101": save the 1% on taxes by forcing America's best and brightest to take out so many loans that they would be better off in menial-wage jobs, thereby making room in the Ivy League, the executive washroom, and politics for the idiot children of the 1%, thus perpetuating the cycle. Mission accomplished. (dusts hands like Pontus Pilate)
2
I am paying back my loads in the regular schedule, but the callousness displayed here in some of the comments is very disheartening. It shows an attitude of 'I got mine'. I have a very significant amount of debt, but was able to consolidate when interest rates were low. Students today are saddled with at least double the interest rate. These programs allow young people to start their lives and I am more than happy to contribute.
These uncharitable views illustrate our lack of shared responsibility for the larger values and benefits to our country and fellow citizens. I teach college and feel bad that my students have to go out into such an unforgiving and screwed up world. Maybe young people should feel like contributing to Social Security while they are young is 'stealing' their money and that older people should have planned better, since this reflects the same thinking.
We all benefit by having an educated population and please spare me the university as 'liberal brainwashing' since most colleges prepare students for careers in their region in fields like communication, business and other job oriented areas.
2
An educated and informed citizenry is what the nation's founders said was needed for a well run and thriving nation. They were visionaries and correct. Congressional Republicans and their puppet masters (wealthy donors - Betsy DeVos, for example) prefer a dumbed-down citizenry that does not know what critical thinking is and will get their simple minded "education" free from Fox "News" - just like our current President does. If FOX education is good enough for trump it's good enough for the American people, especially the young.
Cutting funding for education in today's world is the equivalent of ignorance, greed andtreason. Keep the middle and working classes uneducated and ignorant and "we can tell them how to think and what to do." And then these same people rake in more money by lowering their own tax rates (90% of trump tax cuts go to the wealthiest)
and increasing the cost of education benefits the bankers and lenders, then they pay lower taxes on that added income. It's clear - with trump and the republicans in control today it's all about making more money for them and their donors, keep the masses ignorant, fooled and "enslaved" and all is good.
Good luck to the masses. Either wake up or get screwed by those currently in power. Who you vote for in November 2018 and 2020 will be a clear signal of our intelligence. If we're smart vote for ANY D over ANY R if you care about your future and that of your children. Learn from our mistakes and don't be fooled again.
2
Obama's program does absolutely nothing to fix the source of the issue, which is rising out-of-control tuition. In fact, in aids and abets it.
4
Especially for Younger people, AND their Parents: VOTE, like your future depends upon it. IT DOES.
3
The Republican war is not just against government involvement, period. The ideologues who now call themselves Republicans are against college at all for people who don't pay in cash, and against denying banks the right to make a predatory level of profit against the peons who presume to think they are entitled to an education rather than to learn a trade. And if you think this is an overstatement, just follow some of the comments in these columns and from politicians from the Right over the last few years. None of us have lived in an era that is as backward as the one the Republicans are trying to take us back to.
3
What? We can't have progressive programs! What would that mean for our vulture capitalism?!
1
However, what this article fails to mention is that IDR/IBR is not perfect. Even with IDR, I still cannot afford my monthly payments.
Eliminate taxpayer-subsidized student loans and ban all foreign students and watch the cost of college plummet.
3
you do know that foreign students pay the rack rate and hence subsidize the cost of tuition for in-state students?
3
Liberty—if foreign students weren’t here, empty seats would force colleges to lower costs.
I cannot believe people ignore DECADES of economic stats.
1
Yes! My point exactly!
It seems that the goal of Republicans and their donors is to turn all but the rich into debt peons- virtual slaves. They seem to hate us. Voting Republican means tax cuts for the rich and making life exponentially harder for everyone else. Are these our so-called "American values"? If so, it is truly frightening and depressing.
2
I am a second career person. I was fortunate to attend a state school at a time when the cost was not exorbitant. And even more fortunate that I was able to pay for and attend a prestigious private school for an MBA.
Several years later when I found my true calling and entered rabbinic school, I used my inheritance, worked part-time throughout 5 years of school and began repaying some $60,000 in student loans immediately following ordination.
After 15 years in a congregation, I entered a 2-year chaplaincy program for which I received a meager stipend of $1,200 a month. I used funds from my rabbinic pension in order to be able to pay for basic needs. And, I deferred my student loans for 2 years. By the time my CPE program ended and I was hired full-time, Sallie Mae had sold my loans to Navient. They demanded a repayment of almost $600/month. More than half what I pay in rent. And, I still owe, after 23 years, $50,000 because of the deferred interest Navient tacked on.
At 69, I am looking forward to retirement. But unlike others in my peer group, I will be severely restricted because a significant portion of my income will be repaying my student loans.
Don’t misread me. I want to repay my loans. However, at an income based rate. I have insurance that will repay the balance when I die. I am certain I am not alone as the shifts in our economy have demanded people make career changes.
We must stop this proposed change from penalizing all of us.
2
How come that in the US the most basic and the most important things of any human being as healthcare and good education remain the privilege of affluent people? The system seems designed and defended by those who want in some way to perpetuate the gap between rich and poor, lucky and smart but ill-fated kids.
4
It's sad to see several commenters reminding us about personal responsibility -- borrow money, pay it back, don't buy things until the debt is paid off. Thanks, but I'll remind you all that you all enjoyed tremendous government support for higher education which made it so cheap and affordable until recently. Financial support for schools and students has disappeared as states cut away at budgets and now the majority of the financial burden of financing an education falls on the student rather than society. 1.3 Trillion dollars of debt at 7% interest is a lot of money to pay back before getting that "fancy apartment" somewhere down the line -- you expect us to take over and keep the economy growing?
19
I am one of the commenters below advocating personal responsibility. I paid off my law school loans of $200,000 (including interest) as a state contractor public defender. I graduated in 2006. I'm 37, not 57. Choices matter. Whining helps no one.
4
Financial support may have declined, but you're totally ignoring the fact that colleges have been raising tuition rates at ridiculously high rates, mainly because they could since anyone can get government-backed student loans.
1
Taxpayers need to get out of the student loan business, which has driven up the exorbitant costs of higher-ed over the past few decades. Once a public service staffed by relatively low-paid pubic servants, state universities now exploit students and their families with student loans. Tuition was very low until higher-ed discovered this business model. Eliminating student loans would drive costs down.
