Investors are jittery about D.C.'s inability to raise the debt ceiling, so they are seeking alternatives to U.S. bonds. AEM has been discussing the ramifications of not raising the debt ceiling and interest rates on student loans over the past week, and interviewed several experts who painted a grim picture of what will happen to indentured educated citizens if the U.S. loses its AAA rating.
As already stated, there is a likelihood that the U.S.'s credit rating will be downgraded to AA status. That means that variable rates on student loans could increase, and borrowers seeking loans will have a harder time obtaining them. Just to be clear, I do not believe people should have to take out loans to finance their education - as I have stated countless times. In fact, I am so "radical" that I believe higher education ought to be free. But neoliberalism has triumphed, and turned higher education into a market, and one that has been highly lucrative for people like Albert Lord and [insert for-profit President's name here]. But I digress.
The Nation has written a great piece about the situation. It's called, "Shut Up. Raise The Ceiling."
Call your representatives in D.C. and politely tell the ones who are refusing to act on this simple, procedural mater immediately. Send them tweets asking them to raise the debt ceiling. Tell them you don't care if they signed a promise to not raise taxes. Tell them you are tired of them working against the interests of the American people. Tell them that, if they have been opposed to raising the debt ceiling, they are economic terrorists and victimizing millions of people in the U.S.
Some quick facts on the debt ceiling. Right-wing "wonks" are conflating it with raising taxes. Anyone who understands the difference knows that's crap. The debt ceiling was raised under Bush seven times. It was raised under Reagan eighteen times.
As a struggling, underemployed freelance writer and activist, the needless focus on the debt ceiling infuriates me. I blame both parties, too. Moreover, most of these clowns make no mention joblessness anymore. This shows the level of dysfunction and corruption in D.C. While I am looking forward to reconnecting with my contacts on the Hill, and meeting new folks there, I am discouraged by our leaders' inability to actively solve problems.
Related Links
"Sell Those Indenture Instruments Immediately! The Debt Ceiling Disaster and Student Loans," AEM (July 25, 2011)
"The Debt Ceiling Fiasco and Student Loans," AEM (July 25 ,2011)
A non-profit organization dedicated to the eradication of all student loan debt through activism, education, and legislation; because student loan debt is dangerous to the US economy and to the health and well-being of individual Americans and their families. CRYN JOHANNSEN, Founder & Executive Director
9 comments:
You seem to confuse the debt ceiling debate with the loss of AAA rating. The AAA rating is going to be lost because of an unsustainable federal budget. The debt ceiling is a symptom of the problem, regardless of how you feel about the debate.
It's a debt problem, exactly like the indentured student loan servants. Eventually, it reaches a tipping point where it can't even be serviced. We are rapidly approaching that point as a nation.
When interest rates normalize (they are at historic lows), more and more of the federal budget will be consumed by interest payments. Currently, the federal government already spends 20% of tax revenues on interest.
You can call for an increase in the debt ceiling all day, and it will be raised, but that doesn't even come close to addressing the problem.
I am not confusing anything. All discussions about the debt ceiling and our rating show how they intersect.
http://www.guardian.co.uk/business/2011/jul/25/us-debt-crisis-triple-a-danger
http://moneywatch.bnet.com/economic-news/blog/daily-money/top-6-ways-a-us-credit-rating-downgrade-could-cost-americans/3185/
http://www.thenation.com/blog/162296/markets-pols-and-greek-bogeyman
From the last article, "Standard and Poor’s has threatened to withdraw the United States’ AAA rating unless a timely agreement is reached on raising the debt ceiling."
Can you add an option to you survey? I'm not married or divorced. I'm in a long term domestic partnership. I realize that's similar to married but I refuse to check that box until it's conferred on a federal level. Maybe add "domestic partnership" for us couples in limbo?
Many thanks,
Elizabeth
Elizabeth - that's an excellent point. I should have added the option - my apologies. I'll have to delete the answers and category to add "domestic partnership," but I will do so. (Once a survey has started and people have responded, you can't go in an change it). I agree with you entirely. Until it's approved at the federal level, you can't say you're married. Thanks so much. I'm changing it now! And let's hope that we see big changes at the FEDERAL level, and soon . . .
Could you also add a category under education for either "J.D." or "professional degree" I would like to complete the survey as well.
I am for getting rid of student loans because they no longer serve to provide opportunities to the young or the poor; instead, student loans have become "wealth-transfer-instruments" from young, naive student to greedy academicians.
@Anon 3:16 -- that's it: its not the capital value its the stream of income that's important.
I am listening to the purely ideological speeches from the House floor. Where are the statesmen (or stateswomen)? The politicians are saying the opposite of reality. So, you don't like paying taxes? Your big donors don't like paying taxes? Too bad. The crisis of the past four years is one of lack of revenue, not out-of-control spending. Federal tax burden is at a 50-year low.
What's worse, is the politicians never state any specific cuts because they don't have any. Their examples of waste are a few million out of a trillion-dollar problem. It is easy to move to "Washington" and spend a career railing against "big spending by Washington." Who is "Washington"? Guess what, it is the folks who blame Washington.
Unfortunately the red states have gotten used to sucking in more federal program dollars than they pay back to Washington in taxes. Look carefully at the stats, The red states -- the ones with low levels of state & local taxes and services, are the ones on the dole at the federal level.
Their delegates to Washington don't have the political guts to tell them that cutting the federal budget will result in their constituents accepting a reduction in their family standard of living of 10 to 40 percent. But, hey, everyone needs to do their part to reduce the federal budget.
Thanks for the attention to my comment. Until then, I'll happily answer your survey and hopefully be able to check the "married" box soon.
Best regards,
Elizabeth
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