The fact that the debate has remained on this topic is exactly the political division desired.
It’s correct that the relief will do nothing to solve the overall problem.
It’s also correct that it’s an unabashed vote buying scam that probably shouldn’t even be legal.
But it’s also correct that the student loan structure is truly predatory.
This entire conversation needs to shift from paid relief to “0% interest student loans” or fixed interest (borrow 100k and you will pay back 130k) and/or a pre-income tax option to pay back loans faster akin to a 401k.
The way that interest builds on deferrals for these unforgivable loans is truly nuts based on the people I’ve talked to. Unless there’s a permanent way to do that, it’s all political theater.
I'm not sure 0% interest really helps when (prospective) students still have the ability to borrow an unlimited amount of dollars. The current crisis is caused by colleges raising tuition to maximum amount that students are able to pay, which is essentially only limited by how much they are allowed borrow.
What I would like to see is:
1. Federal student loans capped at $XX,000 per semester, disbursed directly to school.
2. If the school accepts federal loans for any student, then tuition and fees are capped for all students at $YY,000 per semester (where YY is a small multiplier on XX, maybe 1.25).
3. Interest capped at a "reasonable" amount. This might mean simple (non-compounding) interest, or non-accrual of interest while loans are deferred, or something else.
4. Private loans should be dischargeable in bankruptcy after 10 to 15 years.
It’s correct that the relief will do nothing to solve the overall problem.
It’s also correct that it’s an unabashed vote buying scam that probably shouldn’t even be legal.
But it’s also correct that the student loan structure is truly predatory.
This entire conversation needs to shift from paid relief to “0% interest student loans” or fixed interest (borrow 100k and you will pay back 130k) and/or a pre-income tax option to pay back loans faster akin to a 401k.
The way that interest builds on deferrals for these unforgivable loans is truly nuts based on the people I’ve talked to. Unless there’s a permanent way to do that, it’s all political theater.