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Flood Of Students Demanding Loan Forgiveness Forces Administration Scramble

Tyler Durden's picture




 

"Loan forgiveness creates incentives for students to borrow too much to attend college, potentially contributing to rising college prices for everyone," is a study's warning over government plans that allow students to rack up big debts and then forgive the unpaid balance after a set period. As WSJ reports, enrollment in student debt forgiveness plans have surged nearly 40% in just six months, to include at least 1.3 million Americans owing around $72 billion. The administration is looking to cap debt eligible for forgiveness, as President Obama's revamped Pay As You Earn scheme has seen applications soar and is estimated to cost taxpayers $14bn a year. The 'popularity' of the student loan bailout plan surged after Obama promoted it in 2012, and now the administration must back-track as costs have massively outpaced government predictions.

 

 

We have been aggresively focused on the government's blowing of the student loan bubble...

Student debt has nearly doubled since 2007 to $1.1 trillion, disproportionately driven by the growth in graduate-school debt.

And questioned the need to incur such massive credit-fueled costs of tuition only to gain a low-paying job...

there is no point in trying to preserve the old regime. Today's emphasis on measuring college education in terms of future earnings and employability may strike some as philistine, but most students have little choice. When you could pay your way through college by waiting tables, the idea that you should "study what interests you" was more viable than it is today, when the cost of a four-year degree often runs to six figures. For an 18-year-old, investing such a sum in an education without a payoff makes no more sense than buying a Ferrari on credit.

And while government plans are nothing new, Obama has aggressively promoted them...

The government has offered some form of income-based repayment since the early 1990s, but few studentsfound the terms enticing. But in 2007, Congress allowed borrowers working in nonprofit and government jobs to have unpaid debt forgiven after 10 years, and cut monthly payments for new borrowers to 15% of discretionary income.

 

In 2010, it cut those payments to 10% for borrowers who took out loans from 2014. A year later, Mr. Obama, through executive action, moved up the date when borrowers could qualify for the new terms, creating a program for those who took out loans from 2011. The White House this year has proposed making the program available to all student borrowers, regardless of when they signed their loans.

 

The popularity of the programs surged after the Obama administration began to promote them, starting in 2012, on the Internet and later through email to borrowers.

And it seems they are ripe for abuse...

"Income-based repayment can be a way for students responsibly to manage debt, but it should not be a bailout for students who borrow too much or for schools who charge too much," said Sen. Lamar Alexander of Tennessee, the ranking Republican on the Senate Education Committee.

But, as usual, the government screwed up...

The plans' long-term costs have greatly outpaced the government's predictions. In the last fiscal year, debt absorbed by the repayment plans from the most widely used student-loan program—Stafford loans—exceeded government expectations from a year earlier by 90%.

 

...

 

A report Monday last week from the Brookings Institution, a centrist think tank, offered one of the few preliminary examinations of the programs' impact. The most popular plan could cost taxpayers $14 billion a year if it becomes available to all borrowers as Mr. Obama has proposed, while fueling tuition inflation, it said.

 

"Loan forgiveness creates incentives for students to borrow too much to attend college, potentially contributing to rising college prices for everyone," the study said. The authors recommend scrapping the forgiveness provisions.

Sure enough everyone piled in looking for their handout...

Enrollment in the plans—which allow students to rack up big debts and then forgive the unpaid balance after a set period—has surged nearly 40% in just six months, to include at least 1.3 million Americans owing around $72 billion, U.S. Education Department records show.

 

Which means costs are soaring and the administration feels the need to do something to fix what it had broken by intervening once again...

 

The Obama administration has proposed in its latest budget released last month to cap debt eligible for forgiveness at $57,500 per student. There is currently no limit on such debt.

 

The move reflects concerns in the administration not just about the hit to the government, but over the risk that promising huge debt forgiveness could make borrowers and schools less disciplined about costs. Colleges might charge more than they would otherwise, leading students to borrow more.

And so is the government about to pop the student loan bubble by spoiling a good thing - unlimited debt forgiveness - for students and trickling down that credit tightening impact on colleges only to happy to raise tuition costs to reflect the credit-forgiveness-adjusted amount of money on the table?

Source: The Wall Street Journal

 

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Tue, 04/22/2014 - 14:27 | 4683534 Shizzmoney
Shizzmoney's picture

TBH, what's worse: a college grad with 100k+ debt making $50k/year; or HS grad with no debt making 33k/yr?

"Consumers" are choosing the ladder:

http://t.co/N5VPNY9VnP

And good for them. Fuck debt and fuck this bullshit system.

Tue, 04/22/2014 - 14:31 | 4683561 TruthInSunshine
TruthInSunshine's picture

1) Borrow 80k to 200k in student loans (to attend the 8 year associates degree program at the University of Phoenix, ITT Tech, Everest University, that place that guarantees you will make oodles of money repairing Harley Davidsons, etc.).

2) Buy Lululemon, Priceline, Herbalife, etc., stock & call options with the loan money.

3) Reap 20x your student loan money that you invested.

4) Default on loan but keep the cool 1.6 million to 4 million, yo!

Ka-Ching, Bitchez! Ka-Ching!

Billary/JebShrub 2016

Tue, 04/22/2014 - 14:35 | 4683575 Badabing
Badabing's picture

we need Obama ed

 

sarc

 

 

Tue, 04/22/2014 - 14:52 | 4683675 Billy Sol Estes
Billy Sol Estes's picture

Can't default on Student Loans, death is the only way out.

Tue, 04/22/2014 - 15:11 | 4683766 MagicHandPuppet
MagicHandPuppet's picture

Sometimes I wonder if I'll regret paying off all of my student loans.  I suspect there will be a student loan "jubilee" one day... and the tax payers will be led to believe that they are getting a nice favor.

Tue, 04/22/2014 - 15:45 | 4683919 Ying-Yang
Ying-Yang's picture

" unlimited debt forgiveness"

Yeah, dis is wat we all want, gimme some of that!

Tue, 04/22/2014 - 17:06 | 4684191 Latina Lover
Latina Lover's picture

We should send the students to fight in the Ukraine and when they die, we can collect on the insurance.

