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Next Mega-Bailout On Deck: White House Studying "New Bankruptcy Options" For Student-Loan Borrowers

Tyler Durden's picture




 

A quick reminder of what the biggest debt bubble currently facing America's population is.

 

Why is this a problem? Because as the TBAC revealed a few months back, the default risk from the $1 trillions in student loans is several orders of magnitude above the 9% student loans which the Fed has revealed as currently "in default", as one has to add those 12% of loans in deferment and 11% in forbearance to the entire risk pool. In short: a third of all student loans are likely to end up unrepaid!

 

And, the punchline: according to the TBAC's worst case scenario of the future of student debt, this gargantuan load will triple over the next decade, to as much as $3.3 trillion by 2024.

This means that up to $1 trillion, and likely more, in household debt will go "bad" over the next decade. The problem: student debt is not dischargeable in a personal bankruptcy.

That is about to change.

It appears that just as the administration is finally figuring out what HFT is, it also decided to take a look at the charts above and has made a decision: the next bailout is about to be unveiled, and it will involve a "streamlined" bankruptcy law allowing students to discharge their student debt.

 Moments ago this hit the wires via Dow Jones:

  • WHITE HOUSE STUDYING NEW BANKRUPTCY OPTIONS FOR STUDENT-LOAN BORROWERS
  • CURRENT U.S. LAW LARGELY PROHIBITS FEDERAL, PRIVATE LOANS FROM BEING DISCHARGED IN BANKRUPTCY

And some more color from Reuters:

President Barack Obama is slated to speak to students at Georgia Tech on Tuesday about how he wants to make the process of repaying student loans easier to understand and manage. Obama will sign a student aid bill of rights  and will speak about an assortment of policy tweaks and projects to try to make it easier to help people with student loans pay back their debt.

 

"It's our responsibility to make sure that the 40 million Americans with student loans are aware of resources to manage their debt, and that we are doing everything we can to be responsive to their needs," said Ted Mitchell, undersecretary of education, on a conference call with reporters.

 

More than 70 percent of U.S. students who graduate with a bachelor's degree leave with debt, which averages $28,400.

 

The White House said it will require clearer disclosures from companies to make sure borrowers understand who is servicing their loan and how to set monthly payments and change repayment plans.

 

"Repayment rates improve when servicers work well and work directly with borrowers, helping them understand the terms of their loans," said Sarah Bloom Raskin, deputy secretary of the Treasury Department, on the conference call.

 

Obama will direct his Education Department to create a system by July 1, 2016 to better oversee and address complaints from borrowers about lenders, servicers and collection agencies, the White House said.

 

His administration will also study whether it needs to propose changes to laws or regulations to create stronger consumer protections, the White House said.

Which can only mean one thing: the appointment of a Student Loan Czar is imminent, as it the "discharge" of tens if not hundreds of billions in debt, which would never be repaid in any case.

And since there is no such thing as a free lunch, it will be the US taxpayer who will as usual end up footing the bill. Expect college fees to go vertical once deans and administrators understand that they can charge anything and the taxpayer will end up footing the bill.

* * *

One can read the Fact Seet on the "Student Aid Bill of Rights: Taking Action to Ensure Strong Consumer Protections for Student Loan Borrowers" below:

Higher education continues to be the single most important investment students can make in their own futures.  Five years ago this month, President Obama signed student loan reform into law, redirecting tens of billions of dollars in bank subsidies into student aid. His historic investments in college affordability include increasing the maximum Pell Grant by $1,000, creating the American Opportunity Tax Credit worth up to $10,000 over four years of college, and letting borrowers cap their student loan payments at 10 percent of income. He has also promoted innovation and competition to help colleges reduce costs and improve quality and completion, including a First in the World fund. While these investments have helped millions of students afford college, student loans continue to grow.

 

That is why, today, President Obama will underscore his vision for an affordable, quality education for all Americans in a Student Aid Bill of Rights.  As part of this vision, the President will sign a Presidential Memorandum directing the Department of Education and other federal agencies to work across the federal government to do more to help borrowers afford their monthly loan payments including: (1) a state-of-the-art complaint system to ensure quality service and accountability for the Department of Education, its contractors, and colleges, (2) a series of steps to help students responsibly repay their loans including help setting affordable monthly payments, and (3) new steps to analyze student debt trends and recommend legislative and regulatory changes. In addition, the Administration is releasing state by state data that shows the outstanding federal student loan balance and total number of federal student loan borrowers who stand to benefit from these actions.

A Student Aid Bill of Rights

  • Every student deserves access to a quality, affordable education at a college that’s cutting costs and increasing learning.  
  • Every student should be able to access the resources needed to pay for college.
  • Every borrower has the right to an affordable repayment plan.
  • And every borrower has the right to quality customer service, reliable information, and fair treatment, even if they struggle to repay their loans.

Today’s Actions to Promote Affordable Loan Payments

 

Americans are increasingly reliant on student loans to help pay for college. Today, more than 70 percent of those earning a bachelor’s degree graduate with debt, which averages $28,400 at public and non-profit colleges. Today’s actions will help borrowers responsibly manage their debt, improve federal student loan servicing, and protect taxpayers’ investments in the student aid program:

 

 Help Borrowers Afford Their Monthly Payments: The President will announce a series of steps to improve customer services and help borrowers repay their direct student loans, which are made with federal capital and administered by the Department of Education through performance-based contracts. High-quality, borrower-focused servicing helps more borrowers successfully repay their federal student loans.  Building on the stronger performance incentives put in place last year, the Department will now raise the bar by:

  • Requiring enhanced disclosures and stronger consumer protections throughout the repayment process, including when federal student loans are transferred from one servicer to another, when borrowers fall behind in their payments, and when borrowers begin but do not complete applications to change repayment plans. These steps will better protect borrowers from falling behind in their payments and ensure consistency across loan servicers.
  • Ensuring that its contractors apply prepayments first to loans with the highest interest rates unless the borrower requests a different allocation.
  • Establishing a centralized point of access for all federal student loan borrowers in repayment to access account and payment processing information for all Federal student loan servicing contractors.
  • Ensuring fair treatment for struggling and distressed borrowers by raising standards for student loan debt collectors to ensure that they charge borrowers reasonable fees and help them return to good standing;  clarifying the rights of Federal student loan borrowers in bankruptcy; working with the Department of Treasury to simplify the process to verify income and keep borrowers enrolled in income-driven repayment plans; and working with the Social Security Administration to ensure that disability insurance recipients who can discharge their student loans are not instead seeing their disability payments garnished to  repay defaulted loans.

