Ideas proposed only ensure the corruption continues in the student loan industry.
The $1.7 trillion of student loan debt is an economic disaster for our nation but the solutions proposed by President-elect Biden and his senate supporters fall well short of lasting, legitimate solutions. In summary, the plans are to give X amount of money ($10,000+), to student borrowers who meet X qualifications (where they attended school, how much their families make, minority or displaced population, etc.), and all of this only applicable to undergraduate degrees.
“Without addressing the multiple issues that caused the $1.7 trillion dollar student debt crisis, the solutions proposed by Biden, Senators Schumer and Warren, do little to help the American people,” said Alan Yeck, Founder and Executive Director of AltRaged. “The government, both Democrats and Republicans created this mess – not the students. Congress started this crisis fifty years ago through changes in the bankruptcy code and multiple changes in the Higher Education Act.” There are simple, but key steps that have to be put in place for a lasting fix.
The disgraceful costs of higher education must be reined in
There is no reason a bachelor’s degree at a state institution should cost $40-50,000. Like a black hole in space where gravity’s pull is so strong that even light cannot escape, fiscal mismanagement and lack of leadership in higher education have created a system that will devour every dollar, and then immediately look for more. The costs are not reflective of markets or student’s abilities to repay. The government solution of throwing money at the problem, without accountability by higher education only benefits the massive, corrupt student loan collection industry.
Full bankruptcy rights must be restored to student loan borrowers
The Student Borrower Bankruptcy Relief Act (H.R. 2648), if passed, would remove the section of the bankruptcy code that currently prevents student loans from being treated the same as other non-criminal debt (as it used to be before Congress changed the code, which removed the safety valve for the cost of higher education). Schools charge phenomenal tuition and fees knowing the government will loan the money, and the loan “servicers” know the students and parents are then trapped. Wage garnishment, social security garnishment, tax return garnishment, and estate seizures for private loans; it is a lifelong, true debtors prison our elected officials continue to protect because of the payouts to their campaigns from Super PACs, both red and blue.
Cancellation by the executive branch
There is an ongoing discussion that the executive branch has the authority to instruct the Secretary of Education to cancel student loans, without the approval of congress. But as is the case with all political rhetoric, the devil is in the details and there’s plenty of evil in this system. If he does, Biden would most likely also make those cancellations conditional to only certain groups, degrees, and dollar amounts – similar to their previous restrictions. This again leaves millions of borrowers abandoned to the collection wolves.
Student loan reform
Beyond fixing the cost of education, beyond restoring bankruptcy, beyond cancelling all student debt, the entire student loan system needs to be reformed and the outsourcing to the loan servicers eliminated. There are millions of Americans who owe more than $100,000 because of fraudulent interest, penalties and lies. It is impossible to ever pay these off and without bankruptcy relief, the loan “servicers” will garnish until death. The lives of millions of Americans in similar situations are being destroyed because Washington appears to only address selective issues with this crisis. There is zero accountability and it affects the future of our country for all citizens.
Yeck continued, “It’s the biggest scam the U.S. Government ever pulled on the American people. Governmental loan sharking enforced with judicial muscle. The mob wishes they ever had it so good.”
#altraged #studentloandebt #studentloancrisis