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Why people with student debt are refusing to repay it

Dave_BerryDave_Berry 492 replies2801 threadsCC Admissions Expert CC Admissions Expert
"The Debt Collective, an organization founded by a group of activists who met during the Occupy Wall Street protests a decade ago, is calling on people with student debt to stop paying it.

The group’s goal is to get all private and federal student loans canceled and to make public college free.

They say there’s essentially already a strike occurring, with a large share of borrowers unable to pay down their loans." ...

https://www.cnbc.com/2020/02/12/student-loan-borrowers-announce-a-strike-refusing-to-pay-their-debts.html
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Replies to: Why people with student debt are refusing to repay it

  • PublisherPublisher 9574 replies119 threads Senior Member
    "Why people with student debt are refusing to pay it."

    Because, like any other problem, if you ignore it, it will go away.
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  • bluebayoubluebayou 27094 replies176 threads Senior Member
    come on Dave, you're better than quoting a click-bait title.
    However, Debt Collective members say they’re not recommending borrowers default on their loans. “We’re not encouraging people to commit financial suicide,” Gokey said.

    Instead, he said, people with student debt should find a way to bring their monthly bill down to $0. That could be through putting their loans into temporary postponements, including forbearance or deferment, or, if their earnings are low enough, through enrolling in an income-driven repayment plan where their payment would be nothing.

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  • coolguy40coolguy40 2638 replies6 threads Senior Member
    How do you live that kind of stupidity and expect grown-ups to take you seriously? That's a declaration I would expect from my 13 year old daughter.
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  • MarylandJOEMarylandJOE 60 replies0 threads Junior Member
    @OneMoreToGo2021

    I agree we have pushed student loans too far but I still think there is a need for some sort of loan. Obviously it should be more regulated because not everyone can make good financial decisions.

    I understand your point though. It certainly has pushed up the costs of college. Uggggh.
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  • PurpleTitanPurpleTitan 12814 replies29 threads Senior Member
    @saillakeerie, we already see it in Germany.

    No tuition costs. Room and board on the student to provide.
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  • saillakeeriesaillakeerie 2407 replies0 threads Senior Member
    As I understand the German system, its only a certain group of kids who are slated to go to college (typically from a relatively early age). Others (with few exceptions) will not go. And the college system isn't like the US system (with new student activity centers, dining halls with huge array of options, new and shiny libraries and dorms, sports facilities, etc).

    What is being tossed about in the US is "free" public college for everyone who wants it. Without some limiter on them, costs will skyrocket. Basic econ concept: subsidize something and you will get more of it and the price will go up. Subsidies in college costs are a big driver for increases in college costs. Look at medical costs: big subsidies (people pay a fraction of the costs of care and have no idea how much anything costs or reason to care). Costs soar. Wash. Rinse. Repeat.
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  • Rivet2000Rivet2000 1199 replies3 threads Senior Member
    @PurpleTitan Is it true that not everyone in Germany can actually take advantage of that "free tuition" ?
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  • PurpleTitanPurpleTitan 12814 replies29 threads Senior Member
    edited February 17
    @saillakeerie & @Rivet2000:

    These days, there are multiple pathways in to German unis and a large percentage of the student population are what we call non-trads. Yes, they are not open to everyone because everyone has to get in by meeting some standard/pathway completion (among many) but it's not like they are extremely difficult to do if you're of at least average intelligence and willing to study (and can do reasonablely well on tests).

    No, they don't tend to have lavish sports centers or lifestyle enhancement extras like many American colleges offer, but c'mon, they have libraries. German unis are there for students to pursue an education and credentials.
    edited February 17
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  • OneMoreToGo2021OneMoreToGo2021 63 replies0 threads Junior Member
    The German system makes sense.

    Not more than 15-20% of the population in the US has the intellectual potential for real academic study beyond 13 years of primary and secondary education.

    Let's start providing alternatives to the standard college prep sequences that are used in practically all US high schools. Just how many people are ever going to understand precalculus on any conceptual level, or ever use it again after high school? 15% may well be an overestimate.
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  • Rivet2000Rivet2000 1199 replies3 threads Senior Member
    edited February 17
    No, they don't tend to have lavish sports centers or lifestyle enhancement extras like many American colleges offer, but c'mon, they have libraries. German unis are there for students to pursue and education and credentials.