In addition, new requirements may be appropriate for private and federally guaranteed student loans so that all of the more than 40 million Americans with student loans have additional basic rights and protections. The President is directing his Cabinet and White House advisers, working with the Consumer Financial Protection Bureau, to study whether consumer protections recently applied to mortgages and credit cards, such as notice and grace periods after loans are transferred among lenders and a requirement that lenders confirm balances to allow borrowers to pay off the loan, should also be afforded to student loan borrowers and improve the quality of servicing for all types of student loans.  The agencies will develop recommendations for regulatory and legislative changes for all student loan borrowers, including possible changes to the treatment of loans in bankruptcy proceedings and when they were borrowed under fraudulent circumstances.

The full fact sheet here.

 

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Tue, 03/10/2015 - 14:53 | 5874408 dsty
dsty's picture

kind of like why medical care costs so much

only not as bad

somewhere I heard that 60% of personal bankruptcy's are from medical bills.

Tue, 03/10/2015 - 15:17 | 5874434 Deepskyy
Deepskyy's picture

 

Damn duplicate.

Tue, 03/10/2015 - 15:16 | 5874513 Deepskyy
Deepskyy's picture

Administration and "facilities" such as pools, game rooms, and other state of the art time wasters drive up cost much more than the professors.

Tue, 03/10/2015 - 16:05 | 5874788 Hubbs
Hubbs's picture

Collegetown USA. "Bring me your huddled masses (of useless professors teaching philosophy, religion, asian studies, black culture, etc)." If you can't make it anywhere, you can always make it by staying in college especially if you get tenured." 

Tue, 03/10/2015 - 14:47 | 5874356 tucano
tucano's picture

Get the government out of the business of guaranteeting student loans.  Let private creditors assess risk in student lending.  Ok, so some people won't be able to go to school on credit to study basket weaving... go fcking cry about it then.

Wed, 03/11/2015 - 06:51 | 5876812 Free Wary
Free Wary's picture

Did you know that USA has a constitution? Did they teach that in your college? Under the US Constitution, as I understand it, I see no powers granted to the Federal Government to grant or guarantee any loens- which means THE FEDERAL GOVERNMENT IS BREAKING THE LAW BY BEING INVOLVED IN THE STUDENT LOAN BUSINESS (and thousands of other things they are involved in).

 

Tue, 03/10/2015 - 15:00 | 5874433 Itchy and Scratchy
Itchy and Scratchy's picture

On the plus side. it is nice to know that Socialism always consumes itself! On the negative side, it hurts everybody alot!

Tue, 03/10/2015 - 15:02 | 5874446 GOSPLAN HERO
GOSPLAN HERO's picture

Barry loves wearing his burqa.

Tue, 03/10/2015 - 15:03 | 5874449 raywolf
raywolf's picture

The Affordable Tattoo and Piercing Act.... because every teenager deserves the right to spend 3 years pissing their future away on a useless degree, while partying and having drunk sex with random strangers, while dressing like a modern day version of a tribal cheiftan's wife....

Tue, 03/10/2015 - 19:47 | 5875736 dsty
dsty's picture

hate crime!

Tue, 03/10/2015 - 20:04 | 5875794 dsty
dsty's picture

your gonna have to go to this class

College conservatives branded 'hate group' for refusing LGBT sensitivity training

http://www.foxnews.com/us/2015/03/09/college-conservatives-branded-hate-...

Tue, 03/10/2015 - 15:04 | 5874455 Law97
Law97's picture

So scrimping the last 20 years and finally paying off the last of my $150K in student loans (two advanced degrees) without being late on a single payment, was for naught. 

 

How long will it take before anyone left who actually takes their obligations seriously, just says to hell with it?  There's no incentive anymore to do what's right.  There's no reward anymore for doing the right thing, in fact you're punished for it. 

Tue, 03/10/2015 - 15:08 | 5874481 Vinividivinci
Vinividivinci's picture

well, "law97", at least you have bragging rights (which you just exercised in your comment). Now wasn't that worth all the scrimping and self sacrificing?
/sarc

Tue, 03/10/2015 - 15:30 | 5874577 libertysghost
libertysghost's picture

Not to be a dick, but it was pretty obvious a couple decades ago that there was no moral high ground to be had in paying off paper debts as a serf while also paying off the paper debts the elites created in your name...to be proud?  Of what?  I don't see any value or valor in playing the rigged game without trying to cheat it.  Am I missing something...honestly and sincerely yours,

 

Libertysghost

Tue, 03/10/2015 - 15:49 | 5874693 libertysghost
libertysghost's picture

system error...i didn't post twice

Tue, 03/10/2015 - 15:30 | 5874580 libertysghost
libertysghost's picture

Not to be a dick, but it was pretty obvious a couple decades ago that there was no moral high ground to be had in paying off paper debts as a serf while also paying off the paper debts the elites created in your name...to be proud?  Of what?  I don't see any value or valor in playing the rigged game without trying to cheat it.  Am I missing something...honestly and sincerely yours,

 

Libertysghost

Tue, 03/10/2015 - 15:05 | 5874456 Vinividivinci
Vinividivinci's picture

A www, just let the poor young fucks have some government crack, will ya'...I feel for the students, because from my vantage point as a 50 year old who is poor as fuck, I know what's not too far down the road for them, the LAST generation who will be able to enjoy ANYTHING for free.
So enjoy Cancun, iWatches and Pods while you can kiddies, cause the .gov tit is about to run dry.

Tue, 03/10/2015 - 15:08 | 5874464 Laddie
Laddie's picture

Bill Clinton tightened the screws on student loan discharge and Joe Biden finished the suckers off with his Bankruptcy bill in 2007, he fronted for the credit card scammers while a Senator.

