Reforming Student Loans

[dancingalone]

The operating expenses are payed out, but the insurance and retirement expenses can be invested and grown in order to protect against losses from inflation. What happened here and in all of these countries is that these pools of money were siphoned off when their managers were sold AAA derivatives that were in reality junk. When the hedge funds naked short sold their own products, they crashed the value, cashed in on the insurance policies, terrorized the government to bailout the insurance wings of the banks, and left gaping holes in the accounts that were supposed to take care of workers benefits.

You are zeroing in on the recent financial swap scandals as the primary cause for the weakness of pension funds, retirement plans, sovereign solvency, etc. This can't be further from the truth.

It's been well known that all of those entities were already in financial difficulty even before the current recession hit. Aging subscribers/citizens simply consume more and more health services as they age and obviously they're eligible for whatever social net payments exist such as Social Security or whatever the local European equivalent is called. The total sum of expected payout obligations exceeded the revenue coming in. All this has been expected even without the financial scenanigans you harp on.

In terms of real money, what this looks like for the HI DOE budget is that out of 2.4 billion, one billion now goes to service the debt that was created by this financial fraud. All of these government agencies are in the same boat because they did the same things, the money was there to pay for these benefits and then it was gone.

What are Hawaii's demographics? I had understood they pretty much follow the same California/NY recipe of overly generous benefits without the financial strength to back them up, especially in times of recession and exacerbated by the state's aging populace. Under those situations it would be no surprise that they are in trouble today without blaming it on the investment banks.

You only have to look at the Keiki Care debacle for a microcosm of what happens when you offer a free lunch. People tend to take you up on it, and SURPRISE! you tend to run out of money.

 

[CoryKS]

All good points and it's why I think we should just socialize the cost of education.

Why, so we can all pay for this girl's stupid life choices? She got a degree in frickin' religion and women's studies, why would I want to help her pay for that? Tell you what - I'll buy some fries from her.

 

[dancingalone]

I think that if our society supported people to educate themselves to whatever level they wished without having to worry about loans, we'd create a new American Renaissance. Think about the productive/creative capacity that is lost by denying education to those who can't pay? Society supporting education is one of the few collective economic policies that I support.

I am in favor of widely available education too, but it needs to be connected with the current needs of the country. And it needs to be practical. We shouldn't make kids who want to work in oil fields take courses in history and art.

I would like the idea of a new shortened bachelor's degree that is strictly about courses in one's major with no general education component. Perhaps these degrees could replace the existing Associate's degree which is largely meaningless as they are designed today, with the primary purpose of being a transfer credential into a 4 year program.

 

[Makalakumu]

Why, so we can all pay for this girl's stupid life choices? She got a degree in frickin' religion and women's studies, why would I want to help her pay for that? Tell you what - I'll buy some fries from her.

There aren't a lot of people who actually want to study those things and you'd be surprised at how these types of education create benefits for yourself.

If you think about this from an investment/return point of view, investment into education brings some of the highest returns as far as real productive value is concerned. It's far better then military which only produces negative returns and acts as a drag on society.

An investment on a degree of which you think is worthless produces more value then investment in a bomb or a missile. It's a matter of priorities. I'm always going to support a person's desire to better themselves and I think society should as well.

 

[Makalakumu]

I am in favor of widely available education too, but it needs to be connected with the current needs of the country. And it needs to be practical. We shouldn't make kids who want to work in oil fields take courses in history and art.

I would like the idea of a new shortened bachelor's degree that is strictly about courses in one's major with no general education component. Perhaps these degrees could replace the existing Associate's degree which is largely meaningless as they are designed today, with the primary purpose of being a transfer credential into a 4 year program.

Yeah, great idea! The only problem I foresee is giving the government too great of a hand in choosing for a student. I foresee a system in which people choose how they want to be educated and society supports that individual's decision. It's the best of both worlds, IMO, and actually increases liberty for all.

 

[CoryKS]

There aren't a lot of people who actually want to study those things and you'd be surprised at how these types of education create benefits for yourself.

That's because most people are sane enough to realize that they will ultimately have to pay for it, and that the degree isn't going to help them with that. I bolded the last word because it is key - the benefits, such as they are, accrue to the person who holds the degree, so that person should be the one to pay for it.

If you think about this from an investment/return point of view, investment into education brings some of the highest returns as far as real productive value is concerned. It's far better then military which only produces negative returns and acts as a drag on society.

Sorry man, you're wharrgarbling again. I am absolutely not going to discuss ROI with someone who considers student loans as a form of "debt slavery". You absolutely have no idea what you are talking about.

An investment on a degree of which you think is worthless produces more value then investment in a bomb or a missile. It's a matter of priorities. I'm always going to support a person's desire to better themselves and I think society should as well.

I think you should give me $100,000. I promise I'll better myself with it.

 

[Makalakumu]

You are zeroing in on the recent financial swap scandals as the primary cause for the weakness of pension funds, retirement plans, sovereign solvency, etc. This can't be further from the truth.

It's been well known that all of those entities were already in financial difficulty even before the current recession hit. Aging subscribers/citizens simply consume more and more health services as they age and obviously they're eligible for whatever social net payments exist such as Social Security or whatever the local European equivalent is called. The total sum of expected payout obligations exceeded the revenue coming in. All this has been expected even without the financial scenanigans you harp on.



What are Hawaii's demographics? I had understood they pretty much follow the same California/NY recipe of overly generous benefits without the financial strength to back them up, especially in times of recession and exacerbated by the state's aging populace. Under those situations it would be no surprise that they are in trouble today without blaming it on the investment banks.

You only have to look at the Keiki Care debacle for a microcosm of what happens when you offer a free lunch. People tend to take you up on it, and SURPRISE! you tend to run out of money.

Again, it's more complicated then people simply using a service. Also, the financial shenanigans that are happening now have simply taken other forms in the past. For example, my state legislature is currently trying to find 25 million in off the book expenditures. We've got government agencies in my state that haven't had a real audit since 1972. So, yeah, it's not one thing like the swaps of these CDOs, it's a number of things that have built and built with the CDO swaps being the landslide that eventually broke the system.

And there can be no doubt that they broke the system, our Auditor recently uncovered that the governor OKed a CDO swap in a retirement account to the tune of several billion dollars. The account now has about 250 million in it. The auditor was nearly fired and the case was quickly swept under the rug.

The idea of providing for the social wellfare with certain things is unrelated for the most part. That's what people need to understand and THAT is what is being used to confuse people to transfer their tax moneys in Austerity Measures to pay off these fraudulent deficits. This looks like a subject for another thread...

 

[Makalakumu]

That's because most people are sane enough to realize that they will ultimately have to pay for it, and that the degree isn't going to help them with that. I bolded the last word because it is key - the benefits, such as they are, accrue to the person who holds the degree, so that person should be the one to pay for it.

Dude, people do not live in a disconnected world. When one person in society gets a degree, that education benefits everyone around them because of what they can create with it. When I said, "yourself" I meant you, because whether you like it or not, YOU are the indirect and direct beneficiary of other people's education.

Sorry man, you're wharrgarbling again. I am absolutely not going to discuss ROI with someone who considers student loans as a form of "debt slavery". You absolutely have no idea what you are talking about.

That's your loss, braddah. I understand this issue very well, but it's different then your understanding.

I think you should give me $100,000. I promise I'll better myself with it.

Certainly. I'll trade one missile for your education.

 

[dancingalone]

Well, I never got the impression that Hawaii was a particularly well-governed state. I think looking around the country, some states are in better shape than others, even with the current projected deficits. You likely know which ones they are - they're generally the states that have resisted growing state programs, even during the good times.