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Think The US Student Loan Bubble Is Bad? You Ain't Seen Nothing Yet

Tyler Durden's picture


By now virtually everyone has seen some combination of the two charts, showing the  magnitude of the student loan bubble, a topic which even Goldman Sachs decided to take on last week:

The amount of student debt being taken on every year has been rising rapidly for years now (via NPR)

Frankly, by now the topic of US student debt has been discussed to death, and like every other bubble, it will keep growing, as the very fungible proceeds are used to purchase such mission critical "student" addenda as iPads and booze, until it bursts. Yet is it really that bad? And how does it look compared to some other countries' bubbles. Like that of the UK? Courtesy of Bloomberg we now know how a similar bubble is being blown across the Atlantic:

As the U.S. grapples with record-high college costs and outstanding student loans of $1 trillion, England is embarking on a plan this year that shifts much of the government’s burden of paying for higher education to students and saddles graduates with unprecedented debt.


Some students in England, after borrowing for housing and living expenses, will leave school with as much as 40,000 pounds ($64,200) in debt, said Peter Lampl, founder and chairman of the Sutton Trust, a London nonprofit group that promotes access to higher education. That tops the $23,300 average debt of U.S. student borrowers. The debt burden means graduates will defer buying a home and makes it harder for people from lower-income backgrounds to catch up, Lampl said.


In this country, we will be on an order of magnitude ahead of the U.S.,” Lampl said in an interview. “We’re loading up these kids with debt. The whole thing is an absolute disgrace.”

In other words, UK students will soon be debt slaves only encumbered with orders of magnitude more debt. However, there is a twist:

While many English students will be borrowing more to attend college, the system is more forgiving than its U.S. counterpart, said Steve Smith, vice-chancellor of the University of Exeter.


English graduates don’t have to repay their loans unless they make 21,000 pounds a year. They pay 9 percent of their earnings over that amount and all debts are forgiven after 30 years. Payments are automatically deducted from paychecks. Graduates don’t have to pay if they lose their job or transition to part-time work, as many working mothers do.


A young person making 27,000 pounds a year will end up repaying about 10 pounds a week and someone in their early 50s who owes 50,000 pounds has the reassurance that it will soon disappear, said Smith, who served as president of Universities U.K., an advocacy group that consulted with the government on the changes.

So do US students once again have the short end of the stick?

By contrast, U.S. education debt can’t be discharged through bankruptcy and almost 2 million Americans with student debt are over 60, according to the New York Federal Reserve. About $85 billion in student debt was delinquent in the third quarter of 2011. In March, the Consumer Financial Protection Bureau said U.S. student-loan debt had reached $1 trillion, based on preliminary findings.


The American system is brutal,” said Tim Leunig, who teaches economic history at the London School of Economics.


The Obama administration introduced an income-based repayment program in 2009 for U.S. borrowers who take out certain types of federal student loans. The plan limits debt payments to a percentage of a family’s income for graduates and erases the debt after 25 years. For those with government or nonprofit jobs, the debt can be forgiven after 10 years.

Of course no matter how you spin it, having debt three times your income before you are responsible for paying it down as a mitigating circumstance is simply idiotic. All colleges in the US and UK are doing, is generating another generation of slightly modified debt slaves, yet ones who have no choice, and more and more end up going to college because at least it is something to do in world in which those between 18 and mid 20s are only about 50% employed. And with debt as cheap as ever, the carrying costs are low enough to where one can just worry about repaying it tomorrow... Even if "tomorrow" ends up being when one hits their 60s. Still, since behavioral changes are additive, the fact that UK student used to pay virtually nothing as recently as 14 years ago, means the pain from the surging debt load is far worse across the pond:

Higher education in England was free until 1998, when students were charged 1,000 pounds. The tuition increased to 3,000 pounds in 2006, and rose with inflation each year after.


In the U.S., the average tuition and fees for 2011-2012 at public universities is $8,244 (5,136 pounds) a year for state residents and $28,500 at private schools, according to the College Board, a New York-based nonprofit group whose members include U.S. universities.


The new English system, unveiled in June by the coalition government of Conservatives and Liberal Democrats, is designed to reduce taxpayer support while introducing competition among universities for the top students, said David Willetts, the Conservative minister for universities and science.

Curiously, if the UK succeeds in enacting its own debt enslavement system, the rest of Europe will be sure to follow:

In the rest of Europe, where higher education is free or relatively inexpensive, governments are watching to see if the U.K. plan succeeds, said Jens Oddershede, president of the University of Southern Denmark in Odense, and the chairman of Universities Denmark, an advocacy group.


It’s creating “widespread fear all over Europe” among college administrators that the region will move toward a high- fee, high-loan system, Oddershede said. He pointed to the U.S. model, calling it “a system that can serve a capitalist society like America but wouldn’t work in a small country like Denmark.”


The prospect of rising tuition angers European students, who say they had no role in causing the financial collapse but are being made to pay for it.


“What caused the debt?” Allan Pall, head of the Brussels- based European Students Union, said in a speech at the European university conference. “Did we spend too much on higher education? We should ask that question instead of rushing to cut the first thing we see, the thing that creates jobs and growth.”

Yet just like US Trasurys (with or without the benefit of the shadow banking system which allows to generate near-infinite fractional reserve demand when using one unit of a "real asset" rehypothecated a fractional-reserve number of times), student loans keep seeing greater and greater demand:

While students have protested, applications through Jan. 15 fell just 1 percent, when adjusted for a decline in the college- aged population in England, according to the Universities and Colleges Admissions Service, which manages university applications.


That’s not surprising, given the importance of a college education for finding a high-paying job, Lampl said.


“Poor kids, low-income kids know they have to get an education,” Lampl said. “They’re not stupid.”


Asta Diabate, 18, who lives in Lewisham in south London, said the higher fees don’t faze her.


“I’m not worried, because it’s something that’s valuable,” said Diabate, who will start college in 2013. “It’s not like I’m going to pay upfront and installments are so low, it shouldn’t really bother me” when repaying the loan.

Of course, local financial employers must always exhibit snobbery when picing resumes, and focus on the promising candidates out of Ivy Leagues (or equivalent), as otherwise the whole charade falls apart. And as long as the return promise is much higher than the alternative, student can at least justify the massive debt load to themselves. Yet the question is how long until the next taxpayer bailout:

While the plan was devised partly to reduce government spending, it may ultimately cost more because many borrowers won’t pay back all they owe, said Nicholas Barr, a professor of public economics at the London School of Economics. About 70 percent of the loans will be repaid because of the 21,000-pound income threshold and the 30-year forgiveness period, according to government estimates.

Then again, a taxpayer bailout of the college loan system will never occur, as tuition and room and board will never, ever go down in price. Just like houses back in 2005.

In the meantime, the latest credit bubble, no matter if its US or UK iteration, continues merrily along, until it is forced to finally stop. Alas, with private lenders now outof the market, and the US government the lender of only resort, the administration's generosity with other people's taxes will hardly ever be tested, until well after the fact. By then we will likely have other problems.


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Mon, 04/23/2012 - 12:39 | 2367298 tu-ne-cede-malis
tu-ne-cede-malis's picture

Won't surprise me a bit if Obama forgives a lot of student loan debt as a last ditch effort to get reelected.

Mon, 04/23/2012 - 12:44 | 2367306 LawsofPhysics
LawsofPhysics's picture

Depends if the forgiveness would be applied universally to all those carrying student loan debt or simply those that are unemployed.  The moral hazard is the problem, encouraging more (moral hazard that is), is not a "fix".  FYI, actually applying this across the board would allow some young doctors I know to to charge less for their services.  Imagine that.

Mon, 04/23/2012 - 13:00 | 2367405 Pladizow
Pladizow's picture

Clue: Eeets not a bauwble!

Who am I?

Mon, 04/23/2012 - 13:10 | 2367463 Floordawg
Floordawg's picture


Mon, 04/23/2012 - 13:15 | 2367483 francis_sawyer
francis_sawyer's picture

A wacko with vaginas on his wall...

Mon, 04/23/2012 - 13:26 | 2367539 Soul Train
Soul Train's picture

No worries - Obama has it all under control.

Another question - Do the "Secret" Service screw with sunglasses on ???



Mon, 04/23/2012 - 14:31 | 2367805 Logans_Run
Logans_Run's picture

To the tune "I Wear My Sunglasses at Night"

Mon, 04/23/2012 - 15:33 | 2368006 Oh regional Indian
Oh regional Indian's picture

Vultures. WHen I joined school in the US, was overwhelmed by credit card offers.