The banksters on the Upper Eastside of Manhattan got TRILLIONS, perhaps SEVEN TRILLION taxpayer dollars. Most of these students were just doing what SOCIETY said to do, and why should their LIVES be ruined, forever? A dear friend of mine's son did what everybody says you should do and got loans and went to college to study engineering. Upon graduation he found that the firms were hiring Indians and other Asians for those engineering jobs. His father had been IT who was kicked out after he trained his Indian replacement. So since all the "favorites" of the regime have been getting "goodies" from We, the Suckers, why shouldn't some of our own get it? For goodness' sake. You have all of these White folks going into MAJOR DEBT to become school teachers and now they find they are NOT WANTED, make no mistake the Tribe is DEADLY SERIOUS about eradicating jobs for Whites:

The Benefits of Minority Teachers in the Classroom

Anna Egalite & Brian Kisida, Real Clear Education, March 6, 2015

The shooting of an unarmed Black teenager by a white police officer in Ferguson, Missouri in August 2014 sparked protests across the nation and prompted calls for greater minority representation in the police force, city governments, local school boards, the teacher labor force, and other positions of authority. Racial representation in the classroom is of particular interest to education practitioners, policymakers, and parents. Many believe that minority teachers are best situated to counter negative stereotypes and to serve as role-models, mentors, or cultural-translators for students of color. Moreover, teachers who can relate to their students’ cultural background should be less likely to hold biased subjective views of their academic abilities.

Many experts believe minority students' achievement outcomes suffer as a result of this disparity, and thus the “diversity gap” may be a contributing factor to the persistent achievement gap between white and minority students. Minority students tend to perform lower on standardized tests, and attend college at lower rates. To date, however, there have been few rigorous empirical examinations to point to as evidence that talented minority teachers are part of the solution.

At the national level, the U.S. Department of Education has called on celebrities like Spike Lee, Oprah Winfrey, and John Legend to promote the TEACH campaign, a public-private partnership with the aim of recruiting high achieving candidates into teaching, particularly those who are Black and Hispanic. States like Illinois, Indiana, and Florida have set up scholarship funds to entice minority college students into teaching. Numerous urban districts such as Boston and Tucson have started their own initiatives to recruit talented minority teachers. The Teach For America organization emphasizes diversity in its recruitment strategies, and in 2014 half of its new teachers identified as people of color. Seventy percent of TFA’s latest cohort of teachers placed in Los Angeles represent ethnic minorities.
But challenges remain. One obstacle is teacher tenure, which virtually guarantees that the demographic makeup of teachers will consistently lag behind changing student demographics.

SCREW THE BANKSTERS and their PUPPET in the Black House.

What do you think this is if not RACIAL DISCRIMINATION against Whites?

Bill Gates Millenium Scholarships
"Students are eligible to be considered for a GMS scholarship if they: • Are African American, American Indian/Alaska Native, Asian and Pacific Islander American, or Hispanic American;"

"The goal of GMS is to promote academic excellence and to provide an opportunity for outstanding minority students with significant financial need to reach their highest potential by:

Reducing financial barriers for African American, American Indian/Alaska Native, Asian Pacific Islander American and Hispanic American students with high academic and leadership promise who have significant financial need;"

http://www.gmsp.org/

http://college.lovetoknow.com/Bill_Gates_Scholarship

The “Hispanic Scholarship Fund” (HSF) says that it “aims to put a degree in every Latino household by 2025” through its affirmative action program in college recruitment.

Funding for the HSF comes from a large number of corporations, which, according to that organization’s website, include the FedEx Corporation; the Mazda Foundation; KLASS Time; GMAC Financial Services; Lowe’s; the McNamara Family Foundation, Inc.; Goldman Sachs; Procter & Gamble; Toyota Motor Sales U.S.A., Inc.; the Verizon Foundation; McDonald’s; Target; the Morgan Stanley Foundation; Nissan North America, Inc.; the Sallie Mae Fund; Wells Fargo; the Draper Family Foundation; the Shell Oil Company; the Wachovia Foundation and the UPS Foundation, amongst many others.

The HSF says specifically that it is only for “Latinos” and those of Hispanic descent.

It obviously does not concern these corporations in the slightest that their money is used specifically for non-whites.

On the HSF’s website, under their “Frequently Asked Questions” section, the policy is spelled out in no uncertain terms:

“Do I have to be Hispanic/Latino to apply?” is the question the website asks.

http://www.hsf.net/innerContent.aspx?id=1196

The answer is: “Yes. You or your family must be descended from at least one of the following countries: Spain, Mexico, Guatemala, Honduras, El Salvador, Costa Rica, Nicaragua, Panama, Colombia, Venezuela, Ecuador, Peru, Argentina, Chile, Bolivia, Uruguay, Paraguay, Cuba, Puerto Rico, or the Dominican Republic. Students from Brazil are eligible to apply.

Tue, 03/10/2015 - 15:13 | 5874497 Vinividivinci
Vinividivinci's picture

Sorry "Laddie"...but your comment is so fucking long, I started dozing half way thru...so I'll give an up arrow, just for the effort.

Tue, 03/10/2015 - 15:21 | 5874541 Laddie
Laddie's picture

Just to add a little perspective as of 2003. Probably double that by now. And for what?, that isn't even considering the BAILOUT, HANDOUT of TRILLIONS of US Taxpayer dollars, yours, and mine, to the BANKSTERS on the Upper East Side and they've done well, speculating in Tel Aviv real estate for instance using that taxpayer money.

Cost to American Taxpayer THREE TRILLION DOLLARS as of early 2003:
http://www.wrmea.org/wrmea-archives/251-washington-report-archives-2000-...

Tue, 03/10/2015 - 16:33 | 5874939 Jstanley011
Jstanley011's picture

Ya' wanna help minority students? Or at least, the ones who want to learn? Make them shut up and sit up straight in class, speak standard English, respect their teachers of whatever race, while judging their performance according to objective academic standards, and expelling the disciplinary cases involving violence.

Short of the above, expect continuing social and economic deterioration no matter how much charity and taxpayer money is thrown their way.

Tue, 03/10/2015 - 19:45 | 5875728 Grosvenor Pkwy
Grosvenor Pkwy's picture

Very interesting that Brazilians are included in this program. Where I used to work, there was a large segment of Portuguese speakers, both Brazilian and Continental, but these sorts of programs were explicitly reserved for Spanish speakers.

Also, many people don't seem to know that many South Americans are descended from other European countries such as Italy and Germany, yet the "diversity training" fanatics ignored all but Spanish speakers, and pretended that the other groups simply did not exist. You could get into trouble just for mentioning the issue.

Wed, 03/11/2015 - 00:08 | 5876538 JoJoJo
JoJoJo's picture

White privilege is merely having 2 parents living in the home. No amount of Affirmative Action will substitute for that. The Dems need every last black voter to win elections and they pay them back very handsomely.

