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Obama's Apocalyptic Student Loan Program

“We’re living the catastrophe,” he said. http://cdn01.dai...
cream office
  02/26/15
...
180 pozpig organic girlfriend
  02/26/15
oh noes, easy money for student loans was so disastrous that...
bronze mediation
  02/26/15
Not a finance masterman; what is so catastrophic about this?
chocolate wild gaming laptop
  02/26/15
In short, pre-Oct 1, 2007 short bros like Johnsmeyer are cau...
cream office
  02/26/15
Or could, I suppose. To be fair, abrupt $20 billion revis...
chocolate wild gaming laptop
  02/26/15
What's the solution here?
cream office
  02/26/15
How should I know?
chocolate wild gaming laptop
  02/26/15
We gotta stop this pre-Oct 1, 2007 expansion, man.
cream office
  02/26/15
free money to goldman
spectacular voyeur
  02/26/15
Pay your god damn loans back
Concupiscible Angry Keepsake Machete Rehab
  02/26/15
lol. PAYE and other debt forgiveness programs help, not hurt...
spectacular voyeur
  02/26/15
To be fair they are also citing a large number of defaults s...
razzmatazz kink-friendly stage
  02/26/15
What? The WHOLE article is about expanding to johnsmeyer ty...
cream office
  02/26/15
Reading comp pwned. Skipped over that first part. Will edi...
razzmatazz kink-friendly stage
  02/26/15
Not entirely. I think it's citing Obama's recent expansions ...
chocolate wild gaming laptop
  02/26/15
Fucking johnsmeyer
cream office
  02/26/15
...
180 pozpig organic girlfriend
  02/26/15
...
chocolate wild gaming laptop
  02/26/15
LOL I DIDNT GET ON BC OF THE NEW PROGRAM. I SNUCK ON
brass black woman
  02/26/15
...
180 pozpig organic girlfriend
  02/26/15
lol so boomers are bitching about the game they invented, fo...
Sexy beady-eyed gaping
  02/26/15
...
180 pozpig organic girlfriend
  02/26/15
180
180 pozpig organic girlfriend
  02/26/15
Boomers plz respond
hairraiser lay milk
  02/26/15
Lol they will win bro
cream office
  02/26/15
Something seriously wrong with this country when this is not...
excitant point
  02/26/15
u retards are seirously myopic as fuck if you can't see how ...
Anal Personal Credit Line
  02/26/15
You are wrongly equating the offer of relief to FUCKED stude...
excitant point
  02/26/15
well im speaking generally about this boards absolutely self...
Anal Personal Credit Line
  02/26/15
the thing is, if the government just demanded "regular&...
Electric jet business firm friendly grandma
  02/26/15
On the other hand, I think a lot of people can make payments...
chocolate wild gaming laptop
  02/26/15
Cr PAYE is a scam that will be ended once Hussain is gone.
cream office
  02/26/15
paye should be gutted but this article is just typical boome...
transparent vivacious forum
  02/26/15


Poast new message in this thread



Reply Favorite

Date: February 26th, 2015 6:37 PM
Author: cream office

“We’re living the catastrophe,” he said.

http://cdn01.dailycaller.com/wp-content/uploads/2014/12/RTR4G2UY_opt-e1424960575791.jpg

http://dailycaller.com/2015/02/26/obamas-apocalyptic-student-loan-program/

Obama’s unilateral revisions to student loan programs could result in U.S. taxpayers being hit with surprise bills in the tens or even hundreds of billions of dollars, according to a new paper from the American Action Forum published Thursday.

Three weeks ago, the release of the Obama’s administration’s 2015 budget proposal revealed an unexpected, massive revision to the balance sheet of the Department of Education’s $740 billion portfolio of student loans. The government’s earnings off of student loans were found to have come in a full $21.8 billion below expectations. (RELATED: $20 Billion Black Hole: Obama Bailout of College Students Costs Taxpayers)

The cause of the huge shortfall lies in administration policy designed to ease the burden of those with student loans. Programs like Pay As You Earn (PAYE) allow borrowers to cap payments at 10 percent of their post-tax income, and have their debt balance forgiven if they have made payments for 20 years (10 years if they work in public service).

Originally available to only some borrowers, recent Obama executive orders have worked to expand eligibility to millions of new borrowers. Heavy use of the programs, combined with higher-than-anticipated default rates, have caused the Department of Education to collect less on its debt than anticipated.

