You went to college to find yourself, well now you have to pay up.

As the college debt bubble balloons to unsustainable proportions, and as more and more college graduates belatedly discover that a seemingly reasonable choice of degree is no longer a ticket to a good job or even a career, there are increasing calls for college debt to be “forgiven”. Of course, debt cannot disappear; someone always has to pay. Usually either the debtor pays or the creditor pays, but when you hear calls for debt to be forgiven, forgotten, and thrown on the scrapheap, what this inevitably means is that the taxpayer will have to pay.

Taxpayers coughing up the money for other people’s mistakes is now a feature not a bug of our modern crony capitalist world. Six months after completion of the Opal Tower apartment block in Sydney, large cracks appeared in the building forcing all residents to temporarily move out. This made headlines in Australia and in short order there were calls for the government to come to the rescue. And by government they mean the taxpayer.

The NSW government may be on the hook for millions of dollars to fix the cracks and defects in Sydney’s damaged Opal Tower because of a law that exposes it to legal action as owner of the land.

While NSW Premier Gladys Berejiklian has “wholeheartedly” encouraged Opal Tower’s residents to take “every legal opportunity they have”, The Australian can reveal that her government’s own Sydney Olympic Park Authority, and not Ecove — the company that developed the land into Opal Tower — could be sued by apartment owners because of changes in building warranty laws designed to close a loophole.

Stupid MPs with no real world experience passing laws that they don’t understand. The standard path for politicians these days is to study law at university and then suck up to their local member until they too get parachuted into a nice fat pre-selection deal. But all that studying at university has a cost. Wouldn’t it be nice if lawyers could apply to have their student loan debt cancelled?

Well in the USA they can.

One-quarter of American workers were expected to be eligible for the program, which allows certain not-for-profit and government employees to have their federal student loans forgiven after 10 years.

How about that? Score yourself a safe and cushy job in the public service and you too can have your student loan cancelled! I wonder what type of professions have been given this luxury?

Matt Tremel

Saxophonist, U.S. Navy

The Education Department forgave Tremel’s $14,000 in student debt earlier this year. “I was ecstatic,” he said.

You have got to be fucking kidding me.

Trevor Milliron

Professor, Lee University

Getting his more than $135,000 in student debt forgiven this year felt as good as getting his Ph.D. two decades ago, Milliron said. “My wife and I cried,” he said.

135 big ones? I’m sure the prick cried. And then he went back to his job of helping to trap thousands of other people in the same situation that he himself was gifted out of. I wonder what he teaches …

Psychology. Let’s check out some of the student ratings on the good prof.

Dr. Milliron is great! His class is literally the easiest class I think I have ever had, in college and in high school. You watch videos he posts to moodle and then take 5 questions quizzes over them the next lecture. No readings, no essays, and no final! Highly recommended.

The easiest class that they ever had, even in high school. Who says that higher education is dead? Sounds like a blast to me.

Literally the easiest class I’ve ever taken. No tests or exams. All we had to do was take a five minute quiz on this app in class over a video(s) we had to watch the night before. He doesn’t respond to emails and seems nice but is kind of rude face to face.

I wonder how much students at this university are paying for this momentous level of education? It looks like the base cost for the 4 year course is around $72K. But when you add up all of the other costs I reckon that it’s going to be entering eye watering territory. And there are so many jobs going for psych majors these days, right? Particularly when they graduate from a course which is literally the easiest ever. Way to go professor Milliron!

man who cries when his college debt is forgiven and who studiously avoids doing deadlifts …

There’s another college professor on the list as well as a lawyer. Shocking, isn’t it?

Even more hilarious are the reasons to the positive given on this debate site on the question on whether student debt should be forgiven. After all, it’s only $1.5 trillion. The pro-forgivers all have the same essential argument – it will be good for the economy!

It will help the economy.

We are going through rough economic times. Forgiving student loan debt will help increase economic consumption by young people and spur economic growth. Think of forgiving all student loan debt as a stimulus.

The poor dear has fallen for the Keynesian lie that demand creates supply. You cannot spend your way out of an economic malaise. In other words, aggregate demand does not make an economy grow. The reverse is true; supply creates its own demand. Far from helping the economy, debt forgiveness on this scale will probably scuttle it. An economy grows by investment and production. The final piece of the puzzle is that which is produced must also be sold. Just where does this individual think that these young people with the forgiven debt are going to find the money to increase their economic consumption? Do jobs appear magically, (well, if you ask politicians they do because apparently politicians create jobs).

These young people will find jobs due to investors investing their money in future production and entrepreneurs taking the risks necessary to grow their businesses. But the financial crisis that will result if $1.5 trillion is thrown out the window doesn’t bare thinking about. The associated increase in taxes will shrink the available money for private investors to grow the economy.

And the people being taxed will be those who didn’t go to college to find themselves when they were 18 but instead went out and found a job. Bit by bit they improved themselves and they earned more money. Perhaps they took risks and started a small business which meant that they probably worked for free for the first few years. They saved their money and worked hard. They certainly didn’t take classes from some nitwit professor whose courses sound so easy that a geriatric wombat would probably pass. Young people who go to college and who agree to these outlandish sums are privileged. And yet they are demanding that the average taxpayer who never had their advantages should cough up the dosh.

If a small business owner’s taxes go up to pay for your college experience then that small business owner will have less money to invest in his business. So he doesn’t begin that new expansion that he planned and which would have created a few dozen new jobs. The future jobs that you college graduates were planning on having so that you could “stimulate the economy”.

There’s no such thing as a free lunch.

 

 

15 thoughts on “You went to college to find yourself, well now you have to pay up.