Tue, 03/10/2015 - 15:21 | 5874499 MacAttack2
MacAttack2's picture

Elizabeth Warren and Maxine Waters can't wait to get their hands on this one...  All those poor, innocent youngsters who were taken advantage of; they didn't know what they were getting themselves into.  All that fine print that lenders obscured from the students' thorough due diligence.  Once again, it's all the banks fault...

Tue, 03/10/2015 - 16:47 | 5874545 Itchy and Scratchy
Itchy and Scratchy's picture

Princess-Squating-Bull won't touch this issue with a hundred foot pole! Lie-a-watha didn't have to worry about any student loans because of her high-cheekbone 'Cherokee' heritage! That little honey knows all what there is to know about milking & bilking the system! That adorable paracite wrote the book on grift and I'm sure the soul sister read it!

Tue, 03/10/2015 - 15:13 | 5874504 Victory_Garden
Victory_Garden's picture

Just another distraction away from the criminals at large.:

http://xrepublic.tv/node/12533

 

Tue, 03/10/2015 - 15:21 | 5874537 TheAntiProgressive
TheAntiProgressive's picture

This will put a dent in illegal imigration. Everything is free here, everything all you have to do is cross the border.

Tue, 03/10/2015 - 15:43 | 5874656 pippi68
pippi68's picture

Just how enforcable is a "memorandum"?

Tue, 03/10/2015 - 18:35 | 5875401 Accounting101
Accounting101's picture

Exactly. Most of the shit Obama proposed today is insignificant window dressing. Do you all really think he will do anything that threatens his Oligarchial masters? Obama is a big bank whore.

Tue, 03/10/2015 - 19:11 | 5875579 overmedicatedun...
overmedicatedundersexed's picture

I am ok with forgiving student debt, as bail outs of banksters was ok by congress and FED.

in 2008 many here said bail out the gen population and or let banks go BK..that would have been ok to.

to pay for this How about we claw back from the schools and put them in debt??

no I know too radical that money swindled from gullible students should be returned, oh and while we are at it claw back the tarp and qe and shoot the last 4 Fed directors ..

dreams of my old man.

Wed, 03/11/2015 - 06:53 | 5876813 quikwit
quikwit's picture

Equality demands that all debts be forgiven equally.  Why discriminate on the basis of debt type? Credit cards, auto loans, home loans, student loans, sovereign loans, all forgiven!  Yippe!  Debt Jubilee for all!

Give everyone a printing press, and we'll all have enough money for all our needs!

Tue, 03/10/2015 - 16:06 | 5874776 Itchy and Scratchy
Itchy and Scratchy's picture

Oh well, I guess that Puritan Work Ethic thing didn't work out to well for the country anyway?

Tue, 03/10/2015 - 16:39 | 5874994 Jstanley011
Jstanley011's picture

It was working fine until we let the damn Irish in.

Tue, 03/10/2015 - 16:21 | 5874893 Falling Down
Falling Down's picture

'Murica!

Tue, 03/10/2015 - 16:43 | 5875012 Itchy and Scratchy
Itchy and Scratchy's picture

How about we make the teachers & their unions pay some of these debts back?

Tue, 03/10/2015 - 18:26 | 5875360 Accounting101
Accounting101's picture

That's what your brain came up with?

Tue, 03/10/2015 - 18:47 | 5875462 Solarman
Solarman's picture

1100% increase in 30 years.  They are a big part of the problem.

Tue, 03/10/2015 - 19:49 | 5875751 Accounting101
Accounting101's picture

You can't fix stupid.

Tue, 03/10/2015 - 19:23 | 5875642 Itchy and Scratchy
Itchy and Scratchy's picture

Yepper ...all by my lonesome too! Do you need help comin' up with your brainstorms?

Wed, 03/11/2015 - 04:33 | 5876731 sessinpo
sessinpo's picture

Accounting101   That's what your brain came up with?

----

And your brain came up with what? 

Nothing.

 

Tue, 03/10/2015 - 17:26 | 5875170 lindaamick
lindaamick's picture

The whole college thing is a nightmare.

Kids getting a crappy education due to Universities being nothing more than corporations who do the bare minimum for students and yet charge them exhorbitant prices.   Most college classes are taught by Grad students!!

Then to add insult to injury there is a $2500. cap on student loan interest deductions on tax returns. 

This whole scheme is just one more predatory system targeting the youth of america.

Tue, 03/10/2015 - 17:42 | 5875221 Deathstar
Deathstar's picture

Welcome to the United States Of Autocratic-stagnation!

Tue, 03/10/2015 - 18:06 | 5875293 Playtime's Over
Playtime's Over's picture

When is this shit show going to end.

Tue, 03/10/2015 - 18:09 | 5875300 JoeSoMD
JoeSoMD's picture

Carl, I think the other thing is that only private lenders will get hit... not Sallie.  It's a grab by the gov.

Tue, 03/10/2015 - 18:17 | 5875315 windcatcher
windcatcher's picture

“First in the World fund”. What a joke and an example of unadulterated propaganda and brainwashing methods! Ha. Ha. Ha.

 When I attended school, the USA was number one in the world in science and education.  Education was called a discipline and indeed it was. In order to be accepted into collage, one had to have straight “A”s with the exception of one “B” grade. Two years of Latin and Civics were also required. All of that required discipline is gone today and America is number 22 out of a possible 23 of the eligible nations in science and education. We are dead last at number 23 in math.

Universities have become money mills producing garbage degrees in worthlessness. If we had industry, who would hire them? Students can’t think for themselves because propaganda and brainwashing has taken the place of science. Americans are the most propagandized and brainwashed people in the world.

If you think that propaganda and brainwashing doesn’t work to dumb down Americans; ask them if a 3 bladed propeller driven wind mill is a turbine dynamic or is it a propeller dynamic?

Tue, 03/10/2015 - 18:38 | 5875412 flyingcaveman
flyingcaveman's picture

Neither.  Those things you call wind mills are wind driven generators.  The propeller isn't doing the driving, the wind is.

Tue, 03/10/2015 - 19:19 | 5875615 windcatcher
windcatcher's picture

In reply to caveman: Well, if the propeller doesn’t turn the generator, why not just take the propeller off and let the wind drive the generator? Ha. Ha. Ha.

