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Student Loan Debt Slaves In Perpetuity - A True Story Of "Bankruptcy Hell"

Tyler Durden's picture




 

The numeric implications as well as the magnitude of the student loan bubble have been discussed extensively before. Yet just like most people's eyes gloss over when they hear billions, trillions or quadrillions, so seeing the exponential chart of Federal Student debt merely brings up memories of a math lesson from high school, or at best, makes one think of statistics. And as we all know statistics are faceless, nameless and can never apply to anyone else. It is the individual case studies that have the most impact. Which is why we would like to introduce you to Devin and Sarah Stang - student loan debt slaves in perpetuity.

First, for those who are still unfamiliar with the brush strokes, here is the big picture, courtesy of AP:

The Federal Reserve Bank of New York estimates 37 million Americans have student loan debt, totaling $870 billion. The average balance is around $23,000 (though that partly reflects a relatively small number of very large balances; the median is $12,800). Only 39 percent are paying down balances. An estimated 5.4 million borrowers have at least one student loan account past due.

 

Roughly 85 percent of outstanding student loan debt is owed to the federal government. The remaining 15 percent that's counted as private student debt is owed to various non-federal lenders, ranging from banks to loan companies like Sallie Mae Corp. to non-profits and state-affiliated agencies (under the Durbin bill, loans from any government-funded entity still wouldn't be dischargeable, only those from truly private lenders).

 

Generally, it's these private loans that bring borrowers to the door of bankruptcy lawyers like Barrett. Private student loans often lack the protections of federal ones, and have rates that typically start higher and can shoot up. A recent survey of bankruptcy attorneys found 81 percent reporting more clients with student debt in recent years, and roughly half reporting a significant increase.

And, also by way of background to those unfamiliar, student debt has a very peculiar feature:

Virtually any other kind of debt — including medical bills, mortgage, credit cards and car loans, even gambling losses— can be discharged in bankruptcy, allowing the "honest but unlucky" a chance to restore their footing through an arduous restructuring overseen by a court. 

 

But under a 2005 law passed by Congress to protect lenders, private student loans fall under the same nearly-impossible-to-clear category as child support payments and criminal fines.

 

"It's a huge part of why the younger generations are here now," said the Stangs' bankruptcy lawyer, Matthew Barrett, whose busy office in Amherst, west of Cleveland, belies stories about the improving economy. He estimates half his clients have problems with student debt.

It is very ironic is that despite all the rhetoric, the president has said absolutely nothing about mitigating this particular provision of bankruptcy law: the one which makes student debt the most expensive form of payment: one which is literally like the proverbial gift that keeps on giving. Or in this case taking.

To advocates for student borrowers, the law is infuriating, counter-productive and — if intended to ensure lenders would be willing to make loans to students— demonstrably unnecessary. They see changing it as among the most effective, and least costly, ways to help those most seriously burdened by student debt, without giving a break to those for whom it's manageable.

 

Yet despite a voluble national conversation on student debt, the issue has gotten comparatively little attention.

 

At stops in three swing states this week, President Barack Obama is calling on Congress to head off a scheduled doubling in federal Stafford loan rates, from 3.4 percent to 6.8 percent. Changing that law could save more than 7 million new borrowers on average $1,000 a year, according to the White House. But this across-the-board benefit for current college students would do nothing for older borrowers already in trouble.

 

Acting without Congress, the Obama administration has implemented a series of protections for those pressed to pay back federal loans, such as income-based repayment and a public-service loan forgiveness program — steps lauded by advocates for borrowers.

 

However, the president appears never to have directly addressed a proposal by Sen. Richard Durbin, D-Illinois, to overturn the 2005 law on private loans. Treasury Secretary Timothy Geithner recently told Durbin the dischargeability proposal had "some merit" and that the administration wanted to work with him to expand the protections it has implemented for federal student loans into the private market. Regardless, the bill has little chance of passing the divided Congress in an election year.

Which brings us to the topic at hand: case study A.

The misfortunes that brought schoolteachers Devin and Sarah Stang and their four young children to bankruptcy — and the loss of their house and a car in the process — were their own unique story.

 

They bought the house at just the wrong time. There were heavy medical expenses when, at five months pregnant, she delivered stillborn twins. And their money woes go back further: When Sarah's college softball team pressured her to drop classes she wanted to take, she quit, lost her scholarship and had to make up the difference with loans. Devin, too, borrowed to get a master's degree. Then they struggled amid school layoffs near their Sandusky, Ohio, home.

 

Now, the Stangs just want a truly clean slate, financially. But even the ordeal of bankruptcy won't give it to them, and the reason is a common one: Much of their debt comes from private student loans.

...Which as noted above, will virtually never go away. So who is the biggest winner? Why bankruptcy lawyers of course, who as it so happens all the time, do nothing but provide false hope...

Generally, it's these private loans that bring borrowers to the door of bankruptcy lawyers like Barrett. Private student loans often lack the protections of federal ones, and have rates that typically start higher and can shoot up. A recent survey of bankruptcy attorneys found 81 percent reporting more clients with student debt in recent years, and roughly half reporting a significant increase.

 

Barrett says he's seeing more recent college graduates who couldn't get a job after graduation or who, if they did, faced garnishment of entry-level wages.

 

Before the 2005 law passed, lenders would "try to work with (borrowers) on a payment plan," Barrett says. "They had the threat, if we don't make it so this person can afford to live and eat and get to work and dress for work, then they're going to file for a bankruptcy plan and we're going to get hit.

 

"Now, they'll hit you with a garnishment — and if you can't make ends meet, tough."

 

Private lenders haven't always enjoyed a spot at the front of the line of bankruptcy creditors.

It wasn't always like that:

Private lenders haven't always enjoyed a spot at the front of the line of bankruptcy creditors.

Until 1976, all education loans were dischargeable in bankruptcy. That year Congress began requiring borrowers to wait at least five years before they could discharge federal student loans. Since 1998, borrowers have been unable ever to discharge federal student loans, and in 2005 the then-Republican-controlled Congress made private loans almost impossible to discharge. Essentially, borrowers must prove they can't repay and will never be able to, but the standard is vague. And litigating in bankruptcy court may be impossible financially for someone in those circumstances.

 

With federal loans, the concern was that making it too easy to walk away from debts would put taxpayer dollars at risk.

 

With private loans, the lender protections were justified by fears that otherwise lenders wouldn't extend students the capital they needed to cover tuition bills. Student loans offer no security or collateral. Lenders are betting on a borrower's education to produce future earnings. Put differently, a bank can repossess your car but not your brain.

 

Changing the law "would force our members to raise borrower rates or elevate their already strict underwriting standards and essentially make it harder to make the loans," said a spokeswoman for the Education Finance Council, which represents nonprofit and state-based providers of non-federal loans, in a statement issued on behalf of president Vince Sampson. A Moody's report also suggested younger student borrowers might be especially tempted by an easier bankruptcy filing, not appreciating the long-term credit damage.

 

But such arguments swim upstream against a lot of historical data.

 

Before 1976, when student loans were dischargeable in bankruptcy, there's little evidence borrowers abused the practice. A federal study from that time estimated less than 1 percent of all matured student loans were discharged in bankruptcy.

Of course, before 1976 there was not 30 years of excessive easing resulting in unprecedented dislocation from fair value for all asset prices, driven purely by nothing but cheap money, and people access to it.

Which brings us back to the Stangs:

"I wasn't raised to say, 'I'll go file bankruptcy,'" said Devin Stang, who is 41. The family's student debt totals $25,000 in federal loans and about $37,000 in private ones, much of it from taking required continuing education credits to keep up their teaching licenses and job prospects at a time of widespread layoffs.

 

Surrendering one of their two cars in bankruptcy will limit the Stangs' work options, Barrett says. And digging out will be even harder because, even after their other debts are clear, the private student lenders could garnishee up to 25 percent of wages.

 

If they could discharge their private loans in the same manner as credit card debts, "away we'd go on our lives," Stang said.

 

There's also little evidence that changing the law would affect the availability of private student loans. In fact, private student lending was expanding rapidly before 2005, when the loans were dischargeable. Then Congress awarded lenders stronger collection powers — but private student lending fell by two-thirds in just a few years, coinciding with the broader credit crunch.

 

A leading financial aid expert, Mark Kantrowitz of the website Finaid.org, doesn't buy the lenders' argument. He says changing the law might slightly increase fees, but lenders make their decisions based on credit scores and macro-economic factors.

Of course, one can say that one has to live the consequences of one's actions, and it is not like the Stangs did not make a mistake. But then the argument would also migrate to the consequences of pervasive bank failures and the fact that unlike the Stangs, banks did get preferential terms for all their losses and shortfalls. And of course that would be true.

And at the end of the day, America has always been about second chances. Perhaps the Stangs, and all those others who took a bet on their biggest asset: themselves, and failed the first time around, deserve a second chance?

Even if changing the law did make private loans disappear, some advocates think that wouldn't be so bad.

 

In fact, new lending has already fallen sharply recently, and it hasn't kept people out of college; enrollment is way up. Students who might have gotten private loans five years ago, but can't now, are apparently choosing less expensive schools or borrowing more of what they need from the federal government, which accounts for more than 90 percent of new loan volume now.