That Americans are essentially being put on the hook for a $22 billion shortfall is bad enough, but the full truth is even worse, AFF argues. In order to handle its debt shortfall and finance new student loans, the Department of Education has to borrow extensively from the U.S. Treasury.

“Each year the FDLP returns less in principal and interest earnings than expected,” the paper says. “Since the [Education Department] is short on its IOU to Treasury, it has to come up with the money somewhere, and that somewhere is another IOU from the taxpayer in the form of additional Treasury debt. Outside of Washington, this process would seem comical, as it looks a lot like asking a bank for a second loan to pay off an initial loan.”

Comical or not, the costs are high: $88.9 billion in additional deficit spending, by AAF’s estimate, more than four times the 2015 budget revision. The trouble doesn’t stop there, either, because Treasury loans aren’t interest free.

“When the ED comes up short, the Treasury still has to pay interest on the unpaid debt,” the AAF report says. “That’s also true for the new debt, which means a double whammy for taxpayers who are propping up Treasury’s borrowing with their tax dollars.” In the end, the $22 billion flub could end up costing taxpayers hundreds of millions or even billions more over the long haul.

The group also warns that there is no reason to believe the 2015 shortfall was a one-off event. Out of 21 annual cohorts of loans issued by the Department, they note, 18 cohorts have ended up costing more than expected, a negative error rate of 85 percent. As long as the government continues to finance a huge number of student loans while failing to properly calibrate loan risks, the $22 billion surprise could be just the beginning.

“Taxpayers should be concerned about the $21.8 billion shortfall, but they should be even more troubled by the nonchalance with which billions of dollars in additional debt are being swept under the rug by the direct loan program and its administrators,” the paper says.

AAF president Douglas Holtz-Eakin, who was president of the Congressional Budget Office under President George W. Bush, told The Daily Caller News Foundation that there is no clear upper limit to how large the revisions could be in the future.

“What we’re finding out now is, as has nearly always been the case, the government underestimates the risk when it makes a loan,” he said, adding that, in theory, a revision of more than $100 billion isn’t impossible, especially if the economy were to enter another recession and greatly constrain the power of young borrowers to pay their debts.

“We’re living the catastrophe,” he said.

(http://www.autoadmit.com/thread.php?thread_id=2818306&forum_id=2#27396640)



Reply Favorite

Date: February 26th, 2015 6:40 PM
Author: 180 pozpig organic girlfriend



(http://www.autoadmit.com/thread.php?thread_id=2818306&forum_id=2#27396659)



Reply Favorite

Date: February 26th, 2015 6:40 PM
Author: bronze mediation

oh noes, easy money for student loans was so disastrous that we are having to borrow more to keep the system alive! whatever shall we do??

"That Americans are essentially being put on the hook for a $22 billion shortfall is bad enough, but the full truth is even worse, AFF argues. In order to handle its debt shortfall and finance new student loans, the Department of Education has to borrow extensively from the U.S. Treasury.

“Each year the FDLP returns less in principal and interest earnings than expected,” the paper says. “Since the [Education Department] is short on its IOU to Treasury, it has to come up with the money somewhere, and that somewhere is another IOU from the taxpayer in the form of additional Treasury debt. Outside of Washington, this process would seem comical, as it looks a lot like asking a bank for a second loan to pay off an initial loan.”

(http://www.autoadmit.com/thread.php?thread_id=2818306&forum_id=2#27396666)



Reply Favorite

Date: February 26th, 2015 6:41 PM
Author: chocolate wild gaming laptop

Not a finance masterman; what is so catastrophic about this?

(http://www.autoadmit.com/thread.php?thread_id=2818306&forum_id=2#27396667)



Reply Favorite

Date: February 26th, 2015 6:42 PM
Author: cream office

In short, pre-Oct 1, 2007 short bros like Johnsmeyer are causing a catastrophic national bankruptcy.

(http://www.autoadmit.com/thread.php?thread_id=2818306&forum_id=2#27396674)



Reply Favorite

Date: February 26th, 2015 6:43 PM
Author: chocolate wild gaming laptop

Or could, I suppose.

To be fair, abrupt $20 billion revisions to the deficit are a cause for concern. That's a lot of money even for the U.S.

(http://www.autoadmit.com/thread.php?thread_id=2818306&forum_id=2#27396680)



Reply Favorite

Date: February 26th, 2015 6:44 PM
Author: cream office

What's the solution here?

