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Letters to the Editor

Loan debt

October 17, 2011

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To the editor:

The student loan program has created a new class of people who now find themselves in “economic slavery”: the highly educated unemployed.

Before you find yourself in debt to the government for the rest of your life you might want to consider my method for avoiding membership in this elite class. Here is how it works:

Get married. Take a job on the night shift. Have a child. Enroll in college. After six or seven years, you will have your teaching degree. Give up teaching because it does not pay well. Take an entry level job in a field totally unrelated to your college degree because it pays more. Have two more kids. Work you way into upper management after 18 years. If the company gets sold leaving you without a job, insurance or retirement plan, start your own business.

Since it will probably not generate enough income to support your family for the first two or three years, take a minimum wage weekend job at a lumberyard and a nighttime clerical job. Devote your remaining waking hours to growing your business. After 10 or 15 years, if you work hard enough, it may just be successful.

Congratulations, in the minds of the “forgive my student loans” crowd you are now one of those heartless, evil rich people.

Many in my generation have followed this path. If you choose another way and find yourself unable to repay your student loans, get back with us. We will cry you a river.

Comments

Ron Holzwarth 3 years, 2 months ago

But, what if they don't want to work, and instead just get everything they want anyway?

Wadde 3 years, 2 months ago

What an propagandic comment; you can get an (income contingent plan and in ten years with faithful low payments due to your income base your loan debt will be forgiven..My loan debt is paid in 2007...

Richard Heckler 3 years, 2 months ago

Doesn't anyone think it odd that financial institutions were allowed to finance large to quite large amounts of money for a college education without collateral? Some of these loans are equal to the cost of a home. INVESTIGATE INVESTIGATE INVESTIGATE!

What about those that do want to work? If my memory serves me well the loan program under Bush/Cheney took on some changes such as higher interest rates which made it a serious for profit industry = scam on the students.

We paid off loans that my spouse took on without any problem whatsoever. Since that time college rates have increased significantly and no matter the increase the loans just keep coming.Without the demand for collateral..... very odd.

Doesn't anyone think it odd that financial institutions were allowed to finance large to quite large amounts of money for a college education without collateral?

This college loan industry became victim to the Bush/Cheney RINO party "Curious Loan Program" quite similar to their fraudulent and reckless "curious home loan" scams. Students in turn became victims of a program that did at one time work quite well. Students have been encouraged to seek this assistance based on what was known in the past.

FORGIVE 75% OF ALL COLLEGE LOANS!!!! INVESTIGATE INVESTIGATE INVESTIGATE!

George Lippencott 3 years, 2 months ago

merrill, I may be mistaken but for most college loans we are the collateral - they are government guaranteed

jlzack 3 years, 2 months ago

I have been working with the student loan program since 1986, they have not had collateral during any of this time. No credit check is ran since MOST students are right out of high school. The government does guarantee the student loan. As for the interest rates, they are & have been much lower than they were in the 80's. & 90's. The interest rate (at that time) on stafford loans ranged from 7 to 9% & parent plus loans were 12%.....
just pay back your student loans... all of it, you borrowed it, not me!

Ron Holzwarth 3 years, 2 months ago

It's my opinion that financial counseling should be required for anyone taking out a student loan. Far to many loans are given to students who have no idea of the possible consequences.

But there a problem in that many young people think older people don't know anything, so they either don't listen, or take wise advise seriously.

I wish I had been more aware of what I was getting myself into when I took out my student loans.

I am so glad I'm finally done with them, they were a big worry for many years.

countrygirl 3 years, 2 months ago

It's called entrance counseling and it's required for everyone who takes out a student loan. You even have to take a quiz to prove you read it. So the don't know the consequences doesn't fly.

