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2012-01-25 Home Front: Culture Wars

DOE admits flawed study about college grad loan repayment - by omitting black students

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Posted by DarthVader 2012-01-25 11:04|| || Front Page|| [11133 views ] Top

#1 The courts have ruled that unforgivable student loans do not constitute involuntary servitude, but if this ain't it then what is?

Posted by Iblis 2012-01-25 12:29|| 2012-01-25 12:29|| Front Page Top

#2 the Oblahblah admin has been trying to put private schools out of business using slanted studies, mistake-ridden data, and racial "thumb on the scales"

Posted by Frank G 2012-01-25 13:02|| 2012-01-25 13:02|| Front Page Top

#3 The courts have ruled that unforgivable student loans do not constitute involuntary servitude, but if this ain't it then what is?
"Unforgiveable student loans" was established by our esteemed {spit} Congresspersons, and is not properly a judicial issue. What one Congress can establish, another Congress can dis-establish. This should be a campaign issue but isn't.

Posted by Anguper Hupomosing9418 2012-01-25 13:21|| 2012-01-25 13:21|| Front Page Top

#4 "Congresspersons, and is not properly a judicial issue. What one Congress can establish, another Congress can dis-establish. This should be a campaign issue but isn't."

When Congress passes a law which violates the Constitution, say for example the 13th Amendment, then it is the duty of the courts to invalidate that law.

In this case you have a debt obligation which cannot be discharged in bankruptcy and never expires. You can either move out of the country (which some are doing) or pay it back. They will garnish wages, even your social security. All of this is justified because now you have a BA in Gender Studies or the like, so you should have no problem paying it all back.

Posted by Harcourt Borgia5708 2012-01-25 13:29|| 2012-01-25 13:29|| Front Page Top

#5 In this case you have a debt obligation which cannot be discharged in bankruptcy and never expires. This has been obvious to any thinking citizen since the Constitution was put into effect. Congress is the appropriate place to deal with this issue, not the courts. The electorate [as a whole] exhibits zero understanding of the meaning of debt servitude, no doubt supported by a collective ignorance of long division and simple exponents.
From an 1833 commentary on this issue:
it may be stated, that the general object of all bankrupt and insolvent laws is, on the one hand, to secure to creditors an appropriation of the property of their debtors pro tanto to the discharge of their debts, whenever the latter are unable to discharge the whole amount; and, on the other hand, to relieve unfortunate and honest debtors from perpetual bondage to their creditors, either in the shape of unlimited imprisonment to coerce payment of their debts, or of an absolute right to appropriate and monopolize all their future earnings. The latter course obviously destroys all encouragement to industry and enterprize on the part of the unfortunate debtor, by taking from him all the just rewards of his labour, and leaving him a miserable pittance, dependent upon the bounty or forbearance of his creditors. The former is, if possible, more harsh, severe, and indefensible. It makes poverty and misfortune, in themselves sufficiently heavy burthens, the subject or the occasion of penalties and punishments. Imprisonment, as a civil remedy, admits of no defence, except as it is used to coerce fraudulent debtors to yield up their present property to their creditors, in discharge of their engagements. But when the debtors have no property, or have yielded up the whole to their creditors, to allow the latter at their mere pleasure to imprison them, is a refinement in cruelty, and an indulgence of private passions, which could hardly find apology in an enlightened despotism; and are utterly at war with all the rights and duties of free governments. Such a system of legislation is as unjust, as it is unfeeling. It is incompatible with the first precepts of Christianity; and is a living reproach to the nations of christendom, carrying them back to the worst ages of paganism. One of the first duties of legislation, while it provides amply for the sacred obligation of contracts, and the remedies to enforce them, certainly is, pari passu, to relieve the unfortunate and meritorious debtor from a slavery of mind and body, which cuts him off from a fair enjoyment of the common benefits of society, and robs his family of the fruits of his labour, and the benefits of his paternal superintendence. A national government, which did not possess this power of legislation, would be little worthy of the exalted functions of guarding the happiness, and supporting the rights of a free people. It might guard against political oppressions, only to render private oppressions more intolerable, and more glaring.

