Posted on 05/20/2019 7:20:14 AM PDT by SeekAndFind
Billionaire investor Robert F. Smith's commitment to pay off the student loan debt for graduates of the historically black Morehouse College covers millions of dollars, the school said.
"When you have to service debt, the choices about what you can go do in the world are constrained," Morehouse President David A. Thomas said Sunday. "(Smith's gift) gives them the liberty to follow their dreams, their passions." Thomas told CNN on Monday that the exact amount of student loan debt to be covered was still being calculated.
Smith's gesture, which Thomas called "a liberation gift," will enable graduates to have more capital to do things like start businesses and support their families.
Studies show disparities in the amount of student debt African-American borrowers amass compared to their white counterparts.
Here are some reasons why Smith's pledge matters:
According to recent Federal Reserve data, Americans owe $1.5 trillion in student loans. Outstanding student loan debt exceeds auto loan debt ($1.1 trillion) and credit card debt ($977 billion). The issue of a free college has emerged as a key topic on the 2020 campaign trail. Several candidates have expressed support for making sure students can graduate without debt. One candidate, Massachusetts Sen. Elizabeth Warren, has proposed eliminating debt for tens of millions of Americans and making all public colleges tuition-free in an ambitious stance.
Morehouse graduate Jonathan Epps, 22, said he has $35,000 in student debt. Elijah Nesly Dormeus, who is the first of nine kids to graduate college, said he had $90,000 in debt.
"It'll sink in as the years go on. I know that for a fact," Epps said.
(Excerpt) Read more at cnn.com ...
Step One in making the Liberal argument that student loan forgiveness “will benefit everybody by stimulating the economy”.
Good choice in commencement speaker
Servicing a debt that one created teaches one responsibility, self reliance, resourcefulness and honor.
And he has now deprived them all of those lessons.
Sorry for those that sacrificed or saved...
Is next year’s class going to feel entitled to the same gift?
Demonstrators or riots if not there?
More stupid philanthropy. Rewarding most those who were the least responsible. And given the whole tax-deductibility thing, a chunk of it comes from what otherwise would have been the philanthropist’s full share of tax payments per our system.
Means that the payoff for each student is taxable income for 2019, due in 2020.
Hey, if a person wants to voluntarily write a check for someone else, more power to them.
It is like saying that I have a $9000 auto loan without mentioning the vehicle, only worse. Nobody will make an auto loan for more than my car or truck is worth.
The government will quite gladly make a loan on a worthless degree.
This is correct— the IRS can easily rule on this, without even a court test case-—
The payoff of a student owned debt by another is IMPUTED income, which is taxable.
And, it is completely suspect that the billionaire can “tax write off “ the payment of another’s debt. It just isn’t so. This is politically contrived nonsense.
They willingly took the money to finance their education. What is the problem? Did they think it was a gift? And $90K.... I hope he majored in a worthwhile field.
It’s stupid and designed to “prove” that the government must provide free college.
Besides, sit on it a few years and inflation will take care of it. A $90,000 debt is crippling - $9000 is easy.
It’s very generous, and that shouldn’t be lost inn the commentary, but it’s also doing nothing to keep the class of 2020 from ending up in then same boat.
A college that spends four years getting their average graduate into $100,000 in debt is insane. There are only so many generous billionaires out there.
Good for him. I remember Malcolm Forbes did something like this when he died - he forgave employee debt. He acknowledged that it may be unfair to people who saved but he viewed it as a lottery. Something good that people weren’t expecting. I have no quarrel with it. Its better than spending it on booze and hookers, or donating it to the Democrat Party.
A nice gesture but he shpuld have left them with some skin in the game, so to speak. JMHO
The schools can keep raising fees as long as the students can borrow the money. And they keep raising the fees while the “quality of service” stays the same.
Since these loans are backed by the taxpayers the schools’ fees should be capped.
But I can understand his kind gesture oh, if he was paying for STEM graduates loans...
As it might give other prospective students pause when determining their course of curriculum and study.
It means that every kid who paid his own way just got played for a chump.
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