Tue, 03/10/2015 - 18:45 | 5875448 Solarman
Solarman's picture

How old are you?  90?

 

B average get's you in most places 40 years ago.  It is almost impossible to get into a UC school in CA without a 4.66 GPA.  

Most of these loans are for crap schools and trade schools that teach them nothing, but harvest the fees.

We still produce a quality education and an educated workforce, don't beleive everything you read on the interwebs.

Tue, 03/10/2015 - 19:30 | 5875674 windcatcher
windcatcher's picture

In reply to solarman: I’m 70 years old, number 23. I should have added a paragraph on American blind exceptionalism and hubris but your ignorant statement has done it for me. Ha. Ha. Ha.

Tue, 03/10/2015 - 18:31 | 5875387 Himins
Himins's picture

This would be funny, but what if you were trying to do business with any other nation, and you over looked a plaque on the wall that displayed your degree from an American college...you know...the same nation that spawned Hillary, Obama, G.Bush, Romney,... ... .. ..
Imagine not burning it with all the rest when Clinton got re-elected! 

Tue, 03/10/2015 - 18:33 | 5875398 Chauncey Gardener
Chauncey Gardener's picture

Gotta make sure that he gets all the unemployed graduates with student loans to vote for his third term. 

Tue, 03/10/2015 - 18:46 | 5875459 Stevious
Stevious's picture

Simple: If jobs are available borrowers should be happy to repay.

When jobs are not avaialable, collections should cease.

Availability of jobs = responsible debtors. 

Of course there are few full-time quality jobs available anywhere anymore, my job is part-time and I still manage to never be late on my ~29k student loan.

It would be easier of I could find a full-time job, but then heck, I'm an experienced, higly qualified RN....what was I thinking... Availability of good nursing jobs is a myth.  Availability of just about any good jobs are myths.

Tue, 03/10/2015 - 18:51 | 5875485 Sorry_about_Dresden
Sorry_about_Dresden's picture

Every dollar denied the money lender is a dollar that flows into the Real economy.

debt forgivness would juice gdp.

Tue, 03/10/2015 - 19:00 | 5875538 Son of Loki
Son of Loki's picture

Botton line is another mega-bailout simply means more mega-USA-Debt.

Tue, 03/10/2015 - 19:05 | 5875557 lordkoos
lordkoos's picture

So, WTF.  Taxpayers paying for education... that suits me a lot better than paying for the military.

Tue, 03/10/2015 - 19:13 | 5875587 rsnoble
rsnoble's picture

I've been having this argument elsewhere.  Here is what I posted earlier:

"I support this move 100%.

Why?

Because kids are taught from a young age, actually brainwashed, into college good, flip burgers bad.  On top of that, the US gov't is directly responsible for LIEING about the state of the economy and kids aren't taught fuck about the real world.  They spend 4 years listening to horseshit in high school, then have thousands of dollars dangled over their heads and what seems like guaranteed job prospects.

The government, the schools and business created and continue to create this problem as it festers in it's own bed of LIES.  Not to mention a bunch of stupid parents.

Next.......the US is already in debt so far it's collapse enroute.  So what fucking difference does a few trillion more make?  None.

Lastly........."we can't make a diffence' is proven BS in this case.  Ban together, raise hell, and yes you can make a change.  I assure you, monkeyboy isn't doing this out of the goodness of his heart."

I would like to add to this and say what is it we are bitching about around here continually?  Something about money being created out of thin air?  The US is literally creating digital zeros out of nothing  and you want to bitch and cry that a bunch of young people aren't going to be enslave the rest of their lives like you were?  The entire monetary system is a sham.  I don't see any reason to let it ruin millions of lives for the benefit of the rich.  All these posts about fucking the taxpayer over.  Please.  We've been over the barrel for a long time the only thing left is to have a bullet put in our heads.    The way things are going around the world it's very possible none of this is going to make a damn difference anyway.  

Tue, 03/10/2015 - 22:17 | 5876253 2handband
2handband's picture

This.

Look, folks... you were lied to. The United States you were taught to believe in does not exist and has NEVER existed. What you actually have is a system that extracts your labor in the service of capital and denies you participation in power. You've been getting ass-fucked almost literally from the day you were born.

Worse, there's no effective means of direct resistance. The deep state is, in my opinion, unstoppable. So what can you do? take as much as you can from it. There is no moral hazard here; you can never take back as much as has been taken from you. Default on your loans. even better, rack up as much debt as you can and THEN say fuck you. It's a small victory, but it's probably as much as any person now living is ever going to see. It's the only way you can fight back. 

Tue, 03/10/2015 - 19:21 | 5875623 grunk
grunk's picture

Aren't they called, "GSL's," Guaranteed Student Loans?

Who is guaranteed? 

Who guarantees?

Any guesses?

Who is on the hook in the event of a default? 

Any guesses?

Tue, 03/10/2015 - 19:24 | 5875648 Itchy and Scratchy
Itchy and Scratchy's picture

Bill Gates?

Tue, 03/10/2015 - 19:25 | 5875649 Itchy and Scratchy
Itchy and Scratchy's picture

Warren Buffet?

Wed, 03/11/2015 - 11:18 | 5877569 Lostinfortwalton
Lostinfortwalton's picture

The Clinton Foundation?

Tue, 03/10/2015 - 19:26 | 5875663 Itchy and Scratchy
Itchy and Scratchy's picture

J Zees?  Who who who????????

Tue, 03/10/2015 - 19:39 | 5875682 grunk
grunk's picture

Katy Perry, thats who.

My goodness, do I need to outline the entire NWO?

Tue, 03/10/2015 - 20:20 | 5875837 FreeNewEnergy
FreeNewEnergy's picture

The call it the bankruptcy attorneys full employment act:

http://blogs.wsj.com/bankruptcy/2015/03/10/bankruptcy-lawyers-cheer-whit...

Law Skool FTW!

Tue, 03/10/2015 - 21:04 | 5875978 yogibear
yogibear's picture

Get a student loan buy a dozen ponds of gold and then bankrupt.

Tue, 03/10/2015 - 21:10 | 5875997 are we there yet
are we there yet's picture

Obama is freebasing again but does not have to turn tricks now that he is the pres.

Tue, 03/10/2015 - 21:21 | 5876040 studfinder
studfinder's picture

My nephew graduated last year..been hard at work paying off what he had in loans...dumb bastard.

