Student Loans: Gateway to Debt Slavery

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Student Loans: Gateway to Debt Slavery

I LOVE THIS -- by Jess Bachman, posted at ritholtz.com. It's a vivid takedown of the extortionate educational-political-industrial complex. This should be posted in every high school counseling office as a mandatory Truth in Education Disclosure.

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Re: Student Loans: Gateway to Debt Slavery

Thanks for the good info Machinehead. That can be like getting sucked into a black hole.  Have you seen any confirmation that student debt now exceeds consumer debt?  That's scary.  I sent a link to my favorite college student.  

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Re: Student Loans: Gateway to Debt Slavery

Yikes, what a racket.  

The info is great, however, there are 13 typos/errors which might cause some people to write off the message.  Hope they didn't make too many hard copies.

 

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Re: Student Loans: Gateway to Debt Slavery

Total household debt --including mortgages, credit cards and student loans -- was about $13.5 trillion at the end of 2009.

Bachman may be talking about the growth rate of student loans, as a consumer spending 'addition.'

But out of all that consumer debt, student loans are the only category that can't be discharged in bankruptcy.

They ought to teach this in school.

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Re: Student Loans: Gateway to Debt Slavery
Travlin wrote:

Have you seen any confirmation that student debt now exceeds consumer debt?

Machinehead -- Appreciate your response.  I found some more info. 

$829 billion in student loans according to the info you posted.

$817 billion in credit card debt.  This may be what he meant, but not what he said.

My source is the US Debt Clock.  Do you find their figures to be generally reliable, as in roughly accurate?

http://www.usdebtclock.org/

Edit: He did say credit cards near the bottom, above the yellow post-it notes section.  He also implied that's what he meant in his first sentence.  Sloppy writing detracts from his good info. 

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Re: Student Loans: Gateway to Debt Slavery

Heaps of data about for-profit colleges have gotten attention in recent months as Sen. Tom Harkin, D-Iowa, pushes to increase oversight on the industry — spurred by allegations of misleading recruiting and lackluster employment rates among for-profit school graduates. Last week marked a deadline for some proprietary institutions to disclose previously private information to the senator.

While the details of those disclosures aren't yet available, Harkin's staff said information will likely spur further hearings in the fall.

"Our goal remains the same: to ensure that students and the American taxpayer are getting what they are promised," a Harkin spokeswoman told The Daily Iowan.

As that investigation continues, experts say the federal government's pursuit of more regulation could have farther-reaching effects — bearing consequences even on nonprofit colleges such as the University of Iowa.

"Higher education is already experiencing problems with the public in terms of the perception of whether we are a suitable use of public dollars," said Christopher Morphew, the head of the UI educational policy and leadership studies department. "Questions about whether the higher education institutions are preparing their graduates are questions, when brought to the forefront, that call into question some of the nonprofits as well."

For-profit institutions only enroll around 10 percent of U.S. college students but those students receive almost a quarter of federal financial-aid dollars — more than $20 billion annually.

Additionally, Pell Grant totals at nonprofit schools have declined while for-profit colleges' students are seeing more Pell Grant dollars.

Students at both for-profit and nonprofit schools draw federal aid from the same limited funds.
Even outside higher education, the for-profit sector's burden might weigh on the entire economy.

For starters, 40 percent of students at for-profit schools default on their loans within 15 years of graduation, according to a report from the Chronicle of Higher Education last month.

"It's taxpayer money going to corporations, and that's money we're not going to get back. There's an economic interest that goes way beyond consumer protection," said Alisa Hicklin Fryar, a political-science professor who studies education and public policy at the University of Oklahoma.

 

http://www.dailyiowan.com/2010/08/30/Metro/18457.html

This is another piece of the monster govt created.  As in housing, the intention of the govt was to provide a way for those at the bottom of the ladder to gain a toehold.  The result is the same - it raises the price of "admission" by creating a false demand driven by "free" money which creates a demand for more free money.  We can easily see the end result in housing. 

Higher education must really refer to the artificially induced state of mind required to enter into these contracts with the devil.  Take away the money and all of a sudden the plunging cost of an education would be the talk of the town. Then maybe someone could afford to go to school while working.  I did it.  My father did it while being married with three kids to feed.

 

 

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Re: Student Loans: Gateway to Debt Slavery

Hey ho!  One of my favorite subjects.  Shhhh...don't tell my editing team, but I am playing hooky from the book right here and now...BUT...this is the most important chart on the subject that goes perfectly with the flow-chart picture posted at the top of this thread...what happens whe you massively subsidize something with government money? 

