Student Loan Debt Clock

Sunday, May 13, 2012

Today's News on the Student Loan Debacle

Senate & Congress Phone & Address Directory

Become Engaged - become a person who participates in their own life and assists in a greater cause for the good of the whole, not just for the sum of its parts.

Join the ‘student loan debt’ advocates & champions in the fight towards changing American perceptions; there is a movement to reach and change societal norms in regards of how people think of ‘student loan debt’ and the serious repercussions in aggregate when the next financial crisis hits. When the student loan bubble bursts, and it will; the devastation will be long reaching into our financial institutions, and then society will finally understand the foreboding economic condition and the actors who were involved in allowing this student loan debt catastrophe to happen: the responsible persons for the Student Loan Debacle, is majority of Congress & the Senate.

And the many thousands of individuals who are rising up and saying to Congress and the Senate “enough is enough, get out of the pockets of special interest groups; quite catering hand and foot to the PACS,” and do the job you were elected to do by the American people, in assisting the American people and not big corporations, you know the United States citizens, the ones who are paying your salaries!

And although, I believe an informed and engaged society is mandatory for citizen commitment, recourse, and discourse; there are grassroots organizations touting “don’t pay your student loans; and just walk away.” That is ludicrous, you can never walk away from that form of debt, and your student loans will follow and haunt you forever. There are ways in which to deal with your student loans, but walking away from that debt is not one of them. There are many programs to assist in managing your student loan debt: exhaust all possibilities of repayment before just walking away and opting out of life. More info:

According to, “Since January 2010, the Education Department has stopped going after defaulted loans of less than $45,000 through the Justice Department. That doesn’t mean people who aren’t making payments are off the hook. Bad loans of less than that are handled by private law firms on a contract basis, Glickman says.”

“What people need to realize: Once you default on a student loan, you owe that money forever,” Alabama’s Kelly says. “If we get a settlement, we can place a lien against your house. You can’t refinance or sell the house unless you clear up that debt. We get a lot of loans repaid when a house is sold.”

1 Trillion student loan debt vs. 11.3 Million collected. “Although the Education Department doesn’t provide information on how many lawsuits are filed, it does say it has received repayments totaling $11.3 million since 2006.” (

And how did student loans become ‘easy and free money,’ “Robert Murphy, a consumer rights lawyer in Fort Lauderdale, said the government issues loans without any regard to a person's likelihood to repay them. He said many people graduate from law schools today with $120,000 in debt and are only making $40,000 to $50,000. They end up having to use a quarter of their salary just to pay off debt and can barely survive, he said.” (,0,2380048.story).

What responsible financial entity, loans mega $$$ to individuals without regards of their ability to repay that money. I’ll tell you, monolith institutions whose clients have absolutely no recourse, because Congress and the Senate have stripped away all financial protections for the American people. But, hey if you’re a big corp and you’ve just gotten say 500 million dollars from the government (or should I say a loan from the American people) for a business that goes sour, just file bankruptcy and start all over. So ‘we’ as a people (our tax dollars) loan big business money all the time; but ‘WE’ have no protections against them.

“Gone is the promise of earlier presidents of a “commitment to the belief that workers should not live in dread that a disability, death, or old age could leave them or their families destitute.  

There is another way the government could find needed funds without raising taxes, slashing services, or going further into debt: Congress could re-finance the federal debt through the Federal Reserve, interest-free.  Canada did this from 1939 to 1974, keeping its national debt low and sustainable while funding massive programs including seaways, roadways, pensions, and national health care.  The national debt shot up only when the government switched from borrowing from its own central bank to borrowing from private lenders at interest.  The rationale was that borrowing bank-created money from the government’s own central bank inflated the money supply, while borrowing existing funds from private banks did not.  But even the Federal Reserve acknowledges that private banks create the money they lend on their books, just as central banks do.

For students, at the very least the bankruptcy option needs to be reinstated, usury laws restored, predatory practices eliminated, and the cost of education brought back down to earth.  One possibility for relieving the burden on students would be to give them interest-free loans.  The government of New  Zealand now offers 0% loans to New Zealand students, with repayment to be made from their income after they graduate.  For the past twenty years, the Australian government has also successfully funded students by giving out what are in effect interest-free loans.  The loans in the Australian Higher Education Loan Programme (or HELP) do not bear interest, but the government gets back more than it lends, because the principal is indexed to the Consumer Price Index (CPI), which goes up every year.

Predatory lenders are keeping us in debt peonage through misguided economics and bank-captured legislators.  We have people who desperately want to work, to the point of going back to school to try to improve their chances; and we have mountains of work that needs to be done.  The only thing keeping them apart is that artificial constraint called “money”, which we have allowed to be created by banks and let out at interest when it could have been created by public institutions for public purposes, either by direct issuance or through publicly-owned banks.  We just need to recognize our oppressors and throw off their yoke, and the good times can roll again.”

Student Loan Forgiveness is not just a novel idea, there are many who agree, it would become a stimulus for the people of the United States; and not a stimulus for big corps who do very little for the American people other than reap huge profits by propagating our consumer-based societies mind-set.

“Let's forgive loans. Just this once, I promise.

I can guarantee this: Those $200 to $800 monthly checks students are cutting (or amassing in interest as they continue to defer payment) aren't likely to get socked away in the drawer.

It will go toward homes for people fortunate enough to already have jobs.

And for those who don't, it will go toward new vehicles and apartment leases in the cities where jobs do exist.

Because those shackled by debt -- even if by their own cavalier and youthful irresponsibility -- simply can't pick up and move, to work and contribute to the economy.

Rather than be marginalized by it.” (

Loan Forgiveness, “President Obama signed a bill in 2010 that would see the so-called forgiveness program expanded in 2014. Under the scheme, eligible students would see their loan repayments capped at 10 percent of their income and written off after 15 years.

Together, Americans over 60 years of age still owe onwards and upwards of $38 billion in student debt and over ten percent of them are lagging behind on payments.” (

An ethical & savvy business approach towards student lending, “Consumer and student advocates, private loan companies and the higher education community have all asked Congress to pass legislation that would require private loans to be certified by the school before a single dollar can be disbursed. This would provide a crucial opportunity for financial aid offices to identify borrowers who are at risk of taking on unmanageable debt loads or haven’t exhausted other financial aid opportunities.” (

“That has some economists worrying that federal student loans could become the nation's next huge financial crisis, like the mortgage bubble that plunged the U.S. into a recession from which it's still recovering.

The Federal Reserve Bank of New York estimates 37 million Americans have student loan debt, totaling $870 billion. Bankruptcies are on the rise, with 81% of bankruptcy attorneys reporting more clients with student debts in the past few years. (

Really, that is ridiculous, “I readily admit it,” said E. Gordon Gee, the president of Ohio State University, who has also served as president of Vanderbilt and Brown, among others. “I didn’t think a lot about costs. I do not think we have given significant thought to the impact of college costs on families.” (

Anyone say student loan collection agencies are practicing sub-prime economics? “If one is not thinking about where this is headed over the next two or three years, you are just completely missing the warning signs,” said Rajeev V. Date, deputy director of the Consumer Financial Protection Bureau, the federal watchdog created after the financial crisis.

Mr. Date likened excessive student borrowing to risky mortgages. And as with the housing bubble before the economic collapse, the extraordinary growth in student loans has caught many by surprise. But its roots are in fact deep, and the cast of contributing characters — including college marketing officers, state lawmakers wielding a budget ax and wide-eyed students and families — has been enabled by a basic economic dynamic: an insatiable demand for a college education, at almost any price, and plenty of easy-to-secure loans, primarily from the federal government.” MSNBC

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