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White House Student Loan Measures Will Barely Dent Soaring Costs [ Costs soar under Obama ]
cnbc ^ | Oct 26 2011 | By: Scott Cohn

Posted on 10/26/2011 1:02:22 PM PDT by NoLibZone

[snip] Tuition and fees at public four-year colleges and universities jumped 8.3 percent nationwide for the 2011-2012 school year, the organization said. The numbers were skewed by California, which raised in-state tuition and fees by a whopping 21 percent this year. But even without California, costs rose seven percent, according to the College Board’s annual “Trends in College Pricing” report released on Wednesday.

[snip]

Private, non-profit colleges raised prices as well according to the report, but not nearly as much as their budget-strapped public counterparts. Tuition and fees rose 4.5 percent, which is still more than twice the core rate of inflation.

“Private institutions don’t rely on state budgets for funding,” Baum told CNBC.

[snip]

The new Obama administration measures—which the White House says do not need Congressional approval—are aimed at lowering payments for millions of borrowers.

Beginning next year, an existing program that allows borrows to base their monthly payments on a percentage of their income will be enhanced. Under the current “Income-Based Repayment” program, borrowers can limit their payments to 15 percent of their income, with the ability to have the balance of the loan forgiven after 25 years. Under the new program, the cap will drop to ten percent, forgivable after 20 years.

(Excerpt) Read more at cnbc.com ...


TOPICS: Business/Economy; Extended News; News/Current Events
KEYWORDS: boondoggle; college; collegecosts; education; eo; loans; schoolcosts

1 posted on 10/26/2011 1:02:31 PM PDT by NoLibZone
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To: NoLibZone
Rather than lower debt based on income let's lower professor and administration wages based on students income.


2 posted on 10/26/2011 1:06:05 PM PDT by NoLibZone (Democrats are violent. Prisons are overflowing with democrats convicted of violent crimes.)
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To: NoLibZone

This is typical vote-buying welfare that invites abuse and fraud.

True story. I struck up a conversation with a woman in an airport while waiting for a flight. The economy and the plight of recent college graduates came up. She openly (without a hint of shame) told to me how her daughter plans to take advantage of Sugar-Daddy Obama’s generosity.

Her daughter is majoring in a graphic design program at an expensive CA university and already has $56,000 in student loans.

Realizing that the labor market is depressed, instead of graduating, she is staying in school and living off student loans as long as she can. Which is what millions of others will do too.

She has no incentive whatsoever to limit how much debt she racks-up. She knows that she will not be held accountable to pay it back. Why stop at $56,000? $100,000! $150,000! $200,000! Sky’s the limit when you are spending free money!

After 20 years of repaying not much if any of her student loans, her debt will be forgiven.

How neat! Like free money or something!!

That is exactly how the system will be gamed.

And the politicians won’t stop bribing the people with their own money until we are Greece on steroids.

So sad.

Easy, cheap, government-guaranteed money caused the housing bubble. Now it has caused a higher education bubble.

This is the vote-buying politicians’ way to keep the bubble inflated and keep the money flowing to one of their best mouth-pieces... liberal professors.


3 posted on 10/26/2011 1:06:16 PM PDT by Painesright
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To: NoLibZone

“White House Student Loan Measures Will Barely Dent Soaring Costs”

Did anyone think they would? Probably the same people who thought adding 30 million people to insurance rolls would somehow slowdown healthcare costs.


4 posted on 10/26/2011 1:07:25 PM PDT by Tublecane
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To: Painesright

“This is typical vote-buying welfare that invites abuse and fraud”

Stupid vote-buying, more like it, since young people, especially college-educated young people, already vote Democrat. Oh, and they don’t vote.


5 posted on 10/26/2011 1:09:44 PM PDT by Tublecane
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To: NoLibZone
Make no mistake, der 0berFuhrer 0bama's edict was not intended to make any difference in student loan debt. It was intended to buy the votes and loyalty of the young and weak minded.

FUBO GTFO! 451 Days until Noon Jan 20, 2013

6 posted on 10/26/2011 1:17:15 PM PDT by The Sons of Liberty (Psalm 109:8 Let his days be few and let another take his office. - Mene, Mene, Tekel, Upharsin)
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To: Painesright
Outstanding post. Also, I would love to see how discretionary income is calculated. If the students are reasonably cunning, there will be little, if any, discretionary income to take the 10% from, so almost the entire loan principal will be forgiven and transferred to the taxpayers in 20 years. Sounds a lot like welfare scams.
7 posted on 10/26/2011 1:18:12 PM PDT by Truth29
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To: Painesright

One of the saddest parts about this, is that it is luring a whole new demographic into the dependency/entitlement populations. People who otherwise would have made their way in life with some self-respect, without the bribery to vote dem.