You get a bubble of course:

(Source)

That chart looks *exactly* like the chart of house prices to incomes except its several standard deviations larger and more pronounced.  Nothing can grow that much faster than inflation forever; the mystery has always been how it went this long at all.  The flow-chart above answers that nicely.  It took a carrot and stick program from the federales to accomplish.  Nicely done!  

Another big mystery is why no colleges have decided to compete on price and virtually all gone along with the scam.  I guess that just proves that greed is pretty hard to resist.   Imagine the competition to get into a college that had kept its prices in line with inflation?  

I predict a very rude future for a large number of colleges and universities as students finally wake up and begin to reject the scam either out of simple economic prudence, or necessity.  The survivors will figure out the importance of competing on price before the rest.  

(..............................)

Now, back to editing!

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Re: Student Loans: Gateway to Debt Slavery

 yobob1 said:

This is another piece of the monster govt created.  As in housing, the intention of the govt was to provide a way for those at the bottom of the ladder to gain a toehold.  The result is the same - it raises the price of "admission" by creating a false demand driven by "free" money which creates a demand for more free money.  We can easily see the end result in housing. 

 

This and the housing market suffered not only from the gov't trying to provide a toe hold,  but more from its swinging policy toward such aid.  "We're going to help you.  We're not going to help you.  We don't think we should help you.  We think some one should help you.  I know let's privatize this help!  "  And so on.  Then you get a government trough feeding private parties, and no oversight on those private parties' level of fraud and greed.

It takes both sides of this debate to make it get this fouled up.

 

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Re: Student Loans: Gateway to Debt Slavery

 

"To develop the clock, Kantrowitz started with a conservative estimate of $665 billion in federal loans outstanding as of June. For private student loans, he used a repayment-trajectory model that he put together in addition to annual new loan volume data. Those calculations yielded $168 billion for private student loans. Combine all this debt and you get the starting estimate of $833 billion. The total increases by $2,853.88 for each second since midnight June 30, he said. The total debt outstanding will be more explosive at the beginning of each semester, when most student loans are disbursed."

 

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Re: Student Loans: Gateway to Debt Slavery

 That graph is .................... scary!

 Anyhoo.. just spotted this article in the NYT mag.

 

Our world, particularly America, is in the midst of huge economic, environmental and technological changes. We could be living in a very different society 20, 25 years from now. Who is to say that the key to success (or even survival) in that world will be having a degree from a top college? It could be that the kids who grew up less programmed are, in fact, more prepared to thrive. Maybe instead of getting them SAT tutors and signing them up for tuba lessons we should be taking them camping and teaching them how to grow their own food. 

 http://parenting.blogs.nytimes.com/2010/10/19/preparing-kids-for-the-unknown/

 

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Students: You Are Exploited Debt-Serfs

 Students: You Are Exploited Debt-Serfs

http://www.oftwominds.com/blogapril11/students-exploited4-11.html

 

Students and parents, wake up: your only salvation lies in political engagement and action.

Of all the exploitative systems in the U.S., none is more rapacious than the Education Cartel. Like the proverbial frog that is unaware that it's being boiled because the water temperature rises so gradually, college students and their parents are unable to recall what higher education was like before students were herded into debt-serfdom.

Apologists for the Education Cartel like to blame Corporate America or the banks, but the reality is that the Federal and State governments and the employees of the Cartel are willing partners in the exploitation and fraud. How did we get to the boiling-water point where students are expected to take on $100,000 or more in debt to attend college--even a mediocre one?

Answer: immensely profitable Government-backed loans. If the Central State wasn't partnered with the Education Cartel, today's debt-serfdom would be impossible.

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$100k Debtor, Cortney Munna

I thought this was interesting. I wonder how many American youth, lacking a solid financial education, just sign documents to borrow money without thinking about the real cost.

New York Times article "Placing the Blame as Students Are Buried in Debt", featuring $100k debtor, Cortney Munna and her mother:
http://www.nytimes.com/2010/05/29/your-money/student-loans/29money.html

Follow-up interviews with Cortney Munna:
http://parabasis.typepad.com/blog/2010/06/the-education-timebomb.html
http://parabasis.typepad.com/blog/2010/06/the-education-timebomb-part-2-...