4
As a HS teacher of many years, I have come up with this premise: If you ask people what should be the determining factor between 2 students, one going to college and the other not, they will say: ability achieve and desire to go. If you ask if all young people who have those things should be able to go to college? they will answer "yes"...But money is the number one deciding factor. There are many bright people who will never attend college because of money. At the same time, there are lesser students and even ones who don't really want to be in college sitting in lecture halls right now because their parents can cut a check. Make college affordable again and young people will have options and colleges will have the best and brightest, not just the wealthiest.
13
If the student loan reforms are undone by the GOP, tow things will happen. First, thousands of borrowers won't be able to contribute to the US economy because they are so financially strapped. Secondly, there will be despair and a sense of hopeless as wages have not been commensurate with the cost of living for a long time. To undo the reforms is cruel, senseless, and not looking at the long-term costs. Why should US citizens pay for the GOP's expensive and irresponsible tax and spending bills?
4
I am upset at both this and the Levy article which fails to mention the falling support in every state for public higher education. 60 years ago I went to Central Missouri University where fees were $25 a quarter. Dad earned aroung $4000 a year. Books were furnished on a rental basis by the school. Today with cuts in state support it would cost $16000 to attend this former teachers college.
I got a good BA degree at minimal costs which even at todays prices would be available if you did not have Ivy League dreams. From here I went to major State University for graduate study. After my MA I was interviewed by the Harvard Graduate Dean for PHD work there. His first words were Harvard reduced all Teacher's College grade to Cs, but now with an MA from Missouri U I was worth looking at. I did not need to go to Harvard as I had just received a Fulbright to the University of Paris and Strasbourg. I was also an alternate for a Rhodes. I returned from this to get a PhD under David Pinkney, a reknown French Historian and was helped by another former Prof Lewis Spitz,later dean at Stanford to a first teaching position at Stanford.
All of this is not to inflate my ego but a note to say everyone does not need to go to an Ivy League school. They might need the support of a lessor institution but with hard work and increasing prestigious schools much is possible. WHAT BOTHERS ME IS STATES NATIONWIDE DECREASING EDUCATION SUPPORT AT THEIR INSTITUTIONS TO PROVIDE A CHANCE.
3
All true.
And elections have consequences.
And millions of people, probably affected by this, didn't bother to vote.
8
Republicans will claim that costs of ANY government program are too high, regardless of any and all evidence to the contrary. AND their conservative supporters will believe them, regardless of any and all evidence to the contrary.
And the reason is actually NOT ideology. The reason is there are no longer any facts in our culture that are accepted *as facts* and widely agreed on, so no argument based on facts has to be accepted any more. Only argument that one already agrees with have to be accepted.
I can't believe that we have come to this, but so long as Republicans keep their numbers in the federal and state legislature, watch every reasonable idea based on an activist government die.
9
Trump and GOP are on a sick mission to destroy everything that offers real hope to America's middle class and underclass. IBR works well mainly because it allows students to suspend loan repayments during periods of unemployment and also limits their burden to something manageable. It helps people invest in their futures. Removing IBR will only increase the number of defaults and discourage poor people from pursuing education. Why? So there's more money available to build a wall or conduct another pointless war? Or put more money into the pockets of the wealthiest Americans? Sick.
21
Higher ed costs pose layers of problems. And the “Obama” reform plan created some problems of its own (doubling of interest rates for grad school loans, to help offset the bill of repayment, for starters). But the benefit of an IBR outweighs those issues. Defunding and destabilizing this program is the worst idea in a long string of bad ideas. This isn’t about lack of responsibility by borrowers. This is systemic inequality. This is about being able to feed your family as you are starting a career, especially after attending grad school and choosing to go into a public service field, but not one covered by public service repayment plans. Wages haven’t risen to match the cost of living expenses. Education isn’t about profit. Shame on you Rep. Foxx. And anyone who supports this measure, seeking to flip a profit without providing a workable way for families to afford loan repayment and food.
9
Those elected to government today have argued that everyone must stand on their two feet and not depend upon others. What they and their supporters ignore is that the US is where it is today because of an enormous amount of money invested in the nation’s higher education system which allowed massive numbers of people to move out of the bottom rungs of our economy. Insisting on those people to now pay the entire freight of education is another example of Republican bait and switch. The irony is that this will back fire to the detriment of the nation our children and grandchildren inherit, not to mention the economic boulder most citizens will be pushing ahead of them every day for the rest of their lives. Thanks Republicans, the future owes you a debt and they will be paying the onerous cost of your selfishness.
6
If Obama did it and it benefits ordinary people, it doesn't stand a chance with the GOP in power.
20
The Republicans cannot win without the support of the masses of folks who do not have an education. They rely on people who have never ventured much past their mail box, and who know very little about what exists outside of their small circle. They think that education is either a waste of time, or leftest propaganda. They are very, very limited people and without them, the GOP would fail.
The GOP will never support education. It's against their best interests.
11
The federal government needs to limit the amount that people can borrow. It isn't right that these people go to the most expensive universities they can find, run up hundreds of thousands of dollars of debt, and then expect to be excused from it, leaving the taxpayer on the hook. All students should be capped at the amount of tuition for four years at their state's university. This nonsense of paying close to a quarter of a million dollars for a B.A. degree has to stop, particularly when we know that the chances of paying that off is remote.
5
Sigh. What makes you think state schools aren't expensive?
8
Are they $65K a year, because that is what private schools are.
The program aims to make hardworking honest industrious productive Americans pay for the loans of students who cannot afford to go to college. And the reason they can't afford to go to college is because the program provides more funding - more demand - which drives prices (aka tuition) higher.
Liberals refuse to learn or understand basic economics.