Signed the Banksters.

Tue, 04/22/2014 - 17:28 | 4684241 Arius
Arius's picture

seriously, it can be established a debt forgiveness program similar to the latinos getting the green card.

there were many latinos who went to Iraq and Afghanistan in order to receive the green card.

 

It might be a hard sell to Americans who are used only to receive for free,but guess what there is no free lunch ... you want a debt forgiveness go and fight for it ...

why are these students so special and different from latinos or even US army people who went into army in order to get some education ... most of the people who join the military do it because they want to make a living even at the price of risking their lifes ...

 

Tue, 04/22/2014 - 17:53 | 4684339 Pairadimes
Pairadimes's picture

"...costs have massively outpaced government predictions."

 

Correct me if I am wrong, but I am almost certain I have heard this before.

Tue, 04/22/2014 - 18:13 | 4684381 g'kar
g'kar's picture

If they forgive the loan debt, the IRS will call it income and send the debtor the tax bill like they did with home debt forgiveness.

Tue, 04/22/2014 - 18:36 | 4684449 TruthInSunshine
TruthInSunshine's picture

FSA mobilizing again.

Billary will not miss seizing this opportunity to spread a message of repackaged Hope & Change in 2016.

Tue, 04/22/2014 - 19:00 | 4684524 CheapBastard
CheapBastard's picture

Mr Ben Dover will pay. No worries.

Move along.....nothing to see here ... just moar FSA stuff....

Tue, 04/22/2014 - 19:37 | 4684652 mjcOH1
mjcOH1's picture

"If they forgive the loan debt, the IRS will call it income and send the debtor the tax bill like they did with home debt forgiveness."

 

That's Old Think, dude.   We're in the vote buying business here.    We're already handing out 4 years of beer money and free housing for Black/Women's Studies in exchange for the debt foregiveness vote.   Let's not pretend we'll be harshing the buzz by calling that income when the (shrinking) pool of taxpayers get handed the bill on default.

Tue, 04/22/2014 - 22:05 | 4685166 g'kar
g'kar's picture

"That's Old Think, dude."

 

Too old to think any other way. However, you are correct.

Wed, 04/23/2014 - 03:59 | 4685693 laomei
laomei's picture

Actually, that's exactly what will happen for all the IBR programs and whatnot once they hit the required number of years.  It's actually an incentive to earn less or go overseas, as overseas you get the tax exemption which knocks your AGI to $0 and thus removes all payments.  In fact, you can go one further.  Props to whoever does it first.

Find a 501c3 bullshit charity and have a "donation" made which covers your salary for the year.  Best to do it in the name of the benefactor, ideally someone who could use the deduction.  Then split the deduction with said person.  They get a record of charity and a tax writeoff, you get a job which will knock out your debt in 10 years of "service" and possibly even profit off of it.  Meanwhile, you base yourself overseas as a remote employee (web something services whatever) to eliminate any tax obligations and work your real job.  The only tax you get hit with is FICA, which sucks, but you make it back from the tax-refund kickback scheme and you increase the number of pay-in years you have under your belt.

 

If you are under a 501c3, in 10 years of IBR, you end up with full forgiveness and NO TAX implications from said forgiveness. 

Tue, 04/22/2014 - 19:50 | 4684703 A Nanny Moose
A Nanny Moose's picture

Sounds like it might be contagious. If you get to close, be sure to wash yourself thoroughly. Moar antibiotics!

Tue, 04/22/2014 - 17:06 | 4684192 Dr_D
Dr_D's picture

Its called (hyper)inflation - the fed is doing all it can to print more as we speak...

Tue, 04/22/2014 - 17:36 | 4684272 TheFourthStooge-ing
TheFourthStooge-ing's picture

No shit. I mean, c'mon, the Bernank was juicing things at 85 billion clownbux per month.

Obama's revamped Pay As You Earn scheme has seen applications soar and is estimated to cost taxpayers $14bn a year.

...or about 5 BDEs (Bernanke Day Equivalents). Seems like small potatoes.

Tue, 04/22/2014 - 18:54 | 4684502 itstippy
itstippy's picture

+1 for "BDEs"

Tue, 04/22/2014 - 20:52 | 4684945 TruthInSunshine
TruthInSunshine's picture

BDEs have been replaced by YIUs; Yellen Inflationary Units

Tue, 04/22/2014 - 22:08 | 4685171 Henry Chinaski
Henry Chinaski's picture

No. It is all part of the plan to make higher education an entitlement.  When enough people are "unfairly" burdened by student debt, there will be an outcry to have another FED Govt bailout. The bailout will be predicated on an universal college education entitlement program that will be funded by a payroll confiscation program like social security and medicare.

Wed, 04/23/2014 - 01:38 | 4685544 Canoe Driver
Canoe Driver's picture

Hey, this post contains an insult to Ferrari buyers. Correction: it's much wiser to buy a Ferrari on credit than to spend an equivalent amount on an "education," and then go to work at the mall.  With the Ferrari, there is considerable residual value. Not so with the "education."

Also, what does it say about current government morality when the Feds will limit the loan foregiveness program to a reasonable amount, here $57,500, but will take no such action to limit the student debt itself, to a congruent reasonable amount?

Even if they limited all student borrowing to $57,500 per head, in aggregate, without explicitly limiting tuition itself, the effects would be very positive. Effectively, the student loan bubble would immediately burst, and tuition would have found an upper limit, which is healthy for all. The notion of using endless credit to support ever higher prices, both for education and for housing, is purely inflationary. Thus, even university administrators, getting unending salary increases, are deluded because their actual purchasing power is going in the toilet.

I am a cash home buyer who is having to add $200k a year to the purchase kitty just to keep up with the inflation in housing.  It's not just the overt price increases, but the fact that the pool of available homes for a given price is constantly getting older, or the parcel is shrinking, etc. It's all currency devaluation, period.

One gets the feeling that no one is at the helm of the ship of state. It's all so very stupid.