Posted by Anguper Hupomosing9418 2012-01-25 13:44|| 2012-01-25 13:44|| Front Page Top

#6 Congress won't deal with it. They could, but they won't. It would mean writing off money that they are counting on in their phony if-we-were-Enron-we'd-all-go-to-jail accounting.

But it is also proper for the courts to step in. The 13th Amendment states:

Section 1. Neither slavery nor involuntary servitude, except as a punishment for crime whereof the party shall have been duly convicted, shall exist within the United States, or any place subject to their jurisdiction.

Section 2. Congress shall have power to enforce this article by appropriate legislation.

So, involuntary servitude shall not exist within the US. Congress creates a law which implements involuntary servitude. And you say the courts have no say in the matter? Sorry, but I don't follow your reasoning.

Strike it down. Let Congress try again, only this time without violating those pesky fundamental rights.

Actually, what should be struck down is any law which has the effect of making the debt a form of servitude. So, for example, it should expire after a period of time.

Posted by Iblis 2012-01-25 14:19|| 2012-01-25 14:19|| Front Page Top

#7 Since the loan is secured on the content of the persons mind then perhaps loan defaulters should lose some percentage of neuronal matter instead of it being a non-dischargable loan....

Posted by Bright Pebbles 2012-01-25 14:20|| 2012-01-25 14:20|| Front Page Top

#8 then perhaps loan defaulters should lose some percentage of neuronal matter instead

Methinks that was already accomplished whilst they were in college.

Posted by Pappy 2012-01-25 14:44|| 2012-01-25 14:44|| Front Page Top

#9 involuntary servitude

Means you had no choice in the matter. No free will. When you sign a contract as an 'adult' committing yourself without purpose of evasion, it's not involuntary.

Posted by Procopius2k 2012-01-25 15:01|| 2012-01-25 15:01|| Front Page Top

#10 Supposedly the loans (using my money) were given on the premise that the student could or would pay it back. The premise that if they wait 20 years (or whatever) without paying it back all is forgiven kind of grates on my nerves.

If a subprime loan is given then is the grantee not obligated to repay? And keep the collateral to boot?

Posted by tipover 2012-01-25 15:32|| 2012-01-25 15:32|| Front Page Top

#11 "Means you had no choice in the matter. No free will. When you sign a contract as an 'adult' committing yourself without purpose of evasion, it's not involuntary."

Not true.

Indentured servants, signed up voluntarily. Usually the deal was passage to America in exchange for X number of years of work. The only "involuntary" part was that once you signed up, you could no longer back out.

The system actually worked quite well. It is now, however, unconstitutional.

Posted by Iblis 2012-01-25 15:43|| 2012-01-25 15:43|| Front Page Top

#12 "If a subprime loan is given then is the grantee not obligated to repay? And keep the collateral to boot?"

These people did walk away, but they did not generally get to keep the collateral (house).

State law varies on whether or not the lender could go after the borrower who just locked the door of the house and walked away. In CA, for example, it depends on whether the loan was for "purchase money" which in turn depends on whether it was the original purchase loan or subsequent refinance.

The fact of the matter, however, is that the industry did not go after these people (with a couple of exceptions). Mostly this was because everyone knew the defaulting borrowers couldn't write a $50k check anyway, so what was the point?

Posted by Iblis 2012-01-25 15:49|| 2012-01-25 15:49|| Front Page Top

#13 Congress won't deal with it. They could, but they won't.
-- The term "won't" is a modal operator, like "can't". Using it drags in hypnotic induction and all manner of extraneous presuppositions that need to be untangled.
-- Just because Congress does stupid and unnecessary things is no reason for the courts to become involved. That is a reason for the electorate to become involved, and if they "won't" or "can't", F-'em. If you don't like this situation, call your congressman, or support a congressional candidate who supports your views. I guess that's too old-fashioned nowadays.
-- The Constitution gave Congress the power to define & regulate bankruptcy. That also means Congress can also exclude certain debts from being discharged in bankruptcy, and whether or not certain debts "should expire after a period of time." The US custom is that debts expire when the debtor does under the condition that the debtor's estate has insufficient funds to pay debts outstanding.
-- Anyone is free to not pay a debt. Deadbeats are no longer imprisoned as they once were. They are free to deal with the debt collectors in their own way. Being harassed by debt collectors is not involuntary servitude.
-- By the way, I do support making student loans dischargeable in bankruptcy. This would instantly destroy the student loan industry, along with cutting off an income stream to overpriced educational establishments & ultimately slash educational expenses. The "rent seekers" who benefited from making student loans non-dischargeable were the financial industry & educational establishment.