In India back then (1995), CC were for the rich, only. So I felt really special and took them all.

Ha! That addiction was a tough one to break. Ruinous.

And then the student loans, which encourage you to live well as a student (ie. take more debt)....

Masterful Social Engineering and Enslavement at every level.

 School there was awesome though...


Mon, 04/23/2012 - 15:42 | 2368049 bobola
bobola's picture


What debt did you put on the cc's..??  Stuff you needed to have right now, or stuff you wanted..??

Have been reading recent articles about cc companies (once again) signing up customers with bad credit ratings.  I guess they figure they will make more $$ than they lose and if they don't get these customers, their competition will. 

Mon, 04/23/2012 - 15:49 | 2368100 Oh regional Indian
Oh regional Indian's picture

Bob, this was back in 1995, I was a newbie to the US. Now I'm all wized up. Not had a CC in 10 years and like it like that. Here in india though, being CC free is quite easy.

And yes, credit farms are not done bottom fishing yet. Inspite of all the rhetorical arguements, ultimately, the system has to generate X amount of debt locallya d globally every day just to stay alive (barely).


Mon, 04/23/2012 - 13:31 | 2367557 theMAXILOPEZpsycho
theMAXILOPEZpsycho's picture

"We had no role in the financial crisis" "therefore we demand the government take from working people and give us free "education""


Mon, 04/23/2012 - 13:50 | 2367634 DaveyJones
DaveyJones's picture

SIDE NOTE: Part two of the William Binney / William Orwell /NSA  interview

Mon, 04/23/2012 - 14:36 | 2367806 TruthInSunshine
TruthInSunshine's picture

What are the UK versions of these hallowed halls of U.S. educational greatness?:


Mon, 04/23/2012 - 13:01 | 2367410 redpill
redpill's picture

Cue various gubmint officials and CNBC talking heads claiming that "no one could have seen this coming"

Mon, 04/23/2012 - 13:08 | 2367447 Manthong
Manthong's picture

"For those with government or nonprofit jobs, the debt can be forgiven after 10 years. "


They should be paying a premium on the loan in accordance with the premium that their government or priviledged sector compensation and benefits provide over civilian compensation.

Mon, 04/23/2012 - 18:49 | 2368630 mjk0259
mjk0259's picture

Not so much in UK. Everyone has medical, dental and retirement

Mon, 04/23/2012 - 21:28 | 2368886 DanDaley
DanDaley's picture

"Everyone has medical, dental and retirement."

All for only $143,000 per capita, but hey, it's only paper.

Tue, 04/24/2012 - 00:40 | 2369094 dubbleoj
dubbleoj's picture

If Brits stay out of the country long enough, I believe 5-8 years, they can get their loans forgiven completely. Have several friends doing this.

Mon, 04/23/2012 - 14:46 | 2367862 The Heart
Mon, 04/23/2012 - 21:53 | 2368919 long-shorty
long-shorty's picture

laws of,

I used to be a doc. Young doctors don't set prices; they collect the reimbursement that the government and insurance companies fix for their services, same as old doctors.

Doctors can set high prices but only patients who are "cash pay" would actually pay those prices, and increasingly, neither young nor old doctors will accept many patients who are cash pay.



Mon, 04/23/2012 - 23:23 | 2369034 dark pools of soros
dark pools of soros's picture

nah it doesnt matter..  he'll just say it and get the bump and the details will just let 10% forgive some of their debt and not talked much in the media

Mon, 04/23/2012 - 12:44 | 2367318 carbonmutant
carbonmutant's picture

That and pardon Corzine...

Mon, 04/23/2012 - 13:04 | 2367430 Stuck on Zero
Stuck on Zero's picture

I think Obama is going to promise 50 sesterces to every citizen.

Mon, 04/23/2012 - 16:58 | 2368401 mick_richfield
mick_richfield's picture

I think that would be about 600 million oz. of silver, or about 20 times as much as the COMEX says it has.  ( And about 200 times as much as it really has. )


Mon, 04/23/2012 - 13:15 | 2367482 Race Car Driver
Mon, 04/23/2012 - 12:52 | 2367364 Floordawg
Floordawg's picture

That would be surprising IMO. It seems unlikely to throw a bone that large to the serfs. His handlers would never allow that kind of "compassion."

Mon, 04/23/2012 - 12:56 | 2367387 Paul Atreides
Paul Atreides's picture

Agreed it would be something more along the lines of interest relief if it happens...

Mon, 04/23/2012 - 15:18 | 2367962 MachoMan
MachoMan's picture

Aside from the fact that it's still moral hazard...  those folks who (unwittingly) gambled and paid off those debts early probably won't be too happy...

All that needs to happen is the debt becomes dischargeable...  everything solved.

Mon, 04/23/2012 - 12:56 | 2367373 Dre4dwolf
Dre4dwolf's picture

The only way hes getting re-elected is if the people of the USA get bailed out just as much as the banks and his private buddies did.


They should just issue a debt forgiveness month where everyone can send ttheir banks a nice letter and tell them to fuck off.... that would get the economy roaring again without a doubt!



Then again, you don't have to wait for them to enact such a law or act, you could just simply stop paying, if everyone did the collector would die before having even collected on / sued even 1/1,000,000th of the people somehow endebted to an mythical entity that never had any of its own money to lend out in the first place.

Mon, 04/23/2012 - 13:26 | 2367540 grey7beard
grey7beard's picture

>> just simply stop paying,

Or how about not borrowing in the first place?  Naaah, that would be taking personal responsibility.

Mon, 04/23/2012 - 13:59 | 2367675 fnordfnordfnord
fnordfnordfnord's picture

Or how about career as a fry cook? Grocery bagger? I know!, A Secretary! Secretaries make a good living, and are treated with respect.

Mon, 04/23/2012 - 14:09 | 2367714 Au Shucks
Au Shucks's picture

Appearantly a grey beard does not equate to accumulated wisdom.  The "borrowing" you refer to is created from nothing.  Money has been corrupted and is worthless paper that is only accepted as payment by threat of violence. 


NOBODY should pay back ANY bank loans, mortgages, credit card debt or any other bank-created-fiat-shit.  Pay back personal loans from sources who had to earn the money to loan to you, for sure.  But anybody who printed the money out of their ass can simply print more if they need it.  Don't be a slave and get off of your soapbox as it is being supported by the bubbles of your ignorance.

Mon, 04/23/2012 - 14:22 | 2367767 grey7beard
grey7beard's picture

>> Don't be a slave and get off of your soapbox

I speak from experience.  I'm not a debt slave as I owe nothing and haven't for many years.  What I have done, ie withdraw from the system, is something you can actually do that makes a difference.  What you propose is simply a lazy man's pipe dream.  I prefer to take effective measures.  You?

Mon, 04/23/2012 - 15:05 | 2367929 hadriansnightmare
hadriansnightmare's picture

You live in a dream world.  Anybody who is buried upside down by 80% is a fool for spending the next 20 years getting back to 0.  It doesn't make any sense to do so.  Financially, ethically, morally, no matter how you slice it.  Moral Hazard is all about philosophy, lets deal with reality for a change.  Obuma had his chance to offer real mortgage adjustments to everybody at the same time he was bailing out his wall street buddies.  Heck, he could have cut every mortgage in half and given tax credits to people who had paid off their homes to boot and bailed out the banks for what we have blown.  That ship has sailed- now it time for each person to do what is best for them personally- and they are doing just that.  You can sit on your high horse and watch it go down from there.


Mon, 04/23/2012 - 15:39 | 2368029 grey7beard
grey7beard's picture

>> You can sit on your high horse

Taking personal responsibility and not getting myself head over heels in dept is sitting on my high horse?  You can protest all you want, but nobody forced you to borrow the money you owe, and nobody owes you a  get out of debt card.  Work hard, live frugally, pay cash.  Rampant consumerism has never made anyone happy for long as you and your ilk demonstrate.  You don't have to have a new car, you don't have to have expensive vacations, you don't have to have expensive meals out seveal times a week, you don't have to buy anything from Apple.  If you have the income to do so, and that's what you want to do fine, but don't borrow to live beyond your means.  No  high horse, just common sense.

Mon, 04/23/2012 - 15:54 | 2368110 bobola
bobola's picture

I'm with Grey,

You borrow money and don't pay it back - you are a burden on society.