 

A study by the Project on Student Debt, a foundation-supported research group, found that half of students who took out private loans in 2007-2008 failed to borrow their maximum eligibility in federal Stafford loans. Those students could have — and almost certainly should have — borrowed more from Washington first (undergraduates can cumulatively borrow up to $31,000 in federal Stafford loans, and in some cases, as much as $57,500). Now, they're doing so.

Yet nothing will happen. Why? Because that ultimate enabler of the status quo - America's higher learning system itself, is dependent on perpetuating the status quo. Because if loans are harder to come by, college tuitions would tumble, and the very fabric holding the lie that is modern socio-economic surreality, would implode:

Finally, if the spigot of private loans cut off, it might temper college cost increases. Colleges would find it harder to get away with charging more than what students can borrow from the government.

Indeed one can dream... Or return to reality, where unfortunately nothing changes, and millions and millions of Americans are converted each year into that most sublime form of debt slave: the one that can't just pick up and walk away from it all. The very definition of slavery.

"There's a special circle of bankruptcy hell for these kinds of debts," said Rich Williams, higher education advocate with the group US PIRG, which lobbies on student loan issues. "It's not that students are asking for extra protections. We're asking for the same protections entitled to every other form of consumer debt."

And so it continues in the once great USA, where countless people are converted not only into perpetual debt slaves but have to brave the various circles of debt hell simply to comply with a self-image imposed on them by a superficial society that demands one buys stuff one doesn't need, with money one doesn't have to impress people one doesn't like.

Truly the American dream, pardon nightmare, lives on.

 

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Thu, 04/26/2012 - 21:51 | 2378937 LasVegasDave
LasVegasDave's picture

because the only collateral for the loan is an ADD, low IQ brain.

Try foreclosing and selling that in the free market.

Thu, 04/26/2012 - 19:00 | 2378511 Arnold Ziffel
Arnold Ziffel's picture

It's much easier to blame others.

If you whine loud enough they will eventaully bail you out or waive it in the future as yet another way to buy votes of the debtors.

Thu, 04/26/2012 - 22:11 | 2378983 Harbanger
Harbanger's picture

Nobody's blaming the Colleges for making too much money.  Some make enough money from their College Sports teams to lower tuitions just a little.

Thu, 04/26/2012 - 19:17 | 2378555 koperniuk666
koperniuk666's picture

Gully;

"no-one ...... forces them to..accept loans"

You are partially right and I sympathise with the broad principle. But the asset bubble has spilled over into everything that one buys; and for the last 10 years ordinary people have been forced to borrow just to live. This is STILL happening.   People on median incomes cannot afford to buy the products and services because the suppliers are themselves hooked into huge repayments on their bloated assets and debt and are thus unable to cut prices to an affordable level. There has been no catharsis because the drops in value of those assets  (necessary)  would be so  huge that they would make the 2009 set back look like a minor event. This is where we are; everyone hoping that we can fudge through but the man is the street is slowley being dragged under....

Thu, 04/26/2012 - 19:48 | 2378608 Renfield
Renfield's picture

Gully, ordinarily I'd agree with you here and I do agree the Stangs are a piss-poor example. Might be hard to find a better one, though...

The only thing is, in the past, if someone made some dumbass borrowing decisions like theirs, the consequences wouldn't be with them for the REST OF THEIR LIVES. The proper punishment for dumbass borrowing decisions is bankruptcy and ruined credit for a reasonable period of time, and the proper punishment for dumbass lending decisions is loss of principle.

In other words, one should not be a debt slave for LIFE because you were stupid in your 20s (or 30s or even 40s). Forty years' hard time is a worse sentence than even violent felons get. (Sidestepping the debate about whether felony sentences should be more harsh.) Which of us has not made fucking stupid decisions when we were young, that we paid for THEN, and are glad to be on the other side of now? What if there were NEVER another side for our idiot periods?

So, while I agree with your sentiment, there is still something VERY wrong with this picture, another side and so far the Stangs have been made to take the entire fall. Even if one does eschew loans, and work through school, it is still near-impossible to afford a degree. Which is a shame - degrees should NOT be required for most jobs, but they of course are very necessary for some. Not to mention there are some gifted intellects out there who should be able to go to school just by working hard and eschewing debt.

I agree with you about the pissers and moaners, but there is still a very skewed big picture here. I marked you up for your point, but I hope the bigger point is not lost in the focus on their individual stupidity.

Also want to draw attention to the point the article makes, about banks being not only forgiven but ENABLED in this same destructive behaviour, which is bringing down the economy, and meanwhile the Stangs get the equivalent of a double life sentence. The Stangs were stupid, and are more than punished. The banks are CRIMINAL, and are rewarded and further enabled for it. I would say this, more than the Stangs' stupidity, is the larger point....

Thu, 04/26/2012 - 19:48 | 2378639 knightowl77
knightowl77's picture

dumbass decisions of every kind can affect the rest of your life...

 

Commit a crime at 20 and go to prison, your whole life is effected

Do something dangerous and end up crippled or brain damaged it effects your whole life....

Every day you make decisions that will alter your life....get over it

Fri, 04/27/2012 - 07:39 | 2379600 Seer
Seer's picture

"The only thing is, in the past, if someone made some dumbass borrowing decisions like theirs, the consequences wouldn't be with them for the REST OF THEIR LIVES."

Really?  Let's think about this one a bit...

I'd say that the norm has been that one DOES get shackled in the debtors prison, that it was ONLY a short time in human history (and the US's at that) that it was not the case.

Fucking bankers/TPTB saw all this coming.  These "leaders" (who are willing to lock us up at the drop of a hat, yet they themselves can get away with much more hat-dropping) knew that the music was going to stop.  They milked it all, set their mutant off-spring up with the ability to continue running the big slave ship: we all buy it (because we've been brainwashed into thinking that we have to be LIKE them) with shit like being against the "death tax," which is really a "get out of jail free card" for TPTB, allows them to launder their ill-gotten gains to their mutant progeny.

Fri, 04/27/2012 - 14:28 | 2380731 Renfield
Renfield's picture

Marked up b/c I think you are right, even if I don't like the idea that this whole collapse into feudalism may be a reversion to mean in cultural terms. This is the same thought that often lurks, big and sad, at the back of my mind.

Thu, 04/26/2012 - 20:10 | 2378678 Dermasolarapate...
Dermasolarapaterraphatrima's picture

I agree with Gully.

Fewer people accept responsibility for their own decisions---bankers, students, underwater home owners, and on and on---

No one forced you to take that loan...or that mortgage...if you have a problem take ot the the realtor who represented you...or the college loan dept...but don't complain to me.

It's a generation of whiners and cry babies....

Fri, 04/27/2012 - 07:40 | 2379601 Seer
Seer's picture

Read what you wrote, see if you can see your bias.

I agree with the premise (but you still step in the pile of steaming turds).

Thu, 04/26/2012 - 20:13 | 2378704 grey7beard
grey7beard's picture

>>Now it's a world of goddamned whiners, pissing and moaning

Don't look now, but you fit right in.

Thu, 04/26/2012 - 20:54 | 2378807 Stevious
Stevious's picture

That's unfair.  Goats often die from eating things that they shouldn't such as plastic bags.  Put stuff in front of them and they eat it, I know from experience.  Cattle too often die of "hardware disease," caused by eating large quantities of nails--they shove a large magnet into the cow's fist stomach to grab most of the hardware but sometimes there's just too much.

In retrospect it all seemed quite reasonable.  Borrow with the assurance of having a job where 10-20% of income easily covers student debt.  The problem is complex.  Degrees that are unsaleable, and a dearth of jobs even if the degree is a good one.

Society painted a nice palatable, reasonable picture and many bought into it.

Frankly I don't mind in the least that I have to work to age 70 plus and for me, I'm one of the lucky few, I'll still have job opportunity at age 70 which is good because my loans now end at about age 80.

I never expected this to happen, and expected that the loans would be paid off by now, but lack of jobs forced me to extend the terms.  I don't mind, and I believe I'll pay them off and I'll be happy to do so, and appreciative (unless the job market truly crashes again). 

At least they end when the debtor dies.  Perhaps suicide will become the most common form of student loan closure.

 

Fri, 04/27/2012 - 07:48 | 2379606 Seer
Seer's picture

Shit, man, you manage to mention "goat" and "cow" and you get down arrowed? that's some fucked up shit!

Anyway... most of human history is about people working until they die.  Really, how many other animals "retire?"

It's this notion of retirement that enables TPTB to sit on the thrones of power.  The "dreams" that they sell distract us from seeing that we work for THEM and that they in turn do NO work (for us).  As soon as we see that there really isn't any "betterment" THEY will crumble: the "betterment" is really only a mirage, created through resource extraction (short-term, finite planet and all that) and stealing from the future (but not from their off-spring's future).

