Before I get into Sanders and his ideas for education. Here’s what Trump wants to do.
Washington(CNN)The Trump administration is retaining the consulting firm McKinsey to assess the federal student loan portfolio as the government weighs selling off some of the debt to private investors, The Wall Street Journal reported Wednesday.
A sale is just one of several options the White House is considering to address potential losses on student debt, the paper reported, citing administration officials familiar with the matter.
As the price of college has surged, the federal student loan program has grown to nearly $1.5 trillion. Outstanding student loans now top both credit card and mortgage debt — raising concerns about whether the Department of Education has the capacity to handle such a large loan portfolio.
Nearly 11% of borrowers who entered repayment in 2015 defaulted on their loans within three years, according to government data.Unlike a mortgage, the federal government lends to students regardless of their potential income as long as they’re enrolled in an accredited college.
“I’m not surprised they’ve reached outside for help understanding the portfolio, but in doing so, it highlights how the Department of Education isn’t staffed accordingly to administer the student loans,” said Beth Akers, a senior fellow at the Manhattan Institute who worked on federal student lending policy at the Council of Economic Advisers under President George W. Bush.
The cost of the lending program has grown as the government created new repayment plans for struggling borrowers. One allows people to tie monthly payments to their incomes and forgives remaining debt after making 20 years of payments.
Those programs can create uncertainty about repayment rates and potential losses. But Akers said the government would likely have to pay a premium to a private investor to take on the debt, raising questions about why it would offload the loans.
My thoughts 🤔👇👇👇👇
So basically student loans would go to a servicer of sorts. That investor which is basically another way of saying DEBT COLLECTOR will buy that debt from your BELOVED U.S. government and they’d be responsible to collect that debt.
And let me tell you, these people are vultures. They will destroy you and everything you hold dear. They will sue you in court, they will garnish your paycheck, they will put a hold on your bank account. If they can take your house, they will. All assets of yours are up for grabs and they’ll do anything to get paid. And trust me, LAWFULLY they can do more damage than you could ever imagine.
Now for what Bernie Sanders wants to do. He wants to bail you out the way Wall Street Was bailed out during the 2006-2008 crisis. He wants the government to take responsibility for the 1 TRILLION dollars in student debt that it’s carrying. And he wants Wall Street to pay up.
What I don’t like about this is they’d be bailing out folks who didn’t think before taking on so much debt to begin with and how will they learn if you bail them out? But if you’ve read any of My blogs on education, I believe college should be free for ALL. It’s that way in Europe and other countries around the world. But I’ll pose this question. Did Wall Street learn from their greed? Did the car companies and banks learn from their greed? Have they changed their behavior?
I think what Sanders wants to do is commendable and what Trump wants to do is pass the problem to someone else. Which do you think is best?