  1. TechieDude

    Cappy had something about this…
    https://captaincapitalism.blogspot.com/2019/02/amanda-lawson-ross-doesnt-know-how.html

    There are a few rules, and whatnot. And it’s ten years. A lot happens in ten years, especially if you are female. You pretty much are indenturing yourself to that gig. I seem to recall a recent firestorm of outrage at the Donald contemplating ending this program.

    My oldest is a teacher and asked me about this. I said stay away, treat your college loans as a car loan. (She only had 12K left). What did she do? Lived like a college student for a year or two, pounded the note away. With the discipline she learned, bought a new car, and quickly paid it off.

    She was a catch. Traditional, debt free with a big fat savings account and a frugality that is almost unheard of this day.

    My youngest was not…

    “And then he went back to his job of helping to trap thousands of other people in the same situation that he himself was gifted out of.”

    Being intelligent, talented, and hard working, my youngest got loads of scholarships and grants to nearly everywhere she applied. The two best were private schools here in TX. But she wanted probably the last one I’d have picked. It was a very liberal school in Ohio. We argued quite a bit about it. The only point she had that made sense was that the two TX schools focused on music education, and she didn’t want to teach. Fair enough. I don’t understand the classical music business. Apparently reputation and who you know determines your fate.

    But what rankled me was her high school teachers (just like the professor above) were all behind her. In their 40’s, deep in debt, lucky as hell to have a school system pension to fall back on, they told her it was so worth it. Only just recently, after she graduated, did one of them admit that it crimped their lifestyle.

    She auditioned for a Navy gig, like the dude above. Pigheaded as hell, she wouldn’t listen to me telling her “But you’re in the Navy. They own your ass. Shit goes down, and you’ll find yourself somewhere you don’t want to be. Probably working in a supply depot. And it’s not just 4 years, there’s a term of inactive reserve after”

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  2. purge187

    “’My wife and I cried,’ he said.”

    I’m sure there were times when I wanted to cry when I realized that I was going to be living with my parents for over a decade paying off loans for a college education that didn’t get me diddly-squat. Must he nice.

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  3. While I’m not a fan of the 10 year forgiveness program in the least, the fact that student loans are pretty much the only debt you can’t get rid of in bankruptcy is ridiculous. 18 year olds are stupid, the government should not be encouraging them to take out 200k in “free” money. Especially when they don’t understand compound interest and the severity of the debt. No other business would lend someone 100k to become a pysch major. I have no student loan debt and I think my lucky stars every day.

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  4. Dave

    In Victoria (Oz), through the 80’s and 90’s I remember most prominent politicians were former real-estate agents, every fuck-up they made had to be bailed out by either a levy on our petrol or some other means such as temporary increases in stamp duty.

    Re uni debt, I’ve observed a change in post-grad education at Monash over the last 30 years…. when I did my first post-grad course at Monash back in the early 90s and then another in the late 90s 99% of the class size for each subject was comprised of local whites. In the teen 2000’s I was the only white when I went back again – it’s like local whites no longer seem to bother with post-grad studies (not wanting the debt? or priced out?) – it’s all foreigners now.

    Re that Opal building, seriously, who would want to live in a thing like that…. other than foreigners and white limp-wrists… who the hell would want to live in something where the only real means of escape in an emergency involves jumping out of a window to your death. Give me my land out in the country any day.

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  5. Cappy understands some economics, but he’s an idiot on this topic because he doesn’t understand the modern monetary system, or modern debt creation and destruction. And no, taxpayers don’t end up paying when their loans are cancelled/forgiven.

    The “student loans” were created out of thin air, by making an accounting entry in the books. They can be “cancelled” by reversing that accounting entry.

    https://verisoeconomica.wordpress.com/2017/12/06/how-to-solve-the-student-loan-crisis/

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    1. Dave

      Well not exactly – if you think the universities involved are going to see their accounts suddenly written down by the amounts student owe I’d argue you are wrong, the universities still keep their credit gains. These loans…. aka promises to pay get shifted in terms of responsibility from those students to another sucker.

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    2. So the costs that the students incurred also came out of thin air as well I imagine. Things like food, board, books, staff wages, the list goes on. All of these are paid for by thin air. How fascinating.

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  6. JohnC

    The funny thing is that if the debt forgiveness happens for student loans then it would destroy lenders (for one thing making small business harder to start), pension system destroy, forever harm the worth of a uni degree (no better than high school), and turn the students into more rabbit like. It would be like a new drug high, a hit of cocaine if you like and the crash would as great and permanently damaging especially for the millennial generations (more so then now). If student loans on the other hand continue and get more ridiculous then going to uni will cut the genes of those that go and do silly subjects. Over time it will also help bring back some gender balanced, making women more feminine since you can not just go to uni and get a job in corporate pretending that you are worth more there than at home making babies.

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  7. Dan F

    The Australian university system is very different from the USA.
    My HECS debt for a four-year social work degree was $19,000 which I paid off years ago and have been paying tax ever since.
    University students usually get jobs, earn money and purchase goods from small businesses. They’re all connected.

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      1. Dan F

        ‘In 2019, the annual student contribution amount (tuition fee) you will pay for a standard year of full-time study is between AU$6,566 to AU$10,958*’
        https://www.rmit.edu.au/study-with-us/levels-of-study/undergraduate-study/honours-degrees/bachelor-of-social-work-honours-bh105

        So for a standard four-year social work degree that’s $26,264 to $43,832 depending upon elective subjects I guess. The HECS repayment system in Australia is also vastly different to the student loans system in the USA. You really can’t make sweeping statements about university education using the USA as an example. Their system is shite.

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  8. PB

    The teaching style of the Dr Millirons of this world is what has led us to to the Ocasio-Cortez’s of this world having a political profile instead being back tending the bar where they belong.

    Like

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