Tue, 03/10/2015 - 23:07 | 5876414 SilverFish
SilverFish's picture

Maybe now I'll get that bachelors degree in basket weaving I've always wanted. Fuck it, right?

Tue, 03/10/2015 - 23:13 | 5876436 Government need...
Government needs you to pay taxes's picture

When faced with the choice of propping up housing or college tuition, .gov will choose housing.  It is far more tangible, and can be levered/re-hypothecated in a way that a student loan for a PhD in Diversity cannot.  Also, housing employs a LOT of mouth-breathing Progressive voters . . . even semi-literate Central Americans can pound shingles and studs.  The propaganda that indoctrinates our educational system could just as easily be included in another form.

Tue, 03/10/2015 - 23:16 | 5876452 allinwood
allinwood's picture

WTF! so i was late to find out about Michael Cormier. That shit can piss a guy off.

Tue, 03/10/2015 - 23:46 | 5876506 dexter_morgan
dexter_morgan's picture

And you thought tuition was high before, just wait now that we all get to pick it up.

Tue, 03/10/2015 - 23:53 | 5876515 JoJoJo
JoJoJo's picture

"Every student has a right to an affordable payback plan." Well, I dont wanna pay nuttin. I also dont want to pay for my new home I got at 3% and no $ down. Try to evict me in less than two years. And I should keep my subprime car. . . No one loses and everbody gets a trophy at the Obamum and Baily Circus.

There cant be moral hazard when there is no morality and that goes especially for you banksters

Wed, 03/11/2015 - 00:22 | 5876552 oooBooo
oooBooo's picture

There has to be a way to keep people enslaved in the system. The student loan debt is like the perpetual debt that allowed company towns to enslave people. That's a feature that can't go away now.

Wed, 03/11/2015 - 00:54 | 5876585 Jack Daniels Esq
Jack Daniels Esq's picture

The dumb black muslim is also a moron

Wed, 03/11/2015 - 02:37 | 5876669 statelessman
statelessman's picture

I'm sure they will have their student loans forgiven when they join the brownshirts.

Wed, 03/11/2015 - 03:12 | 5876682 U-P-G-R-A-Y-E-D-D
U-P-G-R-A-Y-E-D-D's picture

"Expect college fees to go vertical once deans and administrators understand that they can charge anything and the taxpayer will end up footing the bill."

I'm pretty sure that's how we got into this situation in the first place.  The loans were guaranteed by the USFG and schools kept increasing their own salaries and competiting for new sparking buildings.  Once bankrupcy hits, maybe the ridiculous admin salaries will take a haircut and schools will stop encouraging this madness.

Frankly, I would appreciate an investigation into who it was that promoted these gov't guaranteed student loans.  The idea was as bad as "every American will own a home" shit.  However, now we have a lot of people with expectations that can't be foreclosed on and no collateral.

I've often wondered - does some soon-to-be-fucked municipality ultimately own my loans?  Perhaps a Chinese speculator who was led to believe the liars of Wall Street? 

Wed, 03/11/2015 - 06:54 | 5876697 sheikurbootie
sheikurbootie's picture

The USA has taken a retarded pill.  My Alma mater is a medium size State University, fast forward 30 years and it's now 10x more prestigious.  The GPA and ACT scores minimums are on par with Ivy league.  Absolutely insane!  The professors are the same, the education is the same.  I loved attending and have great memories, but it remains one step beyond a shitty academic school.

The price has increased 5x above inflation.  I'm drinking buddies with several professors and they brag about only having to work about 10-20 hours per week.  They don't even have to go into work 2-3 days a week.  They usually work from home on days they don't have to teach a class.  The student population is very Asian in upper level and nearly 100% Chinese for master/phd degrees in Engineering.

My kids are smart, straight A's and solid test scores.  I'm not pushing college at all.  It's not important and you really don't learn shit.  I'd rather see them learn a trade and start a business.  Higher education is total bullshit scam now.  Great fun, but a total waste of 4-5 years with no reward at the end. 

Wed, 03/11/2015 - 07:20 | 5876834 Comte d'herblay
Comte d'herblay's picture

It's a delaying action now geared almost entirely to women who are feeeling their power rising like a rocket.

Take a look at the boy/girl ratios in higher ed, the professors who don't teach but live off the fat of tuition and state funding,  and rethink what these institutions are really all about: 1)The tenured and lifers in "education" who have set up pretty lucrative retirements for themselves. 2) the women who will make profitable contacts among the, "Coincidence of Interests" that run this world.

Higher ed is a gold mine for many, if your kids happen to be girls you do them a great disservice to keep them out of that insular world that will practically guarantee them a solid future if they apply themselves to the studies and politics of getting ahead.

How do you think hilary has managed all these decades to keep her loyalists at her beck and call no matter if she murdered someone? 

https://www.youtube.com/watch?v=SiXGcEpI-sI

 

Wed, 03/11/2015 - 03:51 | 5876710 Bumbu Sauce
Bumbu Sauce's picture

Beware the Government-Education complex.

Way past time to get money out of education.

Wed, 03/11/2015 - 04:57 | 5876748 newsoutlet
newsoutlet's picture

Russia Federation after slip of the word admits it is "rebels" and rebels is Russia Federation army in Ukraine:

http://youtu.be/aRKqcQ2aEio

"...Ukraine army forces was located in region encircled. WE (he is speaking as Russian Federation representative in UN) OFFERED THEM TO GO OUT ... EEE... REBELS OFFERED THEM GO OUT QUITLY and... and... so .. eeee (confused about fact that he just admitted whole world was saying and Russia was denying)"

 

It's like this guy who’s word slipped that Pentagon was attacked by missile not by plane:

http://youtu.be/cUmr9dFbf2c

 

Some times slip of the word happens and truth comes out from liar mouth.

Wed, 03/11/2015 - 05:24 | 5876761 Lanka
Lanka's picture

The Federal gov guaranteed the loan, made from a bank to a student.  Though it is not dischargeable in bankruptcy; I believe that the Federal gov steps in and makes payments when the debtor defaults on payments.  So this would not be a bailout of the lenders, who have the gov guarantees, as the banks always get paid in the current corrupt system.  It is a bailout (loan forgiveness) for the borrowers, i.e. the former students.

This system implemented over the last 25 years just increased demand for universities, allowing them to increase tuition 10 times, and enrich the university administartion staff and professors in the process,  A quality education and preparing students for purposes of working were never part of the equation.