Ron Holzwarth 3 years, 2 months ago

They didn't do that when I took out my loans, I wasn't aware that the policy has changed. That's good!

gl0ck0wn3r 3 years, 2 months ago

What exactly would you like as collateral for a student loan, Merrill? Very few 18 year olds have anything of any value. If financial institutions refused to loan to 18 year olds because of a lack of collateral, you'd be the first person screaming about how unfair that system was. If financial institutions required a parental cosigner and went after parental assets when a student failed to pay student loan obligations you would be the first to complain. So what system do you prefer? Refusing to provide loans for student education? Seizure of parental assets? You clearly don't want loans without collateral so I can only assume you want some variation of those two schemes.

jafs 3 years, 2 months ago

Actually, a parental co-signer isn't a bad idea.

gl0ck0wn3r 3 years, 2 months ago

On paper I understand how this might look good, but I think it might create more problems than it would solve. First, if financial institutions only loaned to 18 year olds who had cosigners with enough collateral to cover the debt there would be quite a few students who could not get loans. In short, you'd be ruling out all those first generation success stories. Anyone who has parents who rents or has significant debt wouldn't be able to get a loan. Second, imagine the public outcry if financial institutions began foreclosing on homes after students defaulted on loans?

Flap Doodle 3 years, 2 months ago

You see, that's how you can tell that merrill actually wrote something instead of doing copy/paste. The coherence level goes waaaaay down. (from a source from a source from a source)

ljwhirled 3 years, 2 months ago

It isn't fair to troll him for copy/paste then criticize when he actually writes something.

He (hopefully) wrote something original. Good on him.

Abdu Omar 3 years, 2 months ago

Forgiving student loans will probably crash the economy. The young who take them out have been given everything in their lives and it is time they learned "responsibility". Let them work two jobs and let them understand that life is not a freebie. Most people my age worked their way through school and were better for it. We didn't curl up on the sofa and want someone to pay our way. It is wrong to gift them. Let them earn it! They will be better for it.

BrianR 3 years, 2 months ago

So what you're saying is, me and my cohorts prospered during a different time so you whiners should be able to prosper during these times. I agree with the sentiment but your example makes no sense.

There were people who prospered during the great depression does that mean everyone else was wrong?

ljwhirled 3 years, 2 months ago

Steve built a computer company. Woz built the computer.

Just clarifying.

Ron Holzwarth 3 years, 2 months ago

"Aptitude tests should be made to determine what the lad is good at."

It's very odd that you used the term "lad" in that statement. That's a term that is in very common usage in Great Britain, and that's exactly how it's done there.

In Great Britain, if you don't show aptitude right out of high school for a college education that is highly subsidized, then efforts are made to select an education that will be a better choice for you.

The world needs welders, plumbers, electricians, and car mechanics too, and careers such as those examples should be given a lot more respect than they are in the USA today.

jlzack 3 years, 2 months ago

ibroke, You need to do your homework on this. The financial institution doesn't force any student to take out a student loan, nor do they determine the amount the student is eligible to receive. The Dept of Ed determines their EFC from the information on the student's FAFSA & the school determines their award package based off of that information. The gov't sets the maximum amount a student can receive.

George Lippencott 3 years, 2 months ago

The problem is the cost of the education that is up way more than inflation. The open ended loans make it possible for KU to increase costs at such a rapid rate because the students can borrow to attend. Propaganda noting that a college education returns more than the cost continues although a careful parsing will show that such a notion is no longer true in the general case. The result is large debt.

Once again greed- this time by educators - is a real problem. Paying college professors a living wage is fine. I am not sure they as an average they should be paid at almost double the average wage here in Kansas. I also note that about 20% of KU's income is from research yet the professors seem to be spending a lot more time on research than the income justifies. If we increased classroom hours for professors and reduced faculty we could afford to continue to pay more and the cost of education would decline in real terms.

Now, I guess the great debate that determined that everybody in the US should have a college degree must have occurred while I was in the war zone. In my time loans were available commercially without government guarantees. Government money was limited to career fields needed by the nation (engineering and science). Consequently, college attendance was much more limited. While I believe education is good as a general rule, I am not certain we can afford to pay to have everyone pursue a college degree - even in fields where there is little or no demand.

Loans are not the real problem. Open ended costs are. We have in excess of a trillion dollars in guaranteed student loans. Will the increasing default/forgiveness rate be the next great disaster impacting our shaky economy? Our elected leaders continue to be very free with our money.

situveux1 3 years, 2 months ago

+1

In addition, it's not just tuition that is the problem. A large part of cost is "student fees" which can also be paid with government loans. These are increased at a similar rate as tuition and are done so with student body approval. The cost isn't all tuition, students themselves are directly to blame for a significant part.

Ron Holzwarth 3 years, 2 months ago

"The problem is the cost of the education that is up way more than inflation."

Very, very true. One can hardly be emphatic enough about how true that statement is!

