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Tuesday, March 26, 2019

Reprinted with permission from Media Matters. 

The Wall Street Journal’s editorial board joined a chorus of right-wing outlets in blasting the federal government’s income-based student loan repayment program, calling it a costly “con” meant to “buy millennial votes.” Yet right-wing media are ignoring the benefits of a program that could relieve millions of student borrowers of a portion of their remaining debt and that is still generating a profit.

Right-wing media lambasted the Department of Education and student borrowers after the Journal reported on November 30 the latest findings from the Government Accountability Office (GAO), which found that the government is on track to forgive $108 billion of $352 billion in student loans as part of federal income-driven repayment plans. The Journal’s editorial board blasted the government on December 1, calling the latest findings proof that the Department of Education’s loan program is a “con” designed to “buy millennial votes.” (The editorial column was the Journal’s second since November 1 lamenting the federal program, which has led to millions of students earning student loan forgiveness.) Earlier that day, Fox News host Jon Scott questioned if the program was a “bailout” for student borrowers. Fox Business host Stuart Varney also called the program “a bailout” on the November 30 edition of Varney & Co., while his guest Steve Costes added that the program is “a shame.”

Federal student loan borrowers have multiple repayment plan options, including income-based plans that require borrowers to pay back loans based on a percentage of their income for a certain number of years, after which the remainder is eligible to be forgiven. The GAO’s findings were for the hypothetical cost in loan principal forgiveness for the 5.3 million borrowers who signed up for income-based repayment plans for loans issued over a 22-year period, between 1995 to 2017. These borrowers will likely see an average of $21 forgiven for every $100 in loans received. Despite right-wing media complaining about the cost of borrower relief for those on income-based payment plans, the GAO found that the Department of Education still nets a profit on student loans.

The reason the government still makes a profit even after loan forgiveness is because many federal student loans have an interest rate at 6.8 percent — a figure that is much higher than inflation or the 1 percent interest rate banks receive from the Federal Reserve. The 6.8 percent interest rate is so high that the GAO’s hypothetical borrower would pay almost double the original principal of their loan if the income-based plan had no cutoff date for forgiveness:

Student loan debt is a leading concern among young people, with The Atlantic finding nearly 30 percent of Americans aged 18 to 29 “cited paying off student loans as their biggest financial challenge.” According to Fortune, “there is little doubt that many Millennials are struggling financially” after a survey by PwC found that 79 percent of the 42 percent of millennials that have student loans struggle to pay those loans. Evidence shows student debt can impact personal wealth, delay homeownership affect personal decisions to marry or start a family, and that it has “cripple[d] retail sales growth.” The financial stress of student loans has a “devastating toll” on borrowers’ mental health, according to Complex, which cited findings by researchers that “student loans were associated with poorer psychological functioning.”

While right-wing media push many myths about student debt, student concerns are valid; according to a November 21 op-ed published by Investopedia, Americans with student loan debt have “a challenging road ahead of them in the present and the future” due to workers being unable to save for retirement. The op-ed, which was authored by a financial adviser, even questioned whether people with student loans “will be able to retire” at all. The increasing debt burden can even hinder career advancement as graduates can be forced to take jobs that may have no chance of wage growth or career development so they can make debt payments on time.

Conservative media have labeled higher education as a “privilege” and suggested students ought to choose fictional cheaper colleges. Some outlets have even defended schools that take advantage of students and leave them with significant debt. But research shows college matters now more than ever, and the cost to attend is rising across the board. The student debt crisis is especially damaging for poor students and students of color, who more frequently attend cheaper open-access and community colleges and are still forced to borrow in higher numbers to pay for their education.

Blaming students for the student loan debt crisis ignores the facts and distracts from finding real solutions to America’s skyrocketing student debt burden.

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20 responses to “Right-Wing Media Slam Student Loan Assistance Program”

  1. Daniel Jones says:

    Higher Education–mechanism of veiled apartheid, source of rage leading to identity politicking and social justice nonsense.

    Seriously, it needs to be less dear, or the hatred will continue to grow.

  2. TMZ1928 says:

    If you can’t pay it back, don’t borrow it.

    • Demsliveon says:

      Because only rich people like Donald Trumps kids should be allowed to get higher education?