Student loans not quaranteed by the federales are treated differently, as an unsecured loan, unless some parent with assets also co-signed. 

Wed, 03/11/2015 - 06:45 | 5876801 Batman11
Batman11's picture

I am a banker, I have one product, debt (loans mortgages).

Who can I sell my product to?

Students

Sub-prime home buyers

Sub-prime car buyers

Risky loans have good yields and if you can convince others that the risks are low when they are sliced and diced, it's profits a go-go.

 

 

Wed, 03/11/2015 - 06:48 | 5876808 Batman11
Batman11's picture

"Flash boys" tells you all you need to know about HFT.

It's micro-second insider trading, pure and simple.

 

Wed, 03/11/2015 - 07:09 | 5876825 Comte d'herblay
Comte d'herblay's picture

Anyone opposed to "Bailouts" for the vast unwashed, no matter their debt load, needs to have a cold hard look at your complete idiocy.

Answer me this:  If it's already given that nearly 12 TRILLION dollars for complete, total, global catastrophe to save their few sorry asses,  was, is and will be given to a few Jewish banksters in Jew Nork, Jew Nersey, and Singapore, Fleet street and other dens of kosher iniquity, WHY on Yahweh's green earth would you oppose a few dollars to ameliorate the debts of students, underwater homeowners with unemployment lasting 2 years or more?

Why would you oppose J Yell buying more government bonds, the Treasury's Bureau of Printing and engraving printing a trillion dollars (one Twelfth of what is earmarked for the primary dealers and their henchmen in politics) to reimburse the Social Security and Medicare, and medicaid lockbox to replenish what the democrats and republicans in CONgress have stolen from them over the last 70 years???

Why would you not see that if a dozen primary dealers who contribue nothing but nefarious stock and bond derivatives to enrich themselves, only, and totally wreck the economy  for their own gain, why would you not enthusiastially endorse the same principle applied to the masses, who do all the god damned work in this country???

You who oppose some relief for the doers, the triers, the contributors the working people and the indigent without a prayer, of this economy, need to examine your dunderheaded thinking as to who should now be made whole if not further enriched as were the crooks, thieves, gypsies and tramps like Joe Cassano, Dick Fuld, Ace Greenberg, Larry Fink, Gary Gensler, Mary Shapiro, and the well connected multi-billionaires with a 30 year hot line red phone to J Yell, Geithner, Paulson, Bernanke, Rubin, Summers, Greenspan, Jews and their consigliere, all. 

 

Wed, 03/11/2015 - 07:42 | 5876877 p00k1e
p00k1e's picture

LOL

Wed, 03/11/2015 - 07:21 | 5876838 JiminGA
JiminGA's picture

Way to go "O".  Nationalize student loans and then write them off at taxpayers' expense.  And the vote buying goes on....and on.

Wed, 03/11/2015 - 07:47 | 5876881 p00k1e
p00k1e's picture

The 26 and up crowd should now be offered free degrees and, if their life has started – all living expenses for themselves and dependants.

Free sedan at completion for that first job interview.

Wed, 03/11/2015 - 08:03 | 5876916 highwaytoserfdom
highwaytoserfdom's picture

 and 70% are Business majors.    But but the fundamentals don't count...  Oh the wonders of structured finance. 

Wed, 03/11/2015 - 08:34 | 5876974 goldenbuddha454
goldenbuddha454's picture

in other words 'you kids should have stayed home and not gone to school when I told you to'.

Wed, 03/11/2015 - 08:39 | 5876987 22winmag
22winmag's picture

1970 10% of American adults have a Bachelor's degree or higher - country doing relatively well

2015 32% of American adults have a Bachelor's degree or above - country in the toilet

 

Fuck what passes for education.

Wed, 03/11/2015 - 09:51 | 5877185 SillyWabbits
SillyWabbits's picture

Listed below are 20 completely ridiculous college courses being offered at U.S. universities.  The description following each course title either comes directly from the official course description or from a news story about the course…

1.What If Harry Potter Is Real?” (Appalachian State University) – This course will engage students with questions about the very nature of history. Who decides what history is? Who decides how it is used or mis-used? How does this use or misuse affect us? How can the historical imagination inform literature and fantasy? How can fantasy reshape how we look at history? The Harry Potter novels and films are fertile ground for exploring all of these deeper questions. By looking at the actual geography of the novels, real and imagined historical events portrayed in the novels, the reactions of scholars in all the social sciences to the novels, and the world-wide frenzy inspired by them, students will examine issues of race, class, gender, time, place, the uses of space and movement, the role of multiculturalism in history as well as how to read a novel and how to read scholarly essays to get the most out of them.

2.God, Sex, Chocolate: Desire and the Spiritual Path” (UC San Diego) – Who shapes our desire? Who suffers for it? Do we control our desire or does desire control us? When we yield to desire, do we become more fully ourselves or must we deny it to find an authentic identity beneath? How have religious & philosophical approaches dealt with the problem of desire?

3.GaGa for Gaga: Sex, Gender, and Identity” (The University Of Virginia) – In Graduate Arts & Sciences student Christa Romanosky’s ongoing ENWR 1510 class, “GaGa for Gaga: Sex, Gender, and Identity,” students analyze how the musician pushes social boundaries with her work. For this introductory course to argumentative essay writing, Romanosky chose the Lady Gaga theme to establish an engaging framework for critical analysis.

4.Lady Gaga and the Sociology of Fame” (The University Of South Carolina) – Lady Gaga may not have much class but now there is a class on her. The University of South Carolina is offering a class called Lady Gaga and the Sociology of Fame.  Mathieu Deflem, the professor teaching the course describes it as aiming to “unravel some of the sociologically relevant dimensions of the fame of Lady Gaga with respect to her music, videos, fashion, and other artistic endeavours.”

5.Philosophy And Star Trek” (Georgetown) – Star Trek is very philosophical. What better way, then, to learn philosophy, than to watch Star Trek, read philosophy, and hash it all out in class? That’s the plan. This course is basically an introduction to certain topics in metaphysics and epistemology philosophy, centered around major philosophical questions that come up again and again in Star Trek. In conjunction with watching Star Trek, we will read excerpts from the writings of great philosophers, extract key concepts and arguments and then analyze those arguments.

6.Invented Languages: Klingon and Beyond” (The University Of Texas) – Why would anyone want to learn Klingon?