Tue, 04/22/2014 - 17:14 | 4684196 SamAdams
SamAdams's picture

Sorry if I'm desensitized to the predicament, but I thought $72 billion was just something that the FED prints every month forever?  I'm failing to see an emergency here...  Just print $72 billion, poof, problem solved....

Isn't that the solution?  Isn't that what the solution has been since 2008?  Has something changed here?  Just have the FED add to its $40 billion monthly of mortgage backed securities a few billion of student loan securites.  Expand that balance sheet.  Keep going, you are going to own it all!  Maybe eventually, the US will default to the FED, the FED will then default to China which will then own the FED shares on the cheap using all that funny money we sent them.

This is gonna work out great!

Tue, 04/22/2014 - 18:38 | 4684457 James_Cole
James_Cole's picture

Sorry if I'm desensitized to the predicament, but I thought $72 billion was just something that the FED prints every month forever? 

They like to harp about student loan debt because it's a good smokescreen. Right along with unions and teachers, the other ultimate destroyers of economies lol

http://images.angelpub.com/2011/19/8519/rising-student-debt.jpg

^I wonder how that happened? 

Somehow other countries haven't had the same explosion in costs...even *gasp* without the benefit of king dollar. 

And again because it's the only chart that matters:

http://static.cdn-seekingalpha.com/uploads/2013/6/19/728943-137168051798...

Tue, 04/22/2014 - 22:07 | 4685169 Buck Johnson
Buck Johnson's picture

Your exactly right, it's all a smoke screen.  I was going to also say that 75 billion dollars is chump change compared to what we have been doing month to month for years let alone the trillions that was used to bailout the banks on top of that.  They are setting up in a row a bunch of scape goats for when the economy implodes and people need someone or group to blame.  You see we go to college to get a high salary position that business wouldn't give us without a degree.  But yet our govt. allowed those same businesses to outsource and insource foreign workers for less because the American worker both hourly and salary was demanding to much for pay and benefits.  We had to go to college and rack up that debt because we wouldn't be able to buy those 100,000 dollar or more houses on a waitress salary or on 33 thousand a year (if you can find that without a degree). 

American businesses and govt. want their cake and eat it too.  You see I wouldn't mind a dollar an hour salary, not a bit.  But businesses and govt. would have to bring the price of goods and services down to the new salary that most would be getting.  So that house would be worth 2,000 dollars instead of 100,000 dollars.  A 60 inch flat screen LG television would be 200 dolllars instead of 2,000 etc. etc..  They don't want that and that is why our country is going through Stagflation.

Tue, 04/22/2014 - 15:47 | 4683924 seek
seek's picture

One way or another there will be a jubilee -- either people will give it to themselves by simply not paying and going the EBT route (and isn't that comical, incentivizing the most educated to not work, because they'll be better off) -- or because it will be a thinly veiled bailout of the banks that funded the student loans.

I imagine there's going to be some interesting hooks for any official debt forgiveness, e.g. 5 years of work in the inner city for free, etc.

Tue, 04/22/2014 - 17:07 | 4684193 onewayticket2
onewayticket2's picture

.....and it begins.  articles about Student Loan Forgiveness.

either this election or they'll give it to Hillary....either way, the students are going to get their bailout (in exchange for votes).

 

just watch.

Tue, 04/22/2014 - 19:06 | 4684548 Serenity Now
Serenity Now's picture

Seek, they already have that.  You can get student loans "forgiven" if you do "public interest" work.

It's a triple whammy for the taxpayer because:

1.  Those jobs are usually taxpayer-funded jobs in the first place;

2.  Those jobs don't usually add anything to the economy (nor taxes);

3.  Congratulations!  You now get to pay off the student loan, too!

Tue, 04/22/2014 - 21:01 | 4684984 centerline
centerline's picture

Seek,

What will happen first is private colleges going bust.  ROI is going to fuck them up as people figure out the BS.  State colleges will fail next but will get bailed out.

Here is the ringer.  The private colleges will reorganize under bankruptcy and come back with costs that .GOV wont be able to beat.  That is when the S hits the real fan.  The public wave is going to crash and lead to a private wave of investment.  It is just the cycle of things.

The real problem of course is the takedown of .GOV by its own bloated, corrupt weight.  That is how we face some sort of mad max or similarly sucky outcome.

Tue, 04/22/2014 - 18:20 | 4684409 CH1
CH1's picture

I suspect there will be a student loan "jubilee" one day

Yeah, but those motherfuckers will have some ugly strings attached.

Tue, 04/22/2014 - 21:22 | 4685048 FreedomGuy
FreedomGuy's picture

I believe all those socialist professors who think business profits are the source of all evil, who do a couple classes a week for over $100k pay and benefits, who believe government should control the price of everything...should all donate a large portion of their pay to make higher education free or a "fair" price...which would be nearly free by most reckoning.

Yer, put your socialist actions where your (bullshit) socialist mouth is.

Wed, 04/23/2014 - 07:27 | 4685922 eatapeach
eatapeach's picture

Isn't a collapsed dollar a total jubilee?

Wed, 04/23/2014 - 08:37 | 4686076 PT
PT's picture

Why do we have student loans anyway?  If the courses are so good then wouldn't they pay for themselves via higher incomes and thus higher taxes?  Aren't student loans just double dipping?  Or are all your unis private?

The largest demographic, the baby boomers, have just come out of their peak earning years (okay, yes, they're all starting to retire now).  Didn't that mean higher tax revenue and proportionately less education costs per head of population?  Why does all the baby-boomer rhetoric only ever work in one direction?

If student loan costs are too high, doesn't that mean an over-supply of students ( or undersupply of teachers - again, why would we have a shortage of teachers if the baby-boomers are at their peak level of experience? )  If there is an over-supply of students, wouldn't that suggest an over-supply of graduates and so lower salaries in the future?  Wouldn't you be better off taking a cheaper course that no-one wants to do so you can be the only graduate and command a higher price for your skills?  

Actually, wouldn't you prefer to have a boss come up to you and say, "Quick!  I desperately need you to learn THIS so I can make a huge profit!  I'll pay for your tuition!  I'll pay for your accommodation!  Just do it!"  Err, those bosses are VERY hard to find but they do exist.  But you'll never find one while you got your nose buried in a book.  Sorry I can't be more helpful.