33
Students work hard too. To assume that all people who go to college and use Pell Grants or other government monies to fund their education are lazy is hyperbole beyond belief. Many work a job(s) or are returning to school to pursue a different career. Many go to state schools. Federal grant and loan borrowers go to public and private, not just ivy-league schools. With education costs rising and wages stagnating, even state schools can be expensive for parents and students to save and that is ludicrous. We as a nation should be more concerned about making sure the citizens with the most potential are getting into the schools that best serve that potential regardless of their socio-economic status. I'd rather spend my tax dollars helping a good student graduate, regardless of income, than cheering on a rich students admission into the school of their choice simply because his parents can afford it. Wealth is not mutually exclusive to either intelligence or worth just as being poor isn't synonymous with laziness or unworthiness. Only authoritarian regimes can afford uneducated and stupid citizens whose merit is based on their bank account, not democracies.
23
So people who have the bad luck to not be born into rich families, and thus, "cannot afford to go to college", should be denied the opportunity get an education?
Conservatives refuse to learn or understand basic human decency, the benefits of having an educated populace, and just about everything else.
12
You are mixing two different concerns.
Concern 1) Society at large should not be subsidizing college tuition of those who cannot afford to pay their own way.
Concern 2) Increased demand for college tuition drives up tuition rates, because the college system as a whole in America is basically a monopoly on post-secondary education.
Response to #1) So you would rather see the engineers, the journalists, the doctors, the lawyers, the teachers of our society be only the progeny of the rich and wealthy? Why would anyone want that? Aren't we already enough of a plutocracy as is?
Response to #2) Absolutely. Tuition is insanely expensive, all because college of some kind is all but a necessity to a better life for most people. But the refusal of society to implement more extensive alternatives to college as a post-secondary education (apprenticeships, broader and more varied trade schools, non-liberal arts business programs) is not the fault of the poor and middle class student population. Fight against the collegiate monopoly all you want, but until we have in place reasonable alternatives to educate professionals and provide non-professionals with the opportunities for better paying jobs... I direct you back to #1: our society must subsidize college education to prevent plutocratic stagnation.
11
Typical big brother takes care of all your needs program. I assumed my son's college loans as a good parent. In fact, I paid 100% of all my children's education. They are self sufficient now with good jobs. As a taxpayer, I don't support paying for the rest of the nation's students who borrow way too much for a useless education, and want to stick me with the bill. I've paid enough.
5
Parental payments of dependents educational expenses should be fully credited against FICA obligations!!
Do not take out enormous loans if you are going into a low-paying job. If you are interested in a low-paying job, why go to college? This is common sense.
If you choose to take out enormous loans, then you WILL have to spend the rest of your life paying them off via your low-paying job. This is how the world works. You knew it when you took out your enormous loans.
7
Pretty sure teaching requires at least a BA, if not a MA, and it doesn't pay well AT ALL.
1
So don't be a teacher until you've repaid your loans. Society will manage without you.
The author cites public interest lawyers as some of those who struggle to pay off their debt. As a court-appointed public defender who works as a state contractor, I beg to differ with Mr. Brooks’ opinion. I paid off my debt a few weeks ago after a few years of... wait for it... sacrifice and very purposeful budgeting. The problem here is not that students cannot pay off their loans. They simply choose not to because we as a society tell them that contractual obligations are not important, and who really cares about paying attention to your money? As someone who paid off her debt, I hope income based repayment (along with PSLF) goes away completely. That is the only way tuition costs will ever decrease. I paid for my education. I don’t want to pay for yours.
https://medium.com/@taraganguly/i-finally-crushed-my-six-figure-student-...
7
The student loan reforms are sensible, compassionate, a good investment for the future, beneficial to the needy and were instituted by Obama, ergo trump and the republican party feel they MUST be repealled.
3
This program is NOT financially self-sustaining and is one more flawed socialistic program that is driving our country into bankruptcy. Currently, the student loan program is 1.5 trillion dollars in debt and growing. FormerStudents are delaying payment as long as possible, and although some students have a great deal of disposable income, are limiting paying the loans to the 10% because, after 20 years, the debts are forgiven.
It is time we return to the old fashioned values of paying back debts which are owed. If you borrow money, keep you word and pay it back. That may be the best lesson these students will get out of college.
9
How about we return to old fashioned affordable tuition prices like we had before your generation lived way too lavishly and then passed enormous debt problems onto younger generations? Student loans aren't a problem older people understand because college prices in ye olden days weren't driven to exorbitant levels by poor allocation of education funding and an increasing tolerance for predatory loan practices.
I'm all for going back to that system but that's going to require some older people to pay back into the system what they stole from posterity.
1
We still need to talk about the real problem: college costs too much.
17
John I would love to not "let them" ... that's impossible for the average citizen as I'm sure you know. November is the best we can do.
1
It is unpatriotic not to support education. We should be subsidizing students, not squeezing them for every cent.
10
Perhaps you missed this article? https://www.nytimes.com/2014/09/21/fashion/college-recreation-now-includ...
We aren't paying for education any longer, we are paying for entertainment. I've been paying for my student debt for 18 years. I have 2 years left. I sacrificed many things to do so.
If people take out loans, they need to be responsible to repay them. I followed the adage of don't take out more loans than you expect to earn in income the first year you graduate. Should I be paying for someone's video game lounge and Starbucks style dining commons and gyms that rival Olympic training centers?
I worked four jobs while in college (dining commons grunt worker, paid note taker, class audio recording technician, advanced pulsing laser and x-ray diffraction tech) during semester, and summer jobs (bus girl, babysitting, dental assistant, National Laboratory science intern, consulting intern) lived in a 1 bedroom apartment with 2 other girls and paid $206/month as rent (late 90's). I also applied endlessly for scholarships (which I received quite a few).
Students now pay over $1,000 a month in rent in RURAL locations to live in expansive luxury, multi-bedroom apartments with exercise rooms and pools so they can have their own bedroom. I didn't even pay that living in NYC as a broke post-college student because I was paying off my student loans. I support education, but the excessive catering to students now is what is driving up costs.
3
'Under the bill, new borrowers would pay 50 percent more per month...also drastically cut the amount that can be borrowed for graduate school.'
Could there be any doubt that republicans' goal is to further dumb down the population? (It's worked pretty well for them thus far.)
12
Some of my best and some of my worst memories are college ones. They were worth every cent. Thank God I don’t have to do that again.