Posted by Anguper Hupomosing9418 2012-01-25 16:31|| 2012-01-25 16:31|| Front Page Top

#14 What? There is racism in the DOE (and the DOJ, etc.)? I am shocked.

Posted by JohnQC 2012-01-25 16:37|| 2012-01-25 16:37|| Front Page Top

#15 Anguper Hupomosing9418:

- Congress passes a law making it illegal to post anything critical of the government on a website. Your response: call Congress, because the courts have no roll. Sorry, but that is nonsense.

- Not paying a student loan is a pretty big deal, and it sticks with you for the rest of your life. You may be "free" not to pay it, but the government is just as "free" to garnish your wages (and in some cases, those of your spouse), your tax returns, your social security, etc. They WANT the money. You are also "free" not to pay off Guido the loan shark, but I don't recommend it.

- Not too long ago student loans *were* dischargeable in bankruptcy. Didn't bring the industry down then. Can't imagine why it would now.

Posted by Iblis 2012-01-25 16:47|| 2012-01-25 16:47|| Front Page Top

#16 The problem is, of course, that starting in the late 60s it became popular on the Left to default on student loans at will, just to Stick it to The Man.

And because they were allowed to get away with it.

Some of them became faculty and administrators directly complicit in the higher ed bubble that now has students defaulting out of need. But Congress' response was to nuke the social contract implicit in those loans.

Posted by lotp 2012-01-25 17:03|| 2012-01-25 17:03|| Front Page Top

#17 Not true.

Indentured servants, signed up voluntarily. Usually the deal was passage to America in exchange for X number of years of work. The only "involuntary" part was that once you signed up, you could no longer back out.

The system actually worked quite well. It is now, however, unconstitutional.

You confuse involuntary servitude with indentured servitude. They're not the same. The latter is still in effect as a form of contract obligating an individual for work/service in return for remuneration or training. Penalties for early withdraw. Go to your local recruiter and see the skill training available, some carry extended commitments in exchange for specific training.

Posted by Procopius2k 2012-01-25 17:43|| 2012-01-25 17:43|| Front Page Top

#18 "You confuse involuntary servitude with indentured servitude. They're not the same. The latter is still in effect as a form of contract obligating an individual for work/service in return for remuneration or training. Penalties for early withdraw. Go to your local recruiter and see the skill training available, some carry extended commitments in exchange for specific training."

If this were correct, then your employer could give you a benefit in exchange for a requirement that you can't quit for some term of years. Well, they can't.

Also, in your example, you talk about paying a penalty for early withdrawal. This sort of thing is fine. A financial penalty is not the same thing as saying you can't ever quit.

Finally, the case law on student loans specifically states that they don't create an "indenture". The voluntariness of it simply isn't an issue. The issue is whether anyone can enslave themselves in the US, even on a temporary basis. The answer is a resounding, unequivocal NO. Except for student loans, of course.

Military service (especially the draft) also appears to be in some ways at odds with all of this.

Posted by Iblis 2012-01-25 18:39|| 2012-01-25 18:39|| Front Page Top

#19 Military service is an exception as you replace your protections as a citizen under the constitution with the Uniform Code of Military Justice. It has been that way since the founding fathers wrote it, which is part of the reason they feared a large standing army and preferred using militias and hence the 2nd amendment.

Posted by DarthVader 2012-01-25 18:47|| 2012-01-25 18:47|| Front Page Top

#20 They signed a contract for their student loans. Why should my tax dollars (or the interest rates I have to pay on other things) pay for their stupidity?

