[fg]

Obama has made making college more affordable and student loans less burdensome a priority issue for his campaign. So everybody can get a fair shot. Of course, he still hasn't learned what happens when the tab is being picked up for consumers by others. The consumer doesn't worry about costs and what the total bill is. So, the more the government gets involved to give everybody their fair shot, the more tuitions costs rise. Seems like that may be the opposite of the desired result.

If you are still reading, this is my favorite part. Colleges jack up tuition prices knowing that the government is picking up part of the tab. The government gives student loans totaling 6 figures to people who couldn't get a $2,000 car loan from the bank. The bank that no longer can give you a student loan by the way. Students graduate and now owe the government $100,000. The people in government, who loaned them the money in the first place, now preach to those same people how unfair it is that they owe that much money. And promises to do something about it if you elect them!! You can't make stuff this good up.

This is an example of how silly it is. I needed two graduate level courses to be able to seek the job I currently have. I paid cash for both courses and did, in fact, get the job. And my change in total compensation for the just the first year was 10 times the cost of the classes. But there is no age limit on the college tuition credit, so I would like to personally thank the 53% of you who paid federal income taxes and giving me a college tuition credit. For courses that I paid for in cash and led to a raise 10 times my tuition cost.

Fortunately, my kids have been taught common sense and personal responsibility. They are borrowing from their parents!!

[IndianFan]

Originally Posted by fg

Obama has made making college more affordable and student loans less burdensome a priority issue for his campaign. So everybody can get a fair shot. Of course, he still hasn't learned what happens when the tab is being picked up for consumers by others. The consumer doesn't worry about costs and what the total bill is. So, the more the government gets involved to give everybody their fair shot, the more tuitions costs rise. Seems like that may be the opposite of the desired result.

If you are still reading, this is my favorite part. Colleges jack up tuition prices knowing that the government is picking up part of the tab. The government gives student loans totaling 6 figures to people who couldn't get a $2,000 car loan from the bank. The bank that no longer can give you a student loan by the way. Students graduate and now owe the government $100,000. The people in government, who loaned them the money in the first place, now preach to those same people how unfair it is that they owe that much money. And promises to do something about it if you elect them!! You can't make stuff this good up.

This is an example of how silly it is. I needed two graduate level courses to be able to seek the job I currently have. I paid cash for both courses and did, in fact, get the job. And my change in total compensation for the just the first year was 10 times the cost of the classes. But there is no age limit on the college tuition credit, so I would like to personally thank the 53% of you who paid federal income taxes and giving me a college tuition credit. For courses that I paid for in cash and led to a raise 10 times my tuition cost.

Fortunately, my kids have been taught common sense and personal responsibility. They are borrowing from their parents!!

You're welcome.

[IndianFan]

Originally Posted by fg

Obama has made making college more affordable and student loans less burdensome a priority issue for his campaign. So everybody can get a fair shot. Of course, he still hasn't learned what happens when the tab is being picked up for consumers by others. The consumer doesn't worry about costs and what the total bill is. So, the more the government gets involved to give everybody their fair shot, the more tuitions costs rise. Seems like that may be the opposite of the desired result.

If you are still reading, this is my favorite part. Colleges jack up tuition prices knowing that the government is picking up part of the tab. The government gives student loans totaling 6 figures to people who couldn't get a $2,000 car loan from the bank. The bank that no longer can give you a student loan by the way. Students graduate and now owe the government $100,000. The people in government, who loaned them the money in the first place, now preach to those same people how unfair it is that they owe that much money. And promises to do something about it if you elect them!! You can't make stuff this good up.

This is an example of how silly it is. I needed two graduate level courses to be able to seek the job I currently have. I paid cash for both courses and did, in fact, get the job. And my change in total compensation for the just the first year was 10 times the cost of the classes. But there is no age limit on the college tuition credit, so I would like to personally thank the 53% of you who paid federal income taxes and giving me a college tuition credit. For courses that I paid for in cash and led to a raise 10 times my tuition cost.

Fortunately, my kids have been taught common sense and personal responsibility. They are borrowing from their parents!!

Since I pay both Corporate taxes AND personal income tax Do I get two "Thank You's"?

[DGUtley]

You are most welcome.

[Bevo]

According to Willard you were suppose to borrow that money from your folks.

[IndianFan]

Originally Posted by Bevo

According to Willard you were suppose to borrow that money from your folks.

Or do exactly as he did. Work, earn, save,better himself. What a concept...

[sleeper]

Cut tuition aid and when no one can afford college, they will lower prices.

The subsidizing of education costs through cheap student loans is an endless loophole that needs to be closed. Unfortunately, if you try to do that, people will scream you hate education and want everyone to be a plumber.

Actually, I'd like to make college a place where people with the smarts and determination to work hard only can attend. You do this by cutting aid and increasing the cost of education; essentially weeding out the scrubs who will major in Art Philosophy and end up flipping burgers at McDonalds anyway.

[docthehun]

I always try and keep the big picture in mind. Looks to me like a pretty good investment. While we cut you a break on the tuition credit, you paid us back with interest. I don't have the numbers, but I suspect your income tax went up more than the credit and you'll keep paying that higher tab into the future. You'll also be paying more in SS and Medicare along with local taxes. Someone probably took your old job and perhaps it was a step up for them as well. In addition, since you're making more money, you'll probably be spending more, bringing in additional tax revenue in ways you probably never considered. You're welcome for our wisdom in setting up such a program! (#996 :))

[DGUtley]

Like many others, I am a product of college loans. It's a great way to help those not born into it. Thank you and you are welcome.