1
The GOP created this mess in the first place by slashing direct student loans and pell grants. They then stood by while states lead by the GOP failed to properly pick up funding slack. They also made it possible for scam college to steal student loans from students who have nothing to show for it except for student loan debt and now want to undo obama' attempt to deal with these problems. Devoid devos and her billionaire cronies will try monetize anything. Greed. Sad.
5
What about the cost of attending college right now? It is ridiculous, and continues to grow at ridiculous rates. Why does no one look to curtail these costs, especially at schools with massive endowments? Or schools that receive tens (perhaps hundreds) of millions of dollars from TV revenues for big time college athletics (like football)?
It costs $70,000 a year to send a student to Georgetown. That is almost double the average national income in the US. No wonder the author does not address this, as he is part of this corrupt system. On the contrary, he argues that some of the 'profit' made by the government on student loans should be given back to the colleges that are charging these crazy tuitions in the first place.
Keep in mind his employer, Georgetown, has an endowment close to $1.7 billion and 'complains' that it is the lowest for a top 20 ranked school.
10
If the GOP insists on hitting young people where it hurts then they can continue to kiss those votes good-bye.
Their idea of lazy, entitled millennials is incorrect. My peers and I worked extremely hard to become contributing members of our society, and IDR made this possible. Without it I personally would be financially handicapped and a candidate for welfare.
2
Stop the presses! Georgetown Law faculty member boldly steps forward to protect a program that subsidizes graduate level JD students so they can pay Georgetown, and then write off their cost on us twice - first by avoiding payment because they choose to work in the lower paying public sector, and secondly by having us pay their salaries while they “serve” us in the public sector.
What does Georgetown and this author get out of it? The ability to keep increasing tuition by exorbitant amounts, and the ability to keep the churn for law degrees going - a field that’s been decimated over the past decade in the private sector due to the use of technology and a shift towards being less litigious.
It’s always interesting when someone steps forward and blatantly advocates for a policy that personally benefits themselves at our cost; DACA recipients and Muslim immigrants show up here from time to time to make their case, and then get savaged for it when comments are allowed. But in this case we have a well off Georgetown law faculty member doing the same. What’s the difference? The lawyer tries to trick us, and makes no mention of how he and his students benefit from this racket, or how it allows Georgetown Law to keep raising its price and packing classrooms. At least the DACA and Muslim immigrants have the honesty to tell us that the policies they advocate for personally benefit them.
Why can’t the lawyer? Probably because the truth here isn’t as defensible.
10
Unlike other loans, student loan borrowers cannot claim bankruptcy or ever have any chance of starting anew again, so it seems that after 20-25 years of payments, debt forgiveness isn’t so unreasonable. Bankruptcy is part of business as usual for Wall Street and of course, our own president, so we should not give students financial life sentences unless we are prepared to treat the rest of society the same way.
11
student loan borrowers always have the option of refinancing their loans. some of the options, like credit card loans, can be dismissed in bankruptcy. some options lower the interest by securing the loan with assets like a home equity loan. some options even lower the interest with consolidation and term expansion.
Hogwash! It’s simple. You borrow money, you pay it back, with interest. It’s called personal responsibility. Choose to owe less money by going to less expensive schools, and live frugally and responsibly until the loans are paid off. No house, no fancy apartment, no furniture, no dining out, no Starbucks, no new car, take a second job. This is how it is done.
27
Rr,
What probably sounds (to you) like a program of personal responsibility, will (in fact) hurt everybody. Money that pays for goods and services creates jobs, helps foster a growing economy, and helps everyone prosper. Think of all the people that build houses and apartment buildings, run restaurants or make cars. Where would they rather have students spend money? Until a college education is free for everyone, the Obama reforms were a good first step - and part of the reason the economy is performing as well as it is.
19
I'm doing all of this, I still need IDR. I'm pretty tired of reading the same comment over and over from people who don't know what they are talking about. I can tell you don't know what you're talking about because of "It's simple". The issues around the costs of college education are many things, but simple is not one of them.
26
Okay. How about if you don't do all of the things you seems to think all college graduates do after they graduate instead of paying back their loans?
How about they go to state schools? (I am so tired of the "less expensive school" argument.) State schools now cost what private schools used to cost.
I am all for paying back loans, but I'm sorry, the interest on your mortgage is probably way less than the interest on my gainfully employed son's loans which top out at 11%. That's the evil part. They pay and pay and pay back, but can never get a head of the accruing interest at those rates. It's ridiculous.
BTW - I've had two student loans that I've paid off. . . at extremely low interest rates. But that was back in the day, before on of the Bushes turned it around.
23
The billionaires want your money. How is that going to move money into their hands? It won't so it needs to go.
This is government GOP style: long on promises, short on delivery with lots of bait and switch for the millionaire wannabes.
2
Interesting that a professor at an elite, high-cost university doesn't mention the real driver of crushing student debt: OUT OF CONTROL TUITION !!
10
The GOP has a simple philosophy. It cannot survive only with the support of the very rich, who dictate its policies . It also needs the support of some poor and very stupid people, those who routinely vote against their own interests. So the GOP supports anything that helps dumb down America. That means making Betsy DeVoss education secretary. It means cutting taxes so severely that schools in some Republican-run states can only operate four days a week. And if they can make higher education unaffordable, Republicans are all for it
2
I keep wondering why trump is so determined to hang Obama's scalp in his tepee … the thoroughly debunked birther issue, the on-going unwarranted trashing of Obamacare, the baseless assertion that he inherited a "mess" from Obama, the spiteful reckless reversal of Obama’s climate control measures, the incredible claim that Obama actually committed a felony wire tapping trump's offices, deliberately blocking a perfectly legitimate supreme court Obama appointee while jamming through a totally inappropriate alternative, and now blaming Obama for Russian election meddling. I’m like Cummings’s blond Olaf: “there is some 'guff' I will not eat.”
2
These kind of plans just distort the market - 10 years is short enough that some can see this as a viable strategy to fund their studies, i.e. take out loans, get the degree, work at some nonprofit hospital for 10 years (they all seem to be non-profits), and then switch gears, become a plastic surgeon or something and cash out. Meanwhile, the public pays for tuition through taxes, the universities make a killing and the cost of educating is socialized. By using the student to channel money from government to educational institutions, the sticker prices are kept high, those with more resources are charged more (price differentiation), parents are clipped at the maximum rate because they are financially x-rayed (FAFSA), and in the end, the societal reward is minimal because doctors still charge astronomical rates (argument about paying back tuition is bogus), the numbers graduated are still limited. Also tuition will keep rising since why would it not, there are no constraints, there is no negative feedback in the system. Same goes for billing rates for doctors.
