Student loans have become a racket. Nowadays (and I can personally attest to this), the few good jobs left in this country require college, and college is, for most people, unaffordable without loans. Students are almost automatically enrolled in the program, yet they are given a false idea as to just how corrupt that program has become.
Graduates enter the working world in debt to the tune of $50,000 to $100,000 or more. But that's not the worst of it. Privatization of the student loan program has brought a host of abuses. Those paying off the loans may have to pay back two or three times the amount borrowed.
And there are other abuses...
...abuses that make student loans the most lucrative to collect and the most onerous debts to carry.An arrangement like this should outrage both the doctrinaire Libertarian and the hard-core Marxist. Can we truly use the word "capitalism" to describe a system like this...?
The process can be so bad for borrowers that Harvard Professor Elizabeth Warren told the Wall Street Journal, “student loan debt collectors have power that would make a mobster envious.”
And no one makes the mobsters greener than Al Lord and his Student Loan Marketing Corporation, the largest student loan provider in the country. It’s also known as Sallie Mae - one of the most profitable companies in America.
The problem with student loans began ten years ago when Congress privatized student loans, largely through a strange arrangement with Sallie Mae.(Emphasis added.)
Sallie Mae assumed all the rewards, but the federal government took all the risks. In addition to legislating draconian collection powers, outlawing bankruptcy protection and imposing huge penalties for delinquent debt, Sallie Mae convinced Congress to outlaw re-financing and other forms of competition for student loans.
Many lives are being ruined. People who expected to take positions among the leadership of our society are learning that they must exist within the outsider economy, paid under the table while working low-skilled jobs without benefits or hope of true prosperity. Some migrate to other nations.
To learn what to do to solve the problem, go here. From the Student Loan Justice web site:
Student loans have become the most profitable, uncompetitive, oppressive, and predatory type of debt of any in the nation. This has occurred due to legislation that was largely paid for by the the lobbying machine of Sallie Mae, the largest student loan company in America. Vast personal fortunes are being made by both Sallie Mae executives, and others who paid for this legislation, at the expense of decent citizens who were not able to capitalize on their education. This has effectively crippled MILLIONS of decent citizens who want to repay their original debt, but are prevented from doing so by staggeringly higher amounts being demanded from them by both "non-profit", and for-profit student loan companies. This has truly created a swath of economic destruction across our land.
3 comments:
Predatory describes anyone who doesn't make 250000 per year.
America is so fucked.
Rising hate towards immigrants.
corrupt politicians that would mobsters blush.
elimination of the middle class.
the inevitable resource wars that are coming.
It does not look good, someone tell me of a scenario in these issues are dealt with that has a happy ending.
Fortunately I had my $20k work of student loans paid off in the early nineties before they changed the rules.
What a shocker, I had no idea what a nightmare taking out student loans has become and how incredibly greedy the student loan service providers like sallie mae have become.
These changes in the student loans suggest that the neocons/republicans/scaife/pnac folks want as few high school graduates to get college educations in order to further impoverish the next generation and force them to live forever more hand to foot.
We could never ever have a 1967 "summer of love" because the students couldn't afford to stop working at their part-time and full-time jobs required to support themselves in school.
There has been a real backlash in this country against education, a dumbing down of the middle class, to keep the next generation as ignorant and obedient as possible by keeping them consumed with their paycheck to paycheck existence.
The folks who hated the sixties/hippies/young people rebelling are making sure that the current "x" generation have very little opportunities for educational achievement. Only students with wealthy parents will be able to afford to go to college.
this country is turning into a very small minority of the "have's" (bush's base as he referred to in michaelmoore's fahrenheit 9/11) and the vast majority of "have nots" .
by the republicans taking control of the house since the mid nineties and the senate in 2000, they have wrecked the futures of thousands of young people by destroying them economically with student loans that they are forced to pay double, treble and more.
what a financial nightmare, my heart goes out to those poor students who have no idea that they are going to be screwed over when they graduate and for those college graduates who are in the horrible process of being screwed over.
these sorts of financial problems also tie up young people and prevent them from having any time or energy to consider bigger picture issues such as election fraud or cheney's push for war with Iran.
thanks for posting this.
The concept of "student loans" was flawed from the start. A society ought to pay for the training of its new productive workers out of its current cash flow, not out of their future incomes. For most of history, this was accomplished by means of apprenticeships...
Post a Comment