Elizabeth Warren blasts "obscene" US profits on school loans

[MannyGoldstein]

US Mass. senator blasts profits on student loans

BOSTON (AP) — U.S. Sen. Elizabeth Warren said Saturday she is shocked that the federal government is earning an estimated $66 billion in profits from student loans originated between 2007 and 2012.

The Democrat from Massachusetts was reacting to a Government Accountability Office report Friday. A previous Congressional Budget Office report estimated that the government will pocket an additional $185 billion in profits on new student loans made over the next 10 years.

‘‘This is obscene. The government should not be making $66 billion in profits off the backs of our students,’’ Warren said in a statement. ‘‘This report reinforces what we already knew — instead of investing in our children and their futures, the government is squeezing profits out of our young people and adding to the mountain of debt they will spend their lives struggling to repay.’’

Warren and eight other U.S. senators committed to wring government profits out of student loans and address a $1.2 trillion in outstanding student loan debt they say is crushing families and putting a strain on the economy.

[Jefferson23]

1. I keep waiting for Obama to use the word, moratorium...on school loans.

The entire school loan enterprise is obscene.

[rhett o rick]

2. Only 12 Senators are concerned about this? I hope

Democratic presidential candidates are equally concerned.

[JDPriestly]

18. If Hillary Clinton is the annointed one, we need to ask her about this issue.

[daleanime]

19. If you need to ask....

you already know the answer.

[Aerows]

40. Since it will be a disappointing one ...

I hope to GOD Hillary isn't the next President. Which is ironic, because when I still had faith in the Democratic Party, I thought she would be a good one.

[daleanime]

42. I hear ya....

[Laelth]

3. k&r for Elizabeth Warren. n/t

-Laelth

[Coyotl]

4. This is an important campaigh issue!

[Fred Sanders]

6. I am not so sure about that.

Republicans will just turn around and attack Democrats for keeping the profits from the hard studying students turned hard working Americans and demand the money be used to reduce the deficit.

[Coyotl]

23. That makes no sense at all.

If interest rates lower, this is better for Republican students too!

Surely, they won't complain that they are not contributing enough to their bankster overlords?

[Fred Sanders]

5. When the banks were making the obscene profits it was AOK for decades, but if government

makes the profits, which goes back to the people, it is?

[kratos00]

7. Exactly

People forget we used to have private banks both make the profit but also pass off the risk to the tax payer, now any "profit" gets rolled back into the program so I don't get what people are whining about.

[Coyotl]

25. People are "whining" because the debt burden is so incredibly immense.

Where have you been, in a cave somewhere?

[rhett o rick]

27. Are you saying that usury is acceptable if the government does it? nm

[bvar22]

34. Nailed It.

This Financial Rapeof our students is something that the Democratic Party should be ashamed of.

In his State of the Union address in 1944, FDR specified a good education as a Fundamental Human Right,
and NOT a For Profit Commodity available only to those with good credit ratings.


http://en.wikipedia.org/wiki/Second_Bill_of_Rights

THAT is the Democratic Party I joined in 1967.
Damn I miss THAT Democratic Party.

When I went to college in the 60s and 70s,
ANYBODY could graduate from the State University DEBT FREE if he/she was willing to work Part Time.
One could even own and drive a beater.
This was the NORM, not the exception,
because back then, we had a Political Party that represented the Working Class.
Sadly, this is no longer true.
QED

[rhett o rick]

37. It's understandable why the Conservatives dont want an educated population, but

why arent the Democrats more pro education?

[Aerows]

41. Exactly. n/t

[DeSwiss]

16. No.

It never was AOK.

Capitalism is fucking CANCER.

So, no. It's not AOK at all.

Maybe it is for you.

So have a nice life.

[JDPriestly]

21. Wrong. The states used to support state universities with tax money.

College was affordable. And part-time jobs on campuses were held by students who, thanks to a livable minimum wage, could earn enough to work their way through college.

I paid for part of my college education through part-time jobs. My family was not wealthy, but tuition was not so astronomical that only the rich could afford it. So my family sacrificed to send the kids to college, and we worked for our room and board and money.

Today, the government makes the students pay too much for tuition. Books are out-of-this-world expensive, and students have to borrow. Back when I was in school, students borrowed maybe some of the money for tuition and books, but not all of it, and it was not nearly as expensive as it is today. The government could be repaid the money it spends on education in the form of increased taxes on the income of students who do well and are paid well in their working lives.