It would be far better use of funds to model things the way they do it elsewhere. Europeans don't have crushing student debt and indentured service, they are very highly educated, and capitalism is still ok.
1
If they adjust repayment plans according to income, why are they garnishing SS benefits that below Federal poverty level even before garnishment? Will NYT publish this question, I wonder?
What is "progressive" about garnishing Social Security benefits?
3
This program is a god send for many hard working Americans. The biggest flaw in it is that it is not well advertised, probably on purpose so fewer folks can apply. And the biggest potential problem is that the well connected, rich and cynical, snake eyed Republicans would end it in a heartbeat.
4
I don’t understand the Republican animus toward education at all levels. It seems state education finds are among the first to be cut when budgets are tight. And in the Republican mindset, budgets are always tight - recessions call for decreasing taxes to ease the burden and boom times call for decreasing taxes on the ‘job creators’.
Republicans should foster those who play by the rules; who follow the proven track to success - education and hard work. They prefer those who succeed on the backs of their trust funds and they foster an undereducated and underpaid underclass that will remain beholden to the ‘job creators’ for the scraps are willing to part with.
6
Really there is not much to understand. Create a class of people who are too tired from work, too hungry from poverty, and too saddled by debt to think about voting. Create a class of people who don't think that they can change the system and the upper class can continue to take advantage of them by legal means in the voting booth.
Look at the demographics of the last election, you'll see that education does not help the GOP in any way.
21
As someone in my early 30s who has counted on IDR to allow me to move to where I could find decent work, this is terrifying. This could very well ruin my life. I'd have to quit my job, move back home, and basically just default. There's no way I could afford to pay $600+ on student loans and make rent, and there's no way I could get a good enough job back home to afford to pay it at all. And before anyone makes that tired remark about choosing the wrong major, my major has nothing to do with it. I don't have trouble finding a job, I have trouble finding a job that pays like I was assured it would when I was taking out my student loans. I have friends who majored in Business, Finance, Fine Arts, and Sciences who are all in this exact same boat.
93
Do not feel like the Lone Ranger. Millions of Americans fell for the lie that a college education is the only ticket to a good paying job. Only to find out that there are a lot of college graduates and very, very, few good paying jobs.
Of course, this brings the argument full circle. Should college again be what it once was? A place to become an educated and well rounded citizen, which can give you a jump start in a career. Or will college continue to be what it has become? A cost shifted substitute for what was formerly called corporate in-house training.
On the plus side, you are finding out at a young age what many older Americans did not find out until much later. You can work (or study) hard and play by the rules---only to find out the rules were changed and nobody bothered to tell you.
Nice country we have. Or nice plutocracy.
16
Sally -- I don't doubt that you are in a difficult spot. But you also accepted money to pay for a college of your choice and in return made a promise to pay that money back. And now you want other taxpayers to pay it back for you. Some of those taxpayers you want to foot your bill chose not to go to college, some chose to attend less expensive schools, some joined the military in order to get education grants for college, and some worked their way through college so as not to rack up too much debt.
3
@Econ:
I lived in-state for an extra year prior to going to college to receive in-state tuition. I'm still here, by the way; it's home now.
I enlisted, but due to medical reasons beyond anyone's control my service was cut short. The GI bill helped, but due to my short service it did not pay my full ride. To be clear: I appreciate the help from the VA, and I have done my best to continue my goal of public service as a result of the assistance.
I worked all through college, because honestly, who doesn't? You can study at a gas station just as easily as at your house.
I still have more debt than ever imagined or predicted to me by advisors.
People who graduated with me have the same story. People who graduated even as little as 10 years ago are blown away.
This isn't a cry for help for me. I'll make due, regardless of the government's decisions. But there are those who will not, and their only fault is wanting to better their lives by going to college, something our government and society has encouraged for years.
They need your help, not your ridicule.
Student loan programs should be guaranteed by the colleges themselves rather than taxpayers. Such a change would ensure that the schools deliver on their charter. If their endowment supports ibr and loan forgiveness, good for them and a selling point.
4
"The program aims to make student loan payments affordable for everyone, regardless of their income. "
Their aim seems off from what I read.
3
True. It sounds great and it does make payments affordable. But the interest one accrues is breath-taking.
1
Several commenters have chastised students for picking the wrong major, as if everyone with high student loan debt is an unemployed art history major. Folks, schools have pages and pages of professional glossy brochures selling overpriced programs and niche majors, telling kids they are buying a handful of magic beans, and they have the well-massaged statistics to reassure kids that jobs and financial security will be theirs if they just sign the dotted line. Warnings and concerns from mom & dad can't compete with the slick con job from these deceptive programs.
Private programs are some of the most rapatious, promising accelerated degrees in everything from Computer Programming to Dental Tech and even Cooking... but $40k later, kids find out that local employers want nothing to do with these schools. HR departments are incredibly coy these days and won't tell you which programs are blackballed. Kids only find out the hard way, after the bill for the school's con job comes due.
Even state schools do the con. In my home state, a library science program tells students they will make six figures a year as a librarian. A LIBRARIAN. Who is held accountable for this nonsense? Only students, apparently, who believed their advisors and are now being scorned for listening to the experts and investing in their future.
32
Alenka--There's no doubt that personnel, in colleges, are often not of the highest calibre, most administratively. Unfortunately, they often operate just the way our Congress does, so student and parents must take the problem in hand and fight to get better people running our institutions. Just remember, it won't be free, although I advocate FREE public college, for 2 years.
3
Librarians actually have a niche, and many businesses and government agencies hire them to organize their data, keep the relevant handy, and effectively store the rest.
I have a liberal arts education. My ability to think, analyse, communicate and interface with others has done as much for me as the MBAs of the folks I work with. So....
2
Actually, a library science degree today is steeped in information architecture. And information architects actually DO make six figures. Hate to break your 80s bubble.