Follow-up response by Cortney Munna (trying to defend herself, I guess):
http://bucks.blogs.nytimes.com/2010/06/01/more-on-cortney-munnas-student...

These kids are yoking themselves to the equivalent of home mortgage payments - but unlike a home where you can live, there's no guarantee of a job...

Poet

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wow

I got my education late in life, in my 40s, and was able to consolidate my loans and take a breather with permission when unemployed.

The current loan conditions, if accutately depicted (aand they sure seem to be), are unconscionable. *Gose to put on her activist hat* Grrr.

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If you are an minimum wage

If you are an minimum wage single mother with under 11k of earned income and unpaid student loans, they will seize your earned income credit .  I've seen it happen.  Student loans are not wiped out by bankruptcy.  Kids absolutely don't know what they are signing.  Next: debtor's prison for unempoyed college grads?

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"Class Of 2011: Most Indebted Ever" With Low Prospects

Cross-posted to "Daily Digest 5/9".

Number of the Week: Class of 2011, Most Indebted Ever
"Given the state of the job market, many degree-holders will face a long slog to get debt-free: The Collegiate Employment Research Institute estimates that the average salary for holders of new bachelor degrees will be $36,866 this year, down from $46,500 in 2009."

"In the near term, the debt burden could weigh on both the housing market and the broader economy. College graduates struggling to pay off debts are more likely to put off major milestones such as leaving home, getting married and buying a house, at a time when the creation of new households in the U.S. remains well below its long-term average."
http://blogs.wsj.com/economics/2011/05/07/number-of-the-week-class-of-20...

Some of the comments just need to be saved for posterity and shared with everyone:

Quote:

11:20 am May 9, 2011
Financial Aid Officer wrote:

Adding to the student loan over borrowing is an entire generation of parents who are so far in debt that they cannot help their children with college costs. At our school, over 50% of parents are denied a PLUS loan. Why? Because they have bad credit ratings. This generation of parents will enter retirement still oweing on their homes. They have less than 5% of what they will need for retirement in investments and savings. Their major asset is their home. Are they going to sell it and live on the street? Or, take a reverse mortgage and end up with about 1/2 their home value going as interest on that mortgage.

It is unfortunate that college kids are coming from homes where they feel “entitled”. They are entitled to use their student loan money on spring break in Cancun or Lake Tahoa. They “need” the latest cell phone, Ipod, designer label jeans, etc. They have no concept of having only 2 or 3 pair of jeans and 3 or 4 pairs of shoes. If they would “live below their means” during college they could avoid some of the debt. By making sound CHOICES and limiting the borrowing, they could have a better life. I have a friend who borrowed about $120,000 while working on her PhD (she never finished). The interest on the original amount was about $700 per month. She filed for hardship, etc. etc. Now the principal is over $150,000 and calculating what she would totally pay IF she ever begins payment on the loans, it would be over $450,000. She makes less than $50,000 per year so no matter what she does, she cannot possibly ever pay this off. Her life is so out of control that 10 years ago she filed bankruptcy on $60,000 of credit card debt. Still she keeps buying. The sad fact is that financial aid professionals cannot deny a student a loan. Well, we can if a student states flat out that they are not going to repay the loan. But, we would probably get sued. We have people coming to our school (a community college) with over $40,000 in student loan debt. And, they are over age 50. We cannot discriminate on age. Mathematically, these students will never be out from under this debt. Student loans have become the welfare of the year 2011.

Poet

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My father could support a

My father could support a family, save for a retirement, and save for nearly all my college on a single income. Today even as a professional who makes sound choices and has a lean budget I still can't even save enough for my own retirement let alone my kids. And based on the above I wouldn't advise them to go into any significant debt for college. College prices will have to come down when the credit fueling them dries up, I hope!

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You actually can get student loans discharged.

You actually can get student loans discharged through bankrupcy but it will take eight years. I had never heard of this until now so I thought I would post it.

http://www.wikihow.com/Pay-off-Student-Loans

Second Bankruptcy, is an option if necessary. There may be a need for time between the two to show new efforts at life have failed a second time (minimum number or years between bankruptcies). The key is you must have included the SLs(Student Loans) in the FIRST bankruptcy and been denied. Inclusion in the second will then get them discharged. The rationale is in TITLE 11 > CHAPTER 5 > SUBCHAPTER II > § 523, (b). To paraphrase it - Even if the discharge was denied under an initial ruling based on NOT meeting the undue hardship rules found in subsection (a)(8), it will be discharge on the subsequent filing so long as it isn't classified as what would be an illegal process of loan. This is rarely understood or dealt with in the vast majority of information sources (web sites) due to their focus on only the current 1st bankruptcy.[17]
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Student Loans as Investment