Period.  End of story.

Unless a gun was put to your head and you were forced to sign a loan agreement, what right do you have to walk away from it and let the rest of society pay for your lack of responsibility..??

Your name is now on the banned-from-bike-club list.......

Mon, 04/23/2012 - 17:17 | 2368455 smb12321
smb12321's picture

Why stop at cutting mortgages in half or forgiving student loans - which were freely taken I might add.   And be sure not to mention the obscene non-stop price hikes of colleges.  Nancy Pelosi says that for every dollar DC spends, the economy gets back 2 (or is it 3?).  If that''s the case then just give every citizen a million dollars for real prosperity.

Tue, 04/24/2012 - 01:43 | 2369132 orwell6
orwell6's picture

"Au Shucks," why do you even post? You ignorance about economics is clear to readers. 

Are you a 'recent' or 'progressive' graduate?

Were you given a 'pass' as a member of some special minority?  (at some point, you will have to demonstrate competence either with logic, or applied knowledge)

Auditions for new Sonic commercials are now being held in Disneyland. No ticket needed, just get in line.

Mon, 04/23/2012 - 12:56 | 2367384 Shizzmoney
Shizzmoney's picture

A) That, according to Steve Keen, is kind of what we need.  The *public* is the one that's needs the bailout, *not* the banks who created these loans (and bad bets on these loans).  We tried giving the banks the money to cover for bad debts didn't work.

If you are going to print cash, print it directly to the public towards just covering debts.  A "debt jubilee", if you will.

B) This, of course, will never happen, anyways.  Banks want that interest, as they seek to continue to be the landlords of society.  As we learned with JFK, if a POTUS doesn't do what they want, that ass gets canned in re-election, or that ass gets shot.

The only thing they have to do to keep the US FailBoat looking like its sailing along, and to make this election seem "relevant" is two things: A) Unemployment under 9-10% and B) Gas prices under $5. 

As long as this persists, for now, TPTB will assume the masses will keep going along like everything is fine (when it is obv not).

Mon, 04/23/2012 - 13:58 | 2367395 Dr. Engali
Dr. Engali's picture

There you go inflate the debt away and print some more money. Throw the responsibility on the backs of the poor.

Mon, 04/23/2012 - 12:56 | 2367385 Dr. Engali
Dr. Engali's picture

You're assuming the fix isn't already in place for him to be reelected.

Mon, 04/23/2012 - 13:18 | 2367499 Gully Foyle
Gully Foyle's picture

Dr. Engali

Obana was a place holder, a bone to Democrats after 8 years of Bush.

Romney gets two terms.

Great US reset comes during his first term and NWO in his second.

Digital currency bitches, digital currency.

On the positive side, you can safely invest in gun manufacturers cause ain't no Republican POTUS gonna ban guns.

Mon, 04/23/2012 - 13:39 | 2367581 Red Heeler
Red Heeler's picture

" . . . . ain't no Republican POTUS gonna ban guns."

Like Bush after Katrina?

Mon, 04/23/2012 - 13:41 | 2367589 pods
pods's picture

Only the ones most suitable for fending off the goon squads:



"Romney signs off on permanent assault weapons ban"


"On the positive side, you can safely invest in gun manufacturers cause ain't no Republican POTUS gonna ban guns."  

Mon, 04/23/2012 - 14:05 | 2367697 XitSam
XitSam's picture

The goon squads seem to be vulnerable to Columbian prostitutes.

Mon, 04/23/2012 - 14:30 | 2367799 pods
pods's picture

Is this just me or did anyone else see this as exceptionally low?

I mean, it must be hard enough for a girl to make a living on her back, but then you stiff her on the bill?

No wonder the world hates us.  


Mon, 04/23/2012 - 15:41 | 2368040 Oh regional Indian
Oh regional Indian's picture



Mon, 04/23/2012 - 16:51 | 2368373 XitSam
XitSam's picture

I see it as a continuation of the low, GSA, Secret Service, are the symptoms that we know about. The government is corrupt at all levels.

Mon, 04/23/2012 - 17:21 | 2368466 smb12321
smb12321's picture

You must not have traveled very much.  In almost any third world country there is one embassy with long lines of folks trying to get in.  Hint - it's not Cuba, China, Syria, Russia or Sudan.   The "world" of ZH posters may hate the US but the real world desperately wants to enter our borders.

Mon, 04/23/2012 - 13:46 | 2367602 Dr. Richard Head
Dr. Richard Head's picture

Surely you are kidding yourself.  These two ass puppets are so closely related to each other on domestic, monetary, and foreign policy it is sickening to think ANYONE can see a pubic hair's worth of difference -

Oh yea, and as far as guns are concerned -

1994: backed 5-day waiting period on gun sales (Brady Bill)Signed NATION'S FIRST Assault rifles ban

NRA Rates "Fast and Furious" Obama better on gun rights than Romney

Running for the Senate in 1994, Romney said: "I don't line up with the NRA." A decade later he became a lifetime NRA member

Mon, 04/23/2012 - 15:43 | 2368052 Marginal Call
Marginal Call's picture

You don't get the game yet, you get a Democrat when it's time to cut social security or welfare, and you'll get a republican when it's time to institute gun control.  The party that is pro something is the one they use to take it away.

Mon, 04/23/2012 - 13:41 | 2367587 Bwahaha WAGFDSMB
Bwahaha WAGFDSMB's picture


Mon, 04/23/2012 - 12:59 | 2367401 Vendetta
Vendetta's picture

more like he'll forgive their college debt if they'll go fight in the next war.

Mon, 04/23/2012 - 13:41 | 2367590 Bwahaha WAGFDSMB
Mon, 04/23/2012 - 13:59 | 2367674 oddjob
oddjob's picture

Selling your ass to a bunch of fags in the army...good god, death would be a better choice.

Mon, 04/23/2012 - 14:12 | 2367726 UP Forester
UP Forester's picture

Worked for me.  In exchange for $20k in loans, I gave up 4 years of my life, and bing-bing-bonus got fucked up knees, a fucked up shoulder, lava dust in my lungs, and a plate and 6 screws in my ankle.

On the whole, I should have skipped college and bought a backhoe and a dump truck....

Mon, 04/23/2012 - 14:33 | 2367809 oddjob
oddjob's picture

Green for the backhoe.

Mon, 04/23/2012 - 13:13 | 2367475 Gully Foyle
Gully Foyle's picture

LAERTES: (Inless I listen, I won’t get my spending money. So I’ll listen, I’ll listen. POLONIUS: (Sings) Neither a borrower nor a lender be, Do not forget: Stay out of debt; Think twice, and take this good advice from me, Guard that old solvency. There’s just one other thing you ought to do. To thine own self be true. [Enter entire cast] ALL: (Sing) Neither a borrower nor a lender be, Do not forget: Stay out of debt; Think twice, and take this good advice from me, Guard that old solvency. There’s just one other thing you ought to do, To thine own self be true.
Mon, 04/23/2012 - 13:13 | 2367478 jpmrwb
jpmrwb's picture

Obama will try to do anything to get re-elected. Of course he will use the student loans to get the college vote. When you have people who are in their 60's and still owe, you know that they will die before it is paid back. The taxpayers will be responsible. It is sad that a person that is trying to be responsible working as a dishwasher making minimum wage will have to pay for these kids who think that the world owes them an education.


Mon, 04/23/2012 - 13:32 | 2367560 grey7beard
grey7beard's picture

>> kids who think that the world owes them an education

This isn't about the kids but about the education industry.  It's turned into another cash cow just like the MIC, real estate etc.  And just like all the rest, it's the people at the bottom rung of the ladder, in this case folks with studen loans, that are getting the blame.  You can thank the colsolidated press for that.  Learn to think for yourself.  Follow the money.

Mon, 04/23/2012 - 20:58 | 2368846 Incubus
Incubus's picture

Frankly, all of us would be better off if education were a right as opposed to a priviledge.


Y'know something maybe along the lines of improving society as a whole?  Or do you just want laborers to serve on you while you pretend live some lifestyle that's on the backs of about...5,000,000,000 other people?

I'm gonna down arrow you: but I'd have preferred to put a pickaxe through your fucking face.

Mon, 04/23/2012 - 23:14 | 2369021 dark pools of soros
dark pools of soros's picture

these days it is.. just get a SNAP card, go on welfare and free housing and go to the library and learn.. all for free

Mon, 04/23/2012 - 13:13 | 2367480 BlueCollaredOne
BlueCollaredOne's picture

You assume Obama is in control of Obama.

