Student loan forgiveness....

[BlkGS]

I can't be the only one who ignoring the many many other reasons why it's a terrible idea recognizes that forgiving a bunch of student loan debt, during an inflationary crisis, would just be like pouring kerosene onto the fire of inflation, right?

It's boggling my mind that with record inflation people can even talk about enacting a program like that. We need to take money OUT of the system right now, not spend more government money.

 

[AZMark]

I totally agree but I will say my wife has student loans that we have not paid off as we wait to see what happens here.

 

[TeenGee]

Warning.
The IRS views any forgiven loan as income and taxes that income accordingly.
The IRS is not known for sympathy and will relentlessly come after "their" $.

 

[Beachbummer]

When I went to college, public school, a semester for a in state resident cost a month minimum wage. Now it's about 4 months worth. That's not great, and we should pursue making state tuition more affordable as it was in the past.

College, when selected strategically to maximize income is still a very very good investment. It is challenging that there is absolutely no way to discharge it, but those terms were known at the time the loan was issued. I could see some program to forgive a portion of the future interest, or perhaps cap payments to a percentage of your income... But forgiveness is not a good idea, for all the reasons you mentioned, and the precedent it sets also is not very good.

Credit is awesome as a tool for growth and being able to access stuff sooner than you otherwise could. Mortgage for example, tied to a good you need anyway... But you have to pay back. That's someone else's money that fulfilled their side, now your turn pay back. My humble thought .

 

[haknslash]

Why stop at just student load debt? Why not wipe out all debt? Why not just print more money and give it to everyone? Better yet, let’s just make everything free and the world will be perfect LOL.

This whole student load debt forgiveness is a bunch of utopia hivemind craziness. Someone wake me up from this nightmare.

 

[zipper]

Trying to navigate thru all the possible subliminal politics here. That said, I paid my student loans off 35+ years ago. Those loans were taken out in 78/79/80 during some of the highest interest rates ever.

 

[crazy4life]

Wonder if I will get a rebate on the $250,000 it cost me to put my kids through college. Myself and my wife made sacrifices to be able to this for our kids. No vacations for years and many other indulgences skipped. As usual the working man gets the shaft and the bums get another free ride. What happened to personal responsibility?? You take a loan and you pay it back. Simple concept. I’ll be damned if I am going to pay for some other bums debt.

 

[swatski]

I can't be the only one who ignoring the many many other reasons why it's a terrible idea recognizes that forgiving a bunch of student loan debt, during an inflationary crisis, would just be like pouring kerosene onto the fire of inflation, right?

It's boggling my mind that with record inflation people can even talk about enacting a program like that. We need to take money OUT of the system right now, not spend more government money.

I know... crazy. It'd be like, say, starting a war while cutting taxes. Fortunately, that's never happened, has it? lol

 

[RNYCLV]

Finally paid mine off in 2020 in the height of the pandemic, and started paying my wife's back right after. Never got any compensation. Don't think it would be helping the right people.

 

[Can0n11]

We were lucky to have this: https://www.kalamazoopromise.com/ We saved probably close to 250k with 5 kids all graduated from college. Interesting to note that it covers Skilled trades and apprenticeships as well. On that note, I will be putting the house up for sale soon for the next family to benefit from this program.

 

[Beachbummer]

Why stop at just student load debt? Why not wipe out all debt? Why not just print more money and give it to everyone? Better yet, let’s just make everything free and the world will be perfect LOL.

This whole student load debt forgiveness is a bunch of utopia hivemind craziness. Someone wake me up from this nightmare.

I know... crazy. It'd be like, say, starting a war while cutting taxes. Fortunately, that's never happened, has it? lol

Can you elaborate?

Reading between the lines as best I can, two wrongs don't make a right. If something crazy and wrong was done before we shouldn't use that as an argument to favor some other terrible idea, but I may have read wrong, and totally willing to hear it.

 

[haknslash]

Not sure what there it to elaborate from my end. I think debt forgiveness of any kind is stupid and perpetuates irresponsible choices. I don’t work to provide for others than my family.

 

[Ronnie]

Briefly stated I think the current loan forgiveness proposals are F’ing BS. Long story short i left law school $99k in debt, deferred and forbeared paying for 2 years while I looked for a real job, paid $1k a month for 8 years and refied my home to pay them off in year 9, the pay off amount was $120k. I have many classmates that are still paying, over 20 years later . We got no help whatsoever some complained but when it comes right down to it we all knew what we were getting into when we signed the promissory notes for each loan.