2
Most people are not smart enough to succeed in college and did not dot finish in the top 25% of their high school. The best schools have large endowments and the government owes these universities and their students nothing. Limited public resources should be focused on on gifted poor students who first prove their worth in in community colleges.
Any student that goes to college and doesn't know how to pay back his or her student loan didn't learn very much. Full time work and evening classes is also an option for all.
5
This is about predatory interest rates on student loans - not about government "owing" anybody anything.
Do you really think our government is helping anyone go to college? Think again. Of course, why would we want an educated population.
33
I agree and I'm happy that others are willing to state the obvious unpleasant truth: most people do not have what it takes to graduate from a legitimate college. Because of the attitude that "everyone needs to go to college", the bachelor's degree has been watered down over the years to where it's a borderline useless diploma. If you want a broadly educated population, do it in high school.
4
I worked full time, had a 75% scholarship, and I still needed loans. Any other helpful suggestions?
10
WHY is this loan repayment income-driven program a debate when we claim to want a competitive advantage against China and India in college STEM programs and the humanities? Disruptive innovation is useless without an educated citizenry to advance our democracy and sustain the ideals of the Enlightenment era. Surely, Republicans and Democrats can agree that college graduates are better contributors, voters, and tax payers when their loan debts are manageable. Enough is enough!!
28
And how many students in this country actually pursue STEM majors? Not many, obviously, because many of those majors are foreigners.
I'm also a law professor. IBR is a nightmare.
Years ago, when students agitated for public-interest job-based forgiveness, this seemed a trivial issue. So what if a few more law students became public defenders at our expense? We need more public defenders, right?
But this public interest-driven idea morphed into one that is totally agnostic as to one's chosen career ("underpaid" lawyers on Wall Street with huge loans qualify along with social workers), and to the amounts of indebtedness. This has two undesirable effects.
First, the benefits of this program are overwhelmingly tilted in favor of a small group of highly-indebted borrowers. The typical student loan debtor has only borrowed around $20,000. I can already hear NYT readers laughing in disbelief, but that is because everyone they know went to an expensive school, often for multiple degrees. A small percentage of borrowers - some from prestigious schools, some from diploma mills - are indebted for hundreds of thousands of dollars. That is indeed a serious problem, one that many law grads can identify with. However, it is *not* the profile of the typical borrower. This "progressive" policy preferentially rewards a few borrowers at the expense of the many.
And it IS at their expense, for such programs encourage schools to raise tuition ever higher, assuring students not to worry - for "IBR will bail you out."
The student debt problem will not be solved by making it bigger. That is what IBR does.
11
not to mention how it depresses wages as well. "public service" employers conspire in each community knowing they have a captive labor pool.
1
My wife and I accumulated a good deal of credit card debt paying for living expenses during our last year of college. Luckily it was all zero interest - for a short period of time. Thanks to income driven repayment we were able to pay it all off as soon as we graduated and went to work. We would never have got it all paid down if we’d been slapped with giant student loan payments during the first few years after college. Now we’ve got good jobs and are doing well, so we’re are paying the loans and should be done in two years. I can’t speak for anyone else, but we’d still be paying off credit card interest, not paying back our loans, if it hadn’t been for income driven repayment plans. Thanks Obama!
115
Education "Industry" needs a thorough shake up. Let me give you an example of some one trying to became a doctor. You have to first do a complete graduate degree, where most subjects have nothing to do with medicine before you can appear for MCAT exam for pretty much takes up another year admission. Why do we need a degree to go to a medical school? In many countries, including India you can straight away go from high school to medical school after 1 year of pre-medical education. They are taught medical related stuff like biology right in 11th and 12th grade in high school. In this country you are almost 30 years old when you become a doctor with half a million dollars in debt , while in other countries you are ready to become a doctor almost around 25-26 years of age with very low debt.
8
Of course the recommendation is coming from someone in academia which is the root of all the financial mess students are facing. Zero substantiation that these ‘educators & administrators’ need or deserve tuition increases that exceeds the rate of inflation by 5-10x in given years. Until they buckle up as the President of the University of Purdue implemented +3 yrs ago, higher education will not be accessible to the masses. Here we come Europe
5
More inequality. This can be addressed by paying all workers more. Stop subsidizing 40 hour a week workers. Pay them enough so they can buy their own food, healthcare, education and retirement. A business that cannot pay their workers a living wage is a burden on our society.
So many of our macro- economic problems go away by just paying people more.
1
If you're still paying student loans after 25 years, you picked the wrong career. I'm completely willing to forgive the debt though. The student has obviously paid the principle many times over in interest. However, we might reconsider our use of educational pedigrees. Does an elementary school teacher really need 6 years of advanced schooling plus several years of volunteer work in order to teach a class of six year olds?
For that matter, why do we even charge students interest? Education shouldn't be a financial windfall for the government or anyone else. The time value of money is a subsidy we should provide freely to academic pursuits. If a student ends up heavily debt laden, no harm, no foul. Holding the debt isn't costing the individual anything. Pay it off when you can. Any outstanding debt is forgiven eventually anyway. Death has a way doing that.
12
Totally agree with your last paragraph. My only quarrel is with your denigration of early childhood teachers. Teaching 6 year olds is just as complicated as the psychological and cognitive development of children is. Good preschool and grade school teachers require lots of training and supervision to grasp the subtleties of how these kids change even from month to month. Yes, an elementary school teacher needs the advanced schooling and supervised training. It's what distinguishes a mediocre classroom from an outstanding one.
29
My best friend teaches 6 year olds. She knows how to do the job without $250k in student loan debt.
The Income Based Repayment program has been a lifesaver for me and for many other people I know. I recommend it to anyone who asks me about student loan repayment. Any attempts to end or severely diminish the program are extremely short-sighted, mean-spirited, and have little to do with financial viability. It is one of the few government efforts to enable those without substantial income and assets to access a quality higher education, at both the undergraduate and graduate levels. Just one more example of financially-irresponsible Republicans attacking those who don't vote for them.
62
I know people on this program who have already bought their first Mercedes and their first 4,000 Square foot home. Whatever happened to personal responsibility and learning how to budget? All this program does is add to the national debt.