I would argue that obama is an empty suit merely playing the role given for him to play.  

Mon, 04/23/2012 - 13:18 | 2367506 Gully Foyle
Gully Foyle's picture


And we have a winner.

Face changes policy doesn't.

Mon, 04/23/2012 - 13:43 | 2367600 Sauk Leader
Sauk Leader's picture

Why do you think he never goes off script from teleprompter. EVER.

Mon, 04/23/2012 - 13:43 | 2367599 twh99
twh99's picture

More than likely he will propose that student debt would be dischargeable in bankruptcy.  And personally I don't think that is such a bad idea.

Mon, 04/23/2012 - 13:52 | 2367645 Sauk Leader
Sauk Leader's picture

They should also allow people to use 401K money to pay down principal. No tax penalty or income tax. lets assume they earn 8% annually on 401K investments (ha) yet they pay out 8% on student loan interest. Its a wash. It would never happen though, practical solutions are off the table.

Mon, 04/23/2012 - 14:31 | 2367784 dwdollar
dwdollar's picture

Sad to say you and all those who "up-voted" you haven't got a clue. The whole point is to make everyone a debt slave. Additionally, the elections are a fraud. Buying votes is pointless when you can manufacture votes as quick as printing digital fiat. WTF? It seems the awakened are disappearing by the day now.

Mon, 04/23/2012 - 14:31 | 2367803 tempo
tempo's picture

Worldwide wages are @ $1.25/hr so only about half of the college graduates (not internet schools) only can secure better than min wage jobs. So taking on so much debt is very risky. A college degree particularly teaching was a road to easy street in the 70s, 80s and 90s. Not so much now. Obama can't forgive more than a trillion $ of subprime loans w/o causing a depression. Why not forgive all $40 trillion debt and start all over. Of course the elites wouldn't have all their debt slaves.

Mon, 04/23/2012 - 14:51 | 2367875 vast-dom
vast-dom's picture

so perhaps i'll apply for retroactive forgiveness on the student loans i paid for my fancy education? this way we will approach semblance of fairness and have a disposable income bump as badly needed by these our fake hopium markets.

Mon, 04/23/2012 - 15:08 | 2367939 battle axe
battle axe's picture

Also, Kids will never move out of mom and dads house, they will not be able to afford it. 

Mon, 04/23/2012 - 17:27 | 2368480 smb12321
smb12321's picture

We need a new type of building - One kitchen, one huge den, 10 bedrooms.  The kids could leave home and even if they didn't get a job they'd still have "Friends with benefits" to supplement their payments from DC. 

Mon, 04/23/2012 - 23:17 | 2369023 dark pools of soros
dark pools of soros's picture

isnt that called a brothel?

Mon, 04/23/2012 - 15:37 | 2368022 Isa rules
Isa rules's picture

So what's the solution to education? How would Austrian Economics design an education system?

Mon, 04/23/2012 - 17:28 | 2368483 blueridgeviews
blueridgeviews's picture

That would be least he could do after screwing them out of gainful emloyment.

Mon, 04/23/2012 - 17:30 | 2368487 GernB
GernB's picture

Forgiving debt is ultimately deflationary which you don't want in a recovery. And, it would saddle tax payers with the bill, which could be unpopular in an election year.

Mon, 04/23/2012 - 12:40 | 2367300 LawsofPhysics
LawsofPhysics's picture

Clear the bad debt and let the savors be rewarded for a change.  end the moral hazard and let's start over.  Those of use with PM's and other capital can be the new banks.  I wonder if the old bankers can do yardwork? 

Mon, 04/23/2012 - 15:16 | 2367960 dizzyfingers
dizzyfingers's picture

"I wonder if the old bankers can do yardwork? "

LawsofPhysics: no, you'll be doing their yardwork;

Mon, 04/23/2012 - 17:33 | 2368496 GernB
GernB's picture

One of the first things Obama did in office was to take over student loans from banks. On the theory that the Federal government is so much less likely to give bad loans and so much more efficient at it than an organization whose profits depend on providing sound loans efficiently.

Mon, 04/23/2012 - 12:41 | 2367304 Zero Debt
Zero Debt's picture

It surely looks like debt-based education is an effective way for the elite to prevent social mobility. But it seems that the students and employers aren't getting it just yet.

Mon, 04/23/2012 - 13:06 | 2367435 NotApplicable
NotApplicable's picture

I was talking to a family member who teaches a biology course at a community college. It's a basic, low-level course that is required for all students, so she gets to see the whole student body. She was telling me how not only are the kids getting dumber, but they get mad at her for their failure.

Idiocracy, coming soon to a reality near you!

Mon, 04/23/2012 - 13:15 | 2367489 HarryM
HarryM's picture

Agreed - current thinking is that there is no such thing as a bad student, only bad teachers.

Students have been taught that they're all equal, so the reason they can't grasp calc 2 can only be that they have a bad teacher.

Mon, 04/23/2012 - 17:35 | 2368499 GernB
GernB's picture

It's better than that. If all students are equal how can they get different grades?

Mon, 04/23/2012 - 13:24 | 2367530 Ben Burnyankme
Ben Burnyankme's picture

Brondo's got electrolytes!

Mon, 04/23/2012 - 13:24 | 2367531 Gully Foyle
Gully Foyle's picture


I disagree. It isn't that kiods are dumber, fuck dude chicks fell for "blue balls" at one point, but people are more vocal.

Being vocally  ignorant is the real problem. Previously people kept their mouths shut. Now every asshole phrase and thought needs to be publicly tweeted and explored.

Idiocracy was loosley based on C.M.Kornbluths THE MARCHING MORONS. He made the same points decades earlier.

""The Marching Morons" is a science fiction story written by Cyril M. Kornbluth, originally published in Galaxy in April 1951. It was included in The Science Fiction Hall of Fame, Volume Two after being voted one of the best novellas up to 1965."

"The Problem"

The human population is now 3,000,000 highbred elite and 5,000,000,000 morons. The "average" IQ is 45. (In the real world, an IQ score of 100 is both average, or median, by definition.) Several generations before the onset in the story, the small number of remaining 100-and-higher-IQ technocrats, after being ignored by the general public about the impending population problem, banded together to preserve the human race. The elite work feverishly like slaves in order to keep the morons alive.

The elite have had little success in solving The Problem (also called "Poprob" in the story) for several reasons:

  • The morons must be managed or else there will be chaos, resulting in billions of deaths;
  • It is not possible to sterilize all of the morons, as there are not nearly enough elite to do the job;
  • Propaganda against large families isn't working because every biological drive is towards fertility (the story predates the development of hormonal contraception).

The elite had tried everything rational to solve the population problem, but the problem could not be solved rationally. The solution required a way of thinking that no longer existed—Barlow's "vicious self-interest" and knowledge of the distant history.


In H. G. Wells' 1895 novel The Time Machine, the time traveller travels to the year 802,701 where he discovers that humanity has split into two different species: the dimwitted Eloi and the subhuman Morlocks. He believes that the Morlocks evolved from the working class while the Eloi evolved from the idle upper class. The Eloi never work, but the Morlocks, being in control of what subterranean machinery remains, ensure that the Eloi continue to live their utopian existence – as feed lot cattle.

The 1954 novel Search the Sky, by Kornbluth and Frederik Pohl, is a series of vignettes of odd cultures seen through the eyes of an explorer from one of the cultures trying to find out what has happened to the others. The final section involves a visit to Earth, which has succumbed to the "Marching Morons" effect. Eventually the explorer contacts the "elite" who are actually running the society, but in this story the elite are unwilling to take any kind of drastic action to reduce population (including withdrawing so everyone else starves).

A similar plot appears in the 1980 novel The Restaurant at the End of the Universe by Douglas Adams. The Golgafrinchans have tricked the most useless third of their population to get on a spaceship and leave their home planet Golgafrincham; unfortunately, since the Golgafrinchans included telephone sanitizers on their list of most useless people, and no one was left behind who was willing to do any cleaning, the rest of the planet was killed by a contagious disease contracted from a dirty telephone.

The Simpsons' 1999 "Treehouse of Horror X" segment "Life's a Glitch, Then You Die", had the Earth facing destruction due the Y2K bug. While the most intelligent elite of Earth escape to Mars, all of Earth's useless celebrities are tricked into boarding a spaceship locked into crashing into the sun.