    • That Neanderthal comment you’ve made tidily sums up the desire to do as little as possible to further one’s education—it’s as compact a luddite attitude as we’ve ever heard in these modern times—“King Lud” would have been proud of you. You and the GOP are determined to let other nations eat America’s lunch when it comes to aspiring for education. We hope that your the attitude doesn’t extend to educating your progeny and your friends’ kids—assuming you have friends.

      • FireBaron says:

        But Aaron, they need an undereducated and uninformed populace. They need to completely control the message their voters hear. Otherwise they would be wiped by every Democratic candidate that ran against them.

        Here are the catchwords successfully used by Republicans and how they are used.
        1. Liberal = Godless Communist who wants to destroy our way of life.
        2. Social Security = An entitlement program designed for people who cannot save for their retirement that keeps the Defense Contractors in their home states/districts from submitting overpriced products that the DoD neither wants nor needs.
        3. Obamacare/ACA = Government program designed to promote a system that is in opposition to the Health Insurance and For-Profit Medical corporations that pay for their campaign materials.
        4. Public Education = an indoctrination program designed to turn people away from God and the Republican Party by allowing them to believe that they should have a say in the government.
        5. Voucher System = Government will give you less than the actual money you need to get your own health insurance, which will not provide anywhere near the coverage you need. Alternatively, it is the Government giving you less than what you will actually need to send your child to an uncertified school where they will be taught to deny science.
        5. Religious Freedom/War on Religion = Christians have a Government-granted right to discriminate against other faiths.
        6. Gun Control/Registration = The first step to confiscation of firearms and the revoking of the 2nd Amendment.
        7. State’s Rights = The rights of states to pass legislation ignoring the 14th, 15th, 24th and 26th Amendments.
        8. Freedom of Speech = the right of Conservatives to not have to hear opinions of others that disagree with them while forcing their opinions on others.

        Once Democratic Candidates learn how to overcome those, we will start seeing more democrats elected in “Red” States.

        • S.J. Jolly says:

          The Democratic Party is only a little less mired in relying on conservative establishment money than the Republican Party. Better to look to the Progressive Party for real change.

        • That lexicon will only get longer because of the nature of the new kind of “Population War” being waged by humanity against itself and the environment, and partisanship will always lead us to view the other as something to be conquered and eliminated.
          One thing I’ve noticed, and which is described, albeit with some major flaws in conclusions drawn I’ve read so far, in the book
          “Population Wars”, by Greg Graffin, is that you can’t entirely wipe out a population or eliminate an ideology. What can be achieved is to establish some level of stability among the competitors, and present a shift in thought that changes a “zero-sum” encounter
          into one of reciprocity and harmony.

      • dpaano says:

        Aaron, I agree. Where does TMZ think that scientists, doctors, professionals come from without getting education? Many of these individuals have outstanding student loans that they are paying. Are we supposed to import these types of people from overseas….the same ones that we actually educated here, to do jobs that SHOULD be open for American citizens? However, with the educational problems with ever-increasing tuition….fewer people are going to college to fill these positions. Where is that going to leave us in a few years? Based on this past election, we’re already a nation of uneducated, uninformed individuals! TMZ is apparently one of them who doesn’t understand the value of education in this country and the fact that there are jobs out there that are going unfilled because of a lack of qualified graduates to do them! Not everyone wants to be a coal miner, an assembly line worker, a plumber, etc.! Some of us strive to be more than that, but at the cost nowadays, many are being lost!

  3. dpaano says:

    Paying off student loans is ALSO hard on older individuals. I owe about $130,000; however, if I pay the income-based payment of a little over $1,000 (of which $960 is interest), I will have my loan paid off when I turn 99 years old and I will have paid over $330,000. The hardest part is that if I don’t pay it, they will take money out of my Social Security check when I retire (at present, I’m working full-time AND getting my Social Security, which I’m socking away for my actual retirement)! I can pay the current payment, but to think that out of the amount I’m sending in, only a little over $100 is going towards the actual principal is hard to take! I won’t have that kind of money to pay on my student loan once I retire. It’s not that I don’t want to pay it or think I shouldn’t owe it…..I do owe it…’s just that they definitely don’t make it easy. My loan got very high when I had it in forbearance for many years while I was the sole support of my disabled mother…..and while I was in forbearance, they kept adding and adding and adding interest each and every month! I was never advised of this until AFTER my mother passed away and I went to start paying my loan! I was in shock when I saw how much it had grown from the mere $45,000 that it was in 1985 when I finished school! Why they have to charge interest MONTHLY when you are in a forbearance is totally ridiculous also! As it stands, I will have to work full time until I drop dead… which time, my loan will be considered dead with me! Until then, I have to either pay the income-based payment or have my Social Security check garnished! At least millennials have more time to pay their loans off…..I don’t.

    • 1standlastword says:

      The capitalist gangsters will seek, find and “make legal”– with the help of profit whoring politicians– every opportunity to exploit every American citizen regardless their status because we have a system based on “vulture capitalism” wherein everything and everybody is converted into an asset: Even people who don’t have anything of value–material or immaterial, are turned into an asset for their apparent state of perpetual neediness!

      The astronomical student debt is being financialized which is why the pricks in power are happy to let it get so damn big without a legal moral and ethical means of relief enjoyed by the likes of our president elect.

      The truth is America loves so called job creators–giving them fresh start after fresh start like Mr. Trump while the labor/ professional class bones are ground to cornmeal to make the rich folks bread.

      We have our presidents Bush and Clinton to thank for signing off on the draconian laws that entrap American students.

      • dpaano says:

        And, what’ s really funny is although I have 6 college degrees (two Associates, two Bachelors, and a dual MBA), I never got a job in any of them and they were in subjects that were NOT liberal arts; i.e., Criminology, Human Resources, International Business, etc. Yet, because I got my MBA when I was in my late 30’s, I was thought to be too old and already making too much money as an admin assistant to be considered for any entry-level position in any of my fields! Had I known this, I wouldn’t have wasted so much time and energy getting my degrees. I went to school 3-4 nights a week and worked a full 40-hour week at the same time! My week-ends were spent doing homework….not going out with my friends! So, now I’m stuck paying back MUCH more money than I actually got for my education, and that’s the hard part! I don’t mind people getting student loans, but to charge interest on those loans is totally ridiculous because that’s where the money adds up. If we were only required to pay back the exact amount that we borrowed, more people would be glad to continue their educations.

    • Stellajcokley says:

      Google is paying 97$ per hour! Work for few hours and have longer with friends & family! !mj158d:
      On tuesday I got a great new Land Rover Range Rover from having earned $8752 this last four weeks.. Its the most-financialy rewarding I’ve had.. It sounds unbelievable but you wont forgive yourself if you don’t check it
      ➽➽;➽➽ http://GoogleFinancialJobsCash478MediaBlackGetPay$97Hour ★★✫★★✫★★✫★★✫★★✫★★✫★★✫★★✫★★✫★★✫★★✫★★✫★★✫★★✫★★✫★★✫★★✫★★::::::!mj478d:….,……

  4. apzzyk says:

    The beginning of the student loan business came with the came with the National Education Defense Act of 1957. The reason for the timing was Sputnik, when someone noticed that se simply lacked the educators to take care of the boomers educational needs, including the trainin of future teachers as well as scientists and engineers. I had completed my military service, just to get it out of the way because of the draft, and got out in 1961, just in time to avoid Nam, even though I had a friend who died there in 1960. Because I had been unable to save any money during my 4 in the Corps, and the GI bill had ended, I had to work, making as much as $1.00/hr for about 18 mos just to save the money for the first quarter, which I had to complete just to qualify for a loan since I was an ‘Elderly student’ – over 21 with no previous higher ed – then could, at the time, only borrow $1,000/per school year still had to work to make it through the BS, so I graduated with about $3K in student debt, on which interest would not be charged until I competed my education, so on grants, fellowships, and finally the Nam era GI bill, I got the Ph.D., and with some loan forgiveness for the 2 years that I taught at the U. level, I was actually able to buy a new car, and put a down payment down on a house while still paying off the rest of my student debt. Since I was there when the mistakes started adding up, I know somehting about all of the things that went wrong.
    In 1963, my tuition was the same as my dad had paid in 1937 – $75.00 per quarter for all of the hours I could cram in, with summer tuition at $100 for the same thing. But, in 1964, the GOP took over CO state govt., so in the 1965-66 tuition rose to $125.00 per quarter – a 66% percent increase in one year which put some of my fellow students out of school, probably never to return because there are only so many jobs in a University town. In 1967 student loans went private with the Higher Education Act, where interest began the day the loan was made at a rate which was higher than a car loan, and no provision for forgiveness at all and tuition and other costs kept increasing until there were no real state supported universities left. One of the things that went along with the loans was the requirement that they had to go to a fully accredited university or college. This changed, so that private, and non-acceidted universities and colleges could also get student loans so this meant that religious school students could also get loans, and then came all of the on-line universities. Now, after some investigation, nearly all funding from student loans cannot be used at on-line universities after it was found that the pieces of paper issued had no value. I knew people in the business world who got taken by these scam universities, and since I was in a hiring position, when an application showing one of these crossed my desk it went into the circular file.
    Now we are back in something of a worse fix than we were in 1957. Due to lack of state funding the enrollment of many brick and mortar schools are having trouble finding students because it is no longer true that a college graduate can earn 2 to 3 times that of a HS graduate because the multiplier is gone because of student debt. In 1970 we had new MD’s and other people at that level with maybe $30,000 in student debt, and now they would have at least 10 to 15 times that, and so we have people with capable minds and hands just going to ojt, and becoming plumbers, welders, etc. With an aging population we need more doctors, but they are not in the works. Wwith the private student loans, they were guaranteed by the Federal Government, so there was no dyincentive to keep them from lending to go to worthless on-line universities, and there has been much resistence in Congress to do anything about existing debt, much less making changes such as loan forgiveness, or even allowing those with the debt to refinance at a lower rate of interest. One of the reasons why our recovery from the most recent recession has been so weak is because there is no way that most recent grads could afford a new car, much less the 20% down required for a starter home.
    The problem, however, is solveable. If payments on existing student loans could be applied to down payments on starter homes, then we would hav something of a building boom to carry the rest of the economy up. With loan forgiveness for medical personell, the increase in insurance preminums would stablize; it takes the equivelent of 5 or 6 Full time Ph.D.s to bring a new pharm product to market so their costs would at least stablize.Then there is always the public funding of higher ed in the future.
    Sadly, none of these will be done because of the hut that would come to the private sector, which makes as much as it can on the backs of people who can least afford it. I have heard that the woman who wanted to do her Ph.D. dissertation on prostitution, and became one and paid down her student debt is becoming something of a role model. Great place in which we live. The motto is “if it does not make a profit, it is of no value” applies.

    • Your last sentence in a concise way describes what is happening in America, and in fact has been a primary driving force powering America’s pell mell drive to acquire by any means necessary. We have a achieved a staggering material success record, but spiritual advance has declined in inverse proportion.

    • dpaano says:

      My biggest problem is that the interest on my student loan is HIGHER than the interest on my mortgage AND my car payment! It’s ridiculous that I’m asked to pay over $1000 month for an income-based payment, and $900+ of it goes directly to interest and NOT to the principal. I’ll be dead before this loan gets paid off, which is ridiculous! Wouldn’t they get MORE money from me if they lowered my interest rate and put MORE of my payment towards the principal? As it stands, they will get only what I can afford to pay until the day I die; then they get nothing!

  5. And the Right Wing elements wonder why so many of the rest of Americans have a low opinion of conservatives as far as advancing the cause of education in America. This action taken against the necessity to always strive to further one’s education is deplorable and contributes to a lot of Americans being left in the dust because they didn’t have the urge or encouragement to move further along the path of education.

    طلبوا العلم من المهد إلى اللحد “Seek knowledge from the cradle (birth) to the grave (death).”
    (An Arabic proverb)

  6. jointerjohn says:

    History is filled with examples of the holders of power and wealth resisting education for the masses. The 2016 election demonstrated how valuable a public made up of dumb-asses really is to the right wing. Republicans will fight higher education for the working class even harder than ever now that they have completely tied themselves to the ignorant and gullible.

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