Income based repayment and loan forgiveness are policies that teach young people that our society is corrupt. We get ahead not by living up to our responsibilities but by gaming the system. I wonder how many Hillary campaign workers were also signed up for the Clinton Foundation with the promise of loan forgiveness.
12
Explain to me how debt forgiveness after 25 years of on-time payments teaches the wrong message?
Millennials have lower rates of home ownership, are less likely to start families, and generally have less expendable income due to the high amount of debt our education system forces them to accumulate. That results in generation economic stagnation which has a huge effect on long term GDP and tax revenue. Our government offers large subsidies to profitable corporations that total in the hundreds of billions of dollars each year. Justifying cuts to a $36 billion/year program under the guise of "fiscal responsibility" makes no sense in the context of the budget and would only further limit the ability of young people to drive our economy forward.
Lastly, I will be entering law school this fall; in order to do this, I will have to accumulate around $100,000 of debt. I plan on devoting my life to public interest work and government service. I'd like you to explain to me why I don't deserve the opportunity for my debt burden to be relieved after 10 years of serving my country and working for you, the taxpayer.
One final note, employees of both conservative and liberal leaning non-profits are eligible for debt forgiveness. The program grants equal opportunity to young Democrats and young Republicans alike to ease the burden of their debt. This issue is not one of politics, it's one of older generations profiting off of younger generations.
38
It is hard to see how 25 years of on-time loan payments will leave any debt to forgive. Sorry, the public benefit of your planned "public interest" work does not work for me. A loan is a loan, pay it back.
But I give you your point that conservative non-profits can exploit forgiveness as much as liberal non-profits.
If you are working for the government, you are not making any sacrifices. Salaries in government far exceed the average income ($75000) of attorneys in the private sector. Government attorneys can make in excess of $160,000, and start at about $75,000 minimum; hardly any sort of sacrifice. So please, do not pretend you are any sort of martyr or Joan of Arc.
When it comes to the Republicans all you need to do is follow the money. Who does it benefit to dismantle Obama's student loan reforms? The Rich. It's always for the Rich.
59
Total nonsequitor.
Why do the rich benefit.
They do not get any of the money from the loan repayments. But they now pay nearly 90 percent of all income taxes.
2
The taxpayer will benefit, and the students will benefit because, with less of a national debt due to fewer losses from the student loan program, the cost of money will be less, businesses can expand, and those businesses will hire these former students.
As the article points out, the student loan program generates a net surplus. It does not contribute to national debt.
This OP-ED is an example of the usual musings from someone who is cloistered in the ivory tower (and who, coincidentally, is employed "Inside the Capitol Beltway").
The intent of US Rep. Foxx's initiative has virtually nothing to do with what Mr. Brooks has opined. The objective is that young people borrowing enormous sums of money need to be accountable/responsible for their actions.
When you sign the front of checks (as I do and as Mr. Brooks apparently does not), the perspective is entirely different.
Going to college is a great opportunity to grow and to prepare oneself for the life to come. Making prudent decisions on a course of study, listening to mentors, and then ultimately starting on a career trajectory should drive the mission of the loan program.
Mr. Brooks appears to want to reward young people who have made poor choices (e.g., majoring in programs where employment is limited). His perspective is 180 degrees out of phase with reality.
11
So, all these institutions that have raised tuition by double digits over the last twenty years - far and away outpacing inflation - are being responsible, but students who borrow so they can attend these schools are irresponsible? Just clarifying.
39
Yes, let’s definitely punish students who choose career paths that don’t pay giant sums of money. Let’s see, that would include most government workers, school teachers, retail managers, factory technicians, etc etc ... essentially the new blue-collar America.
Not everyone is cut out to be a software engineer. If you want people to NOT go to college to get these kinds of jobs, how about convincing employers to NOT ask for a college degree on for any job more complex than working as a retail clerk.
23
That's right! If all you need is a Bachelor's Degree in burger flipping, why study history or languages or literature or music or art or science? I heard there are many jobs for those who chose wisely and got a Master's Degree in French Fries.
3
What amazes me is that as a chemistry graduate student at Florida State U. and my wife as a Genetics graduate student never had to borrow money. Graduate students were paid a small but sufficient stipend that covered enough of our expenses to actually save a modest amount of money. This occurred during the period of 1963 to 1970. We were very frugal as you might expect but also living in Tallahassee, Fla was very inexpensive. As I remember thing our cuts of beef were $0.25/lb. We lived in very modest but acceptable married student housing. Medical costs were also very low so that when our daughter was born that cost about $400 for both the hospital stay and doctors bill. Our daughter is researcher in ILAB at the U of WA. Even more amazing the Federal Government provided research funds sufficient to cover all research costs. While we were there Pres. L B Johnson provided funds for a totally new 7 story research building that was probably better and safer than any lab I worked as an industrial research chemist. Despite the chemical industry depression of 1970 and on we were able to remain employed most of the time until we retired. I would also like to note that the current Congress just passed a research funding allocation that markedly improved the budgets of many scientific programs.
4
Count me among those who are all for this needed program. The problem is we have so many give-away programs, we don't have the tax resources to pay for them. They are underfunded and become a major contributor to our national debt. As we speak, Democrats refuse to help plan a revision in our laws that provide monetary relief for those in need. The revision asks that those who receive benefits, if they are able to work, should find work and help provide for their own needs. The Dems disagree. Wonder why? Think re-election and their own funded largesse. Too pad we don't have a Prosper-Plus Act that requires some time spent helping those in need. We need a government that helps those who, to the extent they can, help themselves.
2
This article has nothing to do with working and receiving benefits (what ever that means). It is about our government giving people with student loans a way to pay back the loan based on their incomes, even if they don't earn much. How many people actually have a voice in the wages they work for, no matter what occupation they are in. Get real. There are plenty of people with high student debt working every day, and earning low wages. At least this program gives them the opportunity to work their way out of sometimes horrible circumstances.
36
Yeah, all them kids in the gubmint schools could be earning their keep as janitors or interning at nite for their job in the iron mine. Was the tax law a give-away or a take-away program?
3
The only voice that working class people ever had in their wages was when we had a large unionized workforce.
The republicans, starting with St. Ronnie Ray-gun, managed to all but destroy unions. Do a search---look when wages started to flat-line.
