Biden cancels $10,000 in federal student loan debt for most borrowers

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2 hours ago, EVENKEEL said:

I'm curious, what kind of money would you consider to be average income for non college grads? And what money is average for a college educated person? Don't give me a graph, just your opinion.

Must be wonderful to live in a world where facts count for nothing and beliefs count for everything. Like living in Disneyland.

[Hanaguma]

2 minutes ago, placeholder said:

That is false

Here is the relevant table from the Wharton report:

https://budgetmodel.wharton.upenn.edu/issues/2022/8/23/forgiving-student-loans

 

As you can see, from column "Forgive 10K with 125K income cap"  there is a very small share of forgiveness for those in the 90-95% bracket, and virtually none at all for those above that.

 

In addition these tables do not include the further 10K forgiveness for those who were recipients of Pell Grants. That would skew the results further towards those who earn less.

 

You also don't take account of the fact that the less one earns, the greater the burden of repayment. So even if the average amounts of the relief is are less, the loans impose a greater burden on the borrower.

Yeah, I said that already. The uber rich will not be the main beneficiaries. Yet as you see, neither will the poor. Only 11% of the benefits to the bottom 20% of income earners. I have yet to hear any argument that people in the top 60% of earners, whose annual income tops $80,000, are deserving of this bonus. 

 

The only obvious answer is that this is a vote buying scheme.  If you want to help people in financial trouble, there is no reason to limit that help to those with student loans only. Unless of course you are courting them as possible voters...

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2 minutes ago, Hanaguma said:

Yeah, I said that already. The uber rich will not be the main beneficiaries. Yet as you see, neither will the poor. Only 11% of the benefits to the bottom 20% of income earners. I have yet to hear any argument that people in the top 60% of earners, whose annual income tops $80,000, are deserving of this bonus. 

 

And as I pointed out, these tables do not take into account the fact that Pell Grant recipients are eligible for another $10,000 in forgiveness.

[Eric Loh]

Trump’s tax cut benefit his wealthy donors. Biden’s student loan debt benefit the educated young which is the Dem base. Seem common play in every incumbent governments anywhere in the world. 

[Hanaguma]

8 minutes ago, placeholder said:

Must be wonderful to live in a world where facts count for nothing and beliefs count for everything. Like living in Disneyland.

Like I said before, the gap is about $22,000 per year, and $800,000 over a lifetime.  This is easily discovered by myriad studies. 

 

Government interference in loans has had a great deal to do with the increased cost of university in the first place. So I could see a very limited plan to help the very desperate, if it were paired with reform to the loan system- basically government getting out of the loan business.  It is proven that if you subsidize something, it gets more expensive.

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9 hours ago, Hanaguma said:

You are presenting a false binary- the choices aren't "university" or "poverty".   Many options exist for those who want to further their education without running up huge debts- community college, in state university, living at home, working to save before entering uni, trade school.... these are prudent things to do which are de-incentivized by cancelling student loans. 

 

As for who benefits? Wharton School says that 70% of the money will go to the top 60% of earners.  Less than 12% will go to people in the lowest quintile of earners.  So as a way to help those truly in need, it is a bust. 

So your contention is that people who go to community college and state universities and those who live at home aren't the borrowers? You got anything to back that up.

And of course another way to frame where the money goes is that 58% of the money goes to the bottom 58%. And that's before the additional $10000 relief for  Pell Grant recipients is factored in.

[Damrongsak]

1 minute ago, Hanaguma said:

Yeah, I said that already. The uber rich will not be the main beneficiaries. Yet as you see, neither will the poor. Only 11% of the benefits to the bottom 20% of income earners. I have yet to hear any argument that people in the top 60% of earners, whose annual income tops $80,000, are deserving of this bonus. 

 

The only obvious answer is that this is a vote buying scheme.  If you want to help people in financial trouble, there is no reason to limit that help to those with student loans only. Unless of course you are courting them as possible voters...

Ah, but pandering to those with some college education seems better than giving $ to the unwashed masses, vote-wise. 

 

I'd prefer that they subsidize those studying science, medicine, engineering and the like.  We need those folks. 

[Hanaguma]

Just now, Damrongsak said:

Ah, but pandering to those with some college education seems better than giving $ to the unwashed masses, vote-wise. 

 

I'd prefer that they subsidize those studying science, medicine, engineering and the like.  We need those folks. 