John Barlow's "suspended animation by botched surgery" would be used as a major plot element in Woody Allen's 1973 comedy science-fiction film, Sleeper, where the protagonist Monroe (played by Allen) enters the story in a similar fashion and with similar demands.

The Marching Morons presents an inane radio game show, "Take It and Stick It," that uses the phrases, "Would you buy that for a quarter?" and "Would you buy it for a quarter?" as its signature. The 1987 dystopian comedy, RoboCop (which presented a similarly cynical view of an over-commercialized future desensitized to violence) makes an allusion to the line, adjusted for inflation, as the catchphrase of a TV comedian ("I'd buy that for a dollar!").

The 2006 comedy movie Idiocracy adds a few twists to the "Marching Moron" effect: in this story, two subjects participating in a suspended-animation experiment ("the most average guy" in the U.S. Army and a common prostitute) sleep for 500 years, only to awaken in a future so incredibly dumbed-down that the ability to give the answer to "1 + 1" qualifies one as a genius. The cultural elite has become extinct, but the decaying society is kept somewhat functional by machines, and the government is actually run on behalf of a few mega-corporations. These corporations are staffed and directed by morons with the limited aid of management computers programmed during the more intelligent past.

Mon, 04/23/2012 - 21:57 | 2368920 margaris
margaris's picture

interesting post.

but RoboCop - a dystopian comedy? lol

Mon, 04/23/2012 - 13:30 | 2367534 SoNH80
SoNH80's picture

Not Applicable:  A close relative of mine has the very same job-- (untenured) community college biology prof.  Of 50 students, 30 flunk a simple multiple choice exam, 10 get C's or D's, and 10 do well-- maybe 1 or 2 A's.  For the flunkers, admin. pretty much requires profs. to do whatever's needed to keep the asses in seats, do-over exams, extra credit, credit for attendance, just to get the kids to C- at the end of the term and keep the dollars flowing.  You have a 50%+ real flunk rate, but only 5% are flunked.  Untenured profs. that buck the system are fired.  Welcome to the "Knowledge Economy".

Mon, 04/23/2012 - 14:35 | 2367816 fnordfnordfnord
fnordfnordfnord's picture

Okay, first of all CC's are gov't institutions. It's not as though anyone has the authority to "fire at will." This is well known and tea-party-ers are constantly whining about this very property of gov't run institutions.

Second of all, thank goodness there isn't much of a profit motive at CC's (although it is getting worse).


Mon, 04/23/2012 - 14:55 | 2367881 SoNH80
SoNH80's picture

The way it works is, you cause "trouble," we (administration) won't extend an invitation for you to teach Biology 101 next semester.   Non-tenured profs. are basically like glorified temps, at least from what I hear from my relative.  And, while "profit" isn't in play there, the need to keep the kids in the institution, so that funding streams aren't reduced, is real.  At my relative's CC, 10% of the students are really talented, 30% are mediocrities, and the rest are too stupid and/or lazy to finish their coursework, and too stupid to realize it-- and that they're wasting their time and money.  There are desparate students that keep racking up Cs and Ds (really, F's, if the fudging system wasn't in place) at their basic coursework, increasing their student loan burdens, under some delusion that Procter & Gamble or Lockheed will hire them??? Who the hell knows.

Edit/P.S.-- we are in the era of Cargo Cult Education.  Young people believe that, by showing up at a place, paying tuition, and going through the motions, they will be "educated" and be ensured "success."  90%+ of what I learned in college, I learned on my own initiative, outside of the classroom.  The most important building at a college, including a CC, is the library, while the kids gravitate mostly towards the gym and student union it seems....

Mon, 04/23/2012 - 17:31 | 2368489 fnordfnordfnord
fnordfnordfnord's picture

A CC with "tenure"? I have a two year contract, that's about as good as it gets in my part of the country. Maybe that's so, it's not like CC's cost a lot of money. Yeah, I won't disagree strongly with the proportions, as in any group, around half are below average (funny coincidence, that). Also like most any group, a small portion are exceptional. It IS a CC after all, unlike Ivy League, everyone gets to play. They don't get unlimited chances though, if after a few tries they can't figure it out, they aren't allowed back.

re: your PS, Agreed, I've seen some students like that, but not all of them. I've also met some brilliant kids who just needed to be shown the/a way. The library? Not so much, the internet is where most basic research is done, as it should be. Our own library/CC hasn't really caught on to that fact yet.

Tue, 04/24/2012 - 21:28 | 2372045 GS-DickinDaMuppets
GS-DickinDaMuppets's picture

"She was telling me how not only are the kids getting dumber, but they get mad at her for their failure."

So true!  The minds of the young can be molded by TPTB, so they (TPTB) can more easily steal the future of the young and get the young to do their immoral bidding.  Protect what you have - the "Night Cometh"...


...doing GOD's work...GS-DickinDaMuppets

Mon, 04/23/2012 - 13:08 | 2367455 AssFire
AssFire's picture

6.4% is not a bad rate considering there is no collateral and the borrower is a 20 year old party animal luffing his/her way through a nanny state college or university, learning or relearning things they should have been taught years before in public school. Taught by over paid ivory tower leftist elites who think teaching 2 classes a term is a chore. Maybe these kids should be out apprenticing instead like in Germany. We send way too many kids to college who should not ever be allowed in.

Mon, 04/23/2012 - 17:13 | 2368441 fnordfnordfnord
fnordfnordfnord's picture

The "Tower" is not ivory, but rather cinder blocks with a brick veneer. It's also not so much a tower as it is a cold-war era bomb shelter type rectangle with no windows. Yeah, the students ought to have been taught more and better by their public schools, but that isn't really the college's fault now is it? Overpaid? Hell, usually I make more money consulting in my spare time. Leftist elite? Leftists support Ron Paul? I didn't know I was so conflicted. Elitist? Tell you what, you know so much, why don't we send the luffers 'round to your house for an education? I'd love to see how that turned out.

I doubt you've thought about this for much longer than it takes you to type out your tripe.

BTW, I agree with the apprenticing thing, not enough respect/pay for skilled tradesmen; but boy are you going to holler when you see the plumber's bill.


Mon, 04/23/2012 - 12:42 | 2367308 GeneMarchbanks
GeneMarchbanks's picture

The American system is brutal,”

That about says it all.

Mon, 04/23/2012 - 12:47 | 2367338 El Viejo
El Viejo's picture

Darwinian is what it is and that can be brutal.

The survivors will be those considered most solvent. The rest may end up living in camps.

Mon, 04/23/2012 - 13:04 | 2367431 pods
pods's picture

Survivors will be solvent.

The rest will be SOYLENT.


Mon, 04/23/2012 - 13:26 | 2367536 Gully Foyle
Gully Foyle's picture


Dude, there will be no Soylent Green.

Everyone forgets the WENDIGO effect.

Ravenous made that perfectly clear.

Mon, 04/23/2012 - 13:13 | 2367479 GeneMarchbanks
GeneMarchbanks's picture

I've been meaning to comment on this tragic misunderstanding that persists. If anything it is Spencerian, as in Herbert Spencer who was a sociobiologist philosopher, in other words another confused rambling idiot who managed to cast horribly unscientific ideas into society and economics and bolster exploitation by the rentier class during the infancy of the industrial revolution.

Darwin on the other hand, dealt with biology and did not comment or claim biological facts to have answers for sociological 'problems'.

Jay Gould's books usually confront this nonsense. Especially here:

Mon, 04/23/2012 - 13:30 | 2367553 Gully Foyle
Gully Foyle's picture

El Viejo

From God Bless America

Frank: My name is Frank. But that's not important. The important question is 'Who are you? 'America has become a cruel and vicious place. We reward the shallowest, the dumbest, the meanest and the loudest. We no longer have any common sense or decency. No sense of shame. There is no right and wrong. The worst qualities in people are looked up to and celebrated. Lying and spreading fear are fine. As long as you make money doin' it. We've become a nation of slogan-saying, bile-spewing hate-mongers. We've lost our kindness. We've lost our soul.

