Want a Real Economic Stimulus and Jobs Plan? Forgive Student Loan Debt!

[Omaha Steve]

http://signon.org/sign/want-a-real-economic?source=mo&id=31118-3297678-hFp4O4x

By Robert Applebaum (Contact)

To be delivered to: The United States House of Representatives, The United States Senate and President Barack Obama
Forgiving the student loan debt of all Americans will have an immediate stimulative effect on our economy. With the stroke of the President's pen, millions of Americans would suddenly have hundreds, or in some cases, thousands of extra dollars in their pockets each and every month with which to spend on ailing sectors of the economy. As consumer spending increases, businesses will begin to hire, jobs will be created and a new era of innovation, entrepreneurship and prosperity will be ushered in for all. A rising tide does, in fact, lift all boats - forgiving student loan debt, rather than tax cuts for corporations, millionaires and billionaires, has a MUCH greater chance of helping to rise that tide in a MUCH shorter time-frame. The future economic success of this country is wholly dependent upon a well-educated, prosperous middle class. Instead of saddling entire generations with debt from which there is no escape, let's empower the American people to grow this economy on their own!

Therefore, we, the undersigned, strongly encourage Congress and the President to support H. Res 365, introduced by Rep. Hansen Clarke (D-MI), seeking student loan forgiveness as a means of economic stimulus.

For over 30 years, the rich have gotten richer, the poor have gotten poorer, and the middle class is slowly but surely being squeezed out of existence. Instead of more of the same corporate welfare/"trickle-down" economics that have been an abysmal failure for the middle class, why not try a trickle-up approach to rebuilding our economy by targeting relief at those most likely to actually help grow the economy?

We need 265,000 signatures. There are currently 264,498 signatures



Take action at link.

[Cool Logic]

1. In order to do that, the fedgov would be required to make the lending institutions whole...

The fedgov does not have the resources that would be required to do that.

And there will be less resources once the so-called super committee implements its budget cuts.

[bemildred]

3. Sure they do.

This would be peanuts compared to TARP or the Pentagon. Or we could even tax the wealthy and corporations to raise the extra funding. After all, business benefits greatly by having a well-educated workforce.

[Honeycombe8]

5. Who do you think would pass that bill to tax the wealthy to pay for student loans?

You have a secret way of making the tea party Republicans in Congress vote for that?

[bemildred]

8. I'm just pointing out that it is feasible, even easy, we do such things all the time.

Getting a Congress that is not corrupt is another matter, as you point out.

[coalition_unwilling]

2. Interesting proposal. Bookmarking for later study. Thanks - n/t

[Pigheaded]

4. Why??

I paid all of mine off.

Should mortgages and auto loans also be forgiven?
How about my Discover bill?

Flamesuit on.

CP

[bemildred]

10. Mortgage and auto loans are "forgiven", student loans are not.

And yes,anybody without means to pay should get a fresh start. "Lender beware" is quite as valid as "Buyer beware".

[dkf]

12. Because you take back the house or car which are the collateral on the debt.

[RainDog]

11. I don't have a mortage that is underwater, yet I would prefer to pay the middle class

to keep them in their homes rather than pay the banks that created the lousy financial instruments that allowed them to package good and bad loans together.

it's more beneficial to you to help the middle class than to help the wealthy.

in the same way that I hope to never need certain services, but want my govt to provide for the general good - this loan forgiveness would help to stimulate the economy in a HUGE way - because a lot of loans are held by the same banks that got bailed out in the first place. they're not going to shop in my city or create a small business here - but people who took out loans to be able to afford to go to school who can shop, create businesses or live in my community add value to my community.

a college education isn't comparable to a car loan or mortgage anyway, imo. An educated populace is a value to a community and a nation. Educational costs are far, far too expensive and those costs don't generally go to the teachers in those universities - so I have no problem with the idea of student loan forgiveness. It can be means tested, even - because the reality is that most people who take jobs that benefit the public good aren't making that much money after graduation anyway, but they couldn't be doing those jobs, in many cases, if they had not had the loans to finance their educations.

[coalition_unwilling]

16. Did you know that student loans are one of the few specie of

American debt not dischargeable through bankruptcy. In your case, you could default on your auto loan and have the car repossessed or default on your mortgage and have the home foreclosed. But you would then be free and clear.

There is no way to do that with student loans. I had one staff member who had foolishly at the mature age of 19 signed up for over $30,000 in student loans at one of the ubiquitous proprietary trade schools that litter Los Angeles. After completing the course, whe was unable to find a job int he field (high tech) that she had trained for. But that did not stop the various fiduciary agents from hounding her mercilessly, culminating in Sheriff's Deputies serving us with a garnishment order for 25% of her gross wages (not net after taxes). You don't think that cripples grievously her ability to move forward with her life and by doing so help the economy recover?

Seldom has a more appropriate screen name been chosen than in your case.

[Honeycombe8]

6. What if the debtor is wealthy?

I know people paying on student loans who are lawyers earning $150,000 a year and come from wealthy families. They are paying down their loans of $200,000 or whatever.

Would that be right to take the taxes from a housekeeper or secretary to pay off that lawyer's student loans?

[left coaster]

14. I would definitely have a problem it the debtor was wealthy..

..but I like the idea of this, if fine details like this can be worked out.

I'd just like to add that my husband and I sent both of our sons to four year universities, at the same time(!), and paid their way, so they wouldn't have to start adult life, saddled with debt. They both worked part-time while going to school, but let's face it.. with the cost of higher education what it is, the money they made barely paid for a little gas in the tank.. And NO, we are not wealthy. We have always been renters (modest neighborhood), and we both drive 20 year old cars, and live modestly. I wish we lived in a nation where it didn't cost a fortune to get a good education, and we may end up living in a cardboard box, if my husband faces lay-off in the next year, but I have no regrets about where the mister and I spent our hard earned cash.