Exactly. If there is one thing the world needs less of, it is "communications" degree holders. Or perhaps "visual arts" majors.  Oh, and lawyers. And of course the aforementioned Interpretive Dance people. 

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18 minutes ago, Hanaguma said:

Like I said before, the gap is about $22,000 per year, and $800,000 over a lifetime.  This is easily discovered by myriad studies. 

 

Government interference in loans has had a great deal to do with the increased cost of university in the first place. So I could see a very limited plan to help the very desperate, if it were paired with reform to the loan system- basically government getting out of the loan business.  It is proven that if you subsidize something, it gets more expensive.

You mean government interference in the way states used to support higher education? How they've slashed their budgets in that regard? How they are continuing to do do?

 

State Higher Education Funding Cuts Have Pushed Costs to Students, Worsened Inequality

Deep state cuts in funding for higher education over the last decade have contributed to rapid, significant tuition increases and pushed more of the costs of college to students, making it harder for them to enroll and graduate. These cuts also have worsened racial and class inequality, since rising tuition can deter low-income students and students of color from college.

 Overall state funding for public two- and four-year colleges in the school year ending in 2018 was more than $6.6 billion below what it was in 2008 just before the Great Recession fully took hold, after adjusting for inflation.

https://www.cbpp.org/research/state-budget-and-tax/state-higher-education-funding-cuts-have-pushed-costs-to-students

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21 minutes ago, Damrongsak said:

Ah, but pandering to those with some college education seems better than giving $ to the unwashed masses, vote-wise. 

 

I'd prefer that they subsidize those studying science, medicine, engineering and the like.  We need those folks. 

But the reality is just the opposite.

 

Why Universities Charge Extra for Engineering, Business and Nursing Degrees

https://www.pewtrusts.org/en/research-and-analysis/blogs/stateline/2017/06/01/why-universities-charge-extra-for-engineering-business-and-nursing-degrees

[Chomper Higgot]

49 minutes ago, Hanaguma said:

How does this put more money into the economy? The government takes $300 billion from people, gives it to other people, where does "more money" come from? Of course it does add $300 billion to the debt.  I think I could possibly find a better use for spending $300 billion than this.

 

Did your daughter benefit financially from her education? Looking back, did the easy availability of government loans influence your decisions? I am genuinely curious. 

The Government already took the money.

 

And the money hasn’t disappeared, the recipients of the loan relief now have more disposable income, which gets spent, creates economic activity and generates taxes.

 

 

[Chomper Higgot]

36 minutes ago, Hanaguma said:

Exactly. If there is one thing the world needs less of, it is "communications" degree holders. Or perhaps "visual arts" majors.  Oh, and lawyers. And of course the aforementioned Interpretive Dance people. 

The aforementioned ‘Dance people’ don’t exist.

 

This has been explained to you.

 

[Chomper Higgot]

41 minutes ago, Damrongsak said:

Ah, but pandering to those with some college education seems better than giving $ to the unwashed masses, vote-wise. 

 

I'd prefer that they subsidize those studying science, medicine, engineering and the like.  We need those folks. 

Yes we do, but we also need lots of other kinds of education too.

 

https://www.arts.gov/news/press-releases/2018/arts-contribute-more-760-billion-us-economy

[sqwakvfr]

Will the forgiven student loan debt be considered as a Taxable Income?  In past when a unpaid loan is forgiven a Form 1099 was issued.  

[ThailandRyan]

1 hour ago, Hanaguma said:

How does this put more money into the economy? The government takes $300 billion from people, gives it to other people, where does "more money" come from? Of course it does add $300 billion to the debt.  I think I could possibly find a better use for spending $300 billion than this.

 

Did your daughter benefit financially from her education? Looking back, did the easy availability of government loans influence your decisions? I am genuinely curious. 

She has yet to benefit from her education as she is now an intern, and has racked up an additional 225k USD in college fees, and loans to become a doctor.  She plans on paying these loans off over time, but the issue is that the loan payments basically make the borrowed amounts twice as much.  If they charged a little interest instead of 8-12%, then the extra money the debtors kept in their pockets would go into the economy instead of to the banks......greed.  Where did I say that I or my daughter would apply for debt forgiveness.  Read my post sloowwwlllyyy to understand the point I am making.  If the interest was minimal, it would cut down on the amount owed over the amount taken.  