Thu, 04/26/2012 - 18:22 | 2378388 RafterManFMJ
RafterManFMJ's picture

"It is very ironic is that despite all the rhetoric, the president has said absolutely nothing about mitigating this particular provision of bankruptcy law"

 

Is it? Really? Hmmm...if loans could be discharged, then who would loan 50K per year for a degree in Multi-Cultural Comparative Studies? No one. And the price, and likely number of colleges would plummet. This would cause massive pain among the Tenured Elite, who reflexively vote Demoncratic and inculcate lies, socialism, etc. into the heads of the lowing cattle. Oblammo's party would lose votes, political power, and a ready-made propaganda gulag known as the US Education System.

 

The only thing Oblammo might do is pass some law or EO that makes the taxpayer's responsible for the debt, or grant a stay of payments for a time - and only this to buy votes. There will be NO relief via bankruptcy as this would collapse the EDU ponzi, stick the bankers with losses, and diminish the power of the DemonCrats; if you think otherwise you must either be credulous to the point you have a keeper, or else you just dropped here from another planet.

Thu, 04/26/2012 - 18:59 | 2378508 MeetTozter
MeetTozter's picture

Careful your ideology doesn't run away with you - in the last 30 years, the major higher education costs are being driven by a 100% increase in the admistrative overhead, especially the public schools - this is your new DMV job for the nephews & nieces of the politically well-connected.  Adjusted for inflation, the teacher expense per credit is flat, at most, in last 30 years, with the burgeoning use of "Adjuncts".  Those are the numbers....

Thu, 04/26/2012 - 19:41 | 2378616 RafterManFMJ
RafterManFMJ's picture

There is no ideology.  There is no need to label what is blatently in front of you. If I were to call a pig wallowing in it's own filth a disgusting sight - would that be ideology?  My failure to castigate the ReThuglicans does not mean I implictly endorse them - the Devil take them both.

Secondly, this article is about student debt, IE post-secondary education.  Your point about admin overhead in Publick Skool is accurate, however - I had a chart bookmarked but lost it a long time ago, charting the increasing cost of administration vs. the cost of actual classroom teachers in California and it was breathtaking, almost hyperbolic.  Have tried perodically to find it but have been unable.

Fri, 04/27/2012 - 03:52 | 2379419 StychoKiller
StychoKiller's picture

Both of yer comments are on the munny!

Fri, 04/27/2012 - 08:03 | 2379618 Seer
Seer's picture

"charting the increasing cost of administration vs. the cost of actual classroom teachers"

Like it could be anything other than this, that the outcome wouldn't end up this way?

We're ALL living on borrowed time.  The fossil fuel era has endowed us with the ability to extract physical resources (aka "wealth") in heaps.  Now that both fossil fuel and physical resources are in decline all that is not direct WORK becomes more burdensome.

Even if you were to eliminate the administrative shit it would STILL end up this way.  Pure hubris would be to think that applying more money to creating AAPL engineers is going to save us.  Can't dig with iCrap.

This is all nothing more than a distraction away from the massive fraud and theft that's going on at the top.  Divide and conquer is alive and well...  The great trick has been that we bought the entire premise.

Fri, 04/27/2012 - 15:51 | 2380964 Cathartes Aura
Cathartes Aura's picture

your posts here have depth, particularly this,

This is all nothing more than a distraction away from the massive fraud and theft that's going on at the top.  Divide and conquer is alive and well...  The great trick has been that we bought the entire premise.

but of course, same as it always is, tools enforce the rules. . .

Thu, 04/26/2012 - 18:30 | 2378419 LasVegasDave
LasVegasDave's picture

Maybe the banks can foreclose on the cheetos wrappers, empty beercans and unopened textbooks in the deadbeat students' apartments?

Thu, 04/26/2012 - 19:55 | 2378653 Freddie
Freddie's picture

Young people voted for this in 2008.   Yeah the alternative was not much better and the elites are the same but the ****tard is the worst choice.  

I will laugh if they re-select the islamic - kids who graduated in 2008 will have 4 more years ++ to start their "careers."   They will then be about 29-31 years old with very little in the way of work or career skills.  They will be competing against 21-22 year olds out of college.  The new graduates will get the jobs - if there are any jobs. 

F***ing karma is a biotch!   Nice job kiddies.

Fri, 04/27/2012 - 08:07 | 2379625 Seer
Seer's picture

You're still buying into the fundamentally flawed premise and don't know it.  And That's something that I can laugh at.

Thu, 04/26/2012 - 21:52 | 2378945 Buck Johnson
Buck Johnson's picture

Your dead on, wait until the currency isn't worth the paper it's printed on. 

Thu, 04/26/2012 - 23:34 | 2379159 Stuck on Zero
Stuck on Zero's picture

The answer is debtors prison.  Put them all in prison till they can come up with the money </sarc>

Thu, 04/26/2012 - 17:32 | 2378195 evolutionx
evolutionx's picture

is Illinois the Greece of the US?

 

according to CMA Default Probability is almost 40% and the state ranks among the Top 10 of

Sovereign Risk


http://www.cds-info.com

(scroll down)

Thu, 04/26/2012 - 17:44 | 2378235 Agent P
Agent P's picture

Yes, except our politicians are WAY more corrupt.

Thu, 04/26/2012 - 17:59 | 2378292 Logans_Run
Logans_Run's picture

...and I believe that penis enhancement is currently illegal here in the USSA

Thu, 04/26/2012 - 20:19 | 2378719 Freddie
Freddie's picture

+1

I would rather live in a cardboard box in Greece than in an apt in Chicago.  Downstate Illinois is still normal but that state is so ****ed. 

Thu, 04/26/2012 - 17:34 | 2378201 BobPaulson
BobPaulson's picture

So, how did they justify protecting student loans from bankruptcy? How can government backstopped loansharking be constitutional?

Thu, 04/26/2012 - 17:48 | 2378250 The Alarmist
The Alarmist's picture

It's called killing two birds with one stone: Banking-lobby contributors made happy with enhanced protections and a pipeline full of easy marks who think they need a degree to get ahead, and Big-Education-lobby contributors and friends made happy with a pipeline full of easy marks desperate to get a degree to get ahead and thereby causing the increased demand that makes raising rates and therefore the lobby's salaries and benefits a piece of cake. The losers are the easy marks who have bought into the fantasy that a degree helps one to get ahead.

Thu, 04/26/2012 - 17:53 | 2378271 Reptil
Reptil's picture

It's not even legal it seems. Loans can be declared void if there's no reasonable expectation to ever repay them. FRAUDULENT CONVEYANCE.

Check this out (skip to 13 minutes in)

https://www.youtube.com/watch?feature=player_embedded&v=KYW5Lxm_Kjs

Orrrr......

they could run to Mexico and start over. NAFTA works both ways </sarc>

Open borders bitchezzz

Thu, 04/26/2012 - 18:01 | 2378304 NewWorldOrange
NewWorldOrange's picture

Yep, and Obama will probably forgive or reduce a lot of those loans if he's reelected, or even push ObamaEd ("free" college for all.) He seems to want to fit in at the Euro Club.

Thu, 04/26/2012 - 18:56 | 2378492 dwdollar
dwdollar's picture

Yeah... just like he forgave all those bad mortgages... Where have you been?

The point is to get everyone INTO debt slavery, not out of it.

Thu, 04/26/2012 - 19:57 | 2378594 NewWorldOrange
NewWorldOrange's picture

"just like he forgave all those bad mortgages"

A lot more will be easier for him to do politically in a second term. So the idiot probably will. All these politicians care about is buying votes. People get THEMSELVES into debt slavery.

Thu, 04/26/2012 - 20:22 | 2378729 Freddie
Freddie's picture

Don't be silly.  Certain people are getting loans forgiven along with credit cards and free houses.  Go to bank of america.  IF you are a certain kind of person - you will get a mortgage.

Fri, 04/27/2012 - 03:55 | 2379425 StychoKiller
StychoKiller's picture

Hmm, "certain kind of person"; NOT like you to pussyfoot around yer point.  Getting gun-shy?

Thu, 04/26/2012 - 20:32 | 2378750 NewWorldOrange
NewWorldOrange's picture

Say reptil I responded on that Dutch thread. Thanks for the long and thoughtful posts there. Love your country and love to chat about it.

Thu, 04/26/2012 - 18:16 | 2378364 OpenThePodBayDoorHAL
OpenThePodBayDoorHAL's picture

why can't they just pay it off with a credit card then discharge that in bankruptcy?

Thu, 04/26/2012 - 18:21 | 2378386 Rainman
Rainman's picture

I smoked a joint before every Logic class before I dropped it, but this makes sense to moi.

Thu, 04/26/2012 - 18:51 | 2378483 Talleyrand
Talleyrand's picture

Maybe because entering into a contract/debt that one has no intention of fulfilling/repaying is fraud (unless one is the State). But then, the whole stew-dent loan debacle is rife with fraud, cupidity, sloth and and willful ignorance...just one more nail in the coffin.

