Blogs For Victory

Just astounding how bad this has become:

When Michelle Bisutti, a 41-year-old family practitioner in Columbus, Ohio, finished medical school in 2003, her student-loan debt amounted to roughly $250,000. Since then, it has ballooned to $555,000.

It is the result of her deferring loan payments while she completed her residency, default charges and relentlessly compounding interest rates. Among the charges: a single $53,870 fee for when her loan was turned over to a collection agency.

“Maybe half of it was my fault because I didn’t look at the fine print,” Dr. Bisutti says. “But this is just outrageous now.”

As the article goes on to note, this is an extreme case but the bottom line, as I see it, is that the student loan program is a scam which benefits banks and colleges and needlessly burdens the kids. By having easy student loans, a teen or twenties kid can get in to college and its just a breeze – don’t have to pay until after you graduate. This is just ripe for our most inexperienced people to get themselves in a jam.

We recently passed a law putting protections against predatory lending to the young. It doesn’t apply to student loans, as far as I can see. Why? Because bankers who can lobby and colleges/universities who can lobby like things just the way they are. The student loan program is a no-brainer for banks as they are sure to get their money and its a bonanza for colleges because it allows them to continually jack up tuition all out of proportion to the actual costs of education.

In case you didn’t know, the curious thing about student loans is that you can’t get out of them. Ever. No amount of time or filing of bankruptcy will get rid of that debt. This provision was put in because some years back kids were taking the loans and then defaulting – including kids who could well afford to pay, such as doctors and lawyers. By making the change we converted what had been a giveaway to the kids in to a giveaway to the colleges and banks. The ultimate problem is, of course, the giveaway aspect.

It is time to end student loans. Kids will have to get grants or scholarships or just work their way through college. They’ll have to avail themselves of community colleges and, maybe, take 5 or 6 years to achieve a bachelors. Colleges just might have to bring tuition in line with reality. And maybe have a few less tenured professors. And maybe one or two less “Feminist Studies” or other nonsense offerings.

It is unfair to burden kids with massive debt. It is disgusting to enrich bankers and colleges on the backs of kids and the American taxpayer. It is enervating to a free society that someone can go to school without having to immediately sacrifice for it. This is just one of a dozen things where we need to get back to basics: nothing is free and rewards only come from hard work.