"the great debate that determined that everybody in the US should have a college degree must have occurred while I was in the war zone."

That's quite possibly true. More so than you might think. In fact, I don't think it was even a debate!

In 1971 or 1972, one of my English teachers in high school had a very emphatic statement that he made to the class about how stupid he though that one of President Lyndon Johnson's statements had been. The President had just made a speech about how the government of the USA should help everyone get a college degree.

I don't remember the exact phrasing my teacher used, but he was very angry about that. He claimed that not everyone wanted to go to college, and there were certainly many other career choices available.

I'm sure that part of the reason he talked to the whole class about that was to give some of his students assurance that their choice to not go to college was a very valid one. That high school teacher earned an excellent reputation, later became part of the high school administration, and I've had discussions about what a great teacher he was with one of the other LJWorld posters here that I personally know. That poster had him for a teacher too, and certainly learned a lot from him also. The only regret I have about him is that more high school students were not and are not exposed to such wonderful teachers that instructed on so many things that were not actually part of their assigned topic to teach.

"Loans are not the real problem. Open ended costs are."

Not just yes, but hell yes!

"Will the increasing default/forgiveness rate be the next great disaster impacting our shaky economy?"

I hate to be the one to break the news to you, but others have noted that also. And, some of them were prominent economists!

George Lippencott 3 years, 2 months ago

I wish I could claim original thought but ....

somedude20 3 years, 2 months ago

I know a few people who take the loans but only a small part of it goes to cover schooling rather they use it to pay rent, get beer, go to the movies and buy most of what they want. They are using loans to cover costs that a JOB would pay for and for that alone, I think they should pay back what they take. I worked while going to college as many do. Is working and going to school fun? No. Do you have less free time while working and going to school? Yes. Is it more stressful to work while going to school? Yes. Can it be done? Yes. You took the money, you pay it back!

Phil Minkin 3 years, 2 months ago

I can understand forgiving a college loan if the borrower commits to teaching, practicing law or medicine or some other profession in high poverty or undeserved area of the country. The LTE writer may have been a fabulous teacher that was lost to society.

Peacemaker452 3 years, 2 months ago

Lawyers should have to pay back double their loan balance considering what their proffesion costs society. :)

akt2 3 years, 2 months ago

With all the out of work adults going back to school, they will be making student loan payments into their 60's and possibly beyond. I wonder if the govt can add Dementia, Self Care Deficits, and Debility clauses for loans to be excused. These "students" will have the choice of paying on their loan or buying their prescription meds and eating. Will they garnish the Social Security checks on top of that?

kugrad 3 years, 2 months ago

I took out student loans, quite a few. That and 2-3 jobs helped me get through college and earn a Masters. The interest rate is low. I wouldn't think of asking everyone else to pick up the tab for me; I'm grateful I was able to get those loans. If you took out loans beyond books and tuitions instead of working a job to pay for housing and food, that wasn't real great planning on your part. Don't ask me to pay for it. I won't ask you to pay off my loans. Student loans are great, but they are a hand up not a hand out.

tomatogrower 3 years, 2 months ago

How much was tuition when you went to school? Any idea how much it is now?

Tammy Yergey 3 years, 2 months ago

How about only letting students take out student loans if they are getting degrees in something that may actually get them a decent paying wage? I graduated over 20 years ago, and even then, I would have friends that got degrees in European Art History, or something vague like that, and I would ask them, "so what are you going to do with a degree in Art History?" But nowdays, with the job market as bleak as it is, those fun/interesting degrees just really aren't worth the investment. And odds are, a decent-paying job will not come with the degree.

Richard Heckler 3 years, 2 months ago

I love copy paste because it is soooooo efficient ,presents the source so eloquently and spin free of me .... just the facts.

Are students during counseling advised that in fact USA jobs are going abroad by the millions so don't expect too much after graduation? But enroll and bring big bucks to campus this is big business.

When millions upon millions upon millions upon millions of jobs are lost due to the impact of two republican admin home loan fraud schemes how are grads to find employment?

When millions upon millions upon millions upon millions of jobs are lost due to the impact of of merger mania,hostile takeovers and leveraged buyouts during those Reagan/Bush years how are grads to find employment?

When millions upon millions upon millions upon millions of jobs are lost due to the impact of of Free Trade Agreements WITHOUT VOTER APPROVAL how are grads to find employment?