I don't know what the solution is, but it certainly isn't to saddle young people with a heavy burden of debt just as they're beginning a career. And as with the anxieties suffocating health care, it isn't necessary, because people in other first-world countries don't face these crushing costs for either education or health care.
My daughter is a junior in college who will graduate with a relatively light debt. She's worked 20 to 30 hours a week and full time in the summer in addition to receiving a Pell grant, reduced tuition based on need and academic qualification, and a small merit scholarship. We're still waiting to hear about next year, with some trepidation as our household finances are rebounding from several extremely precarious years, so she'll probably be penalized by losing aid. Best case, she'll end up $10,000 to $20,000 in debt.
She recently traveled to Ireland where she was able to visit her large family of aunts, uncles, and cousins who were complaining of the high cost of college there. They simply could not believe it when my daughter told them her college costs: the "high cost" they complained about to obtain a degree was not much more than she pays for a single semester of in-state tuition.
The GOP goal is always to enhance inequality and ignorance and to maintain a powerless, dependent work force. Education is the enemy. Nothing in their ideology permits them to address either the cost of education or the problems of student loans.
116
It is true that university students in Europe are not encumbered with loan debt, but then getting into a university is very restricted with special examinations. We push everyone to go to college.
13
She must be in desperate times, saddled w/student debt, working 20 hrs a week as a student. So stressful she had to travel to Ireland to talk it over w/relatives. 99% of college students can only pray to be so stressed. Weak lead in to blame the GOP.
5
If she could travel to Ireland, she does not need the Pell Grant, and she could certainly pay back the student debt. A prime example of why this program is bad.
3
According to the authors of Game of Loans (Princeton Press 2016), "How much students borrow and whether they will be able to repay their loans are just two of the trillion-dollar questions that are difficult to answer accurately as a result of inadequate data from the U.S. government."
The "default rates" published by the Department of Education only cover the first three years after entering repayment, and a loan is in "default" only if no payments have been made for 270 days.
My own research concerning borrowing levels by students at law schools in North Carolina suggests that many law school graduates do not earn enough to keep up with accruing interest.
Responsible efforts to change income-based repayment programs should begin with compilation and publication of meaningful data. Data showing how many borrowers are actually paying down their student loans would be particularly interesting, and would probably reveal that a very large number of borrowers with large student loan debt are not paying down their loans.
14
The statistics are convincing whether you are liberal or conservative. $35 billion cost over 25 years in the context of a $1.3 billion debt and then $50 billion profit for taxpayers in interest seem very worthwhile. We need a better educated population in a competitive world and they will contribute more in income tax in their careers.
11
Lest we forget, 'Obama's student loan reforms' also included a doubling of the interest rate charged to graduate students, from 3.4 to 6.8 percent.
13
Graduate loan rates were 6.8% during the Bush administration. I would have loved to have had loans at 3.4%; maybe I would have paid more than $3 toward the principal under IBR by now instead of just watching it grow every year (for those of you who don't know, accrued interest is capitalized annually on federal student loans).
4
how can the author claim that IDR is one of the most progressive policies when the largest benefits go to those who have the highest loans, who tend to be medical students and lawyers? Most low income students who will never get into the kind of medical or law schools charging such high tuitions will never benefit from IBR.
2
You are incorrect, I am a low income student. I went to school to be a teacher. The starting salary was very low. The IBR amount on my student loan is $175 vs the regular payment amount $575 without IBR. IBR has been a godsend and has helped me get going in life.
114
Why do you think your starting salary was very low? Maybe because the employers know about IBR and pay accordingly?
The interest rate for student loans greatly contributes to the problem as does the cost of tuition. For some reason, we continue to ignore both of these problems . . .
25
The interest rate is high because students are a horrible credit risk. They default at high rates and have no assets to recover in case of default.
Simple question: Would you lend to students at the student loan interest rate regardless of their major or GPA?
5
And yet my federal student loans have a higher interest rate than my remaining private loans. How do you explain that?
1
I dunno. Low interest rates for student loans worked for years and they were possible to pay off. I know - I had two of them.
The interests rates now are the big problem.
1
Income based repayment was a last minute "gift" of the Obama administration meant to force change and leave the consequences to the next generation. The student loan program has been self-sustaining until IBR when it immediately moved into the red. The estimates are in fact as high as $100B and the estimates lack the time necessary nor the long term selection bias inherent in the program. Instead of simply giving out loans then figuring out how to limit people paying them back, reform the front end. Why should the loan cost for a person who becomes a computer scientists for a 1% default rate cost the same as going to a 3rd tier school and getting a poor degree. It misleads students, it rewards bad decision making, and it rewards bad schools with bad outcomes. Much simpler to calibrate loan costs by default rate and arm students with good information on their long term prospects while rewarding good schools with good outcomes.
12
Income Based Repayment was a Bush administration program. The Obama administration added some different options to it, as this piece points out.
4
So much of this debt was accrued by students told college is the way by family, teachers, and society. They graduated during the Great Recession, and had trouble finding full time work. And their college costs were astronomical. When I graduated HS in 1988, I went to a major state university that cost about 8K per year. My loans were government subsidized and I was able to pay them back in less than 10 years. The fact that it may take more than 25 years for students to pay back their loans today is insane. How does that set young people up for success and the American Dream?
134
Setting up people with 20-25 years of debt in order to achieve a basic undergraduate education and job also sets up another looming consequence - the inability of this next wave of working adults to save for retirement. Wait until that bloated chicken comes home to roost in a few decades - who's going to support all those seniors living in poverty?
2
The 'American Dream' is dead, and has been for a while. We as a culture need to recognize that.
2
This was a good op-ed. I actually disagree with the author’s justifications, because they’re highly progressive ones and I’m not an unchained progressive; but there was no artifice to the piece. It is an unambiguously liberal piece, it seeks to appeal to liberals and not to conservatives, and its arguments, given liberal premises and well-worn liberal arguments, are good ones.
It’s honest grist like this that supplies the necessary basis for honest debate.
And, no, I’m not going to engage in that honest debate this time – it’s too late and I’m too tired.
8
Are we starting to talk to each other? We'll make it.
1