8 posted on 10/26/2011 1:29:08 PM PDT by NEMDF
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To: Tublecane

The government is the 1% club.

No matter what it does, it can only help 1%.

This generally means the other 99% get screwed.


9 posted on 10/26/2011 1:31:10 PM PDT by edcoil (The will to win is important, but the will to prepare is vital. -- Joe Paterno)
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10 posted on 10/26/2011 1:47:40 PM PDT by TheOldLady (FReepmail me to get ON or OFF the ZOT LIGHTNING ping list)
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To: Truth29

I left that part out because the post was aleady a little long and I didn’t want to send too many people over the edge...

But she added insult to injury by telling me that in her daughter’s line of work, many times she will be paid cash or on a 1099/self-employed basis.

So, she explained that since she doesn’t plan to show much income tax on her tax returns anyway, the 10% of discretionary income will be practically 0.

I am profoundly sad to say that this woman was NOT an Obama-supporting liberal.

That is what happens when a country goes Socialist.

Everyone takes as much as they can, until there is nothing left to take.

As Prof. Alexander Frazer Tytler supposedely said back in the 1800’s (paraphrasing): A democracy cannot exist as a permanent form of government. It can only exist until the voters discover they can vote themselves largesse out of the public treasury. From that moment on the majority, he said, always vote for the candidate promising the most benefits from the treasury with the result that democracy always collpases over a loose fiscal policy, always to be followed by a dictatorship.

That describes Greece today. It could very well be America soon.


11 posted on 10/26/2011 1:49:36 PM PDT by Painesright
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To: NEMDF

I left this part out because the post was aleady a little long and I didn’t want to send too many people over the edge...

She added insult to injury by telling me that in her daughter’s line of work, many times she will be paid cash or on a 1099/self-employed basis.

So, she explained that since her daughter doesn’t plan to show much income tax on her tax returns anyway, the 10% of discretionary income will be practically 0.

I am profoundly sad to say that this woman was NOT an Obama-supporting liberal.

That is what happens when a country goes Socialist.

Everyone takes as much as they can, until there is nothing left to take.

As Prof. Alexander Frazer Tytler supposedely said back in the 1800’s (paraphrasing): A democracy cannot exist as a permanent form of government. It can only exist until the voters discover they can vote themselves largesse out of the public treasury. From that moment on the majority always vote for the candidate promising the most benefits from the treasury with the result that democracy always collpases over a loose fiscal policy, always to be followed by a dictatorship.

That describes Greece today. It could very well be America soon.


12 posted on 10/26/2011 1:55:16 PM PDT by Painesright
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To: NoLibZone

Here’s what I see: He has been looking for a way to funnel money to the DOE, I think he found a way. Just guessing...


13 posted on 10/26/2011 1:55:17 PM PDT by marstegreg
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To: Painesright

I’m not sure how discretionary pay is defined but even if you assume they must pay 10% of gross pay the biggest loan a typical college hire (making $45K per year with 3% annual raises over 20 years) could pay off completely is $62K.

So what is to stop a student from borrowing as much as he can—$100K, $150K, whatever, and using the extra money to pay off just the $62K portion of the student loan!

For my son’s former college roomates now making minimum wage at Starbucks the most they could pay off over 20 years with their own money is $23K.


14 posted on 10/26/2011 2:01:51 PM PDT by blue state conservative
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To: NoLibZone

Last year we visited colleges as my daughter was a high school senior.

All four state colleges we visited had massive building projects going on even though three of the four have had stable enrollments for the past 20-30 years and didn’t need the new buildings.

In the 1960s and early 1970s colleges needed new classroom buildings and dorms because of the massive influx of students. Today new buildings are a luxury.


15 posted on 10/26/2011 2:05:21 PM PDT by bwc2221
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To: NoLibZone

I’m guessing the loan forgiveness after 20 years, will keep getting put off “just a couple more years”. Lowering the minimum strikes me as a way to keep people chained to these debts longer, while making them think they’re being helped.


16 posted on 10/26/2011 2:05:36 PM PDT by Ellendra (God feeds the birds of the air, but he doesn't throw it in their nests.)
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To: NoLibZone
Boo frickin' hoo.