Frank: I wish I was a super genius inventor and could come up with a way to make a telephone into an explosive device that was triggered by the American Superstarz voting number. The battery could explode and leave a mark on the face so I could know who to avoid talking to before they even talked. Yeah, I could look and say, "hm, no, you're not going to say anything that's gonna add any value to my life."
Office Worker: Yeah but it's funny, I mean you gotta admit that. Steven Clark, that's funny shit, Frank.
Frank: It's the same type of freak show distraction that comes along every time a mighty empire starts collapsing. American Superstarz is the new Colosseum and I won't participate in watching a show where the weak are torn apart every week for our entertainment. I'm done. Really. Everything is so cruel now, I just want it all to stop.
Frank: [women walk by gossiping about celebrities] Nobody talks about anything anymore. They just regurgitate everything they see on tv, or hear on the radio or watch on the web. When was the last time you had a real conversation with someone without somebody texting or looking at a screen or a monitor over your head? You know, a conversation about something that wasn't celebrities, gossip, sports, or pop politics. You know, something important, something personal.

Frank: Oh, I get, and I am offended. Not because I've got a problem with bitter, predictable, whiny, millionaire disk jockeys complaining about celebrities or how tough their life is, while I live in an apartment with paper-thin walls next to a couple of Neanderthals who, instead of a baby, decided to give birth to some kind of nocturnal civil defense air-raid siren that goes off every fuckin' night like it's Pearl Harbor. I'm not offended that they act like it's my responsibility to protect their rights to pick on the weak like pack animals, or that we're supposed to support their freedom of speech when they don't give a fuck about yours or mine.
Office Worker: So, you're against free speech now? That's in the Bill of Rights, man.
Frank: I would defend their freedom of speech if I thought it was in jeopardy. I would defend their freedom of speech to tell uninspired, bigoted, blowjob, gay-bashing, racist and rape jokes all under the guise of being edgy, but that's not the edge. That's what sells. They couldn't possibly pander any harder or be more commercially mainstream, because this is the "Oh no, you didn't say that!" generation, where a shocking comment has more weight than the truth. No one has any shame anymore, and we're supposed to celebrate it. I saw a woman throw a used tampon at another woman last night on network television, a network that bills itself as "Today's Woman's Channel". Kids beat each other blind and post it on Youtube. I mean, do you remember when eating rats and maggots on Survivor was shocking? It all seems so quaint now. I'm sure the girls from "2 Girls 1 Cup" are gonna have their own dating show on VH-1 any day now. I mean, why have a civilization anymore if we no longer are interested in being civilized?


Mon, 04/23/2012 - 15:33 | 2368005 KickIce
KickIce's picture

If by Darwinism you mean sucking up to the NWO.

Mon, 04/23/2012 - 12:52 | 2367347 fuu
Mon, 04/23/2012 - 12:44 | 2367315 libertus
libertus's picture

Here is a way for universitites and colleges to reorganize themselves should they choose to. Check out the recomendations at the back of the article.

Its going to be a fun ride regardless.

Mon, 04/23/2012 - 12:45 | 2367324 trembo slice
trembo slice's picture

It says some students will leave with 40,000 pounds ($64, 200) in debt more than the U.S. AVERAGE of $23,300.  Some students leave universities with over $100,000 in debt.  I don't know if they mean the UK average is 40,000 or if this is just another example of how unprofessional journalism has become.  The language and numbers could and should be much more straight forward.  Half-truths...

Mon, 04/23/2012 - 13:02 | 2367419 _ConanTheLibert...
_ConanTheLibertarian_'s picture

and there's the difference between average and median

Mon, 04/23/2012 - 12:45 | 2367325 ElvisDog
ElvisDog's picture

Two problems with the English system of student loan repayment: (1)  They are still debt slaves for 30 years. (2) Someone is paying back the money that the 55 year-old former students are not. Let me see, the schools aren't writing off that debt, the U.K. banks certainly are not. It must be the U.K. taxpayers who are ultimately footing that bill. I don't think I would be pleased knowing that part of my tax burden was going to pay off the PhD in Contemporary French Literature that someone I don't even know undertook.

Side note: One of my wife's relatives is married to a woman who in fact did get a PhD in Contemporary French Literature from Harvard of all places.

Mon, 04/23/2012 - 13:33 | 2367563 EscapeKey
EscapeKey's picture

There's another major issue, which articles such as this completely ignore.

UK education cost has significantly outgrown inflation over the past 20 years, and the reason is rather simple - the government paid all expenses in excess of £3,000 - or, in other words, the institutions had absolutely no reason to limit their costs, as the government (ie, taxpayer) would pick up the tab.

It's another example in a long list of how the government does nothing but create distortions in the market.

Mon, 04/23/2012 - 12:45 | 2367327 bugs_
bugs_'s picture

Its not all kids.  A lot of layed off oldsters hereabouts are using student loans to extend and pretend.

having said that - isn't ALL government debt (and government insured debt) on the kids?

It is a disgrace what has been done.  They will not be slaves.  Do the right thing and end it now.

Mon, 04/23/2012 - 12:46 | 2367328 Seasmoke
Seasmoke's picture

Coming soon for the government and your student debt will go away

Mon, 04/23/2012 - 13:07 | 2367450 The trend is yo...
The trend is your friend's picture

work for the military and your debts MAY be reduced

Mon, 04/23/2012 - 13:57 | 2367665 Its_the_economy...
Its_the_economy_stupid's picture

Already here.

Military service. Underserved area Medical Service.

Don't think there is one for Lawyers yet.

Mon, 04/23/2012 - 12:47 | 2367330 JW n FL
JW n FL's picture



Ron Paul: the Road to REVOLution Video Game kickstarter promo


Ron Paul: the Road to REVOLution Video Game kickstarter promo: via @youtube SHARE!!! Kids need to know this stuff!!


Published on Mar 31, 2012 by

This is a video for my kickstarter project for the Ron Paul: the Road to REVOLution video game.

Old school sidescroller-style, puzzle-driven, action adventure game featuring Ron Paul. Help Ron Paul to traverse each of the 50 united states collecting Sound Money and Delegates so that you can win the Presidency and eventually take down the Federal Reserve!

50+ levels designed around each of the 50 united States
13 Boss Fights - representing each of the 13 branches of the Federal Reserve
Soundtrack by Between Cathedrals
Lots of easter eggs and fun stuff for Libertarians
Handpainted backgrounds that represent the history and essence of each of the United States
Challenging, puzzle-driven side scrolling action


Note: I uploaded this video on april 1st. This is not an april fools joke, I promise.

Kickstarter Project:
Music by Between Cathedrals:





Mon, 04/23/2012 - 12:51 | 2367332 kahunabear
kahunabear's picture

Keep it coming! I have rental property where the rent is paid from student loans, so I am getting mine. Will these kids ever pay 'em back? I seriously doubt it.

It would be interesting to compare the student housing market to the overall rental market over the last few years. It barely ever slowed down from what I have seen.

Mon, 04/23/2012 - 12:46 | 2367336 Ben Burnyankme
Ben Burnyankme's picture

Curiously, if the UK succeeds in enacting its own debt enslavement system, the rest of Europe will be sure to follow

We are the envy of the world!

Mon, 04/23/2012 - 12:51 | 2367346 carbonmutant
carbonmutant's picture

Education is becoming a gamble you can't win...

"53 Percent Of All Young College Graduates In America Are Either Unemployed Or Underemployed"
Mon, 04/23/2012 - 17:39 | 2368508 GernB
GernB's picture

Is it random or are people with certain degrees more likely to get a job. Heaven forbid we suggest that you get a degree where socuiety needs you to work. I mean, after all, shouldn't you be gaurenteed a job in the profession of your choosing regardless of the demand for that skill?

Mon, 04/23/2012 - 12:52 | 2367359 InterestingLinker
InterestingLinker's picture



I just noticed the below link out of   Smartest men in the room are often from MIT, and this is pure genius on changing dynamics.   If anything deserves to go viral on the internet, this just might be it.

Was this worthy of your attention?  Feedback anyone?  

Amazing and thought provoking things are often found here on ZH.  

This was shared with the public just a little over two weeks ago, and the MSM still has not covered this.  You heard it here first.


Mon, 04/23/2012 - 13:31 | 2367555 BlueCollaredOne
BlueCollaredOne's picture

I think we are witnessing the birth of a new troll.

Mon, 04/23/2012 - 13:36 | 2367576 mayhem_korner
mayhem_korner's picture



Good call.  I stopped reading after "smartest men in the room are often from MIT..."

Tue, 04/24/2012 - 03:42 | 2369195 InterestingLinker
InterestingLinker's picture

Not a troll.   Want proof of that?    Been wondering where Trav777 has been lately.  Did he rant over the line somehow either with ZH or with the some PTB?