[skyvue]

Do student loans really cost us taxpayers much money? I ask that question because they are generally not forgiven even when declaring bankruptcy. You often hear Dave Ramsey, Suze Orman and other personal finance gurus warn students not to take private student loans at all, and limit the amount from the government, because there is usually no way get out of them (except dying). I think there are a few programs where you get some portion of them forgiven if you work for the government for x number of years.

If that is true, isn't the government just lending us cheap money, that they hope will be paid back, by our increased earning power and thus higher future income tax payments?

[IndianFan]

Originally Posted by DGUtley

Like many others, I am a product of college loans. It's a great way to help those not born into it. Thank you and you are welcome.

The problem with student loans is that there is no cash flow associated with it. When I talk to my lender about a business loan he wants to know specifically how lending me X dollars will increase cash flow enough to repay the loan in a specified time frame. There should be similar criteria for student loans. What's the ROI? At a minimum it will make an 18 year old kid think about how their chosen career path will impact their lives for years to come.

[sleeper]

Originally Posted by skyvue

Do student loans really cost us taxpayers much money? I ask that question because they are generally not forgiven even when declaring bankruptcy. You often hear Dave Ramsey, Suze Orman and other personal finance gurus warn students not to take private student loans at all, and limit the amount from the government, because there is usually no way get out of them (except dying). I think there are a few programs where you get some portion of them forgiven if you work for the government for x number of years.

If that is true, isn't the government just lending us cheap money, that they hope will be paid back, by our increased earning power and thus higher future income tax payments?

The government subsidizes the interest rate and in some cases makes payments on the loan while you are in college. They most certainly cost taxpayers money.

Of course, my comment earlier was said tongue in cheek. I believe education is the key to success and everyone should have the opportunity to attend college. Key word: Opportunity, not a "right".

[IndianFan]

Originally Posted by skyvue

Do student loans really cost us taxpayers much money? I ask that question because they are generally not forgiven even when declaring bankruptcy. You often hear Dave Ramsey, Suze Orman and other personal finance gurus warn students not to take private student loans at all, and limit the amount from the government, because there is usually no way get out of them (except dying). I think there are a few programs where you get some portion of them forgiven if you work for the government for x number of years.

If that is true, isn't the government just lending us cheap money, that they hope will be paid back, by our increased earning power and thus higher future income tax payments?

There is another side effect. A huge student loan debt makes it very difficult to obtain financing for anything else such as cars, homes or business. And as Uncle Sam will soon find out having a burdensome debt load makes other things very difficult.

[IndianFan]

Student loan are the next "housing bubble". Banks lent money to unqualified borrowers for houses they couldn't afford. Student loans are the same, anyone can qualify.

[UDFAN]

Originally Posted by IndianFan

Student loan are the next "housing bubble". Banks lent money to unqualified borrowers for houses they couldn't afford. Student loans are the same, anyone can qualify.

A bit different---can't "bankrupt" out of student loans like you can mortgage balances and other debt(s).

[DGUtley]

Some unscrupulous "schools" prey on people by getting them loans and then people bail on school.

[DGUtley]

It is the next bubble. It'll be ugly.

[IndianFan]

Originally Posted by UDFAN

A bit different---can't "bankrupt" out of student loans like you can mortgage balances and other debt(s).

True... but it can destroy ones credit and therefore their ability to be productive. You cannot build a mountain of wealth if your shoveling into a hole!

[DGUtley]

Originally Posted by IndianFan

True... but it can destroy ones credit and therefore their ability to be productive. You cannot build a mountain of wealth if your shoveling into a hole!

Well, I don't know about destroying one's credit because you're just starting out. I think the theory of college loans is -- for example, when you get out of law school owing a boatload of college loans, you live in an old house with old windows, no insulation in a place like Slavic Village in Cleveland, drive a beater car and double pay those college loans until they are paid off. You then have paid back the loans and move to a place like Medina, for example - if that's your pleasure. You necessarily have to sacrifice for the ten years or so that you're paying off those loans. Unfortunately, in this day and age, too many people want to get out of school (or law school) and don't want to sacrifice for the time that it takes to pay back college loans.

As an aside -- I walked Kent State this summer for my youngest's college tour. I really hadn't been on campus since 1984. WOW, there's buildings where buildings weren't, there's roads where roads weren't, there's no buildings where there were buildings and there's no roads where there were roads. All of that costs $$$. To some extent, the easy availability of loans (while helping people like me afford college) has probably helped increase the cost of tuition.

[skyvue]

Originally Posted by sleeper

The government subsidizes the interest rate and in some cases makes payments on the loan while you are in college. They most certainly cost taxpayers money.

Of course, my comment earlier was said tongue in cheek. I believe education is the key to success and everyone should have the opportunity to attend college. Key word: Opportunity, not a "right".

sleeper,
If have don't any research or reading on this topic so help me understand. If the government is the one who is lending the money to the students, then how are the "subsidizing" the interest rate? Seems like they are just lending their own money at below market rates. There may be lost opportunity cost from not doing more with that money, but are they really paying money to any non-governmental agency to fund these? (Doesn't seem so)

edit: After thinking more about this, perhaps the "cost" to the taxpayer is that at those artificially low rates, the government is losing money on the program because some people will not be able to pay them back due to severe hardship, death, etc....?

That seems hard to believe though. There are billions of dollars loaned out right now and even at low rates of 3% or so, that would still seem to be enough to cover the hardship cases because most students take so long to pay them back and thus accrue interests over a lot of years.