When people go to college, they know what it costs per credit. The can easily find out what books are going to cost before they sign up for a class. They signed papers agreeing to pay those costs. Now they want someone to rescue them from the consequences of their bad decisions.

Sorry, I have no sympathy for 'em. And it ticks me off that Obama is pandering to the whiners.

17 posted on 10/26/2011 2:07:27 PM PDT by MEGoody (Ye shall know the truth, and the truth shall make you free.)
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To: bwc2221
” Today new buildings are a luxury.”

Are you saying the new student rec center with the water slide is not a core educational need?
You must be one of those narrow minded conservatives.

18 posted on 10/26/2011 2:08:44 PM PDT by HereInTheHeartland (I love how the FR spellchecker doesn't recognize the word "Obama")
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To: blue state conservative

Yep.

It’s a recipe for cheating and financial disaster.

It will be a race to the bottom to figure out how to have as little discretionary income as possible, so as to pay back the least amount of student loan debt possible.

Corrupting and corrosive.

Like all Socialist programs.


19 posted on 10/26/2011 2:17:14 PM PDT by Painesright
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To: Painesright

When a government loses legitimacy for the majority of the population, it becomes easy to rationalize any manner of taking or tax avoidance since the government, itself, is viewed as illegitimate.


20 posted on 10/26/2011 2:28:50 PM PDT by Truth29
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To: NoLibZone

Ineptocracy (in-ep-toc’-ra-cy) - a system of government where the least capable to lead are elected by the least capable of producing, and where the members of society least likely to sustain themselves or succeed, are rewarded with goods and services paid for by the confiscated wealth of a diminishing number of producers.


21 posted on 10/26/2011 2:31:38 PM PDT by 5Madman2 (There is no such thing as an experienced suicide bomber)
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To: NoLibZone

Why would anybody want to go to college in this day and pay $100,000+ to get a worthless degree and be transformed into a ignorant, liberal spewing, park occupying, smelly loser? They can get the same thing by watching MSNBC, CNN and reading the New York Times. They’d be just as productive and contributive.


22 posted on 10/26/2011 2:36:38 PM PDT by Harley (Will Rogers never met Harry Reid.)
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To: Truth29

It’s not based on discretionary income, it’s based on the adjusted gross income on their tax returns. I have a number of colleagues who have looked into it; it’s smoke and mirrors and only affects a small portion of borrowers.


23 posted on 10/26/2011 2:38:19 PM PDT by flying Elvis ("In...War, the errors which proceed from a spirit of benevolence are the worst" Clausewitz.)
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To: Truth29

Bingo!

Greece could pay back much more of her debts if people paid their taxes.

They don’t because they know everything is corrupt and the person who plays by the rules is the biggest loser.

That is a huge problem in this country too.

A corrupt government corrupts the citizenry.

If we had remained a Republic, things would have turned out much differently.

Sad.


24 posted on 10/26/2011 2:39:33 PM PDT by Painesright
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bttt


25 posted on 10/26/2011 6:42:43 PM PDT by Matchett-PI (Obamageddon, Barackalypse Now! Bam is "Debt Man Walking" in 2012 - Rush Limbaugh)
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To: Ellendra

“I’m guessing the loan forgiveness after 20 years, will keep getting put off ‘just a couple more years’. Lowering the minimum strikes me as a way to keep people chained to these debts longer, while making them think they’re being helped.”

If it was a private company doing it, this most definitely would be the case. But it’s not. And though the government could possibly be pinch-hitting for the banks, they aren’t. Not enough votes in the student loan business. This is meant to buy the votes of former students, by making it easier for them to shirk their debts.

It won’t save them very much, obviously, if the debtors follow it honestly. But more and more of them won’t, by design. As with all subsidies, it will encourage corruption. That we know is popular.


26 posted on 10/27/2011 9:14:44 AM PDT by Tublecane
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To: Ellendra

Oh, almost forgot, it’ll buy votes from university workers, teachers and administrators alike, since it’ll encourage borrowing which in turn will help drive costs yet higher.


27 posted on 10/27/2011 9:17:01 AM PDT by Tublecane
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To: NoLibZone

You can have a WHOLE HOUSE full of furniture for only $49.95 a week!

He is pretty much giving students a 20 year ball and chain of debt and they are cheering!


28 posted on 10/27/2011 9:21:51 AM PDT by listenhillary (Look your representatives in the eye and ask if they intend to pay off the debt. They will look away)
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