Just trying to throw so humor out there in a way, and get away from D & G, collapse talk bitchez, survivaling, PMs, etc.  Just looking for one up arrow is all, and someone to to be lighthearted about it.

Mon, 04/23/2012 - 14:42 | 2367798 Zero Debt
Zero Debt's picture

Breaking news: the Stanford Farm Project discovers that chickens lay eggs (!!) and they can be eaten (!!!). Why, double plus facepalm, I was there and I saw the light. No, I mean it, they really are doing this:

But it gets better:

Last week we were lucky enough to have a conversation with environmental policy expert Kari Hamerschlag of the Environmental Working Group (EWG). When we asked her how we could best use our voices to support better food on the Farm Bill, she suggested contacting Representative Anna Eshoo and thanking her for her support of the Local Farms, Food and Jobs Act.

Hey Anna Esho, "environmental policy expert"! How about brainwashing your students with this video about FDA raiding an organic grocery store: Just in case they were thinking of ever breeding chickens off-campus and selling the eggs, or some other outrageously creative ideas. Know your place, and last but not least, remember to thank your representative for what you are given. Corporate food, now that is something to be truly thankful about.

And for all your friends of law and order, there is good news in store, because you can now farm illegal raw milk and have it colored in shades of white for free. One has to be blind not to see the plethora of opportunities available when studying how the government rewards such creativity by pouring dye into the milk tanks, just to make sure that the produce is utterly destroyed. That's something for you, the bright future coming out from Stanford, to think about! (jump to 1:20 to see the dyed milk courtesy of your local nanny state)

But hey kids, at least you will get a useless certificate at the end to earn your well deserved spot in the plantage economy.

Mon, 04/23/2012 - 12:53 | 2367366 kevinearick
kevinearick's picture

Marginal Utility:  King Cnut’s Viral Infection

You have intelligent, capable engineers caught in the empire prison. Work your way back to community character, to the global IC chip, which has replaced the US Constitution, as the babysitter keeping the majority busy, pushing the rock up the hill to the cliff. Once it rolls over, roll out quicker than the empire can react, which isn’t difficult given that it is consumed by volatility mitigation. The minorities together are far greater than the artificial majority operating the empire.

Yes; the Internet is the latest railroad, which the empire is seeking to employ again for vertical integration. Yes; books are the candied bait, and Apple kills many birds with one stone by the example of eliminating alternative access. The Supreme Court is the only circuit breaker protecting individual sovereignty, by design. At the end of the day, you have the content of your character, aggregated.

Jobs requiring a college education do pay more than those requiring a HS education on average, but the data only reflects those ushered into the jobs, not everyone with a college education, nor does it measure profit. Take a look at the characteristics of those granted jobs and the recycling ratios in their event horizons. What the world is watching is the Fed priming the pump with no main supply, burning it up with each iteration, on a stage built for the occasion. We replaced military economic activity with education economic activity, with the expected results.

Draw a line across a sheet of paper. From any point on that line, draw a pyramid underneath it. Draw several pyramids side by side with their bases meeting. Draw another line under those pyramids. Draw a set of inverted pyramids under that line directly beneath the other pyramids. What you now see are diamonds, side by side. On a separate sheet, draw a pyramid, and copy the first figure inside the pyramid. Place an eye above the pyramid.

What you are looking at are family lines, with windows of opportunities and threats, opening and closing DNA NPV. The couple at the root, the tip of the pyramid (Abraham), is extremely wealthy, because assets may be expected to accumulate through generations. At the new roots you will find the labor superintendents, so the empire desperately seeks to identify and liquidate them as early as possible, through income misdirection. To do so, it must control the rules of capital formation, all the way back through Family Law, state preemption, to eliminate due process.

Contraception is most often counter-productive, until gravity requirements are met. Intelligent abstention provides the best results, but, if you check your History of Tribes, you will find many effective alternatives. You do not need, nor do you want, a government pharmaceutical solution, which will only serve the empire, for obvious reasons. The empire can only exist if babies have babies, under government administration.

Labor generates/forms capital, and capital must have labor to perform. Therein rests the looking glass equilibrium, which may be moved by labor at will. Just swap out the economic activity virus, throw the key down in the room, and shut the door behind you, when you are ready to ignite the economy at your new location. The universe will automatically change the lock on the door, adding variables faster than the empire can algebraically reduce them.

They don’t want to sell you books. They want to sell you empire projectors. That’s the only way their model works, on the assumption that all roads lead to empire. Competing for a place in line to its sorting machine is for derivative robots.

A virus is a virus is a virus. Galileo didn’t turn lead into gold with an Apple by accident; Irony is to God as judo is to physics; Float like a butterfly; sting like a bee; and “please don’t throw me into that briar patch.”

Don’t enable the empire gang or program its black box, to eliminate privacy, and expect to feel secure without another cop around. Real labor doesn’t want security to slow it down at the margin. In the unknown we trust, for capital cannot fathom its depth.

Mon, 04/23/2012 - 12:54 | 2367368 mayhem_korner
mayhem_korner's picture

“Poor kids, low-income kids know they have to get an education,” Lampl said. “They’re not stupid.”


College isn't about getting an education.  It's paying for an endorsement that one is cleared to enter the workplace and forfeit two-fifths of their labor for the betterment of the system.  And students aren't the beneficiaries of "student" loans - they are transfer payments to university administrators and professors.

Mon, 04/23/2012 - 13:18 | 2367503 LawsofPhysics
LawsofPhysics's picture

What about institutions where the professor must raise 100% of their own salary?  Most medical schools work like this,  these professor do not recieve any money from tuition.  Same thing at many state land grant schools with strong research and development and private schools.  The profs are schmucks and the administrators and contractors (read friends of the administrators) recieve most of the money from tuition hikes for their "services".

Therein lays the real problem, the increase in tuition is not going into actual instruction or outreach to local business (to provide better labor and innovation-which is where is should be going.  Again, massive mis-allocation and mal-investment of capital.

Mon, 04/23/2012 - 13:30 | 2367549 mayhem_korner
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Get to the root question - do you need a "school" to get educated?  If you think so, then you should go back and stay there....

Mon, 04/23/2012 - 13:49 | 2367624 LawsofPhysics
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Nice avoidance there. Unfortunately it is a bit more complex than that.  I think what you meant to ask was "do you need an educational system and government funded research and development to remain competitive".

I guess we will find out, China is quadrupling their government R&D.  The U.S. is scaling back.  Time will tell, but you might want to bone up on your mandarin now.

Mon, 04/23/2012 - 23:20 | 2369030 dark pools of soros
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remember Twain?     Never let school get in the way of his education? 

Mon, 04/23/2012 - 15:29 | 2367988 John_Coltrane
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Spot on analysis.   Administration is a subsidized parasite.  In the physical sciences, professors typically raise 5-10 times their salaries in grants/year.  Its the parasites in the so-called social sciences who are the bane of modern education.  But, the real problem is that when government "subsidizes" anything it always gets more expensive (e.g. education & medicine) because its OTHER PEOPLES MONEY. 

In the old days before educational sudsidies, students had to put up their own funds (earned by work or savings-theirs or their parents) and thus were more motivated to major, say, in chemistry or engineering, than such lucrative fields as communications, psychology, french literature, or art.  If you want to learn about these fields go to the library and check out a book and save yourself some dough is my advice.  If you need hands on experience in a real field such as physics or chemistry then certainly a top college will pay back your investment-however at prices highly distorted via government price fixing caused by subsidized loans and grants.

Only a minority of a population  can really benefit from a college education.  We should concentrate on making high school more relevant instead.  We need vocational institutes such as exist in Germany for the vast majority.  The area under the IQ curve from 110-150 just isn't that large a fraction of the entire Gaussian IQ distribution-and you'll need to know calculus to compute it!

Mon, 04/23/2012 - 17:46 | 2368522 GernB
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Why would anyone teach for no compensation? Not that people wouldn't be that generous, it's just that who has time to do a second job for which they don't get paid?

Mon, 04/23/2012 - 12:55 | 2367375 AustriAnnie
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The three bubbles shown: Student loan debt, auto debt, and credit card debt:

Students with loan debt often also have auto debt and credit card debt.  If they can only make one payment they'll make the student loan payment and default on the car loan and the credit card.