[ozimoron]

17 minutes ago, sqwakvfr said:

Will the forgiven student loan debt be considered as a Taxable Income?  In past when a unpaid loan is forgiven a Form 1099 was issued.  

I wonder if Trump's administration issued that form when he gave the rich a tax cut?

[ThailandRyan]

19 minutes ago, sqwakvfr said:

Will the forgiven student loan debt be considered as a Taxable Income?  In past when a unpaid loan is forgiven a Form 1099 was issued.  

From what I understand it will be added as income for the individual, much like the past money given to families during the O'Bama administrations Tax relief payments.....not so for the Covid relief payments.

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25 minutes ago, sqwakvfr said:

Will the forgiven student loan debt be considered as a Taxable Income?  In past when a unpaid loan is forgiven a Form 1099 was issued.  

interesting point.

[KanchanaburiGuy]

44 minutes ago, Eric Loh said:

Trump’s tax cut benefit his wealthy donors. Biden’s student loan debt benefit the educated young which is the Dem base. Seem common play in every incumbent governments anywhere in the world. 

Trump's tax cut benefited the people who pay an overwhelming share of income taxes.

 

The people who received little or no benefit from Trump's tax cuts........... got their benefits beforehand.......... by already having to pay little or no income tax!

 

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There's really no comparison between Trump's Tax Cut and Biden's Student Loan Debt Relief. They are very different things reflecting entirely different circumstamces.

 

Sure, there are things that CAN BE compared......... but they really shouldn't be!

 

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Here's a more accurate thing to compare..........

 

People owe taxes and don't pay them. Penalties and Interest get added, so the number gets larger. But the people still don't pay.

 

Time passes and the number keeps getting larger.

 

These are what are known as  "Tax Cheats."

 

Every once in a while, the IRS will give "Tax Cheats" an opportunity to get out from under. They'll offer a program wherein if you pay off a smaller amount right away....... (sometimes 80% less!)....... they will clear your books. They call this "Tax Relief," I believe.

 

It is basically an amnesty program that allows them to collect SOME money.......... and eliminates the costs associated with having to keep chasing after these "Cheats."

 

If you want to compare something related to taxes to Studen Debt Relief........... THIS is the thing to compare.

 

Deadbeats not paying what they owe........... then getting rewarded for it!

 

Tax deadbeats..........

vs........

Student Loan deadbeats!

 

Those two circumstances are truly worthy of comparison.......... not.......... Trump's Tax Cuts vs Biden's Student Debt Relief!

 

Cheers!

 

 

[Hanaguma]

18 minutes ago, ThailandRyan said:

She has yet to benefit from her education as she is now an intern, and has racked up an additional 225k USD in college fees, and loans to become a doctor.  She plans on paying these loans off over time, but the issue is that the loan payments basically make the borrowed amounts twice as much.  If they charged a little interest instead of 8-12%, then the extra money the debtors kept in their pockets would go into the economy instead of to the banks......greed.  Where did I say that I or my daughter would apply for debt forgiveness.  Read my post sloowwwlllyyy to understand the point I am making.  If the interest was minimal, it would cut down on the amount owed over the amount taken.  

If I came across as criticizing, my apologies. Not my intention. Just genuinely curious about the situation. So your daughter will be a doctor, congratulations are in order!  Are you really paying the interest rate you mentioned? That is shocking. I thought federal loan interest was lower than that. 

[Hanaguma]

52 minutes ago, Chomper Higgot said:

The Government already took the money.

 

And the money hasn’t disappeared, the recipients of the loan relief now have more disposable income, which gets spent, creates economic activity and generates taxes.

 

 

NO, the government already lent the money.  Now they have to take money to fill that hole. 

 

And yes the recipients have extra income, but at the expense of the people who paid to fill the hole.  Classic income redistribution in an upwards direction. 

[Hanaguma]

1 hour ago, placeholder said:

So your contention is that people who go to community college and state universities and those who live at home aren't the borrowers? You got anything to back that up.

And of course another way to frame where the money goes is that 58% of the money goes to the bottom 58%. And that's before the additional $10000 relief for  Pell Grant recipients is factored in.

Never said that. But the chance that they are under large debt burdens, caused by their personal decisions, are much lower. 