 

Wed, 04/23/2014 - 08:56 | 4686126 Ghostdog
Ghostdog's picture

Herr President is drooling over that prospect of vote buying

Tue, 04/22/2014 - 15:14 | 4683769 wee-weed up
wee-weed up's picture

 

 

Yep, Sugar-Daddy Obozo's pen will make them all go away.

"Stroke of the pen... law of the land... kinda neat!"

Tue, 04/22/2014 - 15:26 | 4683829 libertus
libertus's picture

Tyler:

Please check out oplerno.com. There are a lot of people working to create a new disintermediated higher education system that rewards great teaching has small classes and keeps costs low for students. It's all about leveraging technology and actually producing a transparent marketplace that links students and teachers within an accrediated institution. They just got approval to offer courses for credit by the State Board of Education in Vermont--the first step after only 8 months in operation. Time for a total reset in higher ed. This is one answer!

Help them get the word out. 

 

Tue, 04/22/2014 - 15:29 | 4683845 Son of Loki
Son of Loki's picture

"Just walk away."

I have no doubt inncoent taxpayers are going to hit between the eyes with this, "loan forgiveness" stuff.

Tue, 04/22/2014 - 17:09 | 4684199 onewayticket2
onewayticket2's picture

check out SoFi...they're skimming all the best loans out of the govt pool....the top 100 schools (where the default rate is the lowest)....leaving only the adverse selection pool to hit tipping point more quickly.

Tue, 04/22/2014 - 21:09 | 4685012 peterZ
peterZ's picture

not even...the IRS will come after the family.

Tue, 04/22/2014 - 22:36 | 4685238 Antifaschistische
Antifaschistische's picture

build stellar credit, pay off student loans with Visa/MasterCard/Chase whatever cards or personal loans from a bank.....sit tight for a year, then file for bankruptcy and hand them the pile of credit cards.

Note: may require help from Mom & Dad to build your credit, but don't use the cosigner feature except for the very first card with a $1k limit, when you're a freshman.

Wed, 04/23/2014 - 07:00 | 4685878 August
August's picture

You could always defect to Eurasia or Eastasia.

Tue, 04/22/2014 - 14:54 | 4683682 0b1knob
0b1knob's picture

Loans which can't be repaid won't be repaid.   It will all be written off one way or another.   Of course it will be done in a manner that will make the ex-students Democrat vote slaves forever.

Tue, 04/22/2014 - 15:05 | 4683743 Greenskeeper_Carl
Greenskeeper_Carl's picture

wont work like that, at least not as much as they would like. my wife doesnt like this govt any more than i do, but she would gladly let them take those loans off her hands. my main worry is that eventually they come after MY assets simply because we are married, even though we hadnt even met when she took those loans. i don't really think thats fair to the people who have worked hard and paid theirs off, but somethings gotta give. its tough to explain why its wrong to people who witnessed what the govt did for the banks after they got in over their heads in bad debt. especially since they are just creating this money out of thin air

Tue, 04/22/2014 - 15:19 | 4683799 Billy Sol Estes
Billy Sol Estes's picture

My GF will be $125k in the hole when she graduates. She "hates" Obama but loves the free birth control and is hopeful about debt forgiveness.

Tue, 04/22/2014 - 15:31 | 4683859 Chump
Chump's picture

Do.not.put.a.ring.on.that.

Tue, 04/22/2014 - 16:45 | 4684120 Rubbish
Rubbish's picture

Damn that birth control didn't work honey.

Tue, 04/22/2014 - 21:09 | 4685011 centerline
centerline's picture

If she is good person, no worries.  This broken-ass world is going to break.  Just be ready for it.

Punishing people because they did not understand or got leveraged by whatever insecurity or imaturity... whatever reason... is just criminal.  Predatory.  Never ever think anything different.  The world as it is now eats good people every day.  And good people need taking care of.

Yeah, there are those of us who see this and are watching.  We wont forget.  We wont forgive.  Time has long past for forgiveness. 

Wed, 04/23/2014 - 01:42 | 4685585 Canoe Driver
Canoe Driver's picture

"My GF will be $125k in the hole." Poor choice of words. But then, the hole is often the solution to the female debt conundrum.

$125k for what? Another law student, no doubt.

Wed, 04/23/2014 - 02:11 | 4685617 SoCalBusted
SoCalBusted's picture

If it flies, floats or fucks, rent it.

Tue, 04/22/2014 - 16:13 | 4684020 BobRocket
BobRocket's picture

You haven't quite grasped it have you, whilst you are still alive you owe the money, if you pay it off you shrink tha balance sheet. If you die you foreclose, this means that the bank (remember them) is on the hook.

They make their day money on the fees they charge on new loans.

When debtors die it makes a hole in their balance sheet. You, because you have assets will make good that hole.

Whilst the debtors are alive the debt can be re-hypothecated via the fed into a new loan, new loans attract fees.

(in actual fact, when a non-performing non-dischargeable debt is lodged with the fed it cancels an existing repayable debt which allows the bank to create (from thin air) new money)

It is money for recycled old rope, that is why they call themselves the Masters of the Universe

 

 

 

 

Tue, 04/22/2014 - 14:35 | 4683580 Hippocratic Oaf
Hippocratic Oaf's picture

You mean i actually have to pay it back?!?!?!?!?!?!?!

Gawd!!!!

Tue, 04/22/2014 - 14:38 | 4683595 ZerOhead
ZerOhead's picture

This debt forgiveness nonsense has to stop before it gets worse.

Perhaps Obama could be just the guy to sell Americans on reinstituting slavery. I doubt at this point Clarence Thomas and the Supreme Court would likely object.

Tue, 04/22/2014 - 14:43 | 4683623 McMolotov
McMolotov's picture

That's the way you do it, get your money for nothin' and your chicks for free.

Tue, 04/22/2014 - 15:48 | 4683931 quasimodo
quasimodo's picture

Or in his case, your dicks for free.

 

Tue, 04/22/2014 - 18:52 | 4684498 Papasmurf
Papasmurf's picture

I think ITT Tech produces more graduates capable of a skill than most of the big buck liberal arts colleges.

