Loan forgiveness is a welcome step – Chico Enterprise-Record

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The current college debt storm is a complicated one. Most defaults are set at $8,000 and were created to attend college for profit. These colleges spend a large portion of their budget on advertising, promising quick completion and good jobs to entice students to enroll, and most of their income comes from student loans. These schools have abysmal completion and employment rates. They represent 10% of registrations, 20% of loans and 50% of payment defaults. (Chicago Booth Review, May 13, 2019.)

Those who attend these schools tend to be non-traditional students looking for a more reliable income. Helping them get out of expensive and fraudulent debt is an absolute GOOD. (“Why I Changed My Mind About Canceling Student Debt”, New York Times, August 30, 2022)

While it is true that those working on higher degrees in medicine, law and business have large loans, their default rate is 20%. Most of them are repaid by quarries that directly result from the loan, a liability measure that was lifted in the last administration. He must be reinstated.

Most student loans are guaranteed by the government. This means that student loans fund the for-profit college system, which is a government subsidy to a corrupt industry that benefits those trying to get better jobs.

The new loan forgiveness package is a welcome bandage for the consumer and the economy, and the next job is surgery for the system.

—Brooks Thorlaksson, Chico

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