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Obama's Apocalyptic Student Loan Program

“We’re living the catastrophe,” he said. http://cdn01.dai...
Talented zombie-like knife casino
  02/26/15
...
bearded bawdyhouse
  02/26/15
oh noes, easy money for student loans was so disastrous that...
Big puce double fault
  02/26/15
Not a finance masterman; what is so catastrophic about this?
razzle-dazzle violent circlehead gaping
  02/26/15
In short, pre-Oct 1, 2007 short bros like Johnsmeyer are cau...
Talented zombie-like knife casino
  02/26/15
Or could, I suppose. To be fair, abrupt $20 billion revis...
razzle-dazzle violent circlehead gaping
  02/26/15
What's the solution here?
Talented zombie-like knife casino
  02/26/15
How should I know?
razzle-dazzle violent circlehead gaping
  02/26/15
We gotta stop this pre-Oct 1, 2007 expansion, man.
Talented zombie-like knife casino
  02/26/15
free money to goldman
Beady-eyed naked indirect expression
  02/26/15
Pay your god damn loans back
Exciting deranged corn cake hospital
  02/26/15
lol. PAYE and other debt forgiveness programs help, not hurt...
Beady-eyed naked indirect expression
  02/26/15
To be fair they are also citing a large number of defaults s...
lavender coldplay fan area
  02/26/15
What? The WHOLE article is about expanding to johnsmeyer ty...
Talented zombie-like knife casino
  02/26/15
Reading comp pwned. Skipped over that first part. Will edi...
lavender coldplay fan area
  02/26/15
Not entirely. I think it's citing Obama's recent expansions ...
razzle-dazzle violent circlehead gaping
  02/26/15
Fucking johnsmeyer
Talented zombie-like knife casino
  02/26/15
...
bearded bawdyhouse
  02/26/15
...
razzle-dazzle violent circlehead gaping
  02/26/15
LOL I DIDNT GET ON BC OF THE NEW PROGRAM. I SNUCK ON
Drab twinkling uncleanness chad
  02/26/15
...
bearded bawdyhouse
  02/26/15
lol so boomers are bitching about the game they invented, fo...
Exhilarant Elite Brethren
  02/26/15
...
bearded bawdyhouse
  02/26/15
180
bearded bawdyhouse
  02/26/15
Boomers plz respond
cream wrinkle hall
  02/26/15
Lol they will win bro
Talented zombie-like knife casino
  02/26/15
Something seriously wrong with this country when this is not...
jet racy heaven tank
  02/26/15
u retards are seirously myopic as fuck if you can't see how ...
alcoholic rehab
  02/26/15
You are wrongly equating the offer of relief to FUCKED stude...
jet racy heaven tank
  02/26/15
well im speaking generally about this boards absolutely self...
alcoholic rehab
  02/26/15
the thing is, if the government just demanded "regular&...
diverse jet-lagged mental disorder set
  02/26/15
On the other hand, I think a lot of people can make payments...
razzle-dazzle violent circlehead gaping
  02/26/15
Cr PAYE is a scam that will be ended once Hussain is gone.
Talented zombie-like knife casino
  02/26/15
paye should be gutted but this article is just typical boome...
vibrant onyx stock car
  02/26/15


Poast new message in this thread



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Date: February 26th, 2015 6:37 PM
Author: Talented zombie-like knife casino

“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: bearded bawdyhouse



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



Reply Favorite

Date: February 26th, 2015 6:40 PM
Author: Big puce double fault

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)



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Date: February 26th, 2015 6:41 PM
Author: razzle-dazzle violent circlehead gaping

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

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



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Date: February 26th, 2015 6:42 PM
Author: Talented zombie-like knife casino

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)



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Date: February 26th, 2015 6:43 PM
Author: razzle-dazzle violent circlehead gaping

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)



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Date: February 26th, 2015 6:44 PM
Author: Talented zombie-like knife casino

What's the solution here?

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



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Date: February 26th, 2015 6:46 PM
Author: razzle-dazzle violent circlehead gaping

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: Talented zombie-like knife casino

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

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



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Date: February 26th, 2015 6:47 PM
Author: Beady-eyed naked indirect expression

free money to goldman

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



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Date: February 26th, 2015 8:45 PM
Author: Exciting deranged corn cake hospital

Pay your god damn loans back

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



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Date: February 26th, 2015 6:46 PM
Author: Beady-eyed naked indirect expression

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)



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Date: February 26th, 2015 6:50 PM
Author: lavender coldplay fan area

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)



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Date: February 26th, 2015 6:51 PM
Author: Talented zombie-like knife casino

What? The WHOLE article is about expanding to johnsmeyer types

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



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Date: February 26th, 2015 6:53 PM
Author: lavender coldplay fan area

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: razzle-dazzle violent circlehead gaping

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)



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Date: February 26th, 2015 6:58 PM
Author: Talented zombie-like knife casino

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: bearded bawdyhouse



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



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Date: February 26th, 2015 7:01 PM
Author: razzle-dazzle violent circlehead gaping



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



Reply Favorite

Date: February 26th, 2015 8:45 PM
Author: Drab twinkling uncleanness chad

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)



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Date: February 26th, 2015 7:00 PM
Author: bearded bawdyhouse



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



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Date: February 26th, 2015 7:13 PM
Author: Exhilarant Elite Brethren

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)



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Date: February 26th, 2015 7:15 PM
Author: bearded bawdyhouse



(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: bearded bawdyhouse

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: cream wrinkle hall

Boomers plz respond

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



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Date: February 26th, 2015 8:22 PM
Author: Talented zombie-like knife casino

Lol they will win bro

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



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Date: February 26th, 2015 8:23 PM
Author: jet racy heaven tank

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)



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Date: February 26th, 2015 8:43 PM
Author: alcoholic rehab

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: jet racy heaven tank

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: alcoholic rehab

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: diverse jet-lagged mental disorder set

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: razzle-dazzle violent circlehead gaping

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)



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Date: February 26th, 2015 11:18 PM
Author: Talented zombie-like knife casino

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: vibrant onyx stock car

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)