Considering all of the above in addition to the fact that those jobs went abroad and zero new industry to create new employment plus match wage levels lost how in the world is a grad to find employment?

Considering many many grads never find employment in their areas of expertise why the hell go to college? Seems to me they would far better off attending JCCC or Vo-Tech to learn a valuable skill for a whole lot less money.

Sometimes after reading comments it appears as though Lawrence,Kansas has become a glass house. 20 million without full time employment = hundreds of applications per job opening.

Richard Heckler 3 years, 2 months ago

"How about only letting students take out student loans if they are getting degrees in something that may actually get them a decent paying wage?"

Number one there are not that many jobs available

Number two that would give the real estate industry/Chamber of Commerce heart failure.

Number three Lawrence,Kansas would be filing bankruptcy because there are not enough wealthy people to pay the bills as all others would be unemployed.

Yes Lawrence,Kansas and the over priced housing would suddenly become an endangered species. Up in smoke...

Richard Heckler 3 years, 2 months ago

Actually forgiving college loans would not necessarily be bad for the economy:

  1. it would improve credit ratings
  2. it would allow more expendable cash into the economy
  3. it then might allow for some of the millions of foreclosed homes be bought
  4. it would promote economic growth
  5. with economic growth comes more new jobs
  6. with economic growth comes new small business opportunity

Go for 75% forgiveness on some and 100% based on current income situation

Forgive College Loans and end the 5 or more military campaigns( Bring the Troops home and fire the USA mercenaries)

George Lippencott 3 years, 2 months ago

merrill how does that work. If we forgive the loans the feds will have to cover the guarentee. That would mean anothere trillion in taxes. That would further depress consumption. That would cause more job loses. Somebody dug this hole - perhaps we should find out who and ask them to pay.

Flap Doodle 3 years, 2 months ago

George, the dude has found a slogan and will keep repeating it as long as there is breath in his body. The fact that what he's advocating would be ruinous doesn't phase him at all.

Mike Ford 3 years, 2 months ago

My late mother got a loan for her masters in Library Science along with her Elementary Ed degree from KSU. She taught in this area and taught in Emporia until selfish republicans didn't pass a LOB and my mom's 8 years of teaching and library work and a masters degree was something republicans in Emporia didn't want to pay for. $33k to $9k in a year. My mother taught in an at risk district out of state until her death. The Dubya administration fiddled around on my mom's student loan payments even after she taught for a time through two hurricanes in said bad district. I got my moms masters degree loan debt forgiven after she died. Republicans don't support education regardless of what they say....they want everyone home schooled...paranoid....vouchered....and christian.... this system doesn't work....ask the numerous American Indians forcibly taken to said government boarding schools ran by Catholics, Baptists, Episcopals, and Methodists into the 1960's.

George Lippencott 3 years, 2 months ago

"Republicans don't support education regardless of what they say....they want everyone home schooled...paranoid....vouchered"

Do you have a source for this assertion?

gl0ck0wn3r 3 years, 2 months ago

blah blah blah random semi-coherent comments about racism against American Indians blah blah blah

tomatogrower 3 years, 2 months ago

Dear Mr. Hamon, When you got your education, you could usually work and pay as you go, because tax payers were paying for the college. When you went to school, you weren't paying triple the amount for your basic living expenses. When I was young I was making $10/hour, rented a house, not an apartment, bought a new car. This was in the 80's. I know a lot of young people who would love to make $10/hour. Of course, when I was young we had a lot more companies who cared about the country. I'm glad you grew up in a time when our country had companies who cared. I'm also glad you wimped out on teaching. I certainly wouldn't want you teaching the youth that money is more important. They get enough of that from the stupid reality shows.

George Lippencott 3 years, 2 months ago

Why are you blaming companies fror an action by our political leadership??

bearded_gnome 3 years, 2 months ago

Many in my generation have followed this path. If you choose another way and find yourself unable to repay your student loans, get back with us. We will cry you a river.

---very good Mr. Hamon, tip of the hat to you. according to the envy/obama economics proponents, if you earn more than $250,000, you are rich! lol!

Mixolydian 3 years, 2 months ago

...and if you make $516,000 a year you're one of the evil 1 percenters, you know, like Roseanne Barr and Michael Moore.

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