GOP's Secret $90 Billion Gift to Wall Street by raising cost of student loans

Bfgrn

Bfgrn

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GOP candidates are making a point of running against "bailouts" this year. Yet even as they rail about rescuing big banks, they're working on a plan that would slip those same banks an estimated $90 billion in taxpayer money...and that's just in the first ten years.

"Fiscal conservatism," anyone?

It was always hypocritical to slam a bailout that they and their party initiated. But it turns out they were just warming up. Now they're trying to pull a fast one on the American public, tapping Tea Party rage about big government spending even as they prepare to slip the big bankers some big bucks. They're planning to siphon off $90 billion meant for America's college students and their families and give it to Wall Street.

Any Tea Partier who votes for these guys is being played for a sucker.

The Republican repeal plan wouldn't just put tens of billions of public dollars in bank coffers. It would also raise the maximum amount a graduate is forced to pay each year from 10 percent to 15 percent of income. And it would extend the length of time before their debt is forgiven from 20 to 25 years.

Your GOP: Sending billions in taxpayer money to rich bankers, and squeezing young people starting out in life. Call it the New Populism.

Small government? Less spending? The Republican Party's backdoor bailout of wealthy bankers is bigger than the auto-industry bailout. It's bigger than the home-loan program. It's bigger than the lending program for small businesses. And unlike those programs, it serves no social purpose at all:
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1: Where did the author get the info you are referencing? Is this an actual bill, or a baseless election year scare tactic accusation?

2: Exactly how does their plan "slip the banks $90 billion in taxpayer money?" How is this plan more expensive (ie: giving the banks more tax money) than the current method of subsidizing interest rates on student loans with tax revenues?

3: When a person is forced to pay back a loan faster (ie: 15% of income instead of 10%), it means they end up paying LESS in finance charges. It also means the government pays less in tax revenues subsidizing the loan rates over that period of time. It will save the people billions in interest charges, both directly and in taxes. In short, it ends up giving the banks LESS taxes over the life of the student loans. How is that bad?

4: What is wrong with extending the debt forgiveness clause to 25 years? How is that a bad thing? IMO there should not even be a debt forgiveness clause. These are LOANS we are talking about, not grants. They are expected to be paid back. The forgiveness clause simply encourages people to default, costing tax payers billions more. How is forgiving their loans after 20 years a good thing? After 20 years any individuals still owing on their student loans should be advanced enough in their careers to finish paying it off, anyway. The entire concept of forgiving loans is bullshit. Don't you people believe in personal responsibility?
 
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A College Test for Washington: Help Young People in Need, or Kowtow to Bank Lobbyists?

It should be, as the President once called it, a "no-brainer": Overhaul our broken system for distributing federal student loans. Stop giving banks undeserved profits for administering these loans (an estimated $80 billion over ten years), since they take no risk and have managed the program poorly. Make sure our money goes directly to the young people that need them the most. Who could be against that? In fact, the student loan reform bill has already passed the House.

Yet, in an ugly replay of the lobbyist feeding frenzy that accompanied health reform, this initiative is being undermined in the Senate by highly paid K Street bank operatives. This is a test case: If Washington can't overcome lobbyist influence enough to do the right thing for our country's young people, it will be a public spectacle. Any politician who fails to fight for this program will be hurting themselves politically and punishing college students financially, leaving those students in the hands of rapacious and corrupt lenders.

It's a simple, multiple-choice test for Washington politicians: Do you choose a) fight for the banks, or b), fight for students and their families? Your answer will be graded on Election Day.
 
It was conservative icon Edmund Burke who said: "Education is the cheap defense of nations."

The $90 billion dollar give-away is the ADDITIONAL COST to taxpayers for banks to 'administer' loans. Not only will it cost taxpayers more $$$ for student loans, it will cost those students more $$$ FOR the loans.

The Republican repeal plan wouldn't just put tens of billions of public dollars in bank coffers. It would also raise the maximum amount a graduate is forced to pay each year from 10 percent to 15 percent of income. And it would extend the length of time before their debt is forgiven from 20 to 25 years.

You right wing vultures even circle our young people starting out in life!

HERE is the leading private company providing student loans and how they 'administer' those loans:

Sallie Mae cuts student loans

Sallie Mae cuts student loans - CollegiateTimes.com

Sallie Mae's the poster child for the moral and operational bankruptcy of the 90's privatization craze. Created and funded entirely by the taxpayer, it went private in the late 90's and immediately went on a greed binge. It started throwing mad money at Presidential and Congressional candidates, then kicked in the maximum allowable amount - $250,000 - to George W. Bush's inauguration.

2010-03-08-AstraSPX.jpg


One of Sallie Mae's corporate jets: Model IAI-1125A Astra SPX, registration #N188AK
 
One more time for the illiterate:
WHAT EXACTLY IS THIS "PLAN"?
Where does the 90 billion come in? Where are the details to show the entire claim is not just one more election year lie?

As for putting the government in charge, how is it better to spend untold billions building yet one more government bureaucracy to run directly the federal student loan program as opposed to paying financial institutions to do the job? Do you actually think the government will do the administration cheaper?