I am attempting to pay for both of my daughters' college, including room and board. In order for me to be able to aford to do this, they are attending community college for two years each before going to a state school. They are living at home for at least the first two years. (We live in a University town.) One will likely get some scholarships. My questios is this: Assuming they get a fixed interest rate, which is currently about 4.0%, does it make sense for them to borrow -- say -- $40,000 in student loans now, and then put it all in gold (and possibly silver) unless and unti we need some of it for expenses? And if I am able to pay for most ot their schooling, does it make sense to pay it off after they graduate with part of the gold?

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Would You Borrow Money To Invest?
Debra B wrote:

I am attempting to pay for both of my daughters' college, including room and board. In order for me to be able to aford to do this, they are attending community college for two years each before going to a state school. They are living at home for at least the first two years. (We live in a University town.) One will likely get some scholarships. My questios is this: Assuming they get a fixed interest rate, which is currently about 4.0%, does it make sense for them to borrow -- say -- $40,000 in student loans now, and then put it all in gold (and possibly silver) unless and unti we need some of it for expenses? And if I am able to pay for most ot their schooling, does it make sense to pay it off after they graduate with part of the gold?

Debra B

I can tell you have a lot of common sense and practical-mindedness and your daughters are smart to follow your lead about going to community college first.

That is why it surprises me that you're considering playing with loans and gold and silver, gambling that precious metals will increase in value enough to make a profit and pay for expenses.

First, depending on how you borrow, it may not be legal to speculate with loan money intended for school.

But more importantly, while it is likely that gold will increase in value and you will be able to sell it for a profit, it is not a certainty. Because you likely will buy above spot-price and sell below spot-price, and there may be taxes on the gain, you have to be pretty darn sure that the price will increase enough that you will make a profit - or be prepared to be hit with a potential loss. Gold and silver prices CAN be rather volatile. Silver was just a few months ago at almost $50, before dropping down to $34.

Personally, I wouldn't NOT borrow money to invest. A lot of people who borrowed to buy houses - very certain in their knowledge that home prices would continue to rise - are learning that painful lesson right now.

Here's another way to put it:

1. Would you borrow money to invest? Really?
2. If so, would you lend me money to invest in gold and silver? But it's a sure thing, right?

Personally, I think you would come out much further ahead if your daughters also stayed at home with you (or roomed/boarded with a relative for cheap) in their last two years as well. Also be aware, most students don't graduate in 4 years unless they plan very carefully.

P.S. - I would like to leave you with two links. The first is about outcomes for college graduates. "According to a recent study out of Rutgers University, of people who graduated from four-year colleges and universities between 2006 and 2010, only 53% have found full time jobs. The rest were attending grad school (some after giving up on their job search), working part time, or unemployed."
http://minoritysurvival.com/2011/06/13/not-everyone-should-go-to-college/:

The second is to published results of a Georgetown University study of Americans of all ages who happen to have a Bachelor's degree. It lists their employment levels and median salaries (which includes those who have been at their jobs for 20+ years as well as those who have just started out). This is a much better survey than those self-reported surveys that colleges proudly put out, that are usually only filled by those graduates who happened to have found a nice job (maybe at daddy's company) right after graduation.
http://www9.georgetown.edu/grad/gppi/hpi/cew/pdfs/whatsitworth-complete.pdf

Poet

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Asked Another way

Thank you Poet, for your well thought out and civil reply. For the sake of thoroughness, let me pose the question in a different way;

I am a physician who lost everything in a brutal divorce from an unemployed man with a Ph.D, who planned for me to take care of him the rest of his life while he wrote a book (which he has been working on for about 25 years.) In addition to having my savings and retirement ransacked, I am saddled with paying for my daughters' higher education.

We have cut back our lifestyle dramatically already. We have three large gardens, can apple sauce, make our own fabric softener, and buy used clothes.

While I am aware of the statistics about college education, as children of parents with 'advanced degrees" my girls cannot fathom not going to college. So I have agreed to support them and pay for thier college the best I can, but it may be necessary to take out some student loans.

Student loans are paid out in a chunk, which you then put in the bank (or wherever) and spend gradually as needed.

In these extremely uncertain economic times, I wonder if the best place to put a few thousand dollars might actually be in gold buillon, which can be cashed in a $1000 or so at a time as necessary.  I think it is far more likely that the value of the dollar will go down over the next four years, than that the price of gold will go down the same amount.

At the end of four years, we can just pay back the loan by selling the gold and making up the shortfall with payments if necessary. Any thoughts about this?

 

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Debra, It's Your Life
Debra B wrote:

Student loans are paid out in a chunk, which you then put in the bank (or wherever) and spend gradually as needed.

In these extremely uncertain economic times, I wonder if the best place to put a few thousand dollars might actually be in gold buillon, which can be cashed in a $1000 or so at a time as necessary.  I think it is far more likely that the value of the dollar will go down over the next four years, than that the price of gold will go down the same amount.

At the end of four years, we can just pay back the loan by selling the gold and making up the shortfall with payments if necessary. Any thoughts about this?

I should make a quick correction to my previous comment. I meant to say "I would NOT borrow". I am sorry you had such a bad situation and had to extricate yourself. As to whether I would borrow on student loans to invest in gold and silver, my answer is still "No." I think I've already laid out my reasoning. Again, my question stands: "Would you lend me (Poet) money to invest in gold and silver to pay you back 4 years later?"

However, this is your life. If you wish to take the risk, that is your choice to do so. Yes, it's very likely that gold will go up. As long as you are aware that the precious metals may also go down, or stay stagnant, or just not go up fast enough on a timeline convenient to you and your loan repayment terms, and you are prepared to make up the shortfall with payments, fine.

 

If you do want to borrow to invest, then my suggestion is that, if your daughters are to borrow, have them borrow under their names only. Avoid signing for anything yourself. As many financial advisors like to say, you can't borrow money for retirement. If they end up not being able to repay their loans on a timely basis - say a job can't be found or it pays too little - they can still move back in with you, as 85% of recent college graduates have reported they will do with their parents. And if they do end up moving back in with you, that extra money they save on rent - even from a part-time job - could go towards paying off the loans they incur. You can optionally also help them.

But if you incur loans alongside them, or borrow for them, then it becomes your debt burden on top of everything else you'd be saddled with (helping your daughters, managing living expenses for yourself, rebuilding your savings, saving for retirement, and possibly - if he got some kind of spousal support besides the ravaging of your life's savings -  paying for your ex-husband's living expenses). I know a physician can make good money, but I bet there is only so much money to go around.

I can understand your daughters expect to go to college. I do hope they choose majors you approve of. Please show them some of the statistics and guide them in picking majors and sticking to difficult coursework. Unless they are in STEM (science, technology, engineering, or math) majors, they should at a minimum hold a 10-hour a week job. I worked 15 to 20 hours while going to college full time. Maybe it was a little too much work. But having a part-time job does force you to stay organized.

Roth IRA For Wage (Non-Loan) Earnings
If you can meet the income requirements, I suggest you - and your daughters if they are working part-time through high school - start socking away any savings into a Roth IRA instead of a savings account or regular brokerage account. Money already in a Roth IRA is considered retirement money and is NOT used in financial aid calculations (the FAFSA), whereas savings and other non-retirement assets are considered eligible to be withdrawn from to meet college expenses.

However, the money you contribute into a Roth IRA (not the earnings) can be taken out at any time for any reason, without penalty, whether you want to buy ice cream or pay for college for your daughters. (So if given the choice between having $5,000 in a savings account or $5,000 in a Roth IRA, pick the latter.)

Depending on which state you live in, money in Roth IRAs (like certain other retirement accounts) may also be protected from creditors in bankruptcy. This may turn out to be a very important consideration.

Debra, as you know, these are very different times. The ball of string that is the American economy is unraveling faster.

Poet

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Thanks Poet

Thanks for the information, Poet. I should correct  a persistent mistaken belief about physicians. We are not making that much money anymore, especially in view of how hard we work and our incredible responsibility. We also HATE insurance companies, more than the non-physicians of the world do, but insurance companies have done an excellent job of implying we work hand in hand with them. They even make it appear that we work for them, and it is true that we are getting closer and closer to that arrangement.

I'm still not sure where to put the student loan money if we (my daughters) need it. We live in such an expensive part of the country that I assume they will be living with me for a while -- maybe for a long while, as I see extended families living together as an economic reality in the not too distant future.

 

Peace, Poet.

 

D

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if the children going

If the children going to college live with you, your income will be considered in their filing for the loans. I was able to go to college later in life, when i was not living with my parents, and it helped me qualify for aid, lower interest rates, and scholarships. I also really knew what degree in what field was right for me, and it served me well as I chose a field with shortages of personnel.

I guess I am saying that if your young people wait for college, that is not the end of the world. I worked full time while i was in school, too, and saved money on commuting with online courses.

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 This applies directly to

 This applies directly to the recent talk about an "education bubble". I myself has seen it, graduating recently with a post-graduate degree with many of my classmates taking 50k in loans to leave without a job. Something is wrong here.

Pete Thiel (paypal) had some excellent comments on it back in April: http://techcrunch.com/2011/04/10/peter-thiel-were-in-a-bubble-and-its-not-the-internet-its-higher-education/

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I'm In HUGE Debt

HI all.

 

So, between me and my wife, our grad school laons are well over 6 figures.  Our best hope has been the 'income based' repayment option, and making steady payments for 20 years or whatever it is, until the loans just go away, and you pay taxes on the remaining balance.

Yup.  We are debt slaves.  But hey - even with payments, I'm still making more money than before, so, it's not SO bad.  And my new career, acupuncture, translates well to the 'new economy' - it's inexpensive, health care is always needed, I can do it nearly anywhere, and it is great for bartering.  Hehe... maybe I should be buying those silver needles....

That being said, I remember this news program I heard where they were interviewing people from Zimbabwe, asking them what they would have done different if they knew in advance their currency would collapse.  Some of course mentioned moving their savings to foreign holdings.  One guy said, "I would have gone into more debt".  I guess that by this he meant, with devalued dollars, it would have been easier to make paymets... and maybe, just maybe, a wrecked system would somehow 'make them go away', although I can't imagine the federal mob allowing THAT to happen. But what if they have no choice or recourse?

That's how I console myself when I think of total meltdown.  Maybe they'll lost my paperwork in the riots.

Meh.  So it is.

 

But kids?  Don't do it.  It's not worth it.  Really.  It IS a basic scam.  But my life was going nowhere, so, I jumped in (before it all went to hell).  Is what it is.  I'll just try to make the best out of what I got.  At least I got a skill.

 

 

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Re: I'm In HUGE Debt

RedHeadKingPin

You may want to read this thread.

http://www.peakprosperity.com/forum/student-loans-gateway-debt-slavery/4...

RedHeadKingPin's picture
RedHeadKingPin
Status: Member (Offline)
Joined: Oct 7 2008
Posts: 20
thanks

Hi JO

 

The link take me back to the start of this thread we're on here.  And I took note of your contribution.

But I'm guessing you meant another one?

Thanks for the info, btw.  I'm uneducated on bankruptcy in general, so it might be something for me to research, even if I cen hear the reververations of my wife's resounding 'NO!' in my head just by imagining it.... we're not exactly on the same page with regard to the direction in which this country is headed.  It's not all bad though.  She's agreed to certain preparation, such as food stores and PM allocations.  And man, she wure does put up with a lot of verbage from this paranoid dude over here....

Thanks!

RedHeadKingPin's picture
RedHeadKingPin
Status: Member (Offline)
Joined: Oct 7 2008
Posts: 20
thanks

Hi JO

 

The link takes me back to the start of this thread we're on here.   I took note of your fine contribution.

But I'm guessing you meant another one?

I'm uneducated on bankruptcy in general, so it might be something for me to research, even if I cen hear the reververations of my wife's resounding 'NO!' in my head just by imagining it.... we're not exactly on the same page with regard to the direction in which this country is headed.  It's not all bad though.  She's agreed to certain preparation, such as food stores and PM allocations.  And man, she wure does put up with a lot of verbage from this paranoid dude over here....

Thanks!

Poet's picture
Poet
Status: Diamond Member (Offline)
Joined: Jan 21 2009
Posts: 1889
College Students Using 'Sugar Daddies' To Pay Off Loans

Note: Cross-posted also to the thread "Other News, Articles, Or Links Of Interest":
http://www.peakprosperity.com/comment/116172#comment-116172

A sign of the times...

Seeking Arrangement: College Students Using 'Sugar Daddies' To Pay Off Loan Debt
"Rich guys well past their prime have been plunking down money for thousands of years in search of a tryst or something more with women half their age -- and women, willingly or not, have made themselves available. With the whole process going digital, women passing through a system of higher education that fosters indebtedness are using the anonymity of the web to sell their wares and pay down their college loans.