Tue, 04/22/2014 - 21:47 | 4685128 Freddie
Freddie's picture

Woman says "Does my ass look big in LuluLemon gear?"

Warning: What has been seen cannot always be unseen:

http://www.returnofkings.com/wp-content/uploads/2013/11/350x364xripped-y...

Tue, 04/22/2014 - 14:49 | 4683646 Ol Man
Ol Man's picture

What we could really use is tax forgiveness...

Tue, 04/22/2014 - 14:54 | 4683686 Headbanger
Headbanger's picture

Hey.. I just want a new truck while we're at it..

Let's see now... F350 Power Stroke... GMC 3500 Duramax... 

 

Tue, 04/22/2014 - 15:01 | 4683721 Ol Man
Ol Man's picture

Put me on the new truck list as well....8>)

 

 

Tue, 04/22/2014 - 15:05 | 4683736 NoDebt
NoDebt's picture

That value of that truck will be taxable to you, unfortunately.  Just like when people win a car on Wheel of Fortune or, perhaps, that $4,500 cash-for-clunkers rebate from a few years back.  All taxable.

But you asked for a government program, so you knew this was part of the deal, of course.

Tue, 04/22/2014 - 15:25 | 4683820 KidHorn
KidHorn's picture

Cash for clunkers wasn't taxable. It wasn't a rebate. It was a trade in of an old car. Not any different than any other trade in.

Tue, 04/22/2014 - 15:26 | 4683828 NoDebt
NoDebt's picture

It was most definitely taxable, Kid.  Ask me how I know.

Tue, 04/22/2014 - 15:51 | 4683942 quasimodo
quasimodo's picture

I witnessed many a truck or car having the engine ran so damn hot to sieze them up that they had to keep fire suppresion on hand.....it was a damn shame, some of them were in good shape. 

Tue, 04/22/2014 - 18:32 | 4684442 post turtle saver
post turtle saver's picture

broken window fallacy made policy

Tue, 04/22/2014 - 20:26 | 4684846 Greenskeeper_Carl
Greenskeeper_Carl's picture

Ill bite. "How do you know"? (really curious how that went, i kept my 8 year old gas guzzler, too pretty..)

gotta love the unintended consequences from this govt folly- driving the price of a decent used car up, screwing over the little guy in yet another way

Tue, 04/22/2014 - 15:33 | 4683869 Overfed
Overfed's picture

WTF? It was a trade in of an old car for some gubmint cheese. CforC is over and now I won't get $4500 from Unka Sugar for my old beater.

Tue, 04/22/2014 - 15:23 | 4683812 SDShack
SDShack's picture

Tax forgiveness will never happen. But the winds of change are blowing in other areas. The biggest evidence is millions of gun owners refusing to "comply" with laws "mandating" they register their "assault weapons". Overnight, these protesters have become felons in the eyes of the govt. but the govt fears the blowback they will get from millions of pissed off gun owners if they try to enforce the mandate. Just look at the Bundy BLM standoff, and multiply that by a Million. Civil Disobedience is sprouting and will grow as the economy continues to deteriorate. I see the day coming after the 0zer0care fines kick in, that people start adjusting their W4's so they don't get a tax refund each year to prevent the govt from taking the 0zer0care fine from their tax refund. The next step is millions (just like gun owners) will refuse to file tax returns. That is when govt will have to strike back since they only exist because of tax revenue. The kindling is buiding and getting drier and drier every year. It is only going to take a spark, and that day is coming. There is a reason why the NSA is spying on every citizen. The govt wants to control the internet and social media. The IRS is extorting every citizen. The DHS and every other Govt Agency is stockpiling billions of rounds of ammo. They know the potential for revolt is coming and they are desperate to stop it before it spreads. Plan accordingly.

Tue, 04/22/2014 - 17:58 | 4684356 Advoc8tr
Advoc8tr's picture

We thought the same thing when they took our guns ... they will just wait it out and successive generations brought up under the new "rules" eventually slide quietly into compliance. All new purchases are no doubt registered by default - death by a thousand cuts; same as it ever was.

On Topic - we've had governemnt voucher university funding for a long time here in Australia ... the debt repayments are automatically deducted along with income tax once you start earning ... works well. Difference is there is no middle man bank callecting interest payments or fees and the "loans" are capped at a prescribed amount for each course which has the effect of containing the fees charged by the universities - so they can attract the most students.  The debt does not show up on your credit history and has no time limit for repayment.  If you lose your job payments stop until you're earning again.  If you're going to print money or provide welfare it is one of the better, more deserving and beneficial causes from a societal view ?

Tue, 04/22/2014 - 22:10 | 4685174 Freddie
Freddie's picture

I post this often but it is worth it. 

http://wsfrprograms.fws.gov/Subpages/LicenseInfo/HuntingLicCertHistory20...

14.6 million licensed hunters in the USA.  How many have .308 rifles with scopes?  Cammo outfits for hunting?

Some of the states you never dreamed of in the NE have tons of licensed hunters.

PA 968,735

NY 581,401

The list has all 50 states and the numbers are mind boggling.  How many of theses hunters are happy with what is happening to America?

 

Tue, 04/22/2014 - 14:58 | 4683708 ebworthen
ebworthen's picture

I think you meant "choosing the latter" versus "ladder"; but both groups are climing the ladder to debt serfdom.

Thanks for the cool article/chart; it appears some consumers are averse to debt.

Tue, 04/22/2014 - 15:19 | 4683798 ILLILLILLI
ILLILLILLI's picture

I see an M.C. Escher kinda thing going on there....

Tue, 04/22/2014 - 17:10 | 4684207 drendebe10
drendebe10's picture

More freebies for votes by the arrogant, narcissistic, lying, illegal alien indonesian kenyan muslim sociopathic fudge packer in chief living the obscene grand imperial life style with all of this funded by the sucker tax paying serfs and peasants....

Tue, 04/22/2014 - 18:11 | 4684378 SilverRhino
SilverRhino's picture

Amen

Tue, 04/22/2014 - 18:49 | 4684486 villainvomit
villainvomit's picture

I opt out for paying the loans that the studnts made promises to and then opted out.

