EPIC FAIL.
Tax rebate checks have already had a proven FAILED history when Dubya in all his wisdom began doling them out during his second term (May 2008) to stimulate the economy. It failed, the economy continued its precipitous decline and by summer's end...Americans were rightly seeing RED, most of them 'undecided' suddenly voting BLUE thereby boosting Obama into the White House.
Yet, in just under a year, Obama, unabashedly using Bush's failed policy, gave it the 'ole college try once more...further burdening the nation's economy with even more debt. It's nearly a year on...and the $787 billion has been a costly [exponentially costly too] mistake.
Obama failed, as Bush did, to understand that the bulk of consumers who keep the economy running by-and-large have substantial credit card debts, beyond-their-means mortgages, new-car loans, and, yes, even student loans...cumulatively in the billions and billions. (Could the combination of all these be in the trillions?) The stimulus checks, ironically, 'stimulated' nothing, and were, for the most part, dissolved into consumer debts. This is why unemployment is now over 10%...and holding at least into mid 2010.
How to fix it:
It's a Hail Mary Pass. But a brave one. If Obama was courageous enough to get behind it...he would have bipartisanship support, millions of 'thankful' voters in the tank for 2012...and (in my hopeful opinion) save the nation's economy and restore the greatness of the dollar on the Global Market within mere years. In short, do THIS one thing...and reap immediate rewards.
Write off ALL Student Loan Debt. Every cent. Amnesty for the educated and those who seek to better themselves in the Land of Opportunity. Forgive it now...and guess what happens?
The millions of students who pay (with interest) Sallie Mae et al millions (billions?) each month...would suddenly have hundreds, if not thousands more each month...to pump back into the economy. Those thousands quickly turn into billions and billions per month. And that always bodes well for the economy.
Sallie Mae is the biggest Fat Cat profiteer on all this debt; it's no wonder that they keep laughing all the way to the bank year after year. Some alarming facts worth noting:
*Between the years 2001-2006 (according to College Board), tuition fees across America's colleges & universities rose by 57%. The rise remains on pace at TWICE the rate of the nation's inflation. So it's nice that Obama allocated 6 billion dollars to future borrowers, but with annual borrowing estimates of over 80 billion per year, it's barely a morsel. This doesn't bring Change....it doesn't even make a dent.
To break it down...the current system is analogous to a Hamster on a Treadmill. Consider:
College Tuition fees are continually rising...
So students are borrowing MORE money to offset the cost...
So the government makes MORE money available for students to borrow...
Which [consequently] makes financing a collegiate education affordable, right?
Wrong! Colleges and universities see money flowing in...and decide to raise tuition costs yet again...
So students are borrowing MORE money to offset the cost...
So the government makes MORE money available for students to borrow...
And as colleges and universities see money flowing in...invariably they decide to raise tuition costs yet again...
So students borrow even MORE money to offset the cost...
Which results in the government making MORE money available for students to borrow...
And as colleges and universities see money flowing in...invariably they decide to raise tuition costs yet again...
(You get the idea).
And grinning ear-to-ear year after year? Sallie Mae. It's no mystery why (according to the Wall Street Journal) Sallie Mae' stock has risen a whopping 1900% since 1995, made mafioso-style off the backs of the children of the Middle Class with crippling interest rates.
Student Loan Debt in the US?
It's one of the biggest, under-reported scams in modern history and it is hurting millions. It stifles economic growth, it discourages education, it punishes the middle and lower classes and rewards the opportunistic Fat Cat lenders, like Sallie Mae.
This system is broken. It smells of corruption; (evidenced by all those end-of-the-year bonuses execs at Sallie Mae are always receiving). It must change or else a painful bubble will burst economically, intellectually, and spiritually.
Obama's been barking up the wrong tree all year with his ObamaCare. He's divided the nation, polarized independents and has put at risk his reelection plans in 2012. He could reverse this damage by canceling Student Loan debt. He has that power and it's a much easier 'sell' to politicians on both aisles who would jump on the Free-Education bandwagon to please their various special-interest constituencies.
I fail to see why this cannot be done. Other countries (mostly in the EU) have been doing it for generations and have reaped the rewards too numerous to list here.
America calls itself 'The Land of Opportunity'...why not earn it with 'Free Education' for the strata of society who wish to improve the nation with their trades and skills? If our government is so hell-bent to spend money we do not have, why not put it where young Americans need it most? Imagine the economic benefits of millions of young Americans, free of student loan debt, able to work and contribute after their under/post graduation? This isn't a Utopian fantasy...but a suggestion to make things better. To truly bring HOPE and CHANGE to America. With millions of Americans with more money in their wallets will come demand to move the money around. Demand engenders surplus, surplus creates jobs. Jobs stimulate the economy.
Do this Obama...and my children's children will be thankful.
Don't do it...and it's business as usual. And Pat Buchanan's grim retrospective of the last 10 years bodes ill for the upcoming decade as well. I don't care 'what' Party wants to do this...but someone should get it done and run in 2012 with this as one of their primary campaign promises. Education and ingenuity once made America the envy of the world. I think we've lost our way...but it's not impossible to get back on track.
(Props given to the Facebook Group: "Forgive Student Loan Debt to Stimulate the Economy" for inspiring this blog. With a quarter of a million members, it never fails to surprise me how out-of-touch our politicians are who continually ignore public tips and suggestions to make America better).
QUESTION:
Which debt is the least lenient?
a) Mortgage
b) Gambling debt
c) Credit Card debt
d) A Sallie Mae student Loan
ANSWER:
