Posted On: Wednesday - March 3rd 2021 6:11PM MST
In Topics:   University  Global Financial Stupidity  Economics  Zhou Bai Dien
Note: This school loan business is really domestic financial stupidity rather than Global Financial Stupidity. However, the financial stupidity going on is pretty much global is scope (the government of China, for example, performs many of the same acts of stupidity as does the US Feral Gov't), and, well, you work with the Topic Key you have, or something...
The 2 headlines above give us the gist of the University Student Loan problem in this country. It's a pretty serious amount of money, 1 1/2 Trillion Dollars is. Peak Stupidity was about to get into a rant about the causes of the problem and proposed solution, but I noted we'd done this before, about 1 1/2 years ago, in the series "Student loan debt and forgiveness": Part 1, Part 2, and Part 3*.
The idea of the US Gov't waving it's magic money wand and forgiving these debts has been bandied about for a few years. From a writer name Rick Moran at the PJ Media site, Student Loan Debtors Refusing to Pay Off Debt in Anticipation of Biden Forgiveness. The article gives some facts about the political situation, but the author is wishy-washy in his opinion on the forgiveness "solution". I'd have expected a bit better from PJ Media.
I suppose since Presidents and Congress just blow a half Trillion here and a half Trillion there, I can see why people (other than the students in debt themselves) may think "oh, sure, why the hell not? Poor kids, starting out in life ..." Yeah, well, you may want to go back to our Part 3 of that series linked-to above, but let me give the gist of it. It's not just the money blown by the taxpayers for students to knock out 4 or 5 years at Indoctrination U, some having a big long party in the process.
There are 2 big moral hazards. One is that the students who DID try to be responsible, maybe forgoing all the partying and buying of nice vehicles, maybe working in the evenings and summers to help keep the final number down to only $15,000 or so, have a right to be very pissed off. It's not just that they will be pissed. Socialism pisses off a lot of people by screwing them - "Welcome to the Party, Pal!" No, the bigger problem is that these people will have been taught that "responsibility DOES! NOT! PAY!" and even "responsibility means GETTING! SCREWED!" From then on, I wouldn't blame them if they became just as irresponsible as the rest of them.
Secondly, the Universities will have the current big benefit of guaranteed-to-collect high student tuition due to the US Feral Gov't's loan guarantees doubled down on. From now on, nobody will get all responsible and protest or even balk at tuition increases. "C'mon, don't be a sap - only suckers pay loans back."
The headline of the PJ Media article shows that there is an advance moral hazard, if I may, going on, just due to mention of loan forgiveness plans. I see that "Some student loan debtors have decided to have a “debt strike” and refuse to pay on their loans until Biden acts." Great.
Yeah, student loan forgiveness means College is FREE, FREE I tells ya'! By free we really mean "free" ... till what can't go on, won't go on. The shit WILL hit the fan. We've all read the economist's maxim "there is no free lunch." A Peak Stupidity corollary goes "there is no free lunch, unless you are OK with having pieces of shit that are flying off a fan for lunch."
One more thing that pissed me when I read here, there, and everywhere: Nowadays the President is just assumed by everyone to have powers that were not permitted for him by the US Constitution, such as MAKING FREAKING LAWS! Oh, that's what Executive Orders are about, right? I mean, if the media discussed Presidents using the bully pulpit or pushing for such and such a thing, that would sit better in my stomach. This is the way it is now (same article):
Biden has yet to issue an executive order on student loan debt. Many Democrats are urging the president to cancel $50,000 in debt with the stroke of a pen. But Biden says he would much rather involve Congress in the decision. [My bolding]How very kind of him to involve the Congress! This country's just ... too damn far gone.