 

Thu, 04/26/2012 - 19:59 | 2378613 NewWorldOrange
NewWorldOrange's picture

That CAN be done, but it must be done carefully. When you file bankruptcy, the credit card company reps look at where you spent the money and can successfully object to the discharge of the cc debt if used for that purpose. They can even examine your income/expenses to see if you did that on the sly. If you gradually use the cc's to pay common expenses you would have paid from income, over several years, and use the money you would have used to pay common expenses to pay off the student loan debt, then wait about a year after the student loan debt is gone THEN file bankruptcy, it's almost sure to work. Better yet, once you've paid off the student loan debt, zero out the credit card balances with some other dishargeable loan/whatever, the run then up again while paying off THAT loan/whatever, and THEN file bankruptcy. That'll definitely work so long as you don't make any statements to the Court or creditors even hinting that you intended that. Also, spread the credit card debt over as many credit cards as you can get (a few thousand each) instead of putting it all on one high limit card that'll have that cc issuer pissed and poring over all your finances.

And if a person was going to ruin their credit anyway, they COULD get all the credit cards they can, use them to finance a forex account (yes, you can) and then place a bet on some currency pair on some Sunday evening after some big news comes out over the weekend (forex market closed) that is likely to push some currency pair one way big (happens often these days.) Even if you flip a coin, 50/50 you make a bundle and can, if you want, just use that to pay off the student debt and still have good credit and maybe even some cash left over. If the trade fails, you're no worse off IF you were going to file bankruptcy anyway. Investing/trading, even in high risk stuff, with borrowed money is not in and of itself fraud. But if you do that and lose that bet, struggle on and make some payments for a while (a year or so) before filing bankruptcy.

Whatever you do, if you think you may end up filing bankruptcy, DO NOT lie about your income when applying for the credit cards. Apply for every one you can find, all on the same day, online, AFTER you've taken all the steps needed to increase your credit score all you can. You can claim ALL household income from any legal source.

FOR INFORMATIONAL PURPOSES ONLY. I'M NOT SUGGESTING ANYONE DO ANY OF THIS. THAT WOULD BE WALL STREET-LIKE BEHAVIOR.

Thu, 04/26/2012 - 20:50 | 2378794 dark pools of soros
dark pools of soros's picture

haah yeah i did some of this back after the dot com bomb and blamed it all on that and got the fuck outta my wayward spending ways - then a few years later good old Biden ran torch bearer for the banks to clamp down on easy bankruptcy

If you want to get taken away by the black helicopters tomorrow, organize everyone to max out their cards with cash advances and short the stock of one TBTF at a time..  the other banks may be greedy enough to lend enough shares out to kill one of them.. then move to the next...

 

Thu, 04/26/2012 - 23:02 | 2379099 kekekekekekeke
kekekekekekeke's picture

I don't have any student debt but this is really good info, you should publish it you'd make a killing

Thu, 04/26/2012 - 20:05 | 2378687 oddjob
oddjob's picture

Sorry, We Do Not Accept Discover.

Thu, 04/26/2012 - 23:00 | 2379093 Vendetta
Vendetta's picture

govt has backstopped investmentsharking, why not student loan debt.  Corruption is job one.

Fri, 04/27/2012 - 08:12 | 2379632 Seer
Seer's picture

CORPORATIONS RUN THINGS- got that?

Corporations get the govt to educate their slaves.  They don't care how many "rejects" there are, as the govt will cover that cost.

Constitutional- ha, ha!  The Constitution itself was a big set-up by TPTB.

Thu, 04/26/2012 - 17:36 | 2378207 buzzsaw99
buzzsaw99's picture

Young people, there are some serious pitfalls in life:

 

student debt

baby daddy

tax arrears

 

There are many others but if you avoid the 3 listed above you will be way ahead of the pack.

Thu, 04/26/2012 - 17:43 | 2378233 Unprepared
Unprepared's picture

On Yahoo! (do not judge me), there was a headline of some guy that the take away of his new book "How to be better slave in less-than-a-fanta-second or-something-like-that" is that youngsters need to pay off their student loans as soon as possible.

Thu, 04/26/2012 - 17:40 | 2378219 Richard Head
Richard Head's picture

This more of a YP than an MP.

Thu, 04/26/2012 - 20:53 | 2378804 dark pools of soros
dark pools of soros's picture

true - they didnt try this shit on Gen X

they didnt even want us to go to college

 

Thu, 04/26/2012 - 17:40 | 2378221 q99x2
q99x2's picture

What if there were a place that all like minded people to, let's say agree on marching on washington, could sign up. Like there has to come a point where the FED (mayswell throw the banksters in with the politicians) has fucked over a large percentage of the people, one way or another. Those people all click a radio button on a website to agree to march against general tyranny. Then everyone also agrees to get a family member to join in.

Wouldn't that kick start the revolution?

Once the goons start spilling blood poof off she goes.

Looks like there are plenty of students ready to click.

Fri, 04/27/2012 - 08:29 | 2379657 Seer
Seer's picture

POWER doesn't give a shit.  Violence only goes down hill.  All those who are propping up POWER (by agreeing that "leaders" are necessary) are ONLY allowed to "speak," while POWER is allowed to KILL.

But... what is the AIM of this?  I'd say that it's the same conditioned mindset that allows TPTB to stay in power.  THEY get you to demand (beg for) what THEY have, demand "education" (from THEM) so that you can (still) pay THEM back while you WORK for THEM.

http://blog.mises.org/20957/withholding-consent/

”I do not ask that you place hands upon the tyrant to topple him over, but simply that you support him no longer; then you will behold him, like a great Colossus whose pedestal has been pulled away, fall of his own weight and break in pieces.” -Étienne de La Boétie

Thu, 04/26/2012 - 17:42 | 2378226 Stackers
Stackers's picture

Mama always said stupid is as stupid does. I have no empathy for these people. Probably racked up $100's of thousands in student loans and master degrees to become "teachers".

Thu, 04/26/2012 - 18:05 | 2378313 Gully Foyle
Gully Foyle's picture

Stackers

Thank you for the refreshing realistic take on modern day shitheels.

I'm glad I'm not the only ones who see people making stupid choices then crying about the consequences.

Thu, 04/26/2012 - 18:58 | 2378504 ForTheWorld
ForTheWorld's picture

I wouldn't want to be taught, nor would I want any of my (possible) future children to be taught by people who can't take care of themselves and their affairs firstly. Besides, I'd rather my (possible) future children receive an education and think for themselves, rather than schooling and follow the herd.

Fri, 04/27/2012 - 08:54 | 2379757 Seer
Seer's picture

"nor would I want any of my (possible) future children to be taught by people who can't take care of themselves and their affairs firstly."

Any ideas who such people would be?  I'm guessing that it wouldn't be anyone who is "poor" (such as is the case with the majority of the world's population, MOST of which are NOT irresponsible).

And maybe I, someone who, for the most part, does take care of my affairs (really, what does this mean?), don't want to pay for your "future" children to be "educated" because you preferred to work for a corporation and were unable to attend to your most important affairs- your children?  Yes, why the fuck aren't YOU planning on educating YOUR children?

Sorry, but I'm not seeing that you're really understanding what you're saying, especially the part about not following the herd (which sounds like something an elitist might say).

Thu, 04/26/2012 - 20:43 | 2378777 Freddie
Freddie's picture

From what I have witnessed third hand - the unions want teachers to get a masters or PhD. The teachers get more pay and the union gets more union dues.  99% of the time, the teachers go to overpiced diploma mills and get worthless masters or even a doctorate.  In a lot of the cases - the school board aka takpayers - pickup the tab.   These joke masters degrees often cost in excess of $30,000 from joke diploma mills.

Many of these teachers with an MS or even a phony PhD cannot read and no way would they be capable of teaching elementary school mathematics.  The whole thing is a scam - usually based on "fairness" and affirmative action.

Getting tired of the O 2012 banner ads here on ZH - tylers.

Thu, 04/26/2012 - 20:51 | 2378795 Backspin
Backspin's picture

And then they take all their vacation days, all their sick days, and play on Facebook while the kids watch a video in the classroom.  Don't get me wrong - there are lots of good, conscientious teachers.  But the opportunities for abuse of the system are legion.

Fri, 04/27/2012 - 08:59 | 2379778 Seer
Seer's picture

"But the opportunities for abuse of the system are legion."

Like it's any different in the corporate world?  Oh, WAIT! it's the SAME SYSTEM!

Perpetual growth on a finite planet.  When the premise is totally fucking wrong how the hell can we really be surprised that things are fucked up?  All this bashing of teachers and whatnot is a great distraction from looking in the mirror.  Nature works on deception, humans do it well...

Thu, 04/26/2012 - 23:04 | 2379103 Vendetta
Vendetta's picture

Have seen the same thing in defense related work, the fraud is everywhere.

Fri, 04/27/2012 - 09:24 | 2379874 Seer
Seer's picture

Blasphemy I tell you, blasphemy!

It's everywhere because it's the System.  We're all running around lying to ourselves about the System, that it's been corrupted.  NEVER do we question its very premise, for if we did we'd have to confront the reality that no matter how we would command it to be "perfect" its operation would still end up producing corrupt outcomes.  We would never be able to come to grips with the fact that growth is NOT the be-all that we claim.  The essence of the System is to head over the cliff, yet here we are proclaiming that it can do it better!

This is a death ride.  That's why we're seeing dead students, dead teachers, dead "leaders."

Thu, 04/26/2012 - 17:43 | 2378234 NERVEAGENTVX
NERVEAGENTVX's picture

That last paragraph just hits the nail on the head in so many ways!