    That's the key point here. Germany is very much different than the US, so the comparison is hard to justify. I still prefer the options available here.
    edited February 17
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  • PurpleTitanPurpleTitan 12814 replies29 threads Senior Member
    ^
    You can prefer whatever you want, but I don't see free undergrad in Germany making their education expensive, which was the original point of debate.
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  • privatebankerprivatebanker 5844 replies86 threads Senior Member
    The whole concept of paying very little for your national defense in relationship to your size and strategic importance for decades allows for options.

    There is more to it as well. Culture.

    And the athletic options, creativity/exploration via varied course work and social connections you gain here have value too.

    It’s about choices. We probably have too many. Restricting it to European standards, time lines and major focused study only is one idea. Perhaps something in between, the state flagship options. Etc.

    However, try getting everyone on board with listing a small group of schools and having little flexibility in choice. It’s my understanding it’s a very score and board exam driven process. Think of uproar for many of the parents with children with lds, advocates for low ses and other barriers to entry.

    Tough questions. But worth a conversation.
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  • Mwfan1921Mwfan1921 3307 replies62 threads Senior Member
    edited February 17
    As pointed out there are many differences with regard to the Germany universities, their relative operating costs/lower cost structure, and who can access that college education.

    Let's look at the proportion of Germany's residents who have a college degree. The proportion of 25-64 year olds who have a tertiary degree in Germany is 29.1% (vs. 47.4% in the US), and among 25-34 year olds: Germany 32.3% vs. US 49.4%.

    https://data.oecd.org/eduatt/adult-education-level.htm#indicator-chart
    https://data.oecd.org/eduatt/population-with-tertiary-education.htm#indicator-chart


    While we don't know the isolated impact that 'free' college tuition has on the % of German residents with college degrees, tracking students from a relatively young age (before high school), and the robust post-secondary vocational training system are two factors that likely keep the college graduate numbers relatively low.

    I do think easy loan money is part of the increase in college costs in the US, but with the projected rise of online not-for-profit schools and the looming decrease in the college age population (starting around 2026), there may continue to be downward pressure on college costs....average tuition discount rate is already over 50%. These market dynamics are probably unsustainable for some smaller and/or financially challenged colleges.
    https://www.insidehighered.com/news/2019/05/10/nacubo-report-shows-tuition-discounting-trend-continuing-unabated


    edited February 17
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  • PurpleTitanPurpleTitan 12814 replies29 threads Senior Member
    ^ I don't see much change in either country.

    I will say:

    "And the athletic options, creativity/exploration via varied course work and social connections you gain here have value too."

    They also occur in Germany. Students have the equivalent of our intramurals, organize music festivals, etc. Doesn't seem to hinder their economy much. For elite professions, Germany uni grads are probably overrepresented at McKinsey.

    "The whole concept of paying very little for your national defense in relationship to your size and strategic importance for decades allows for options."

    Fair point. Though you could also argue that paying much more to sustain a military-industrial complex that is much bigger than needed and in many of the wrong areas (because it is one of the few massive welfare state schemes that are deemed politically acceptable by many) instead of on education may not be the best policy either.

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  • Sue22Sue22 6545 replies115 threads Senior Member
    Putting on my grouchy old lady pants...

    Whenever I see an article like this I check the LinkedIn profiles of the people being profiled and I am rarely happily surprised.
    Sandy Nurse doesn’t see why she needs to be $120,000 in debt “just for trying to improve my understanding of the world.”

    What has she been doing with that understanding? According to her LinkedIn profile she received a BA from Emmanuel College, a private college in MA, then an MA in international affairs from the New School. She’s currently working as the founder/project manager at a nonprofit. Being the snoop I am I checked her salary on the IRS nonprofit website. $4,728 for 20 hrs/wk. as of the latest filing on record.

    Everyone wants a job they love but that’s not always an option. Become an artisanal soapmaker or start a nonprofit if that’s what will feed your soul but then don’t complain that you can’t pay back the loans you agreed to repay. Recently my daughter, who’s under-challenged at work told me she hates her job. I responded. “Everyone hates their first job.” A bit of hyperbole, but for most kids it’s a shock to go from working on something that interests you on a schedule that’s largely under your control to sitting in an office being told what to do all day. Her response was “Actually, you’re right. All my friends hate their jobs.”

    The kids I feel for are the ones who took out what should have been a reasonable amount in loans then had a life event that took them off track. The ones with disabled kids or big medical bills or other unforeseen circumstances that make repayment impossible.




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