Monday, May 16, 2011

If Legislation Isn't The Answer, Then What Is?

Copyright Notice: If you are not reading this at All Education Matters, and unless I've explicitly given an individual or entity permission to publish my work, this post has been illegally appropriated. Please read original content here.

If our politicians and policymakers can't get their acts together when it comes to solving the student loan debt crisis, then what? What other solutions - that aren't harmful to student loan debtors - might we come up with to solve the problem?

It's obvious. There is a problem. There is a big problem. When you face big problems, whether it is in your own personal life or at a collective level, you realize that it needs to be solved. So, people, how do we come up with a solution to the student loan debt crisis?


Anonymous said...

Cryn, I just don't care about copyrighting.

All of that stuff belonged to the old world.

My stuff is all for free, and the wolves can all fight over it.

There have been other writers that had to pursue writing for the mere sake of it, and for a cause. Maybe many of them have died anonymously.

I can feel all my bones by now.

Anonymous said...

I know, I know, but all the angles have been contemplated, and are covered, and in the end, we all get ripped off, no matter where we go or what we do.

But that's just me talking.

Did Cervantes die poor? I think I recall something about that. Oh well, I'll look it up.

John in Boston said...

Copyright isn't old world at all - unless one is a rationalizing IP thief.

That said, I'll respond to the topic. Cryn, I can't think of any extra-legislative solution that doesn't imperil a debtor.

Cryn Johannsen said...

I know what you mean philosophically, and I agree. You are saying that ALL things are derivative. True. But I am not talking on that level. I am talking on a very real and practical level. IT MATTERS. And I'm not yelling at you, my friend.

Cryn Johannsen said...

Thanks, John. I have had thousands of conversations about the problem, and three significant ones took place today about the subject. We NEED legislation to change the damned problem. WAKE UP WASHINGTON! That should be our new slogan.

Nando said...


Here are some other solutions:

1. Keep documenting and highlighting the problem with "higher education" - at some point, young people should realize that they might be better off going to trade school.

2. Talk to friends, neighbors and relatives about this problem - maybe these people will understand the gravity of the situation and NOT demand that their kids go to college.

3. Hold sit-ins and tent cities, to highlight the extent of the problem. This will embarrass these private/public/non-profit/for-profit corporations known as "institutions of higher education."

4. Use social media and video and confront law school and university administrators. This will hurt the schools' reputation, and impact their ability to fundraise and to attract ever-larger incoming classes.

In the end, these pigs only care about and understand MONEY. They do not lose sleep over the fact that LEGIONS of students will be drowning in debt, for the rest of their lives.

Embarrass these corporations. Do the tactics above sound like they will imperil debtors, John in Boston?! If so, keep in mind that people who protested Jim Crow laws and segregation suffered physical beating - which none of us will experience. I forgot. Everyone in this toilet of a country is too busy working on their resume.

Anonymous said...

The solution is not going to come from Washington because:

1) Students loans, despite defaults, are still profitable to the federal gov.

2) This problem affects mainly young people, and young people don't vote. Sad, but true.

I think Nando is right. The war is going to won over information control and dissemination. So far, higher ed has had the upper hand, but technology is changing that. Use the internet, facebook, etc to spread the message.

Anonymous said...

As long as tax increases are off the table, there is no Washington legislation without the proponents identifying OFFSETS. That means cost savings must be identified to cover the costs of any legislation. Even if you wanted to begin only with loans issued starting in 2013, you would need to identify savings somewhere, because the status quo includes all current program features. If you want to include pre-existing loans in the changes, the costs quickly snowball. For past groups of loans, decades of future revenues were already assumed, and that money has already been spent on the wars, the oil subsidies, etc. The Department of Education administers the federal education loan programs but does not physically receive the profits. Those go into virtual financing accounts in the general government pool which in effect funds part of the federal fiscal deficits.

The method with the least red tape would be to find the savings within the federal loan programs themselves. For example, make new/future borrowers pay for benefits which would go to past borrowers. One way would be to reinstate the up-front origination fees of three percent which were phased out over the past five years. Another way would be to require some sort of up-front matching funds for Pell and Direct Loan, sort of like you see in the federal Campus Based programs. This would make the schools put some of their own skin in the game. Many schools whose only cash flow is federal financial aid would quickly close. Others might change the way they do business. Even some schools which get almost all their revenue from federal financial aid sources might survive -- they would be forced to act like most other types of businesses, though: Go to a bank with a business case and document viability. This would possibly enable most to obtain a line of credit to cover the matching funds.

Finding the savings in other types of federal programs would entail more red tape, getting more committees on board, for example, cutting medicare and medicaid.

Legislation not impacting federal or federally-guaranteed loans would not cost anything. For example, reversing the 2005 bankruptcy reform and allowing alternative private education loans to be dischargeable in bankruptcy would be one. Going back to the early 1970s and allowing at-will discharge of federal student loans in bankruptcy is basically a non-starter. The budget would possibly have to assume that most borrowers would try to discharge their loans. Other federal debts (IRS, SSA, USDA, child support, etc.) are nondischargeable in bankruptcy, so student loan borrowers would be hard-pressed to persuade Congress that they are somehow different.