Thu, 04/26/2012 - 18:12 | 2378346 Bob Sacamano
Bob Sacamano's picture

"...society that demands one buys stuff one doesn't need, with money one doesn't have to impress people one doesn't like."

Bull crap.  Blaming "society" for the money you spent is bull crap. 

I know, I'm sorry.......I forgot......everyone is a victim and everyone is entitled to live at top quartile world living standards.

 

Thu, 04/26/2012 - 19:02 | 2378514 ForTheWorld
ForTheWorld's picture

Not everyone is a victim, but when the majority are so easily dupped into "Keeping up with the Joneses" because that's what their parents did, it becomes a cycle that is tricky to get out of. It's called television "programming" and "schooling" for a reason. Only the most aware can get away from it.

mayhem_korner said it in a slightly better fashion: http://www.zerohedge.com/news/student-loan-debt-slaves-perpetuity-true-s...

Thu, 04/26/2012 - 23:09 | 2379119 Bob Sacamano
Bob Sacamano's picture

Ok. So everyone is a victim and/or "so easily duped" (kind of the same thing) and are caught in the parent induced cycle of greed that there is no way they should fully be held responsible for their poor decisions.   Blame someone beside self.  Make others pay for it. Got it.

Fri, 04/27/2012 - 09:35 | 2379914 Seer
Seer's picture

It's top-down...  TPTB wanted this and now THEY are going to have to pay.  Yes, it's all fucked up, but TPTB had the ability to steer things otherwise.

The story of Edward Bernays should tell you something about their power.

Yes, sometimes the victim isn't responsible.  Up until the 1950s (late?) it was acceptable to send women to "institutions" when they failed to act like Stepford wives.  It was Their fault!

And the Easter Islanders, I'm not thinking that folks there were born with the reflex to chisel their demise in stonework.

We have a "leadership" problem.  I'd even say that the very premise of "leadership" is bunk: this sets it up for some to, to borrow from Orwell, be "more equal than others," and as soon as you have that you create the justification for oppression (which the State apparatus does very well).

Thu, 04/26/2012 - 17:44 | 2378241 TraderMark
TraderMark's picture

Here is an idea.  Perhaps 18 year olds should study financial literacy.  And realize the payoff from racking up $50K in loans for a communication major is about 48 years.   Nothing wrong with going to community college for 2 years and then transferring to a 'name school'.  

This is no different then our healthcare system - there is no laws of supply and demand so pricing is out of whack.  Tuition is increasing at 2x the rate of healthcare the past 2 decades.  So yes people need to borrow since prices are out of whack with what the market can bear.  Just offering more and more (and more) loans, doesnt help - it exaggerates the issue.  

In about 10 years this debt will be 'forgiven' because just like the mortgage mkt (currently 90% originated by federal govt) - the student loan mkt is now 85% originated at federal govt.  And when you hand out a "leave jail free" card in about a decade the only one who pays is the taxpayer.  The college gets to keep all the money, the taxpayer gets hosed.  And even taxpayer doesnt feel it because it will jut be a headline that says "1 trillion billion extinguished, pushing federal debt from $27T to $28T"  Does anyone "feel" the $300B or so from Fannie or Freddie?  Nope it just was some more numbers on cool websites that track national debt.  

Now if you instituted a tax ala "the bailout Fannie and Freddie tax" ala "bailout your neighbor whoo took 3 cash out refis and now is walking tax" you'd have something that makes Occuption Wall Street look just silly.  But let the circus and bread continue.  And stick that student debt on the Fed balance sheet in a decade and it can all run off over 2 decades.  Ponzi on Garth.

Thu, 04/26/2012 - 17:50 | 2378262 mayhem_korner
mayhem_korner's picture

 

 

Problem is, those 18 year-olds (and often their parents) are brainwashed from the nursery that they need to get a degree to be anything in life.  And of course, one cannot "study financial literacy" at the institutions that hand out those degrees.  It's a tidy little paradox that they've spun for themselves.

 

Thu, 04/26/2012 - 18:16 | 2378367 fonzannoon
fonzannoon's picture

Fucking bingo.

Thu, 04/26/2012 - 20:36 | 2378755 Yes_Questions
Yes_Questions's picture

 

 

And of course, one cannot "study financial literacy" at the institutions that hand out those degrees.  It's a tidy little paradox that they've spun for themselves.

 

Funny how schools so fail to educate.

 

Fucking Doubleplus Bingo!!

Thu, 04/26/2012 - 20:53 | 2378805 Freddie
Freddie's picture

How about just studying literacy or being literarte.   I am also talking about middle class as well as poor and working class.  The parents are so into their mindless shit of iPhones, video games, soccer practice or high school social crap, SUVs, TV, other stupid crap that the kids and parents have no clue about anything. 

They cannot even make decent decisions about really important things - aka no common sense anymore.  The priorites are Kim Kardashian, Facebook, Desprate Housewives, Sex in the City and other mindless garbage.  Then it all goes bad and it is not my fault.  

Schools are designed to fail because it requires more school.  Just like govt - you need more govt.  A masters degree today is probably the same level as junior high school 70 years ago.

Thu, 04/26/2012 - 21:39 | 2378911 Yes_Questions
Yes_Questions's picture

 

 

Well, indirectly literature through music and movies rehypothicates to the end iUser: they get symbolism though they don't know why.

And I'd tell you more but I may need this proprietary information during this era of corporafascim.

Thu, 04/26/2012 - 17:52 | 2378265 The Alarmist
The Alarmist's picture

What you will get is ObamCorps, where X-years of Federal service will wipe out your student loan debt. This is how you source the human capital you need to do the distasteful things that will need to be done as the current cheap crop of labor stops pouring across the borders.

Thu, 04/26/2012 - 18:11 | 2378341 nmewn
nmewn's picture

My thoughts exactly.

Thu, 04/26/2012 - 19:02 | 2378518 UP Forester
UP Forester's picture

They do.

Sign your life away on the dotted line for 4 years, and the military will wipe out up to $80k.

Of course, that was the limit 13 years ago, so it might be higher.

Depleted uranium ingestion and traumatic brain injury is just an added bonus.

Thu, 04/26/2012 - 20:40 | 2378768 nmewn
nmewn's picture

Just like a variation on I owe my soul to the company store...

http://www.youtube.com/watch?v=jIfu2A0ezq0

An old song, an old deceit, the ancient trap the young are not taught to stay away from.

Fri, 04/27/2012 - 02:06 | 2379346 Revert_Back_to_...
Thu, 04/26/2012 - 18:30 | 2378417 Ricky Bobby
Ricky Bobby's picture

Double the pay down if you sign up with the TSA.

Thu, 04/26/2012 - 19:07 | 2378528 vast-dom
vast-dom's picture

Kinda like the G.I. Bill in reverse....genius! 

Thu, 04/26/2012 - 18:07 | 2378323 Piranhanoia
Piranhanoia's picture

Problem is no one teaches financial literacy and you can get a student loan for the poorer quality schools. We have too many government jobs where no work for value is performed.  

Fri, 04/27/2012 - 09:37 | 2379925 Seer
Seer's picture

"Perhaps 18 year olds should study financial literacy."

And who establishes what "literacy" is?  Jamie Damon?

And in a System that's based on a giant Ponzi? (perpetual growth on a finite planet- yeah, let's just pretend that people are illiterate while we go about running over the cliff)

Thu, 04/26/2012 - 17:47 | 2378244 rbg81
rbg81's picture

The median loan is $12.8K--that's less than half the price of a new car.  I'm always a little suspicious of these sob stories.  I'm sure there is stuff in the back story is being hidden to make the Stang's look more sympathetic. 

Private universities, like the University of Phoenix, are famous for loading their students up with debt for programs of little value.  Buyer beware!

Thu, 04/26/2012 - 17:54 | 2378272 The Alarmist
The Alarmist's picture

yeah, but I know people who spent $100k to get a social work type degree at places like Brown.

Thu, 04/26/2012 - 18:01 | 2378302 mayhem_korner
mayhem_korner's picture

 

 

Some of them refer to themselves as "Occupiers"

Fri, 04/27/2012 - 09:42 | 2379944 Seer
Seer's picture

Yeah, they could have spent that much at Harvard for a financial degree and then not only gotten taxpayers to pay for their education but for yachts, mansions and their future offspring's future (nothing says oligarchy like saving "death taxes").

Hard to really rape people with a degree in social work.  Better to go for the anti-social degrees... with these everyone envies you, believes that you're doing god's work, er a, capitalism's work...

Thu, 04/26/2012 - 18:16 | 2378362 JR
JR's picture

I no longer believe ANYTHING the government or Bernanke say without due diligence on my part.

I was told recently by a former collection agent of student loans in Oregon that the average student loan they were processing in their area was $200,000; the highest  encountered to date apparently was S372,000 (amounts of $300,000 or above mainly to doctors, lawyers and vets). Some borrowers, the former collection agent said, have as many as eight defaults with the average collector in their office processing 30 defaults a day.  After renegotiating terms, such as taking the interest rate down “from 18% to 9%” (that’s what she said!), and default continues, garnishment of wages begins. 