At the same time the bankruptcy laws changed. The only ways you can discharge student loan debt are to (1) pay them off, (2) be declared totally and permanently disabled (e.g. quadriplegic) or (3) die.

What’s the justification for foregiving student loan debt of current or new debtors when there are more jobs than job applicants?

 

[HangOutdoors]

but when it comes right down to it we all knew what we were getting into when we signed the promissory notes for each loan.

Well put!

 

[Jim_in_Delaware]

What’s the justification for foregiving student loan debt of current or new debtors when there are more jobs than job applicants?

In part, because even through unemployment is at record lows, wages are surprisingly low.

If a recent graduate were to go into public service it is tough, to make ends meet. For example, a federal GS-5 starting salary in the Washington/Baltimore area is $40,833 a year (including the locality pay). I know my daughter's one bedroom apartment in this area is approximately $1,900 a month. Then throw in the fact that 4 in 10 folks with college debt never graduated college.

Jim

 

[BlkGS]

In part, because even through unemployment is at record lows, wages are surprisingly low.

If a recent graduate were to go into public service it is tough, to make ends meet. For example, a federal GS-5 starting salary in the Washington/Baltimore area is $40,833 a year (including the locality pay). I know my daughter's one bedroom apartment in this area is approximately $1,900 a month. Then throw in the fact that 4 in 10 folks with college debt never graduated college.

Jim

Then that sounds like somewhere to not take a job, because it's not cost effective. A higher education should easily have taught someone a basic calculation like that.

That said, I disagree with the assessment that wages are the issue. COST is the issue. Above posted paid 120k for a law degree. My college roommate paid 240k for his like 10 years ago. I'm sure the cost now is north of 400k. Colleges keep adding amenities and raising costs to the students because they can, there's no pressure from above to keep costs in line, and so cost grows while they add more and more stuff that doesn't improve educational value. Colleges are becoming more of a social force than a place of career preparation.

I maintain it would be very easy to sole this all. Have the schools be the lenders, subject to all the same rules and regulations as any other loan. If the college were to not get paid if their education did not easily pay for itself, watch how quickly prices would snap back into reality.

 

[Beachbummer]

Sorry, @haknslash I meant to ask @swatski to elaborate on his response to you, but the quotes got mixed up. Thanks for restating your position, I agree it is clear and there's no confusion on how you feel.

 

[HangOutdoors]

In part, because even through unemployment is at record lows, wages are surprisingly low.

Unemployment claims are at record lows, Not Unemployment (people without jobs), since the majority of those who were on benefits are no longer eligible. That is how it is gauged. Those unemployed are still at a rather higher rate at this time., and from I am seeing I good percentage is by choice. Believe me if those without jobs, which really couldn't be tracked accurately, could still be on unemployment they would be.

The misrepresentation of "Unemployment" numbers and percentages is a joke.

Additionally, wages in my industry are ridiculously high right now. I work in Information Technology. Salaries are up over 50%. I cannot find any talent right now. Companies are paying to keep their Staff. First year Software Developer is over $80k right now in Michigan, then it crosses $100k very quickly.

 

[Farny]

So you have a link to this proposal?

Initial thoughts & reaction (before digging into the proposal):

• Money has to come from somewhere (our tax dollars)?
• What kind of ethics does this teach the graduating student?
• Does this not devalue education?
• Do you have to be a US citizen?
• If debt is easily forgiven - I think I’ll go back to Harvard Medical school and have my son transfer and live off the free money in the meantime. Who cares about the price of anything - it’s all free through our forgiven student loans

 

[BlkGS]

Unemployment claims are at record lows, Not Unemployment (people without jobs), since the majority of those who were on benefits are no longer eligible. That is how it is gauged. Those unemployed are still at a rather higher rate at this time., and from I am seeing I good percentage is by choice. Believe me if those without jobs, which really couldn't be tracked accurately, could still be on unemployment they would be.

Anecdotally, the people I know who are currently not working and not on unemployment do not want to be working.

One lady quit our company a few weeks ago. They begged her to stay on, they'd go part time, fully remote, whatever she wanted just please don't leave. She flat out refused, and they're living off her husband's income. They were desperate to keep her because we have 7 vacancies for her role right now, and we can't fill them. There are simply no candidates.

My wife has an aunt who is not working, not on unemployment because she convinced the state of NY she's disabled... After she moved there from SC. The state of NY paid for her to have hip replacements, which I guess she claims she has too limited mobility now to work? It feels like a scam to me knowing her aunt, but whatever.

Obviously anecdotes, and could be outliers, but based on that I disagree. Right now, if you can stock a shelf or open a box, you can find a job.