Tuesday, October 22, 2019

Solving Student Debt


A new idea called "income share agreements" could help solve the student debt crisis.





Student loan debt keeps growing! President Obama blamed that on greedy bankers -- "unnecessary middle men". Senators said they'd fix things. “Take the banker out of the picture, because they’re taking a profit!” shouted Sen. Durbin. He and Obama got their way, and the government took over student loans in 2010. President Obama promised “We’ll save American taxpayers 68 billion dollars." But the government takeover didn’t save tax money. Student debt just kept rising. Part of the problem is that cheap government loans invite students to take on debt without even thinking about whether they will earn enough money to pay it back. Democratic Presidential frontrunner Elizabeth Warren wants to solve the massive student debt problem by having government forgive nearly all of it. That'd cost taxpayers a massive $1.25 trillion. A better solution, says Beth Akers, author of "Game of Loans" and a Senior Fellow at The Manhattan Institute, is something called an ISA: an "Income Share Agreement". ISAs mean, instead of incurring loan debt, students agree to pay a percentage of their FUTURE income. "The ISA is a way for the school to say to [a student], 'you're only going to pay us if we help you succeed,'" Akers explains. Private computer coding boot-camps already do that. Now universities are experimenting with ISAs. A big benefit is that the lenders have skin in the game -- they care about being paid back. They guide students to higher paying careers, and warn them that some majors probably won’t lead to jobs that pay as well. At Purdue University, English majors with a $10,000 ISA loan must pay, after graduation, 4.58% of their income for 116 months. Math majors pay less--3.96% for 96 months. The difference, of course, is because students majoring in math are expected to earn more; investors expect they'll need less time to recoup their investment. Two students with ISAs told me they much prefer ISAs to debt. "It is a win-win situation for everyone involved in it,” said Purdue graduate Andrew Hoyler, who's just started working as a pilot. "We don't know who the investor is, but I'd love to give him a hug or buy him a beer or something," Engineering student Paul Laurora added. Still, some people say ISAs are unfair. A Vice headline called them “indentured servitude." I told Laurora and Hoyler what some critics say: "You're locked into paying all these months." "If you're graduating and you don't have a job, you're not paying anything! Where's the servitude in that?" Paul asked. Good point. I hope ISAs will lead to less debt and more responsible college decisions.











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“Control oil and you control nations; control food and you control the people.” Henry Kissinger


once a standing army is established, in any country, the people lose their liberty.”
George Mason

“Military men are dumb, stupid animals to be used as pawns for foreign policy.”
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“If you are an ordinary person, then you can prepare yourself for war by moving to the countryside and building a farm, but you must take guns with you, as the hordes of starving will be roaming. Also, even though the elite will have their safe havens and specialist shelters, they must be just as careful during the war as the ordinary civilians, because their shelters can still be compromised.”
Henry Kissinger

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The people who cast the votes decide nothing. The people who count the votes decide everything.
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Governments keep a lot of secrets from their people . . .
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“Some call it Communism, I call it Judaism.”

Rabbi Stephen Weiss

“Anti-Communism is Anti-Semitism.”
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The Tax you pay is The Bill for Staying Stupid

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The few who understand the system will either be so interested in its profits or so dependent on its favours that there will be no opposition from that class, while on the other hand, the great body of the people mentally incapable of comprehending the tremendous advantage that capital derives from the system will bear its burdens without complaint and perhaps without even suspecting that the system is inimical to their interests.
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"First they came for the Socialists, and I did not speak out--
Because I was not a Socialist.

Then they came for the Trade Unionists, and I did not speak out--
Because I was not a Trade Unionist.
Then they came for the Jews, and I did not speak out--
Because I was not a Jew.
Then they came for me--and there was no one left to speak for me." UNKNOWN