Thu, 04/26/2012 - 20:47 | 2378789 nmewn
nmewn's picture

...“from 18% to 9%” (that’s what she said!), and default continues, garnishment of wages begins."

Heart warming.

Clearly we need Princeton & Harvard faculty to offer insight as to why they need so much blood.

Thu, 04/26/2012 - 17:52 | 2378253 Zero Govt
Zero Govt's picture

Default bitchez (students)

 

Born a man, debt-slave by 18

another 'fantasitic political solution' by your firendly neighbourhood Govt.. just like housing, healthcare, green energy, banking (cough) and global peace (choke)

Thu, 04/26/2012 - 17:48 | 2378255 fleur de lis
fleur de lis's picture

The whole edjakashun industry is a scam. They borrow phenomenal heaps of money to graduate with "degrees" in the most stupid, hippie, marxist fields with little or no hope in finding jobs in said fields, so they do what ever they can just to pay the bills. They could have done that without putting themselves in hock forever.

So what's the attraction? Empty pride. They can say they went to this or that school or university, and everyone is so impressed with how smart they are, but fail to notice the field of study is a dead end or overcrowded for the foreseeable future.

Doesn't matter, they only have to wave that piece of paper around to prove they have arrived. The schools are even worse in their complicity, they know very well that they are feeding into the expectations of teenagers and many parents who don't know the difference. It is nothing short of theft. They are grifters.

Unless they can place the graduates of dud courses in 6 - 12 months, they should be required to issue refunds. That would straighten them out in one semester. Let's see how long the dud courses would be offered if they were no longer a source of easy money. They can't have it both ways, I'm sick of cleaning up after fat cat parasites.

Thu, 04/26/2012 - 17:58 | 2378285 Dr. No
Dr. No's picture

I remember having to take a Interor design course in order to meet the "liberal arts" objective of my Engineering degree.  It was one of those last minute gotchyahs in my last semester.  Take Design 101 or you dont graduate.  Does interior design make me a more qualified engineer?  No, but it allowed them to continue paying a tenured Prof.

Thu, 04/26/2012 - 18:34 | 2378429 LowProfile
LowProfile's picture

Can't believe you got a downvote...LOLWUT

Thu, 04/26/2012 - 18:41 | 2378457 Tortuga
Tortuga's picture

-1 is probably from a tenured interior design professor. Very good idea though, refunds make extreme un-common sense.

Thu, 04/26/2012 - 19:35 | 2378604 Theosebes Goodfellow
Theosebes Goodfellow's picture

But let's be honest, Dr. No. I just love what you've done with your evil lair, and you had to have learned that somewhere, now didn't you? (Sorry, I just couldn't resist.) :-)

Thu, 04/26/2012 - 21:00 | 2378828 dark pools of soros
dark pools of soros's picture

exactly - and WHERE did he get that perfectly accentuating avatar pic?  You too Goodfellow . your's is to die for, truly commands the mood

Fri, 04/27/2012 - 11:27 | 2380286 The Alarmist
The Alarmist's picture

Yeah, I had to take one of those for my AE degree ... useful for laying out crew quarters on the ISS, I guess, but I never got a chance to work on that.

Thu, 04/26/2012 - 17:49 | 2378258 Heroic Couplet
Heroic Couplet's picture

In my state, there was a grand total of 2,000 jobs created during 2011, with the Bush tax cuts in place for 10 years. Support Dick Durbin's bill to restore student loan debt to inclusion in bankruptcy.

Thu, 04/26/2012 - 17:53 | 2378267 mayhem_korner
mayhem_korner's picture

 

 

Did you wear a hockey helmet to grade school?  And ride the "short" bus?  Just wunnerin...

When I see the words "Support Dick Durbin's..." I am really, really fearful to read the next word.

Thu, 04/26/2012 - 19:26 | 2378582 krispkritter
krispkritter's picture

Support Dick? If I didn't I'd be peeing on my shoes everyday...oh, you meant...nevermind...

Thu, 04/26/2012 - 17:55 | 2378260 Bob Sacamano
Bob Sacamano's picture

Bad decisions compounded over time creates painful consequences.  Who doesn't "just want a truly clean slate?"  Are there no lasting painful consequences to stupidity?  Why are the responsible always suppose to bail out the irresponsible?  They discharge all of their other debts via bankruptcy, and they are unhappy about the remaining college loans?

Why are they having more kids after having four and in financial straits.  Why did she walk away from a college scholarship (the other girls "pressured" her?)?  Why did they buy that house? Etc, etc.

And we wonder why people expect the government to confiscate income taxes from some to pay for the government dependence of many?

"Since 1998, borrowers have been unable ever to discharge federal student loans, and in 2005 the then-Republican-controlled Congress made private loans almost impossible to discharge."    Not a Republican fan, but not noting who signed the 1998 legislation (Clinton) tells you the author is a leftist political hack. 

Note to all:  If you don't want to be held responsible for paying back a loan, don't take out any loans. 

 

Thu, 04/26/2012 - 18:10 | 2378335 GeorgeNY
GeorgeNY's picture

Sanctimonious people like you are usually the first ones who blame everyone else for your problems. Your post incorporates that attitude by blaming those unamed people who "expect the government to confiscate income taxes." 

Thu, 04/26/2012 - 18:31 | 2378423 aerojet
aerojet's picture

I don't think you understood what Bob was saying there--he's making a case for personal responsibility.

Thu, 04/26/2012 - 23:06 | 2379110 Vendetta
Vendetta's picture

tell that any politician that has stepped foot into elected office the past 20 years.  Now the country is in the condition it is but its 'others' who caused it.

Thu, 04/26/2012 - 18:31 | 2378424 Bob Sacamano
Bob Sacamano's picture

Actually, I am partly driven by making sure I can solve my own problems.  I just want people to be responsible for themselves and their family.  I purposely live my life so that I would not be a burden on others.  You do that primarily by living below your means, low limits on debt, and plan on bad things happening.  If everyone approached life that way, we would not have the welfare state mentality that seems to appeal to many.  

If a material problem arises for a family member, I will be there to help.  And I am not unsympathetic to plight of those, who through no fault of their own, find themselves in need.  I give more to charity on both a percentage of income and absolute level than 95% of people. 

But I am increasingly unsympathetic to those who make a number of really poor choices in life and then complain about their circumstances and expect or demand others to remedy it -- like it seems the people in that article.

Thu, 04/26/2012 - 18:52 | 2378485 GeorgeNY
GeorgeNY's picture

I respect what you say about your life and I respect that you live your life that way. But I think that you may not see that many of these young kids did think that they were being "responsible" while in hindsight it might have been a really bad idea. Yes, now in 2012 I think that we would all ask soemone going to college whether they really wanted to go into debt. But what about back in 2000 when dotcoms were making millions and everyone was hearing that the world was changing? What about in 2005 when everyone thought their houses would just keep going up in value and their incomes were increasing?

You were right to leave the way you did. You were correct that none of this was sustainable and probably did not do all of the stuid things that everyone else did. But show me one leader of our country during thos etimes who said to kids. Be carefull about spending money on school. Be careful about taking on that student debt. 

Maybe you are lucky. Have you ever lived in an area or a time when NO ONE could get a job? I did. I saw my steel town lose 20,000 jobs in one day. I knew people who were hard working all their lives try to get jobs at Dairy Queen to feed their families. Sure, in hindsight they were stupid. They let the union guys keep negotitating them out of jobs. They did not see that steel was a dying industry and that imports were taking over. Its all great in hindsight. But I guarantee you that they all agree with you. That people should work hard and save for the tough times. Not go into debt. All of those values. They are great values. But once the jobs left they looked stupid. Everyione said that they should have been more mobile and open to the world around them. more educated in other things. They should have realized the factory jobs were done and gone to college and got "real" training. 

Hindsight is lways 20/20. 

 

Thu, 04/26/2012 - 19:31 | 2378593 Bob Sacamano
Bob Sacamano's picture

Appreciate your comments.  I am very fortunate. While I started with nothing, the outcome has been good (it took a few decades, but compounding does work). 

But I do not think the "laws" of financial prudence have ever changed (i.e., always living below your means, planning for bad things (saving), etc).  And I don't think the concept of greed (wanting more than one can afford - to which no one is immune) has ever changed.  So I don't buy into blaming the dot com, housing boom or student loan frenzies.  Those frenzies have been going on for centuries -- they are not unique to this generation.  While it would be nice if "leaders" would espouse prudent financial practices, at the end of the day, they are not responsible for me.  It would be nice if parents taught their kids such things -- but parenting is not in vogue. 

But I hear you and am sympathetic and willing to help.  Best regards.

Thu, 04/26/2012 - 18:29 | 2378412 aerojet
aerojet's picture

I agree.  I feel for the Stangs, especially their medical problems which aren't their own doing, but come on, if people could discharge student loans, everyone going to college would declare bankruptcy right afterwards.  It's a nice way to stick it to the man, but it isn't an economically sustainable practice.

