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#309926 - 12/18/18 04:43 AM Why Record $1.465 Trillion Student Debt Could Test U.S. Economy
NW Ponderer Offline
Moderator
Carpal Tunnel

Registered: 09/09/11
Posts: 17220
Why Record $1.465 Trillion Student Debt Could Test U.S. Economy (Fortune)
Quote:
U.S. student loan debt outstanding reached a record $1.465 trillion last month and one particular set of borrowers is having a hard time paying back their loans, according to a Bloomberg analysis of student loan securitization data. This debt is raising fiscal risks.

“Over 90% of student loans are guaranteed by the U.S. Department of Education, meaning that if a recession causes a rise in youth unemployment and triggers mass defaults, this contingent liability could prove burdensome for the U.S. government budget,” said Paul Della Guardia, economist at the Institute of International Finance in emailed comments.

The record student debt level is more than double the $675 billion outstanding in June 2009 when the recession ended.
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A well reasoned argument is like a diamond: impervious to corruption and crystal clear - and infinitely rarer.

Here, as elsewhere, people are outraged at what feels like a rigged game -- an economy that won't respond, a democracy that won't listen, and a financial sector that holds all the cards. - Robert Reich

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#309938 - 12/18/18 11:10 PM Re: Why Record $1.465 Trillion Student Debt Could Test U.S. Economy [Re: NW Ponderer]
jgw Offline
enthusiast

Registered: 05/22/06
Posts: 2766
Loc: Port Angeles, WA
The simple fact is that these student loans are a disaster anyway you look at them. I know of one heart specialist that moved to Canada and simply gave up trying to pay back the loan. She paid 100,000.00 and didn't even touch the interest which was, basically, a loan with twice the interest rate that banks normally charged. Then there are the for profit so called 'universities" that teach nothing just take the student loan money and then let the debtors swing in the wind. Obama tried to deal with this one but the current administration reinstalled existing debts incurred by people trying to get ahead but, instead, have a debt that cannot be bankrupted out of, never forgiven, you know, a debt that somebody will get to live with their entire life!

Given that these debts now, basically, represent at least 1 and probably 2 generations of possibly educated with high interest loans that are, as far as I can tell, never going to be paid off. The current administration has done a wonderful job creating a bunch of foreigners who will hate the United States, now add in an entire generation of debtors who are also a bit miffed with the United States government for wrecking them too.

Now add in the elderly without any healthcare because the current administration decided to shut down medicare at the rate of 10 billion a year until its finished (about 8 more years)

Its going to be a miracle if we go another 20 years without a LOT of blood on the streets.

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#309977 - 12/22/18 01:49 PM Re: Why Record $1.465 Trillion Student Debt Could Test U.S. Economy [Re: NW Ponderer]
chunkstyle Offline
enthusiast

Registered: 10/02/07
Posts: 2045
The contradictions do seem to be stacking up now aren't they JGW?
My observation is the current social, political and economic order is floundering. Enriching a few but diminishing most to do it.
Here in New York we got us a deal to provide a multi billionaire a big shiny building and tax abatements but can't find the money to meet its state school funding commitments.
What I like about the student debt is how it targets and diminishes the credentialed class the most. That's the current class the Democratic Party caters to, having abandoned working class and poor decades ago. The contradictions might just become evident to even this constituent crowd as it pits their interests against their own preferred political party. A party that has been well funded by the debt industry during campaigns. It may just shake them out of their indifference to or tacit support for a party that has become ineffectual to meeting needs of a majority of Americans but highly effective at serving its donor class.


Edited by chunkstyle (12/23/18 06:40 PM)

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