If you went tens of thousands of dollars into debt to get a degree in Basketweaving Studies, you deserve whatever happens to you. What happened to saving, and working, to pay for college?

Posted by Barbara 2012-01-25 19:26|| 2012-01-25 19:26|| Front Page Top

#21 When they made student loans non-dischargable they gave incentive to lenders to make loans they would otherwise not make. Colleges encouraged the practice since most of the loans were guaranteed to be paid (to them). This drove up college costs to absorb all the available funds. Nobody thought they had any skin in the game - and nobody did, except the students, who were too stupid to know any better (or were deceived, even) and the taxpayers, and nobody gives a sh*t about them.

Posted by Glenmore 2012-01-25 19:31|| 2012-01-25 19:31|| Front Page Top

#22 Military service (especially the draft) also appears to be in some ways at odds with all of this.

Draft is another misnomer that causes the confusion. It's selective service of the federal militia. Per Art I, Section 8 of the Constitution, Congress defines the militia. One of the first acts passed by Congress was the Militia Act which defined it as all free white males from 18 years to 45 years of age - which also pretty much covered the electorate. Today that is covered in Title X USC para 311 as the class of unorganized militia incorporating all males 17 to 45. You're in per Congress' Constitutional authority. [Ah, but what about women? Well, the same section authorizes Congress to make the laws governing land and naval forces in which Congress has chosen to bar women from combat. When they repeal that little inconvenience that some people think it is, you'll have a valid Constitutional argument that as currently written para 311 fails to meet 'equal before the law'.]

Posted by Procopius2k 2012-01-25 19:45|| 2012-01-25 19:45|| Front Page Top

#23 BTW, it's not just the military, look in here -

To provide scholarships to American Indians and Alaska Natives at health professions schools in order to obtain health professionals to serve Indians. Upon completion, scholarship recipients are obligated to serve in the Indian Health Service or an Indian health organization for each year of support with a minimum of 2 years.

Posted by Procopius2k 2012-01-25 19:52|| 2012-01-25 19:52|| Front Page Top

#24 I think Glenmore has the right take on the student loan argument: the federal government first guaranteed the loans, thus relieving banks of risk, and then made the loans non-dischargable, relieving themselves of risk. The banks win, the government wins, and the students lose.

Yes, students are adults. But they're not very sophisticated, they're not very knowledgable about real life and finance, and we shouldn't have a system that takes advantage of them.

Yes also, students should not incur heavy debt to obtain a degree in Gender Studies, Sports Broadcasting, or any number of other useless (to the marketplace) degrees. If you want to blow $100K of your own money (or that of Mummsy and Daddsy) to gain personal enlightenment by obtaining a degree in Music Theory, go for it. But borrowing $100K to get a useless (to the marketplace) degree is going to haunt you.

A half-century ago a college degree demonstrated that you had critical thinking and writing skills that were useful in the market -- there was seldom a 'useless' degree. Nowadays, we've democratized college attendance (good) without insisting that the students have the entry skills (e.g., all the remedial courses now required) and the performance (e.g., all the grade inflation) to make that degree meaningful.

Thus, you as an employer don't know if the new grad in front of you at a job interview can do the job, her/his degree in Gender Studies not withstanding.

So how would I solve the problem of student loans (and thus begin to solve the larger problems faced by higher education) --

1) make a student loan dischargeable in bankruptcy
2) government guarantees no more than 80% of the face value of a student loan after a certain threshold is reached
3) universities (profit or non-profit) have to hold a certain percentage of the loan paper. Even 5% would enforce discipline in lending

This would cut student loan lending a fair degree. Universities would have to make up some shortfalls to get superb but poor students (if they want them). States would have to reconsider grants (not loans) as a basis for poor and working class kids to get into college, and would have to condition these on performance.

Most of all, universities would have to police their own expenses. That's my own rice bowl and I'm aware of the implications. But universities can't afford every program, every center, every major, every department. Academia has to get back to basics, or the coming wave in certification (a certificate for demonstrating proficiency, not a degree for attending Enormous State U.) is going to swamp them.

Not every kid should go to Harvard.

