Using myself as an example (which is an extreme, I’ll admit)…

Through college and grad school I amassed about 73,000 in federal student loans. On my current payment schedule, where I pay more than the minimum that was required, forgiving my loans after 20 years would mean writing off around $37,000!

The dems have also proposed capping payments at 10% of salary. When you consider that I pay more than 10% of my salary towards my student loans, that number to be written off only gets worse. How many students will have their loans forgiven at the same time?

I just can’t understand how this plan makes any sense! Is there anyone who can explain it?

First: forgiveness programs already exist within the federal loan system for public employees. The maximum repayment period of 20 years is a non-starter, so don’t worry about it. But neither of the above are core to the proposal.

Second: congress has already passed a law, which was signed by George Bush, that caps repayments at 15% of disposable income for federally backed loans.

Third: the feds already back up all of the loans, which means the financing companies basically pocket the spread between the 10 yr. note and the stated rate (6.8% for new federal loans).

Fourth: the feds eat the losses on principal in the case of default whilst the financing companies get fees plus ‘the rake’: a sweet deal. These loans are enormous profit centers for companies like Chase, Bank of America, and Citigroup. Sorry, but I’m not going to cry about the government pulling the rug out from those people.

Fifth: anyone who opposes the core thrust of the proposed legislation is unwittingly advocating for a continued system whereby losses are socialized and gains are privatized. It doesn’t matter that you dont see it that way, all that matters is that THAT IS HOW IT ACTUALLY IS.

Conclusion: do your homework, use your brain, and understand that lenders are getting an absolute free ride off YOUR TAX DOLLARS. The money is being spent anyway, it is cheaper for the tax payers if the feds administer the money directly, instead of using unnecessary middlemen whose only effect is to drive up costs both to students and to tax payers.

If you want to advocate for getting RID of federal student loan programs, that’s one thing, but to oppose cutting out a blood sucking middleman simply because you have a vague sense that government is bad and private enterprise is good, then you are really barking up the wrong tree on this one.

They should make student loans and own the default risk. They have the best ability to monitor the potential for the borrowers to repay. Additionally, through the curriculum they offer, they are in the best position to ensure that they are loaning money that actually goes towards the economic enhancement of human capital.

These federal subsidies and bureaucrats are simply not needed. All of this extra dumb money chasing student lending has pushed up costs and enticed people to attend college who don’t belong there. Universities are full of non-academic departments for students of limited ability who really just want a multi-year hedonist experience. Cut the federal subsidies and force universities to take responsibility for the long-term consequences of their academic standards and their socialist bent for economically useless fields of study.

It seems to me that this is just more proof that Tiger Woods would be the ideal Dem nominee in 2016:

1) He spends about as much time playing golf as the incumbent
2) He has as much economic knowledge as the incumbent (maybe more – he’s managed an endorsement empire for years)
3) He has not one, but TWO minority parents, making him twice as qualified as the incumbent
4) He has the sexual morals of the previous Dem president (though he seems to have at least limited himself to willing partners who weren’t working for him and weren’t young enough to be his daughter)
5) He has the driving skills of Ted Kennedy, but proved it in a situation that didn’t kill one of his lovers.

Is that the ones being bled are the middle class. What indeed is the definition of “needy”? My guess is there’s a rather too steep phase out so that those working hard in the middle class get little to no benefit at all, providing yet another disincentive for people to work hard to get ahead.

Add enough of these entitlements up and you get government dependency, you get a disincentive for people to make something of themselves, you stifle small businesses and job creation, you unjustly redistribute wealth, you increase the deficit & debt, and you hurt the economy as a whole.

This destroys opportunity. All so the bleeding hearts can feel morally accomplished, while self-righteously dismissing anyone who dares disagree with their stupid plans.