"'Over the past few years, the number of college students using our site has exploded,' says Brandon Wade, the 41-year-old founder of Seeking Arrangement. Of the site's approximately 800,000 members, Wade estimates that 35 percent are students. 'College students are one of the biggest segments of our sugar babies and the numbers are growing all the time.'"
http://www.huffingtonpost.com/2011/07/29/seeking-arrangement-college-stu...

This isn't anything new, of course. It's been going on since the beginning of time.

Personal anecdote: Some years ago - back in my single days, before the Great Recession - I went out a few times with an attractive college student who actually suggested a few times to me that I be her sugar daddy. I didn't take her (or anyone, for that matter) up on the offer.

Poet

Wendy S. Delmater's picture
Wendy S. Delmater
Status: Diamond Member (Offline)
Joined: Dec 13 2009
Posts: 1977
article on student loan debt

There's an interesting article on student loan debt slavery at Zero Hedge today.

This is the perfection of indentured servitude. How many students pay off their $100,000 loans in a mere seven years? Modern banks and corporate "higher education" diploma mills have improved the old system of indentured servitude, extending the servitude from seven years to decades.

The key dynamic here is the transference of risk from the lenders, who stand to reap immense profits from these loans, to the students.

 

 

Damnthematrix's picture
Damnthematrix
Status: Diamond Member (Offline)
Joined: Aug 10 2008
Posts: 3998
Education superpower because it values equality

What Americans Keep Ignoring About Finland's School Success

By Anu Partanen

 

Dec 29 2011

The Scandinavian country is an education superpower because it values equality more than excellence.

Sergey Ivanov

Everyone agrees the United States needs to improve its education system dramatically, but how? One of the hottest trends in education reform lately is looking at the stunning success of the West's reigning education superpower, Finland. Trouble is, when it comes to the lessons that Finnish schools have to offer, most of the discussion seems to be missing the point.

The small Nordic country of Finland used to be known -- if it was known for anything at all -- as the home of Nokia, the mobile phone giant. But lately Finland has been attracting attention on global surveys of quality of life -- Newsweek ranked it number one last year -- and Finland's national education system has been receiving particular praise, because in recent years Finnish students have been turning in some of the highest test scores in the world.

Finland's schools owe their newfound fame primarily to one study: the PISA survey, conducted every three years by the Organization for Economic Co-operation and Development (OECD). The survey compares 15-year-olds in different countries in reading, math, and science. Finland has ranked at or near the top in all three competencies on every survey since 2000, neck and neck with superachievers such as South Korea and Singapore. In the most recent survey in 2009 Finland slipped slightly, with students in Shanghai, China, taking the best scores, but the Finns are still near the very top. Throughout the same period, the PISA performance of the United States has been middling, at best.

Compared with the stereotype of the East Asian model -- long hours of exhaustive cramming and rote memorization -- Finland's success is especially intriguing because Finnish schools assign less homework and engage children in more creative play. All this has led to a continuous stream of foreign delegations making the pilgrimage to Finland to visit schools and talk with the nation's education experts, and constant coverage in the worldwide media marveling at the Finnish miracle.

So there was considerable interest in a recent visit to the U.S. by one of the leading Finnish authorities on education reform, Pasi Sahlberg, director of the Finnish Ministry of Education's Center for International Mobility and author of the new book Finnish Lessons: What Can the World Learn from Educational Change in Finland? Earlier this month, Sahlberg stopped by the Dwight School in New York City to speak with educators and students, and his visit received national media attention and generated much discussion.

And yet it wasn't clear that Sahlberg's message was actually getting through. As Sahlberg put it to me later, there are certain things nobody in America really wants to talk about.

* * *

During the afternoon that Sahlberg spent at the Dwight School, a photographer from the New York Times jockeyed for position with Dan Rather's TV crew as Sahlberg participated in a roundtable chat with students. The subsequent article in the Times about the event would focus on Finland as an "intriguing school-reform model."

Yet one of the most significant things Sahlberg said passed practically unnoticed. "Oh," he mentioned at one point, "and there are no private schools in Finland."

This notion may seem difficult for an American to digest, but it's true. Only a small number of independent schools exist in Finland, and even they are all publicly financed. None is allowed to charge tuition fees. There are no private universities, either. This means that practically every person in Finland attends public school, whether for pre-K or a Ph.D.

