Economists Say Forgiving Student Debt Would Boost Economy

CPT Jack Durish It's a great question, who being the operative word.

- The status quo is to just let the students pay for it who were likely about 18 at the time. Old enough to join the military but young enough were they were likely not great at understanding the financial consequences of what they were signing up for, but sign up for it they did.
- The lenders who gave them the loans, knowing for many they were not going to be able to pay them back in any reasonable way and took advantage of the government guarantee and inability of debtors to discharge their debt, providing them very low risk.
- The instructional institutions that realized they could take advantage of this to raise their endowments and kept raising tuition because lenders could give them more.
- The general public (AKA the taxpaying public) who elected in officials that took away many inexpensive public education opportunities to spend the money on other things. Then also put legislation in place to protect the lenders from giving out loans then know are not reasonable because students can't get out of the debt and by the way in effect cosigned the loans by providing a guarantee. (Apparently that whole thing started because we were worried about the less than 1% who declared bankruptcy on their loans in the 1970s so put increasingly draconian legislation in place to fix it and ended up with a much worse problem).

You point is a good one, it's not only how do we deal with this mess we got ourselves into, but how do we make it so we don't get into it again?

The sad part here CPT Jack Durish is that an entire generation has been handed everything and they fully expect everyone else to take care of them. I'm in no way being judgmental but their families probably have massive amounts of debt and more often than not do not take personal responsibilities for their actions. They grow up pointing the finger elsewhere and it translate over into adulthood. It even happens in our federal government where we are now $22T in debt. I guarantee they feel that if the federal government doesn't have to pay their debts, why should the rest of us.

Many schools have huge endowments. Why don’t they finance the students they select to attend their students and increase the endowment funds with interest from the loans. As long as the government backs all loans it will continue.

SPC Kevin Ford - Are we going to get ourselves in this mess again? The Magic Eight Ball says... Look at mortgages. The government made loan guarantees for people to purchase homes they couldn't afford (so they could get votes, of course), and look what happened there. And, it's happening again. We're on track for another Fanny Mae/Freddy Mac disaster. So, we'll bite the bullet and pay these loans to bail out the banks who made them just as we paid the banks to bail them out of all that bad mortgage debt. We never learn...

If we start down the slippery slope of forgiving this type of debt, what's the stop Congress and politicians from going after credit cards, car loans, and mortgages? Where does it stop?

Debt is debt.

You're all talking about moral hazard, but we subsidize major corporations every day. When an oil company drills and finds no oil, did you know the money they lost is fully tax deductible?

So, why not bail out our students. The loans they hold equate to mortgage payments, wouldn't you rather see them buy a home?