 

Yeah yeah......caniculae

Tue, 04/22/2014 - 19:58 | 4684738 Van Halen
Van Halen's picture

Why are these students demanding loan forgiveness when they can just go out and get a job?

Hey, wait!

Tue, 04/22/2014 - 14:28 | 4683535 ebworthen
ebworthen's picture

If .gov followed their previous 2008 example of bailing out banks/insurers/corporations they'd raid the Treasury for $1 Trillion, forgive all the student debt, then turn around and lend those kids all the money they wanted at 0.25%.

Tue, 04/22/2014 - 14:31 | 4683557 813kml
813kml's picture

I could see the forgiveness happening, if only to buy the White House in 2016 for the Dems.  But the thing is, if they forgive one loan they will have to forgive them all.  It will add to national debt but that's hardly a concern anymore.

Tue, 04/22/2014 - 14:38 | 4683593 Hippocratic Oaf
Hippocratic Oaf's picture

2016?

Forgiving ALL student debt, well................we know the LBJ quote of the century:

'I'll have those niggers voting Democratic for the next 200 years"

Tue, 04/22/2014 - 14:54 | 4683685 StacksOnStacks
StacksOnStacks's picture

Try convincing ANY black person that that is real. Why?  Because the Democratic party is the party of the poor people and minorities.  LMFAO!!!!!! People are horribly ignorant and would rather be slowly, painfully murdered than to pick up a book and learn something.

Tue, 04/22/2014 - 16:11 | 4684016 MrTown3
MrTown3's picture

Try meeting a real black person first idiot...

Tue, 04/22/2014 - 16:58 | 4684169 N2OJoe
N2OJoe's picture

There are exceptions to every rule but by-and-large, he is 100% correct.

Tue, 04/22/2014 - 17:37 | 4684278 Tengri Temujin
Tengri Temujin's picture

Nobody has to do anything, the hyperinflation will pay off all the debt. For the price of one loaf of bread, 100K dollars you can pay off your entire student debt.

But I am sure the govt will time it just right for the votes and forgive the debt.  Expect hyperinflation soon thereafter

Tue, 04/22/2014 - 17:46 | 4684314 Arius
Arius's picture

Red team - Blue team

democreats vs. republicans

lets go at each other ... well, gladiators probably did not want to fight either, but no choice ... sorry, thats life in the big city

Tue, 04/22/2014 - 23:34 | 4685397 adr
adr's picture

In a college history class one brave professor ran the tape of LBJ saying,

"It's damn criminal what we're doing to these people, but we need their votes. We're going to give them everything, break them down, and we'll have those niggers voting Democratic for the next 200 years."

LBJ along with most democrats were fucking racist pigs. They destroyed the black family along with every major American city for votes.  Detroit, Philly, Cleveland, Oakland, etc are the direct result of The Great Society. A race of people dumbed down, drugged up, and armed to the teeth. 

Tue, 04/22/2014 - 17:04 | 4684185 Deathrips
Deathrips's picture

What is a "real" Black person?

 

Tue, 04/22/2014 - 17:12 | 4684209 drendebe10
drendebe10's picture

... well for starters, not one who is an illegal alien indonesian kenyan muslim.... 

Tue, 04/22/2014 - 15:21 | 4683807 ILLILLILLI
ILLILLILLI's picture

The Supreme Court voted today 6-2 to allow a ban on Affirmative Action hiring...

Tue, 04/22/2014 - 15:27 | 4683834 KidHorn
KidHorn's picture

AA is not really needed any more. Glad to see it may go away.

Tue, 04/22/2014 - 14:49 | 4683651 RafterManFMJ
RafterManFMJ's picture

Nothing satisfies like nailing a Women's Studies major who was forced to prostitution to make her ends meet.

When asked for a name, I call myself Pat. Last name Riarchy.

Tue, 04/22/2014 - 15:08 | 4683756 Greenskeeper_Carl
Greenskeeper_Carl's picture

as the song says," a lap dance is so much better when the stripper is cryin' "

 

Wed, 04/23/2014 - 00:22 | 4685475 Tsunami Wave
Tsunami Wave's picture

Great song, I used to play it when I was a DJ doing college radio.  That song was so heavily edited though, most of the time you'd hear the instrumental.

Wed, 04/23/2014 - 02:17 | 4685625 SoCalBusted
SoCalBusted's picture

Half right.  They would forgive the loans and then give the bankers free money to lend out to kids without jobs at 24.99% on plastic.

Tue, 04/22/2014 - 14:27 | 4683536 Itchy and Scratchy
Itchy and Scratchy's picture

Next thing you'll be telling me is that my M.A. in Puppetry has no value! Ya right!

Tue, 04/22/2014 - 15:23 | 4683813 ILLILLILLI
ILLILLILLI's picture

Sounds like you are qualified for some kind of elite government program...

Tue, 04/22/2014 - 15:27 | 4683835 SDShack
SDShack's picture

As an engineer, I found it depressing that there wasn't any Masters in Engineering listed. Just looking at what the students are studying says a lot about the sorry state of the USSA. Truly sad.

Tue, 04/22/2014 - 19:58 | 4684736 cynicalskeptic
cynicalskeptic's picture

WAAAY too many lawyers - and nowhere near enough need so they end up as politicians or ambulance chasers (not sure which is worse but both are costing you and I a fortune).   Law School is one of the biggest scams going - most of those going to a second tier school will NOT find employment and you're going to have a hard time at even the top schools unless you're at the very top of your class.  The big money is NOT there like it used to be.

Same thing for Busioness School.  Unless you're going to a top school - or work is paying for your MBA (another scam requiring an MBA even if you learn nothing getting it) it is NOT worth the money.  But with all the otherwise unemployable Liberal Arts majors going to Law School or Business School you're guaranteed a huge growth in debt.

 

Of course they should end all the 'for profit' crap schools that depend on government loans for people who are not qualified in any way shape or form for 'college', who drop out in no time but with a lifetime of loan payments.  THAT is the ultimate scam and one that's easily ended.