 

You take out a loan for a service and use the service, you pay it back.  Especially if your family income is six figures plus. This is the part I truly don't understand- how is it possible to justify people with household incomes over 200 grand getting debt "relief". 

[EVENKEEL]

1 hour ago, placeholder said:

Must be wonderful to live in a world where facts count for nothing and beliefs count for everything. Like living in Disneyland.

Must be terrible not to have one original thought. Does a college education take away your ability to have a thought of your own.

 

 

[HappyExpat57]

So, if a cure for cancer was discovered, would you deny it to current cancer patients because it was never an option for cancer patients in the past?

[sqwakvfr]

34 minutes ago, ThailandRyan said:

From what I understand it will be added as income for the individual, much like the past money given to families during the O'Bama administrations Tax relief payments.....not so for the Covid relief payments.

If this what happens then it will come as a shock to some.  I recall speaking with a highly educated liberal who said “I want property owners to pay more taxes but I don’t want rent to increase”.  

[KanchanaburiGuy]

47 minutes ago, Chomper Higgot said:

The Government already took the money.

 

And the money hasn’t disappeared, the recipients of the loan relief now have more disposable income, which gets spent, creates economic activity and generates taxes.

 

 

Sounds a lot like "Trickle Down Economics," to me...........

 

Let'em keep more on the front end.......... and we'll get it back......... and more!......... on the back end!

 

Meanwhile, we keep borrowing money to keep our Current Accounts current.......... knowing full-well that someone in the future is going to have to pay for it!

 

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How about this.........

 

The borrowers pay their bills........

 

So the treasury can pay their bills.......

 

So the government doesn't have to borrow money to pay its bills.........

 

..........and future taxpayers get to keep more of their own money....... (to buy things and boost their economy!)........ because there's no massive debt they have to pay off!

 

How about THAT idea?

 

That's called doing-it-the-right-way............

 

.........rather than...........

 

............doing it the wrong way and pretending  it's the right way!

 

Lol

[ThailandRyan]

4 minutes ago, Hanaguma said:

If I came across as criticizing, my apologies. Not my intention. Just genuinely curious about the situation. So your daughter will be a doctor, congratulations are in order!  Are you really paying the interest rate you mentioned? That is shocking. I thought federal loan interest was lower than that. 

Thank you, and yes the Parent Plus Loan I obtained for her 4 years of university had an initial 6 months grace period before the loan re-payments started in 2012, She then went onto nursing school and became a nurse practitioner, and now is going the final step.  The interest rate that the loan servicing center charged me started at 6.8% and then went to8% and then finally 12%.  I could have done a forbearance and not paid for the past 2 years but then all that does is add the interest accrued during that time tothe back of the loans, and so that is why many folks owe twice as much as they borrowed and are having a hard time paying it back.

 

Thankfully, after 10 years of payments I am finally done.  The initial payments were $386 a month but then went to $412 a month as they raised the rates, yes like buying a car.  I had two of these loans, and paid of my other daughters as well who is now a CPA and paid of her other college loans by working, something my older daughter tried and is trying to do.  My son went the military route, then became an Officer after finishing his education on-line while in between deployments to many of the problem areas......I can count my blessings that as a parent I could cover expenses, while many others can not.  Banks and the Government charge horrendous interest rates for college loans.  I am sure this is done to make up for the deadbeats who never pay them back.  

[sqwakvfr]

38 minutes ago, ozimoron said:

I wonder if Trump's administration issued that form when he gave the rich a tax cut?

You do not get a 1099 on a Tax cut.  

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12 minutes ago, Hanaguma said:

Never said that. But the chance that they are under large debt burdens, caused by their personal decisions, are much lower. 

 

You take out a loan for a service and use the service, you pay it back.  Especially if your family income is six figures plus. This is the part I truly don't understand- how is it possible to justify people with household incomes over 200 grand getting debt "relief". 

It's about loans relative to income.

And in what percentile are those with household incomes over $200000 getting debt relief. From that Wharton report you cited, it looks to be close to virtually zero.

[candide]

13 minutes ago, EVENKEEL said:

Must be terrible not to have one original thought. Does a college education take away your ability to have a thought of your own.

 

 

Right, it's terrible: the people who just parrot what they read in right-wing social media posts and memes, Trump's lies, Fox News, Breitbart, etc... without ever checking facts.

Edited August 28, 2022 by candide