The irony of Sahlberg's making this comment during a talk at the Dwight School seemed obvious. Like many of America's best schools, Dwight is a private institution that costs high-school students upward of $35,000 a year to attend -- not to mention that Dwight, in particular, is run for profit, an increasing trend in the U.S. Yet no one in the room commented on Sahlberg's statement. I found this surprising. Sahlberg himself did not.

Sahlberg knows what Americans like to talk about when it comes to education, because he's become their go-to guy in Finland. The son of two teachers, he grew up in a Finnish school. He taught mathematics and physics in a junior high school in Helsinki, worked his way through a variety of positions in the Finnish Ministry of Education, and spent years as an education expert at the OECD, the World Bank, and other international organizations.

Now, in addition to his other duties, Sahlberg hosts about a hundred visits a year by foreign educators, including many Americans, who want to know the secret of Finland's success. Sahlberg's new book is partly an attempt to help answer the questions he always gets asked.

From his point of view, Americans are consistently obsessed with certain questions: How can you keep track of students' performance if you don't test them constantly? How can you improve teaching if you have no accountability for bad teachers or merit pay for good teachers? How do you foster competition and engage the private sector? How do you provide school choice?

The answers Finland provides seem to run counter to just about everything America's school reformers are trying to do.

For starters, Finland has no standardized tests. The only exception is what's called the National Matriculation Exam, which everyone takes at the end of a voluntary upper-secondary school, roughly the equivalent of American high school.

Instead, the public school system's teachers are trained to assess children in classrooms using independent tests they create themselves. All children receive a report card at the end of each semester, but these reports are based on individualized grading by each teacher. Periodically, the Ministry of Education tracks national progress by testing a few sample groups across a range of different schools.

As for accountability of teachers and administrators, Sahlberg shrugs. "There's no word for accountability in Finnish," he later told an audience at the Teachers College of Columbia University. "Accountability is something that is left when responsibility has been subtracted."

For Sahlberg what matters is that in Finland all teachers and administrators are given prestige, decent pay, and a lot of responsibility. A master's degree is required to enter the profession, and teacher training programs are among the most selective professional schools in the country. If a teacher is bad, it is the principal's responsibility to notice and deal with it.

And while Americans love to talk about competition, Sahlberg points out that nothing makes Finns more uncomfortable. In his book Sahlberg quotes a line from Finnish writer named Samuli Puronen: "Real winners do not compete." It's hard to think of a more un-American idea, but when it comes to education, Finland's success shows that the Finnish attitude might have merits. There are no lists of best schools or teachers in Finland. The main driver of education policy is not competition between teachers and between schools, but cooperation.

Finally, in Finland, school choice is noticeably not a priority, nor is engaging the private sector at all. Which brings us back to the silence after Sahlberg's comment at the Dwight School that schools like Dwight don't exist in Finland.

"Here in America," Sahlberg said at the Teachers College, "parents can choose to take their kids to private schools. It's the same idea of a marketplace that applies to, say, shops. Schools are a shop and parents can buy what ever they want. In Finland parents can also choose. But the options are all the same."

Herein lay the real shocker. As Sahlberg continued, his core message emerged, whether or not anyone in his American audience heard it.

Decades ago, when the Finnish school system was badly in need of reform, the goal of the program that Finland instituted, resulting in so much success today, was never excellence. It was equity.

* * *

Since the 1980s, the main driver of Finnish education policy has been the idea that every child should have exactly the same opportunity to learn, regardless of family background, income, or geographic location. Education has been seen first and foremost not as a way to produce star performers, but as an instrument to even out social inequality.

In the Finnish view, as Sahlberg describes it, this means that schools should be healthy, safe environments for children. This starts with the basics. Finland offers all pupils free school meals, easy access to health care, psychological counseling, and individualized student guidance.

In fact, since academic excellence wasn't a particular priority on the Finnish to-do list, when Finland's students scored so high on the first PISA survey in 2001, many Finns thought the results must be a mistake. But subsequent PISA tests confirmed that Finland -- unlike, say, very similar countries such as Norway -- was producing academic excellence through its particular policy focus on equity.

That this point is almost always ignored or brushed aside in the U.S. seems especially poignant at the moment, after the financial crisis and Occupy Wall Street movement have brought the problems of inequality in America into such sharp focus. The chasm between those who can afford $35,000 in tuition per child per year -- or even just the price of a house in a good public school district -- and the other "99 percent" is painfully plain to see.

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