(http://www.autoadmit.com/thread.php?thread_id=2818306&forum_id=2#27396684)



Reply Favorite

Date: February 26th, 2015 6:46 PM
Author: chocolate wild gaming laptop

How should I know?

(http://www.autoadmit.com/thread.php?thread_id=2818306&forum_id=2#27396696)



Reply Favorite

Date: February 26th, 2015 6:47 PM
Author: cream office

We gotta stop this pre-Oct 1, 2007 expansion, man.

(http://www.autoadmit.com/thread.php?thread_id=2818306&forum_id=2#27396703)



Reply Favorite

Date: February 26th, 2015 6:47 PM
Author: spectacular voyeur

free money to goldman

(http://www.autoadmit.com/thread.php?thread_id=2818306&forum_id=2#27396701)



Reply Favorite

Date: February 26th, 2015 8:45 PM
Author: Concupiscible Angry Keepsake Machete Rehab

Pay your god damn loans back

(http://www.autoadmit.com/thread.php?thread_id=2818306&forum_id=2#27397296)



Reply Favorite

Date: February 26th, 2015 6:46 PM
Author: spectacular voyeur

lol. PAYE and other debt forgiveness programs help, not hurt, the mess we made for ourselves

(http://www.autoadmit.com/thread.php?thread_id=2818306&forum_id=2#27396691)



Reply Favorite

Date: February 26th, 2015 6:50 PM
Author: razzmatazz kink-friendly stage

To be fair they are also citing a large number of defaults so it could be argued that getting those who may default on an affordable payment plan may boost the revenue.

As an out and proud PAYE member, I hope they just gut obama's proposed plan under the new budget. That new proposal creates far to much uncertainty for me and may create such an uproar that it causes boomers to take notice of loan repayment plans and gut them completely.

Don't really trust dept of edu's statements to not worry, you'll always be able to stay under your current plan.

(http://www.autoadmit.com/thread.php?thread_id=2818306&forum_id=2#27396713)



Reply Favorite

Date: February 26th, 2015 6:51 PM
Author: cream office

What? The WHOLE article is about expanding to johnsmeyer types

(http://www.autoadmit.com/thread.php?thread_id=2818306&forum_id=2#27396718)



Reply Favorite

Date: February 26th, 2015 6:53 PM
Author: razzmatazz kink-friendly stage

Reading comp pwned. Skipped over that first part. Will edit accordingly.

(http://www.autoadmit.com/thread.php?thread_id=2818306&forum_id=2#27396725)



Reply Favorite

Date: February 26th, 2015 6:53 PM
Author: chocolate wild gaming laptop

Not entirely. I think it's citing Obama's recent expansions as symptomatic of the wider problem of the government's student loan system being screwed up and likely to repeatedly produce big shortfalls.

(http://www.autoadmit.com/thread.php?thread_id=2818306&forum_id=2#27396726)



Reply Favorite

Date: February 26th, 2015 6:58 PM
Author: cream office

Fucking johnsmeyer

(http://www.autoadmit.com/thread.php?thread_id=2818306&forum_id=2#27396749)



Reply Favorite

Date: February 26th, 2015 7:00 PM
Author: 180 pozpig organic girlfriend



(http://www.autoadmit.com/thread.php?thread_id=2818306&forum_id=2#27396758)



Reply Favorite

Date: February 26th, 2015 7:01 PM
Author: chocolate wild gaming laptop



(http://www.autoadmit.com/thread.php?thread_id=2818306&forum_id=2#27396762)



Reply Favorite

Date: February 26th, 2015 8:45 PM
Author: brass black woman

LOL I DIDNT GET ON BC OF THE NEW PROGRAM. I SNUCK ON

(http://www.autoadmit.com/thread.php?thread_id=2818306&forum_id=2#27397300)



Reply Favorite

Date: February 26th, 2015 7:00 PM
Author: 180 pozpig organic girlfriend



(http://www.autoadmit.com/thread.php?thread_id=2818306&forum_id=2#27396759)



Reply Favorite

Date: February 26th, 2015 7:13 PM
Author: Sexy beady-eyed gaping

lol so boomers are bitching about the game they invented, forced us to play, and then won, just because they don't get to win by as much as they hoped

(http://www.autoadmit.com/thread.php?thread_id=2818306&forum_id=2#27396814)



Reply Favorite

Date: February 26th, 2015 7:15 PM
Author: 180 pozpig organic girlfriend



(http://www.autoadmit.com/thread.php?thread_id=2818306&forum_id=2#27396832)