Mon, 04/23/2012 - 13:47 | 2367608 El
El's picture

Oh, I disagree. They will pay the car loan, because without transportation, they won't be able to even try to find a job that pays enough to make the payments on any of the three. Besides, it appears with the student loan debt, they can get forebearance for just about any reason at all, and then after a time just go into default. Down the road a bit, they can then rehab the loan and even have the ding completely removed from from their credit report after a year of paying on time. They might not be able to get out of paying on the loans off and on for the rest of their lives, but the system is designed to be gamed for a fair amount of time, giving them plenty of wriggle room. What a mess.

Mon, 04/23/2012 - 12:56 | 2367378 q99x2
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Give the students $100,000 loans at ZIRP and borrow it back from them at 3% and the world would be a better place.

These students are going to put the Banksters into jail when the SHTF.

Mon, 04/23/2012 - 13:07 | 2367442 BlueCollaredOne
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You must not know too many college age people.  I am 27, and live in an area with a lot of young "professionals." 

A vast majority I have met that has recently graduated are borderline alcoholics.  They have no drive, expect jobs to be given to them and feel that if they apply to 3 jobs online a day everything will work out for them in the end.  They have no real skills, and most comment on how they just bullshitted their way through school.  They are some of the most self absorbed douchebags I have ever met.  They know nothing of politics besides red vs. blue.  They know nothing of economics besides what they see on TV.

When SHTF these will be the idiots knocking on my door for food, and will have no idea how things came to be. 


Mon, 04/23/2012 - 13:33 | 2367565 mayhem_korner
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About five years ago, I would interview freshly-minted students for entry level analyst work.  The process was easy, as only about one in five of 'em didn't have a chip on their shoulder and was ready to roll up the sleeves and actually learn something.  The others acted like they could lever some threat that they had 2 or 3 other offers.  It made for quick interviews.

Mon, 04/23/2012 - 13:52 | 2367640 LawsofPhysics
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Great summary.  I hire vets because most know the difference between knowledge and wisdom and offer internships to weed out these douchebags, most of which are this way because they have never dealt with people in person.  This is the dark side of the social media revolution.  What people will say in a text message is very different when they must look someone in the eye.  A lot harder to bullshit.

Mon, 04/23/2012 - 12:58 | 2367383 Count de Money
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College tuition costs have gone up more than 10 times since the late 1970's compared to an average three times for everything else. My yearly tuition was less than $4000 in my last year of college in 1979. And yes, it was a private college. Their yearly tuition now: over $37,000.

The question that nobody's asking is what are colleges doing with all that money? I read not to long ago that the median salary for a full professor was over $200K. And who knows how much for administrators and coordinators.

Used to be you went to college to become rich. It now seems that the way to get rich is never leave.

Mon, 04/23/2012 - 13:01 | 2367406 Shizzmoney
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The question that nobody's asking is what are colleges doing with all that money?

I went to Northeastern University in Boston in 1999 for my freshman year.  That first year, they gave me 60% of scholarships and the rest in a loan, which was doable for me, around $3K.

Then, next year, tuition rose 20%, and they took all my scholarship away (despite 3.5 GPA) *but* they did offer me a loan on the rest of the $16K for the year!

After I learned what they did with the rising tuitions: building waterfalls in the student square, and getting a new fleet of limos for the President of the Univeristy,

I passed on going back there, even at 19 I knew what the fuck was up.   

Mon, 04/23/2012 - 13:11 | 2367448 Count de Money
Count de Money's picture

Good to know, thank you. I was thinking that the tuition numbers that get thrown about are really "list prices" and that nobody pays list. Now I have to worry about "teaser rates".

What's really galling is that you have to open up your books to them and then find out what the real price is.

To put things is perspective, I bought my first car, a used 1976 VW Scirocco for $4000 in 1979. Now you could buy a new BMW for the cost of one year's tuition.

Mon, 04/23/2012 - 13:09 | 2367461 BlueCollaredOne
BlueCollaredOne's picture

Look at Harvard's endowment fund.  Its sickening.

Mon, 04/23/2012 - 12:59 | 2367398 Ted Baker
Ted Baker's picture


Mon, 04/23/2012 - 13:01 | 2367403 Racer
Racer's picture

The debt overlords have fooled the slaves into thinking debt is okay... with statements such as allowing data  to say 'debt excluding mortgages'...

but a mortgage is a HUGE debt and a millstone round the necks of the slaves.


IF they rented instead of buying a house they wouldn't be a slave to it. No legal fees to move, no stress of finding a buyer, move when and where you want. Also at the end of it when/if you have your mortgage paid off,  you won't be hammered into selling it to pay for your care in a home... you would get it for free instead! Or if you die, your children will pay tax on a value where the tax allowances don't keep up with inflation and they get hammered for all your looking to the future and 'saving' for your retirement!


Mon, 04/23/2012 - 13:57 | 2367412 yabyum
yabyum's picture

I watch nursing students come in the ER from the for profit schools to do there clinic time, they will graduate (if there school does not go broke) with 50,000 K in debt. A  two year college would be  3/4 that amount or less. Nursing is a great job, but not when you are buried in a avalanche of debt.

Mon, 04/23/2012 - 13:02 | 2367416 DavidC
DavidC's picture

They know it's a captive market, which is why they do it. Without a degree, many employers won't even look at a CV.

Similar to when I first started commuting by train to work, car parking used to be free and now it's over a fifth of the daily train fare, just to park. But people have to get to work - it's a captive market. Both train fares and car parking continue to rise by more than the rate of (official) inflation each year. I drive and it's CHEAPER for me than catching public transport.


Mon, 04/23/2012 - 13:06 | 2367420 JustObserving
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The American system is brutal,” said Tim Leunig, who teaches economic history at the London School of Economics.

It is not just American brutality in handling education loans.  Brutal are also our numerous wars and our prison system. Our incarceration of our own citizens is unmatched anywhere in the world. Brutality is usually the face of Fascism:

in 1980, there were about two hundred and twenty people incarcerated for every hundred thousand Americans; by 2010, the number had more than tripled, to seven hundred and thirty-one. No other country even approaches that. In the past two decades, the money that states spend on prisons has risen at six times the rate of spending on higher education."

We need that money from those educational loans to pay for our prisons and that $400 a gallon gas in Afghanistan.


Mon, 04/23/2012 - 13:06 | 2367437 Vendetta
Vendetta's picture

Oh remember how much the politicians and media told everyone to get 'retrained' and get more education for the jobs that don't exist?  Remember GW bush's "ownership society" remark about the housing market?  Of course, Georgie Boy was talking about the "haves and have mores' at his campaign fundraisers as they laughed their asses off at the orwellian remark.  Now we a clone of bush and clinton in the whitehouse talking up the decrease in unemployment numbers as if the reduction was due to jobs being created instead of people dropping off into the swamp of no hope and no jobs masked by BLS number games

Mon, 04/23/2012 - 13:07 | 2367449 Catullus
Catullus's picture

I don't know why baby boomers haven't picked up the student loan scam yet and started to go back to school. Just enroll full-time, drop half your classes, get an awesome dorm apartment, and drop the board plan. Cheaper than living in a retirement community, cheap sports, cultural events, student discounts on top of your senior citizen discounts, excellent health facilities, food available all the time. Go to one or two classes a week. After working your entire life, school work is a joke.

And a university will never kick you out. Just threaten to sue them for age discrimination.

Mon, 04/23/2012 - 13:11 | 2367464 Bicycle Repairman
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And the debt is completely discharged upon death.

Mon, 04/23/2012 - 13:08 | 2367452 theprofromdover
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3 guesses who spent a long time lobbying for this system.

Told the colleges and universities they could make a fortune and could raise fees,

Told the governments it would be self-financing,

Told the Treasury employers would collect it,

Kept a big secret how much they could cream off for themselves.

just didn't quite get round to telling the students they would become even more enslaved.





"........For those with government or nonprofit jobs, the debt can be forgiven after 10 years....."

Say, lookee here. That doesn't sound fair.

Mon, 04/23/2012 - 13:08 | 2367454 undertheradar
undertheradar's picture

I plan to write an article on the student debt problem in NL. In the meantime, a story about debt collection:

Mon, 04/23/2012 - 13:10 | 2367459 Bicycle Repairman
Bicycle Repairman's picture

"By contrast, U.S. education debt can’t be discharged through bankruptcy and almost 2 million Americans with student debt are over 60"

Trust me on this, the debt will be discharged upon death.


Mon, 04/23/2012 - 13:12 | 2367470 Sandmann
Sandmann's picture

Cannot be discharged through bankruptcy in UK either

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