Posted by Steve White 2012-01-25 21:01|| 2012-01-25 21:01|| Front Page Top

#25 Yes, students are adults. But they're not very sophisticated, they're not very knowledgable about real life and finance, and we shouldn't have a system that takes advantage of them.

The point you are making is a point many make about signing a contract with the military. Do we need to legally redefine 'adult' back up to 21 for contracts and voting?

Posted by Procopius2k 2012-01-25 21:32|| 2012-01-25 21:32|| Front Page Top

#26 Anguper Hupomosing9418:

- Congress passes a law making it illegal to post anything critical of the government on a website. Your response: call Congress, because the courts have no roll. Sorry, but that is nonsense.
I agree, the words you put in my mouth ARE nonsense. However, those are your words, not mine. STRAW MAN!
- Not paying a student loan is a pretty big deal, and it sticks with you for the rest of your life. You may be "free" not to pay it, but the government is just as "free" to garnish your wages (and in some cases, those of your spouse), your tax returns, your social security, etc. They WANT the money. You are also "free" not to pay off Guido the loan shark, but I don't recommend it. The last time I checked, the government doesn't work like Guido. Debtors are no longer thrown in prison. There exist plenty of bad debts the government has cheerfully taken on, except for the student kind.
Steve White - why should the feds guarantee any student loans? If certain college level studies are in critically short supply, simply give grants. No public loans or grants for things like gender studies.

Posted by Anguper Hupomosing9418 2012-01-25 21:40|| 2012-01-25 21:40|| Front Page Top

#27 Steve has summed it up all very well.

Anguper Hupomosing9418:

It's called argument by analogy, and is perfectly valid.

Barbara:

Government does many stupid things with our money. The question is how to fix it.

Procopius2k:

Look up "efficient breach". No one thinks that all contracts should be enforced no matter what. The economy would grind to a halt if we tried. Anyway, that's also an argument against bankruptcy in general, and centuries of experience have proven that bankruptcy is better than debtor's prison. Leave the moral issues to your priest.

Posted by Iblis 2012-01-25 23:00|| 2012-01-25 23:00|| Front Page Top

#28 To Glenmore and Steve White: yes, that the federal government and the banks shifted all the risk to student borrowers, benefited universities too. All that risk-free money made runaway tuition inflation possible, which in turn funds all those useless departments, majors, and degrees. It's a self-feeding cycle that begets ignorant graduates with no marketable skills, no way to repay, and taxpayers who will inevitably get stuck with the bill.

The government can keep filling the gap by granting visas to Indian and Chinese scientists, doctors, and engineers, but as taxpayers they're wise to it and are just as angry and disgusted as anyone on this thread.

Isn't it great when government gets involved?

Posted by RandomJD 2012-01-25 23:14|| 2012-01-25 23:14|| Front Page Top

#29 universities (profit or non-profit) have to hold a certain percentage of the loan paper. Even 5% would enforce discipline in lending

The measure of a field's value should determine who pays for it. It seems to me that a college education should keep someone at or above maybe 3x the federal poverty level. Graduates should be required to pay back loans with 50% of any income they receive above 3x the poverty level. After seven (?) years any remaining debt is totally forgiven. Maybe the school eats half and the government eats the other half, and the graduate walks away free and can pass any learnings on to their children.

Posted by gorb 2012-01-25 23:37|| 2012-01-25 23:37|| Front Page Top

23:39 Shimble Guelph5793
23:37 gorb
23:17 Northern Cousin
23:14 RandomJD
23:09 Northern Cousin
23:01 Barbara
23:00 Iblis
22:58 Shimble Guelph5793
22:52 Shimble Guelph5793
22:48 JosephMendiola
22:43 gorb
22:40 JosephMendiola
22:35 gorb
22:31 JosephMendiola
22:29 gorb
22:18 gorb
22:10 JosephMendiola
22:01 Lord Garth
21:58 American Delight
21:56 JosephMendiola
21:43 Anguper Hupomosing9418
21:40 Anguper Hupomosing9418
21:39 JosephMendiola
21:32 Procopius2k