Yes, the bank (GASP!!) MAKE A PROFIT by administering federal student loans. So what? Why do you socialist assholes hate the idea of businesses making a profit? How is it better for the money to go to a government bureaucracy? Bottom line, it DOES cost money to administer the federal student loan program. That money can go to the private sector creating (or maintaining) private sector jobs, or it can go to government bureaucracy. Which would actually be better for the overall economy?

And did you read the article about Sally Mae, or did you just glom onto the obviously biased, slanted, and not-exactly-truthful headline? Sally Mae made the decision to stop giving high risk student loans. "On Jan. 29, (2008) student loan provider Sallie Mae announced it would no longer provide loans to students with sub-prime credit scores." So, in the midst of a severe banking crisis brought about by massive loan defaults, they decide to not continue issuing more risky loans. HOW DARE THEY!!!!!

Bottom line, so far all you've shown is a bunch of typical liberal anti-business "profit is wrong" rhetoric. Nowhere have you provided information about where the first reference got their information. Nowhere is there any support for the claims of "giving Wallstreet 90 billion dollars". Nowhere is there any support for the claims that banks are not running the federal student loan program efficiently.

I'll agree with Obama on one thing: it's a no-brainer. Anyone who listens to his BS has no brains.
 
Its lefty bullshit.....our student load program, that includes banks, has worked perfectly for decades.....now, Obama wants to take it over...take over banks just like the take over of GM....and the Healthcare insurance Companys....

Government in control....the Liberals way......
 
Good Luck said:
One more time for the illiterate:
WHAT EXACTLY IS THIS "PLAN"?
Where does the 90 billion come in? Where are the details to show the entire claim is not just one more election year lie?

As for putting the government in charge, how is it better to spend untold billions building yet one more government bureaucracy to run directly the federal student loan program as opposed to paying financial institutions to do the job? Do you actually think the government will do the administration cheaper?

Yes, the bank (GASP!!) MAKE A PROFIT by administering federal student loans. So what? Why do you socialist assholes hate the idea of businesses making a profit? How is it better for the money to go to a government bureaucracy? Bottom line, it DOES cost money to administer the federal student loan program. That money can go to the private sector creating (or maintaining) private sector jobs, or it can go to government bureaucracy. Which would actually be better for the overall economy?

And did you read the article about Sally Mae, or did you just glom onto the obviously biased, slanted, and not-exactly-truthful headline? Sally Mae made the decision to stop giving high risk student loans. "On Jan. 29, (2008) student loan provider Sallie Mae announced it would no longer provide loans to students with sub-prime credit scores." So, in the midst of a severe banking crisis brought about by massive loan defaults, they decide to not continue issuing more risky loans. HOW DARE THEY!!!!!

Bottom line, so far all you've shown is a bunch of typical liberal anti-business "profit is wrong" rhetoric. Nowhere have you provided information about where the first reference got their information. Nowhere is there any support for the claims of "giving Wallstreet 90 billion dollars". Nowhere is there any support for the claims that banks are not running the federal student loan program efficiently.

I'll agree with Obama on one thing: it's a no-brainer. Anyone who listens to his BS has no brains.
Click to expand...

Where does the 90 billion come in?
From the article:

The Department of Education Arne Duncan estimates the bank subsidy was costing approximately $9 billion per year, including the interest banks were able to collect. Given the rapid and ongoing increases in college tuition, it's not unreasonable to think that the total amount could wind up being much more than either figure. I used the data compiled by the New York Times for the other figures. In every case, I used the highest possible figures for the final cost of each program, to make my estimates as conservative as possible. (I stayed away from TARP, even though we're told it's making a profit, because the total cost is still unknown.)

The result was clear: This GOP's planned Wall Street giveaway was the biggest and costliest of all the programs listed.

Senator Lamar Alexander disputes that it will save taxpayer $87 billion, he squeals that it will ONLY SAVE $47 billion dollars of taxpayer's money.

As for putting the government in charge, how is it better to spend untold billions building yet one more government bureaucracy

Typical right wing straw-man. The program will use offices designated by the U. S. Education Department." (It's more likely students will go online to make their selection)

Do you actually think the government will do the administration cheaper?

ABSOLUTELY!!! Why do you think the insurance lobbyists fought so hard against the public option during the health care debate? Medicare is a government-run program that has administrative expenses that are around 3%. The insurance industry spends about 20 cents of every premium dollar on overhead.

This right wing privatization mantra has reached the stage of INSANITY!

WAKE UP! The Republicans are shilling for the elite and top 1% they handed almost ALL the wealth to over the last 30+ years. Now you brainwashed parrots want to help them finish OFF the middle class...
 
Good Luck said:
4: What is wrong with extending the debt forgiveness clause to 25 years? How is that a bad thing? IMO there should not even be a debt forgiveness clause. These are LOANS we are talking about, not grants. They are expected to be paid back. The forgiveness clause simply encourages people to default, costing tax payers billions more. How is forgiving their loans after 20 years a good thing? After 20 years any individuals still owing on their student loans should be advanced enough in their careers to finish paying it off, anyway. The entire concept of forgiving loans is bullshit.
Click to expand...

Banks have a responsibility to not give out loans to those they believe can't pay them back. It's a two way responsibility. A loan is secured to the persons ability to be paid back, not their price as a slave.

Good Luck said:
Don't you people believe in personal responsibility?
Click to expand...

Not really.
 
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