US Will Have to Write Off Billions in Student Debt Due to Deaths
bloomberg.com
bloomberg.com
Well...there is another way.....
My point is that this has changed and wasn't always the case.
50-year-olds are 6x more likely to die than 20-year olds. [1]
And while I don't have a citation.....it's not a stretch to say 50-year-olds have less student debt.
Rentier economics throughout the economy are crippling the working class and feeding the rentiers.
People finance their cars, their education, their music, healthcare, phones, laptops, just about any major appliance. You can even finance your food!
What exactly are you getting for your tax dollars?
It used to be the case that you could realistically save up money to buy a car or whatever. These days, so many people are living paycheck to paycheck that they can't afford assets at all, and forget about home ownership or other kinds of equity. Some may be lucky enough to have a 401k with an employer match, but without the latter I see why many people prioritize immediate survival over long-term financial planning.
We are no longer living fulfilling lives but going about lining the pockets of landlords and rent-seekers.
The problem is people going into debt for credential-granting schools that are becoming more expensive while simultaneously becoming less correlated with education.
It's also the case that back in the 80s, the elite ultra-expensive schools did not offer generous financial aid like they do now, so middle class kids had to pay themselves.
I was aggressively paying them off before COVID.
I was able to pay my loans off in about 7 years but mainly because I lived with my girlfriend (now wife) and we shared expenses. Point is, yes the balances are higher now but so are the salaries. The average student with my degree from my school makes about $80k to start now, so if they have $60k in loans, we are in similar situations.
So many backflips through flaming hoops when allowing bankruptcy to discharge loans would solve it all in one fell swoop. Universities donating millions and millions to political candidates would never want this golden goose to be culled though. Creating debt slaves is good for business. All business. Good for the military too, in fact, and good for calling citizens lazy and entitled to justify bringing in more and more H1Bs working for less than their position is worth.
The more you dig the more it feels like a giant conspiracy. I am not pro "forgiveness" in the mainstream sense of the term. I am absolutely for no-fault, no question bankruptcy that eliminates the debt entirely. This would punish the lenders, punish the schools, and punish the government for their absolutely moronic decisions.
https://www.scotusblog.com/2023/06/supreme-court-strikes-dow...
It was struck down because not because the circumstances (emergency) was not met, but rather because the action itself was not allowed.
> The HEROES Act, Roberts emphasized, gives the secretary of education the power to “waive or modify”...“modify” means that the Biden administration can make “modest adjustments and additions to existing provisions...Roberts stressed, instead “created a novel and fundamentally different loan forgiveness program.”...Roberts suggested, “only in the same sense that the French Revolution ‘modified’ the status of the French nobility — it has abolished them and supplanted them with a new regime entirely.”
This would be an interesting article if the headline included an actual dollar amount that pointed out the excess write off due to deaths. This would be trivial for any actuary to calculate.
> The Government expects that around 27% of full-time undergraduates starting in 2022/23 will repay them in full
https://commonslibrary.parliament.uk/research-briefings/sn01....
Doesn't seem like the most accurate way to do that.
> The US government will have to write off billions of dollars of student loans from borrowers who died during the pandemic, adding another complication to a system ill-equipped to handle the resumption of payments this fall.
Wait so we're just talking about borrows who died during the pandemic. I get that a lot of people died during the pandemic bust most of them fell into the category of people who were substantially older, and as consequence are least likely to be paying back on student loans, as those usually are paid off earlier in life. Especially since most of these people would've had much smaller loans.
> The calculation to arrive at the lost revenues is twofold. First, Bloomberg asked economists and demographers to estimate how many borrowers died during the forbearance period. Loan holders skew older now than before the pause and thus have a higher probability of dying.
Again I'm going to guess many of those paying student loans skew younger (<40) and thus 2 years probably doesn't change their mortality rate all that much.
Seems to me like the whole article was designed more for clickbait than any rigorous analysis.
1. (hard part) Establish a new university
2. Charge high prices for worthless degrees
3. Government provides the loans
4. People die in debt or just keep paying (they're out of your hands at this point so you don't care that much)
Net result is that you can get a taxpayer subsidy which you can roll into a non-profit. An interesting side effect is that because you're teaching junk like Divinity at Columbia and stuff, the people don't really learn any reasoning skills and so they'll go out there and say that the government should forgive student debt and pay for college for people. I don't think that part was planned. That was just accidental and beneficial.
Honestly, that step 1 is really hard, and I think there's some trouble with step 2 as well, but you can get there. I think, if things don't change in the next 10 years, I'll try a startup that does this. I think there's a way to organize the spending such that you benefit a VC's portfolio through the non-profit university's spending thereby making it a strong investment even if it won't actually get you an exit.
Essentially you just tax arbitrage government dollars into hiring your for-profit companies as vendors.