Tue, 04/22/2014 - 15:57 | 4683962 BurningFuld
BurningFuld's picture

So you're the guy with your hand up Obama's ass making him talk. I wondered.

Tue, 04/22/2014 - 14:28 | 4683539 Ignatius
Ignatius's picture

Cancel all these debts (except for the lawyers).

Tue, 04/22/2014 - 14:30 | 4683549 Deathrips
Deathrips's picture

Has less value than my lesbian sexual exploration extra curricular degree..earned simultaneous as real degree. It may have cost me a couple beers. Dont tell the wife...lol.

 

 

RIPS

Tue, 04/22/2014 - 14:33 | 4683566 Ignatius
Ignatius's picture

Sounds more useful than my degree in The Hairy Butt of the N. American Black Bear.

Tue, 04/22/2014 - 14:48 | 4683645 Deathrips
Deathrips's picture

I had read the outline to that degree..after a quick self inflicted beating. I opted for some real college value. Lesbians/bisexual women...and me.

Just try and take that shit away from me. LOL

 

RIPS

Tue, 04/22/2014 - 14:56 | 4683697 Ignatius
Ignatius's picture

What caught me was the exhilaration and danger when close examination was required.  Extra credit for plucking a pube and winning the sprint to the lab.

Still, I must agree, you had more fun.

Tue, 04/22/2014 - 14:47 | 4683636 Bill of Rights
Bill of Rights's picture

Well since we're in a canceling mood Ill add my Mortgage to the fray...small but debt no less.

Tue, 04/22/2014 - 14:28 | 4683540 Dr. Engali
Dr. Engali's picture

No worries. soon they will earn debt forgiveness by volunteering to defend the homeland against those scary terrorists (which is just about every free thinking person in the world).

Tue, 04/22/2014 - 14:32 | 4683563 813kml
813kml's picture

That's a very real possibility, much more palatable than a draft.

Tue, 04/22/2014 - 15:05 | 4683742 Sabibaby
Sabibaby's picture

So am I a terroist because I paid off all my loans and got out of debt?

Tue, 04/22/2014 - 15:07 | 4683752 QQQBall
QQQBall's picture

Dude, wake the hell up. What you ahve now is a poverty draft, but I get your point.

Tue, 04/22/2014 - 15:12 | 4683773 Greenskeeper_Carl
Greenskeeper_Carl's picture

unfortunatly, thats a very acurate statement. Most people that joined for the college money, or just bordeom, are now staying in since there arent jobs out there that pay as well. I loved how everyone jumped on the bitch on MSNBC for saying most people join up because they need the money, and everyone(mostly those who have never served in the armed forces) gt all spun up about it. But it was the palin, ugly truth. but the idea that poster above you put out, debt slaves to the front line, that is scary shit right there

Tue, 04/22/2014 - 18:36 | 4684450 post turtle saver
post turtle saver's picture

"palin, ugly truth" is almost up there with "shitgums", good one

Tue, 04/22/2014 - 20:01 | 4684753 cynicalskeptic
cynicalskeptic's picture

Army recruiters were having a hard time getting recruits before the 07 crash.  They were literally scraping the barrel when it came to educational minimums and physical fitness.  

AFTER the crash....  it's been easy to fill slots.

Tue, 04/22/2014 - 14:33 | 4683567 disabledvet
disabledvet's picture

they're called "patriots" now. and "no your debt is still not forgiven." we're gonna pay that thing off one taxable penny at a time.

It might take a while...but we're good for it! Now get in there and start buying!

Tue, 04/22/2014 - 14:44 | 4683619 Gaius Frakkin' ...
Gaius Frakkin' Baltar's picture

You mean CLRP?
http://usmilitary.about.com/cs/joiningup/a/clrp.htm

It's been around for awhile.

Tue, 04/22/2014 - 14:52 | 4683672 reTARD
reTARD's picture

+1 They're not bankers, so they're serfs for life. Perhaps sacrificial serfs to be more precise.

Tue, 04/22/2014 - 15:37 | 4683890 Overfed
Overfed's picture

How very Roman that sounds.

Tue, 04/22/2014 - 14:34 | 4683542 Hohum
Hohum's picture

I think this forgiven debt is income to the IRS.  Strike one for borrowing too much; strike two for the tax liability.  Exceptions may apply to the nonprofit and government workers.

Tue, 04/22/2014 - 14:28 | 4683544 alangreedspank
alangreedspank's picture

Bribing people with their own money has never been so politically profitable!

Tue, 04/22/2014 - 14:28 | 4683546 Uncle Remus
Uncle Remus's picture

.

costs have massively outpaced government predictions

SOP for government.

Tue, 04/22/2014 - 14:30 | 4683553 youngman
youngman's picture

You can bet on it for buyig votes this will be a big item in the next election....1 trillion worth of votes out there....

Tue, 04/22/2014 - 14:40 | 4683605 Duke Dog
Duke Dog's picture

Exactly my first thought.

Tue, 04/22/2014 - 14:51 | 4683660 Billy Sol Estes
Billy Sol Estes's picture

Ah well, the hell does it matter at this point. Might as well grab as much copper wiring as you can on the way out.

Tue, 04/22/2014 - 22:11 | 4685181 Blano
Blano's picture

You've been to Detroit I see.

Tue, 04/22/2014 - 18:31 | 4684439 SilverRhino
SilverRhino's picture

I hate that you are 100% correct.  

Tue, 04/22/2014 - 14:31 | 4683559 Honey Badger
Honey Badger's picture

"Loan forgiveness creates incentives for students to borrow too much to attend college, potentially contributing to rising college prices for everyone,"

replace "students" with "banks" and replace "to attend college" with "speculate on assets" and replace "college prices" with "asset prices" and presto, an explanation of where we are.

 

Tue, 04/22/2014 - 15:25 | 4683824 ILLILLILLI
ILLILLILLI's picture

Well done...

Tue, 04/22/2014 - 14:33 | 4683562 QQQBall
QQQBall's picture

Forgive the student debt so they can get approved for CCd and run those up. The more credit expansion the better, afterall, there is always the taxpayer to bail out the bad debt and stoopid crediors. Deflation is good for savers and must be fought at every turn. How much purchasing power have savers been fucked out off since 2008?