Thu, 04/26/2012 - 19:23 | 2378578 Irwin Fletcher
Irwin Fletcher's picture

It's not economically sustainable because everyone going to college for bullshit degrees is not sustainable. Take away the no-discharge slavery, the bullshit lender bailouts, and then education loans would be sustainable because lenders wouldn't keep lending for 4-7 years to someone making crappy grades in a bullshit field of study. Many of these loans weren't made in good faith. At one time, Americans rejected Debtor's Prison because it didn't fit within the ideals of liberty to force stupid people who made bad decisions into a potential lifetime of slavery. Turning students into debt slaves won't help now. Better to turn them away from college, as market forces would dictate in a closer-to-free loan market.

Thu, 04/26/2012 - 18:37 | 2378443 Tortuga
Tortuga's picture

It's a mess. Republicrats will screw us all in the end. GBA and RICO all banksters and their ho politicians, which, by the way, get their $47 dollars.

Thu, 04/26/2012 - 17:49 | 2378261 Rainman
Rainman's picture

This tragedy screams for involuntary servitude of some sort. Oligarchs are busy with other priorities like saving the postal unions 

Thu, 04/26/2012 - 17:56 | 2378264 Catullus
Catullus's picture

Changing the law "would force our members to raise borrower rates or elevate their already strict underwriting standards and essentially make it harder to make the loans," said a spokeswoman for the Education Finance Council.

Strick underwriting standards?  Since when is giving someone with no job, no collateral, and no co-signer pursuing a liberal arts degree "strick underwriting standards".

You're full of shit, honey.  You don't have repeat lies for your employer.  You can just quit.

You need to put down a 2 month deposit just to have your electricity turned on.  You can just filled out the form online to get a student loan.

Thu, 04/26/2012 - 18:34 | 2378432 aerojet
aerojet's picture

Exactly. The whole reason the loans can be made at all is because they are not dischargeable in bankruptcy!  That the student loan system has been co-opted by banksters selling derivatives is another whole issue, as is the corruption of higher education by all the debt-based money flowing into these institutions--there's not a single campus in the US that didn't go through a real-estate binge and a construction binge due to all the funny money passing through their hands.  Also, many student loan administrators have been caught red-handed driving business towards certain lenders for kickbacks.  The original stated intent, to get more kids to go to college by making it somehow affordable, was a great--but the follow-on effects based on pure greed, not so great!

Thu, 04/26/2012 - 19:22 | 2378572 smiler03
smiler03's picture

You've made me wonder, can I buy any AAA rated Student Loan Backed Securities?

Thu, 04/26/2012 - 21:26 | 2378892 Yes_Questions
Yes_Questions's picture

 

 

Bundled with bridges Floriduh land.

Thu, 04/26/2012 - 17:54 | 2378273 tony bonn
tony bonn's picture

it's not the chiefly the bankruptcy lawyers who benefit but the terrorist banksters and politicians who want a slave society....forget the modifier debt. they want slavery pure, simple, and raw.

go durbin and fuck the politicians. and fuck the loan program too.

Thu, 04/26/2012 - 17:55 | 2378277 sensibleperson
sensibleperson's picture

I was SHOCKED recently to HEAR Fed. Chairman Bernanke say "his son will have $400,000 in student loan debt after medical school"!   Does not say much for Mr. Bernanke's "money management" skills, if he did not start saving for college when his child was born.  One can only hope that his son goes into one of the highest paying medical specialities. 

Thu, 04/26/2012 - 18:04 | 2378310 Logans_Run
Logans_Run's picture

Perhaps patricide? It would certainly be a help to all of us and he would have housing and three-squares a day.

 

Thu, 04/26/2012 - 18:10 | 2378333 lakecity55
lakecity55's picture

You don't really believe him, do you?

Thu, 04/26/2012 - 17:59 | 2378293 JR
JR's picture

 Scandal, fraud, and lies pretending to be statistics seem to be parachuting in from all sides of our economy. And the currency mobsters always seem to be the chief suspects… such as in the tragic student loan sideshow that is corrupting the educational aspect of America’s economic system.

“Money is stored labor. Labor is part of life. To control money is to control life… When the state declares the exclusive right of the issuance of money, freedom is impossible.” – Hugh A. Thomas.

What kind of sound money system is it that allows private bankers to print and control the currency in secret, issuing it at zero cost to non-producers such as themselves, i.e., Goldman Sachs and Chase, who then use it to take over complete industries, commerce, and markets –thousands of competitors big and small -- and then profit further by devaluing the currency as a store of value for the producers via monetizing and negative interest rates that rob stored labor using monetary inflation?  At the same time, the currency tyrants throw the economy farther off balance by issuing themselves money at zero interest as the basis for usury loans to creditors, therefore, making it unnecessary to pay out interest to attract term deposits from producers.

Thus, they impose their name on all that surrounds the free and honest dealings among men.

This is not capitalism. It’s racketeering.  The tyrants want, via the creation of central banks and paper notes, to bypass the tedium of labor of mind and body that changes materials into life-giving commodities in order to capture the most liquid form of productive labor through thievery.

Here is Hugh A. Thomas on the greatest fraud in man’s history.

“Money is a generic commodity used as a vehicle for labor storage and labor exchange…man needs to be able to store labor in order to rise above a day-to-day existence…in order to gain the specialized labor of other men without the use of force…

"When governments get into the money game (governments acting on behalf of the racketeers), they do so in order to rob people of their accumulated labor… With money having been replaced by fiat paper, with central banks manipulating production by credit expansion, the true meaning of money has little chance to be understood… there is no way for people to see that their stored labor is being captured by the government in a slow process of fraud… 

"If there is a common thread to the nature of governments, it is the control of labor by force or fraud (without themselves having to experience the pain of labor).  This tendency to control and enslave is by far the uniting feature of government action…. Why take slaves when the manipulation of money will accomplish the same goal?...  Those who wish to bypass the tedium of labor can either die or steal. Inflation comes under the heading of the latter alternative. It is a sophisticated form of stealing made possible only by its complexity and false definitions of money (as a medium of exchange)….

"When governments place their name on money, they are placing their name on the most generic form of private property, on the most commonly exchanged commodity… The most damaging consequence of this action is that governments have taken control of the most exchangeable form of life, which is the most important aspect of money and its relationship to trade. (The medium of exchange is the ability to deal with others through the medium of agreement rather than through the medium of force. The common factor of the items exchanged is the factor of stored labor.) The medium of exchange is morality.  Money, i.e., stored labor, is never in the middle of the transaction, it is never the medium. It is always on either side of the equation of exchange…. Money does not circulate…it exchanges.

“When one applies the idea of money as being stored labor to the historical record, many events that were formerly chaotic fall into conceptual order…

Money supply is labor supply… To control money is to control life.” -- Excerpts from STORED LABOR: A New Theory of Money, 1991 by Hugh A. Thomas

Thu, 04/26/2012 - 18:00 | 2378297 maggiemayok
maggiemayok's picture

My son is graduating from high school in the top 10% (all AP classes loaded with Physics, Calculus, Chemistry), in the 93rd percentile on ACT/SAT tests, but scholarship offers are pittances from Engineering schools.  We did, however, get notice that we "qualify" for a $23,000 subsidized parental loan in addition to his $5000 subsidized student loan and $3750 unsubsidized loan that accompanies his $2500 scholarship per semester. 

Gee.... really?  He's been working part-time at a horse stable.  We are thinking farrier school is in order.  He's shoveled enough horse crap.

Thu, 04/26/2012 - 18:07 | 2378320 Rainman
Rainman's picture

Forget the loans. If he knows how to shovel a lot of horse crap his future is bright, bright, bright.

Thu, 04/26/2012 - 18:13 | 2378349 I am Jobe
I am Jobe's picture

No future in sciences:

Field of Study:

Community Organizer

Looting Officer

NSA

TSA

Lobbyists

Good Ole Fashion Politician- Take some toastmasters lessons and he is set.

 

Thu, 04/26/2012 - 18:38 | 2378446 aerojet
aerojet's picture

It's true for the moment, anyways.  Science is a really nice hobby.  I just watched a cool video about dinosaurs with my kids--I kept wondering how the Paleontologists featured in the video, people at the top of their field, get by at all.  The must live real cheap in order to pursue their passion!

Thu, 04/26/2012 - 21:07 | 2378848 dark pools of soros
dark pools of soros's picture

it's just like all cool jobs and drummers, the ones doing them either don't have to work (trust funded to death) or are fine living on someone elses couch. 

Thu, 04/26/2012 - 23:11 | 2379122 Vendetta
Vendetta's picture

the paleontologists will be studying themselves after they become extinct in this type economic environment.  THe USA, as was known to those of us that have been around for awhile, is virtually dead.

Thu, 04/26/2012 - 21:05 | 2378844 dark pools of soros
dark pools of soros's picture

patent lawyers and farming    -   does he like outdoors or reading?

Thu, 04/26/2012 - 21:12 | 2378865 Freddie
Freddie's picture

I wonder if TSA "officers" have to take continuing ed for groping?

Thu, 04/26/2012 - 18:30 | 2378418 Tortuga
Tortuga's picture

Don't be dissin' horse shoe'ers buddy. Aquaintance of mine down here knocking down $80k putting shoes on the hawses. AND, send math whiz to jr college for two years while he works part time and then to the state university, again with a pt job or two and bam, state U engineering grads, like my son's bf, graduate with multiple $120 k offers for EE with minor PetroE. It can be done. Ya just gotta want it. I did it and I'm just a knuckle-draggin' redneck two-fisted beer drinkin', grilled dog-eatin  Texian that is registered to vote and have registered 30+ others and that graduated with nooooo frickin' debt.