7.The Science Of Superheroes” (UC Irvine) – Have you ever wondered if Superman could really bend steel bars? Would a “gamma ray” accident turn you into the Hulk? What is a “spidey-sense”? And just who did think of all these superheroes and their powers? In this seminar, we discuss the science (or lack of science) behind many of the most famous superheroes. Even more amazing, we will discuss what kind of superheroes might be imagined using our current scientific understanding.

8.Learning From YouTube” (Pitzer College) – About 35 students meet in a classroom but work mostly online, where they view YouTube content and post their comments.  Class lessons also are posted and students are encouraged to post videos. One class member, for instance, posted a 1:36-minute video of himself juggling.

9.Arguing with Judge Judy” (UC Berkeley) – TV “Judge” shows have become extremely popular in the last 3-5 years. A fascinating aspect of these shows from a rhetorical point of view is the number of arguments made by the litigants that are utterly illogical, or perversions of standard logic, and yet are used over and over again. For example, when asked “Did you hit the plaintiff?” respondents often say, “If I woulda hit him, he’d be dead!” This reply avoids answering “yes” or “no” by presenting a perverted form of the logical strategy called “a fortiori” argument [“from the stronger”] in Latin. The seminar will be concerned with identifying such apparently popular logical fallacies on “Judge Judy” and “The People’s Court” and discussing why such strategies are so widespread. It is NOT a course about law or “legal reasoning.” Students who are interested in logic, argument, TV, and American popular culture will probably be interested in this course. I emphasize that it is NOT about the application of law or the operations of the court system in general.

10.Elvis As Anthology” (The University Of Iowa) – The class, “Elvis as Anthology,” focuses on Presley’s relationship to African American history, social change, and aesthetics. It focuses not just on Elvis, but on other artists who inspired him and whom he inspired.

11.The Feminist Critique Of Christianity” (The University Of Pennsylvania) – An overview of the past decades of feminist scholarship about Christian and post-Christian historians and theologians who offer a feminist perspective on traditional Christian theology and practice. This course is a critical overview of this material, presented with a summary of Christian biblical studies, history and theology, and with a special interest in constructive attempts at creating a spiritual tradition with women’s experience at the center.

12.Zombies In Popular Media” (Columbia College) – This course explores the history, significance, and representation of the zombie as a figure in horror and fantasy texts. Instruction follows an intense schedule, using critical theory and source media (literature, comics, and films) to spur discussion and exploration of the figure’s many incarnations. Daily assignments focus on reflection and commentary, while final projects foster thoughtful connections between student disciplines and the figure of the zombie.

13.Far Side Entomology” (Oregon State) – For the last 20 years, a scientist at Oregon State University has used Gary Larson’s cartoons as a teaching tool. The result has been a generation of students learning — and laughing — about insects.

14.Interrogating Gender: Centuries of Dramatic Cross-Dressing” (Swarthmore) – Do clothes make the man? Or the woman? Do men make better women? Or women better men? Is gender a costume we put on and take off? Are we really all always in drag? Does gender-bending lead to transcendence or chaos? These questions and their ramifications for liminalities of race, nationality and sexuality will be our focus in a course that examines dramatic works from The Bacchae to M. Butterfly.

15.Oh, Look, a Chicken!” Embracing Distraction as a Way of Knowing (Belmont University) – Students must write papers using their personal research on the five senses. Entsminger reads aloud illustrated books The Simple People and Toby’s Toe to teach lessons about what to value by being alive. Students listen to music while doodling in class. Another project requires students to put themselves in situations where they will be distracted and write a reflection tracking how they got back to their original intent.

16.The Textual Appeal of Tupac Shakur” (University of Washington) – The UW is not the first college with a class dedicated to Shakur — classes on the rapper have been offered at the University of California Berkeley and Harvard — but it is the first to relate Shakur’s work to literature.

17.Cyberporn And Society” (State University of New York at Buffalo) – With classwork like this, who needs to play? Undergraduates taking Cyberporn and Society at the State University of New York at Buffalo survey Internet porn sites.

18.Sport For The Spectator” (The Ohio State University) – Develop an appreciation of sport as a spectacle, social event, recreational pursuit, business, and entertainment. Develop the ability to identify issues that affect the sport and spectator behavior.

19.Getting Dressed” (Princeton) – Jenna Weissman Joselit looks over the roomful of freshmen in front of her and asks them to perform a warm-up exercise: Chart the major moments of your lives through clothes. “If you pop open your closet, can you recall your lives?” she posits on the first day of the freshman seminar “Getting Dressed.”

20.How To Watch Television” (Montclair) – This course, open to both broadcasting majors and non-majors, is about analyzing television in the ways and to the extent to which it needs to be understood by its audience. The aim is for students to critically evaluate the role and impact of television in their lives as well as in the life of the culture. The means to achieve this aim is an approach that combines media theory and criticism with media education.

Are you starting to understand why our college graduates can’t function effectively when they graduate and go out into the real world?

 

 

This in addition to Political Correctness, Multiculturalism, Feminism, Homosexuality, Sensitivity, Equality, Preference and the War On Men.

 

The money is wasted no matter who pays.

Wed, 03/11/2015 - 10:25 | 5877325 Heavy
Heavy's picture

Summary: Nothing new here.

Wed, 03/11/2015 - 10:39 | 5877383 DontFollowMyAdv...
DontFollowMyAdviceImaDummy's picture

guess this means we should cash-in those 529s, take a vacation, and just tell our kids "hell no we're not co-signing that student loan, you go get those degrees and then declare BK since Obama doesn't want you to pay it back"...

memo to King Obama, a better solution would be to offer 0% or even Negative Interest Rate Loans to students taking loans for degrees in fields we need talent in like Medical Doctors and Computer Science.  And you should charge 100% interest-or-more for "Liberal Studies" or any other degree where the supply is presently double-or-more that of the demand for people with that degree.

Wed, 03/11/2015 - 10:59 | 5877482 dsty
dsty's picture

Why is every one getting upset about this?

It is all fake money anyway.

You really don't own anything.

It is all digital.

One press of a button.

You are on the streets.

Be carefull not to tick some one off, they already have your number.

Wed, 03/11/2015 - 22:13 | 5880191 EscapingProgress
EscapingProgress's picture

I can finance my car up to 150% of its book value to pay off my student loan debt. :)

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