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You can equalize the interest/collateralize the student loan interest by taking the money out of an asset like your home value and paying off the student loan.
BTW - Currently, interest rates for undergrad student loan are about the level of home loan at 2.75%.
Moreover, it's not just the rates at the moment the loan is take, but also the shifty fees and terms that continue to change over the life of the loan.
Leaving a debt unpaid never means someone else must repay it.
Several hundred thousand homes that were lost in the Great Recession became debts that were never repaid. The mortgage holders simply had to take their losses, accept what they could recover, and move on.
But the losses were eventually absorbed; the country did emerge from recession. And most of those empty homes were resold in time.
What was lost in those houses? The interest money gained in the mortgage was the greatest loss. It was money that was all in the future, and when the future changed, it disappeared. BUT when the interest disappeared for every bank all over the world, then it simply meant the banks had to adjust their loans and expectations of future repayment.
Thats how it would be with our universities. There are a lot of young people who want a college education, but are afraid of the cost of it. The initial cost may be high, but the interest on a loan is more dreaded, because it has to be repaid so far into those youngster's futures.
They have seen the burden their fellows have carried, and for the young, 30 years is more than a lifetime of debt in their thoughts.
Any 21-year old thinks 50 is so old is ancient. 30 years of debt is longer than they have been alive.
Maybe its better to put their ambitions aside and seek a career that won't ever pay off but is more financially secure at the moment. A smaller life may be better than a big life with a heavy debt load around their necks forever.
That's how the line of thought goes.
The debt has taken the belief that education is the way to a better life away from a full generation of our children.
But if our colleges were to simply eat their loss of the loan interest, the future money that won't ever come, the kids may begin seeing that a degree is possible without a lifetime of debt in it, and may begin to enroll in bigger numbers again.
Then, because of increased enrollments, the colleges actually can begin to recover, because the money will be there. In the present, when its needed right now.
The graduates will emerge with degrees, and with plans to put their higher incomes to use buying new homes to start their families in. Employers will have more stable workforces. Money begins spreading out instead of pooling in the banks.
America begins a return to our world leadership as an innovator of excellence. Fresh educated blood freshens old industries, and creates new ones. Blue collar workers learn new skills to meet the new demands.
...and soon enough, profits overcome the old losses for all.
Somebody is going to take the hit it’s not free money
Why is that so hard to understand for so many
We are all part of a whole what we do affects others
Saying the rich can absorb it is an immoral decision- taking from someone else to make up for our failings - not an economic explanation
I expect at least 10% of colleges in the higher ed sector to liquidate. Many of them were on a budgetary knife's edge before all this.
That's a good thing. Hopefully the drop in enrollment is in the ridiculous Transgender Literature and America is Racist Studies fields. Maybe we can get our universities back to real education.
Student loan forgiveness means taking money from those who worked to pay their way through or pay off their own loans and giving it to those who didn't. Hard to imagine that finding a lot of support.
That's a good thing. Hopefully the drop in enrollment is in the ridiculous Transgender Literature and America is Racist Studies fields. Maybe we can get our universities back to real education.
You clearly have a biased view of what colleges do.
I actually work for one, and can attest that the enrollment decline is across the board, in every subject.
I hope you'll be happy to be paying the taxes for the unemployment that a couple faculty I laid off from my department this year are now collecting. They taught Spanish, by the way.
If you'd like to meet their families and spit on them, I can arrange that too.
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