Thu, 04/26/2012 - 19:34 | 2378603 maggiemayok
maggiemayok's picture

That's what I'm talking about!  I'm really happy he likes Calculus and Physicx, but shoeing the horses when there is no gasoline or diesel?  Priceless

Thu, 04/26/2012 - 20:40 | 2378767 Miffed Microbio...
Miffed Microbiologist's picture

Better check with your farrier friend again. My shoer made 80k about 5 yrs back but he's not remotely close to that figure now. Of course I'm speaking about San Diego. We're paying about $20/bale here for alfalfa so local horse ownership is really on the decline. Only way now to make that kind of money is shoeing racehorses or polo ponies. My shoer quit doing the polo circuit because he couldn't stand watching the abuse of the horses ( legs broken by mallets and tossed away like trash) but it has cost him dearly. Quite a dangerous profession too, one good kick and you're done. Yet being a clinical microbiologist certainly isn't risk free either.

Miffed :-)

Thu, 04/26/2012 - 21:04 | 2378840 Freddie
Freddie's picture

When I was in college - 10 to 20 years ago (keep Skynet guessing) - the boards in the hallways had listsings for special scholarships.  If you were black, hispanic, maybe American Indian and other things - you got a full scholarship to engineering school.  Everything was paid for. Masters and PhD.

A friend, who is pretty savvy, has a son who graduated from state school.  The kid was very smart and got a good technical/engineering job recently.  The kid still has tons of debt.  He works for a technical company who bills Uncle Sam like you would not believe.  The CEO and major shareholder of the company has one of the largest yachts in the world.  I think he has more than one too.

Best of luck for your son.  Keep looking.  There has to be another way.

Thu, 04/26/2012 - 22:54 | 2379079 giddy
giddy's picture

...ummm... you're not looking at the right schools.  Widen your view.  Stop reading US News "Best Engineering Schools"...  The ability to "think outside the box" is requisite for an engineer in the 21st century.

Thu, 04/26/2012 - 18:00 | 2378300 ReallySparky
ReallySparky's picture

If these kids were smart they would defer the loans for 6 months out of school.  Negotiate and make the smallest payment possible on the student debt.  During this time, they should build their credit, build the score as high as possible and take out as many credit cards as possible.  On those credit cards they should draw as much cash advance as possible, then use that cash to pay down the student debt.  All the while making the minimum payments on everything.  Getting more credit cards, drawing cash, paying down student debt.

Keep paying those credit cards, then claim bankruptcy one year later.  Poof student debt gone, same financial situation as if they had tried to repay back all that debt.  Some on this blog, will critize that this is immoral and dishonest.  I am probably the most conservative person on the planet, and I don't think so.  Who in their right mind loads up a child with 80k of debt during ages 18-24?  Screw the banks and the central planners, it's time for the reset.

Some of my son's friends are really decent kids that have 80K of student debt and work part-time in a service job.  That is pure crazy, they will never be able to catch up or have a decent standard of living.

Thu, 04/26/2012 - 18:53 | 2378488 johnnynaps
johnnynaps's picture

Nothing is immoral in this ass-backwards land anymore! This strategy sounds familiar! While it sounds great, our invasive corptocracy allows for credit checks of job applicants. And, just like the drug tests in their invasive arsenal this could make or break job prospects.

Thu, 04/26/2012 - 18:06 | 2378316 ag3nt0rang3
ag3nt0rang3's picture

Those who can't do teach.

Thu, 04/26/2012 - 18:12 | 2378342 Piranhanoia
Piranhanoia's picture

Those who can't do: run the board of education, city, county, state and federal government, and tell the teacher what they can teach, what books can and can't be used, and where they line is they can't cross when talking about revisionist history dicated by the can't do's.

fixed it for you.

Thu, 04/26/2012 - 18:40 | 2378452 aerojet
aerojet's picture

I used to think that way--it shaped a lot of my decisions in life.  Then I had kids and now I am greatly indebted to my children's teachers, they are remarkable people.

Thu, 04/26/2012 - 18:08 | 2378325 lakecity55
lakecity55's picture

The man who calls himself "O'Bama" will dump all the loans off on the taxpayer about a month before the election.

Students rejoice and vote for the guy who can't pass E-Verify.

Fri, 04/27/2012 - 00:38 | 2379264 JR
JR's picture

The purpose behind empowering the U.S. Department of Education to originate all federally subsidized student loans as of July 1, 2010 — about 80% of the total — and to set the repayment terms was to limit student obligations by passing the burden onto taxpayers. In short, it was a scam to enable colleges and universities “to continue to raise tuitions at a rate that outpaces nearly every other cost center in the American economy,” as Peter Schiff put it last year.

Such government moves “come as a great relief to the education establishment who otherwise may have needed to cut or cap tuitions."

In short, students are able to commit to higher debt  levels in order that “colleges might charge whatever they want because their customers simply turn the bill over to the U.S. taxpayer who has no say in the transaction.”

Most all evidences of university need, of course, are based on statistical fraud as are most all government statistics. In a list of the Top University of California Employee Salaries based on total compensation for the 2004-2005 fiscal year, the salaries listed in many instances came nowhere near the Total Compensation received by some individual university employees. For instance, the 2004 salary for Law Professor Neil W. Netanel was listed at $180,000, while his Total Compensation from UC Los Angeles was $351,852.

The San Francisco Chronicle explains the discrepancy, saying thatin addition to salaries, total pay includes overtime, bonuses, housing allowances, relocation allowances, administrative stipends, revenue sharing and more than a dozen other types of cash compensation. It does not include health or retirement benefits.”  Source: UC payroll data

http://www.sfgate.com/cgi-bin/news/casalary/uc?Submit=Page&agency=UC&otmax=&o=&term=law&sort=..

And, while the economy staggers to its death during its “bumpy, irregular recovery,” private college presidents have seen the ranks of those making at least $1 million swell from 33 to 36.

Thu, 04/26/2012 - 18:09 | 2378332 Paul Atreides
Paul Atreides's picture

The loan holders are the ones with the power not the banks. They need to organize and ALL STOP PAYING until the government changes the legislation to allow it to be part of a bankruptcy claim and to fix the rates to prime +2 or prime +3.

Just need a name something like Students Agains Slavery SAS...and a blog.

GOGOGOGOGOGO

Thu, 04/26/2012 - 18:58 | 2378506 Bobportlandor
Bobportlandor's picture

Isn't it funny that the generation who got student loans, ran up the debt, f'ed up the whole economy, is now punishing the ones they expect to payoff THEIR DEBT!!!!!!!!

What Gall

 

Thu, 04/26/2012 - 18:10 | 2378336 I am Jobe
I am Jobe's picture

No escaping bitchess inbred fucks.

Thu, 04/26/2012 - 18:11 | 2378339 Clowns to the l...
Clowns to the left_ jokers to the right's picture

Caption for the picture:

Atlas shrugged and said "F it".

Thu, 04/26/2012 - 18:12 | 2378344 Quantitative_Ap...
Quantitative_Appeasing's picture

Simple but uncomfortable choice -

 

Emigrate to another country....

 

Thu, 04/26/2012 - 18:14 | 2378353 I am Jobe
I am Jobe's picture

Most are too attached to whatever and prevents them. They are willing to die on their knees. Must live in the same place forever and ever.

Thu, 04/26/2012 - 18:17 | 2378368 A Lunatic
A Lunatic's picture

Even the most predatory of lenders cannot make a person sign on the bottom line. It's not my fault someone's Doogie Houser Doctor fantasies went tits up and they have loans to repay in a shit economy.

Thu, 04/26/2012 - 18:18 | 2378373 Tortuga
Tortuga's picture

What say the COLLEGE financial offices be part of the payback. What are all the multi-billion dollar endowments for anyway? I know the answer, big alumni parties, student spas and $400 million stadiums and $10 million coaches and $500 thousand professors. But, there is still billions left over. Make the colleges pay for loan forgiveness, not us taxpayers. If I can work 3 jobs and carry 15 hours and graduate with no debt, I feel no sympathy. GBA and RICO all banksters and their ho politicians.

Thu, 04/26/2012 - 18:42 | 2378459 aerojet
aerojet's picture

There aren't may $500K profs, everything else is pretty accurate.  There are a few superstar professors who bring in a lot of grants, but it takes decades of hard work to reach even six figures and most profs never make it.  They don't do it for the money.  The administrators rake in the dough and work every angle, though.

Thu, 04/26/2012 - 21:10 | 2378859 Freddie
Freddie's picture

Egg-Zactly.   (Tylers turn off the damn O 2012 banners please.)

I went to a local state university to pick up something not long ago.  I had to take CE test.  Third tier state school with a new stadium.  The new buildings are built to the level of a class A office building.  When I went there it was pretty shabby and old.  

 

Thu, 04/26/2012 - 18:26 | 2378403 Benjamin Glutton
Benjamin Glutton's picture

loan number = supplemental draft number.

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