 

The USSA has passed the point of no return. I am actively planning my move away.

Tue, 04/22/2014 - 14:33 | 4683564 Bryan
Bryan's picture

If they do that, I will immediately enroll in the most expensive college I can find and get a massive student loan.

Tue, 04/22/2014 - 14:39 | 4683599 youngman
youngman's picture

this is only for Democrats by the way...no way a Republican or consertative student will be relieved of their debt..you can make sure the Obama administration will see to that...and the IRS...

Tue, 04/22/2014 - 14:33 | 4683569 Itchy and Scratchy
Itchy and Scratchy's picture

Raise the debt ceiling!

Tue, 04/22/2014 - 14:35 | 4683581 Darksky
Darksky's picture

IF someone is given student loan forgiveness (big big IF) THEN they SHALL immediately be required to return the degree to their university. The university SHALL immedately destroy the degree AND delete the students transcripts and all records at the university. Only seems fair.

Tue, 04/22/2014 - 17:06 | 4683632 Deathrips
Deathrips's picture

You may have a point. The degree was obviously in worthlessness. Lets teach the kids another lesson .

YOU CAN HAVE SOMETHING FOR NOTHING!!

 

Why the hell did I pay off my loans? @FACE PLANT.

 

RIPS

Tue, 04/22/2014 - 14:36 | 4683582 QQQBall
QQQBall's picture

BTW, I again point out that non-FASFA schools overseas are way cheaper than FASFA-approved institutions. I could have retired off the college costs for my children. Summer School for matser's program at Harvard is over $10k for tuition. That is insane.

Tue, 04/22/2014 - 14:37 | 4683587 NOZZLE
NOZZLE's picture

Deadbeats, they should be squeezed until they bleed all the booze cheap food and five star apartment living they whopped it up on during their seven year plan. POShits

Tue, 04/22/2014 - 14:43 | 4683622 Grande Tetons
Grande Tetons's picture

The result is not unexpeted....give a kid a vacation fund to attend Shithead Tech and this is what happens. 

Tue, 04/22/2014 - 15:59 | 4683977 zipit
zipit's picture

Booze, tattoos, iPads, coke, gambling, and hookers.   And *maybe* an occasional school book.

Tue, 04/22/2014 - 14:37 | 4683589 Canary Paint
Canary Paint's picture

Hello all. I was one of the short-sighted, irresponsible dumb-asses that got into the student debt trap. I won't put a lot of energy into trying to get out of jail free, but I will certainly tell anyone listening to avoid this form of slavery. I will try to pay back my loans the old-fashioned way.

 

Then again, I could always pay minimally to avoid default until douchebag bankers create some kind of exotic derivative out if my loan and escape the obligation by realizing in a civil court that nobody knows who the hell owns my debt ;-p

Tue, 04/22/2014 - 14:49 | 4683653 Billy Sol Estes
Billy Sol Estes's picture

I can see the "faking your own death" business really taking off soon, otherwise.

Can't be too hard to disappear into the wilderness if you don't have a facebook account, smart phone.

Tue, 04/22/2014 - 14:38 | 4683591 crash commando
crash commando's picture

I don't understand.  You announce beforehand that you'll forgive debt in 10 years as well as the max permitted under such an arrangement?  Strategic Default, anyone?

Tue, 04/22/2014 - 15:15 | 4683786 Oreilly
Oreilly's picture

Announce ahead of securing the border that you no longer will deport illegal immigrants.

Announce before giving food stamps and disability that there will be no background checks or review on eligibility.

Announce before responding to other countries imperialistic advances that you are cutting your military and will not get involved in conflicts overseas.

Do you see a pattern here?

Tue, 04/22/2014 - 14:40 | 4683602 Itchy and Scratchy
Itchy and Scratchy's picture

Pay them back what u think the piece of paper is worth!

Tue, 04/22/2014 - 14:41 | 4683606 Otto Zitte
Otto Zitte's picture

So does this automatically make those excluded from higher education because they wouldn't game the system by loading up on education debt they couldn't pay baccaluareates? Shouldn't this demonstration of principles be more positive on their resume than 4 or more years of delusional indoctrination by the likes of Kogman, Warren and Obama?

Tue, 04/22/2014 - 14:54 | 4683689 Postal
Postal's picture

Silly Otto, no one will hire someone that smart: Such a person would be a threat to management.

Tue, 04/22/2014 - 14:41 | 4683609 Billy Sol Estes
Billy Sol Estes's picture

Abolish the Dept of Education. End Federal subsidized loans, let the private sector eat that shit. Debt forgiveness for all current outstanding school loans.

Everyone gets what they want.

Tue, 04/22/2014 - 15:05 | 4683740 FredFlintstone
FredFlintstone's picture

Amend last part to allow for bankruptcy on student loans. Nobody should get a gift like that. Make the banks eat a lot of the bad debt, not just the taxpayers.

Tue, 04/22/2014 - 14:41 | 4683611 qazwsx
qazwsx's picture

resorting to porn just got that much more attractive...  

Tue, 04/22/2014 - 14:59 | 4683710 Billy Sol Estes
Billy Sol Estes's picture

Actually dated a girl in Texas freshmen year (at private univ) who sold space in her cooter to pay for living expenses.

I quickly jettisoned myself after she told me over the weekend she drove 20 miles to a nearby town and got paid $150 by two guys for 2 hours. 

She left after Spring Semester as college was not her thing.

 

Ol Billie Sol Estes is glad to this day he is STD free.

Tue, 04/22/2014 - 15:03 | 4683731 FredFlintstone
FredFlintstone's picture

TCU?

Tue, 04/22/2014 - 15:08 | 4683755 Cthonic
Cthonic's picture

rofl

Tue, 04/22/2014 - 15:21 | 4683806 Billy Sol Estes
Billy Sol Estes's picture

Baylior

Tue, 04/22/2014 - 22:16 | 4685191 Blano
Blano's picture

LOL not much different than TCU.

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