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Date: February 26th, 2015 7:16 PM
Author: 180 pozpig organic girlfriend

180

(http://www.autoadmit.com/thread.php?thread_id=2818306&forum_id=2#27396833)



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Date: February 26th, 2015 7:38 PM
Author: hairraiser lay milk

Boomers plz respond

(http://www.autoadmit.com/thread.php?thread_id=2818306&forum_id=2#27396973)



Reply Favorite

Date: February 26th, 2015 8:22 PM
Author: cream office

Lol they will win bro

(http://www.autoadmit.com/thread.php?thread_id=2818306&forum_id=2#27397156)



Reply Favorite

Date: February 26th, 2015 8:23 PM
Author: excitant point

Something seriously wrong with this country when this is not a joke:

"The government’s earnings off of student loans were found to have come in a full $21.8 billion below expectations."



(http://www.autoadmit.com/thread.php?thread_id=2818306&forum_id=2#27397164)



Reply Favorite

Date: February 26th, 2015 8:43 PM
Author: Anal Personal Credit Line

u retards are seirously myopic as fuck if you can't see how this shit is terrible for the country (even if it benefits you)

you know how many retards are doing 5 years of a shitty cal state PHD program in applied gender studies, will earn 40k a year as case workers for trans youth, and essentially forgive 200 grand in debt in the 2020s?

the fact that some of you failed lawyers are benefiting doesn't change the fact that the system as designed is a complete fucking disaster. any financially shrewd doctor doing a real fellowship, for example, is essentially getting nearly completely free medical school.

(http://www.autoadmit.com/thread.php?thread_id=2818306&forum_id=2#27397285)



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Date: February 26th, 2015 8:49 PM
Author: excitant point

You are wrongly equating the offer of relief to FUCKED students as the problem.

This is merely a temporary solution to those FUCKED by the current system. It is neither the condition that FUCKED students to begin with, nor the solution to the FUCKED system. But it is relief. No one is going out and racking up student loans based on student loan relief. No one. Not a single person so don't even think about contradicting me or I'll post a dick pic.

(http://www.autoadmit.com/thread.php?thread_id=2818306&forum_id=2#27397322)



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Date: February 26th, 2015 9:29 PM
Author: Anal Personal Credit Line

well im speaking generally about this boards absolutely self serving love of IBR forgiveness and shit

but even targeted forgiveness is bad. the only way people learn not to do stupid shit is when they see other people have their lives fucking destroyed by stupid shit. so yes, any policy aiming to relieve the burden of these bad choices is a problem, because its not like 17 yaer olds are sitting around thinking "well my uncle isn't homeless and he got an MA in fine arts...but a lot of that is probably because of unsustainable and targeted relief efforts that i wouldn't be eligible for"

they just see that people are doing fine and do what they wanna do.

we literally need people with phds dying in the fucking streets before the average person wakes up and realizes this system is broke. anything else just sustains it

(http://www.autoadmit.com/thread.php?thread_id=2818306&forum_id=2#27397585)



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Date: February 26th, 2015 9:24 PM
Author: Electric jet business firm friendly grandma

the thing is, if the government just demanded "regular" repayment from everyone and suspended all the special repayment programs, the default rates would explode, and the debtors wouldn't even have bank accounts worth raiding with a court order nor salaries worth garnishing.

(http://www.autoadmit.com/thread.php?thread_id=2818306&forum_id=2#27397545)



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Date: February 26th, 2015 9:26 PM
Author: chocolate wild gaming laptop

On the other hand, I think a lot of people can make payments either way, and offering them PAYE just eases their burden.

(http://www.autoadmit.com/thread.php?thread_id=2818306&forum_id=2#27397560)



Reply Favorite

Date: February 26th, 2015 11:18 PM
Author: cream office

Cr PAYE is a scam that will be ended once Hussain is gone.

(http://www.autoadmit.com/thread.php?thread_id=2818306&forum_id=2#27398295)



Reply Favorite

Date: February 26th, 2015 11:36 PM
Author: transparent vivacious forum

paye should be gutted but this article is just typical boomer bitching - if it were housing loans he'd be saying obama should tax moar while exempting retirement age people from the tax because millennials are at a stage in their lives where they can afford a higher tax burden without harming their retirement savings, which he'd also falsely assume they'd all have.

(http://www.autoadmit.com/thread.php?thread_id=2818306&forum_id=2#27398395)