[Greybnk48]

7. Just signed on to this on Facebook. K&R n/t

[anarch]

9. LOL good luck with that. might as well ask for forgiveness of medical debt

this is America, not some civilized country. the hell do you want? sustenance, housing, education, and health care? ponies?

[dkf]

13. The biggest beneficiaries would be doctors, lawyers, and wall street execs. Lol.

The Biggest beneficiaries are those who will be making the most money. How ironic is that?

[RainDog]

15. let the debt forgiveness be means tested, then.

they could do this via the IRS.

[dkf]

17. The value of a college education never goes away.

An unemployed graduate now could be making big bucks in a few years. At what point do you judge when it is to be forgiven? Or are you talking about individual payments? That isn't what the OP presents as they say it will free up spending money meaning these people have jobs.

This is like mortgage interest deductions...it doesn't benefit the poorest who never got the education and don't need to pay back loans.

[RainDog]

22. the cost/benefit of a college education, for most, is unbalanced

the cost is too high. wages have stagnated for decades.

and, honestly, the wall streeters and bankers are not the ones who will be creating jobs or an economy for the poor that didn't get the chance to go to college - it's the local economies that help the poor in their areas, not the powerful.

the middle class is disappearing because of things like unaffordable college tuition. so, rather than doing something for the poor by refusing to see the community value of student loan debt forgiveness, you're just creating more of an underclass with debt that never goes away.

if you want to tie it to something - have people do volunteer work in their communities in return for debt forgiveness. volunteer at soup kitchens, or tutor kids in low-income areas. right now, if you work in the public education for 8 years after student loans, those loans are forgiven b/c you are putting your education to work in that way - and b/c the jobs don't pay that much.

but with the financial crisis, those jobs are being defunded, people are being laid off, and so you have people who would LIKE to be able to do public sector work but can't. - and I'm talking about teachers, librarians, social workers, etc.

if someone is a wall street banker, let them pay off their loans. if someone is a teacher - that person should be able to have those loans forgiven, esp. as they try to break teacher unions. If you think people shouldn't take loans to be a teacher - well, how are people supposed to get out of poverty except through education? That was the mantra of the 60s and this tactic DID work for many. It still works - you'll make more with a college education than without (tho, if you're a female, you need a PhD to make as much as a male with a BA/BS.)

So, this issue has A LOT to do with female poverty, believe me.

[dkf]

23. You are right that the cost is unaffordable.

What does forgiving loans do to solve that? If anything it makes the problem worse as people will incur the costs with the assumption they don't have to pay for it.

[RainDog]

27. as I noted, there is already loan forgiveness in place via public service work

this doesn't solve the problem of unaffordable college costs, but it does make it possible for people to go into fields that need educated people even when those fields are not high-paying ones.

no one, or at least no one I know of, takes student loans thinking they won't pay them off. since this is the worst economy since the great depression, however, those who took student loans could not have foreseen that what seemed like a reasonable solution to get the training or certification, etc. to do a job would turn out to be a way to create an impossible burden since the jobs simply are not there.

making college more affordable is one issue - wages that keep pace with cost of living is another. if wages were reasonable, maybe fewer people would attend college because they could find work that made it possible to survive without the costs, but the reality at this time is that a college degree is a bar that is set for many jobs anyway.

The reality is also that America needs college-educated people, not only because of all the interference from the religious right in high school education, but because the K-12 educational system is not as rigorous as it could be with the emphasis on things like sports in schools, rather than clubs, and the general anti-intellectual climate in the U.S. The only place in the U.S. that gets away from that attitude and creates another one is a University environment.

I suppose I see all the money that goes for administrators and sports, even in Universities, and wonder why, once again, the burden of educational costs falls on the poor and middle class rather than those who can afford to contribute to an educated populace - knowing that having a better-educated populace improves the lives of all.

Tax-payer funded education makes sense to me, but that's because I also see that education creates a larger tax base, even in situations like the one that exists now, simply because such educations are needed for so many jobs.

[taught_me_patience]

18. Pretty ridiculous proposal that will go nowhere

But the government stepping in and lowering the 6.9% fixed rate would be of some benefit and would have some chance of passing.

[patrice]

19. Yes!!! Let's invest in the future!

[patrice]

20. Tweeting with Occupy Wall Street hashtags. This is one of their issues. nt

[Itchinjim]

21. Yeah, and refund me the money I used to pay mine off twenty years ago!

[roamer65]

24. Damn str8.

[Blue_In_AK]

25. My daughter would LOVE that.

Almost 10 years after graduation from law school she still has over $50,000 worth of student loan debt, despite having well-paying jobs this whole time and making large monthly payments. It's crazy.


ed. I see comments bagging on the "rich" here (as in "lawyers"), but my daughter sold her plasma as an undergrad to make it through, so I don't think she qualifies as "rich," especially with the debt she's paying off now.

[jmowreader]

26. Damn fine way to end access to education for the non-rich

If we forgave student loans, the people who make student loans would stop doing it, out of fear it would happen again and they'd be left holding the bag. At that point, education would be available to three groups: the very rich, who could afford to pay cash; superstar high school athletes, who would be able to get sports scholarships; and extremely talented scholars who were good at pulling in academic scholarships. Everyone else could just work for a big box retailer or drive a truck.

[JCMach1]

29. Most student loans are direct from the Federal DOE these days.

[joshcryer]

28. Why not just make higher education ... free?