Taking the money in the form of interest on student loans discourages people from getting an education. It influences the career choices. If you want to know why the best and brightest do not become teachers nowadays, think student loans. You can only afford to go to the best schools in the country if you have either a very good scholarship or you rack up the student loans. And it is very difficult to repay thousands and thousands of dollars in student loans plus interest on a beginning teacher's salary. Teaching just does not pay as well as some other fields and entails constantly taking courses and attaining additional degress. That principle applies to other public service professions.

When we shortchange students, we shortchange ourselves. Business needs and wants educated workers. Businesses should pay higher taxes so that workers can be educated.

[Fred Sanders]

22. I agree with other posters, yourself included I presume that sky high tuition rates are the crux

of the problem, and the source of the solution.

[bvar22]

35. In this New American Century,

....Education is an unnecessary luxury for the Working Class.
That is being reserved for the children of the rich.

[whathehell]

39. Truer words about the current state of education in this country have rarely been spoken..

Republicans like Newt Gingrich and a new Repuke congressman are already

advancing the idea of doing away with Child Labor laws so as to make grade-schoolers

do janitorial work as "payment" for their education.

[groundloop]

8. I'd rather see Senator Warren going after private student loan lenders

Private lenders are charging much much higher interest rates than the various government programs, normally around double what the government rates are. THAT is what I consider obscene. I'd honestly be thrilled if my son could get all of his student loan needs met through the government programs and their relatively reasonable rates. And, as I understand it, the 'profit' from the government programs are being recycled back into the program so more students can get loans.

[Spitfire of ATJ]

10. Go after collection agencies grabbing money from 30 year old student loan debt...

They get judges to rubber stamp orders to garnish wages and they often don't apply ANY of what they snatch from people to the principle. They use it to pay interest and penalties THEY impose and since it's owed to the government you can't bankrupt on it and it's a major spot on your credit report. I know someone in that boat who lost a job when his boss got the garnishment order.

[LuvNewcastle]

14. +1000 n/t

[Spitfire of ATJ]

9. Tuition at Berkeley used to be FREE in the 60s.

[LuvNewcastle]

15. I think it should be free at all public schools.

It's time to eliminate the need for student loans.

[daleanime]

20. Amen....

[Spitfire of ATJ]

28. It goes back to "Everything that is a need should be for SALE."

[CFLDem]

29. I second that amen

[notemason]

24. Until, as I recall,

Ronnie Reagan rode into town.

[Spitfire of ATJ]

30. His biggest fear was that average people would realize the rich were dumb as posts.

[notemason]

31. Missed that one

Didn't he

[Spitfire of ATJ]

32. Admit it, until the intertubes most people thought the rich were pretty smart.

[notemason]

33. Agreed

although amazingly with the intertubes in full swing many still believe the fairy tales from Fox news.

[Spitfire of ATJ]

36. I've met some. They consider me to be a "hacker" because I can use a mouse....

Back in the day they were the ones with the VCR that flashed "12:00".

[sulphurdunn]

11. Accordin some research I've been doing,

State and Federal government could provide a free public university education to all qualified students for about what it spends now on loans, tax breaks, grants and scholarships. It would also stop diverting public money to financially endowed private universities and force their exclusionary tuition rates down. I wonder why that isn't happening?

http://chronicle.com/article/For-Public-Colleges-the-Best/140623/

http://www.theatlantic.com/business/archive/2014/01/heres-exactly-how-much-the-government-would-have-to-spend-to-make-public-college-tuition-free/282803/

[Fred Sanders]

17. "I wonder why that isn't happening?"

Sure. Because there is no massive profit in providing free education. No profit, no campaign contributions, no campaign sugar, no sugar for the media.

[Coyotl]

26. Exactly. I had to read down the thread this far for this bit of reason.

Now that is a tragedy, but not as tragic as the loan situation. We need better education too, it seems.

[polichick]

12. Subsidies to corps, tax havens for the rich, rip-off the kids. USA! USA! USA!

[benld74]

13. THIS is criminal

[F4lconF16]

38. I hope she succeeds

and I hope she can fix some of the private lending practices as well. As a current out of state student, I have no idea how I'm going to afford my last year of school (thank goodness my parents have saved enough to get me that far), let alone graduate school, almost a necessity in my chosen field. The debt that many of my friends are incurring is going to kill them when they get out, and they'll even have good medical and engineering jobs, hopefully. These loans are crushing students, and I know more than a few brilliant people that could have led fortune 500 companies that are relegated to $9 an hour jobs at McDonalds.