Via Instapundit, ‘Puter came across this article on the imminent student loan crisis, coming soon to a theater near you. Essentially, students have mortgaged their futures and will be unable to meet (or, inconveniently for them, discharge in bankruptcy) their debts.
Of course, simply owing a debt that cannot be discharged does not mean that debt will get paid. According to the article, approximately 22% of all student loans are currently in forbearance. Default rates range from 20-40%, depending on the type of institution.
And who’s on the hook when federally backed student loans collapse like the federally backed mortgage loan industry? Take a good look in the mirror, fellow taxpayer. You’re the sucker left holding the hot potato. Not the banks, not the borrowers, and certainly not your government. It’s you. Sucker.
Here’s ‘Puter’s solution. Require any educational institution paid with student loan funds to guarantee half of the money paid to it, and permit the student debtor to discharge half the debt in bankruptcy. Further, require schools to reserve capital against their contingent student loan guarantee liabilities. This gives both sides of the transaction skin in the game. The spendthrift kids can’t walk away from their poor school selection and crappy work ethic (or simple minds). The schools can’t walk away from their crappy admissions decisions and useless program offerings. It’s a win-win for the taxpayer.
Making schools guarantee a portion of their student loan crack habit would have the following salutary effects:
1. Schools would not unthinkingly raise tuition, as they would be on the hook for part of the increase.
2. Schools would look more critically at the value added component of their education, as that would impact the ability of their students to repay, and would thereby lower their risk. For example, do you want to churn out more instantly employable engineers, or do you want to churn out Gender Studies majors, whose best employment prospects entail selling something on a streetcorner, either drugs, tschotschkies for tourists or themselves.
3. Weaker schools would fold, or lower tuition to something approximating the market value of their product. If the education you provide students doesn’t permit them to make enough money to repay your tuition, then you’re going to have to find a tuition number that makes sense.
4. Stronger schools would focus on selecting the best, not the richest or most connected, students, as better students tend to do better in life. That’s not to say people who can pay their own way won’t get in anyway, because they will. It’s simply that schools will be competing for the best, hardest working students.
5. The “Studies” majors would likely fold, as they offer no value of any sort to anyone except the professors who foolishly invested their life in a post-modernism inspired circle jerk. ‘Puter’s looking at you Womyn’s Studyes, Chicano Studies, etc. ad nauseam.
6. Science, technology and math majors would flourish, and be the drivers that support the university again. It makes more sense to invest in money making enterprises, than in the career suicide pacts described in pargraph 5, supra.
Universities can shut up about ‘Puter’s plan being unfair. You know what’s really not fair? It’s really not fair that multi-billion dollar educational conglomerates pay no income or property taxes. Nor is it fair, that like Fannie and Freddie, these diploma mills staffed by lotus-eaters are subsidized with taxpayer dollars, from the student loans to the research grants, to the stadium bonds.
Imagine for a moment life under ‘Puter’s plan. ‘Puter knows people say he’s a dreamer, but he’s not the only one. He hopes someday you’ll join him, and the world can put a frikkin’ stake through the heart of our messed up education system and the even more messed up funding methods it requires.
Always right, unless he isn’t, the infallible Ghettoputer F. X. Gormogons claims to be an in-law of the Volgi, although no one really believes this.
’Puter carefully follows economic and financial trends, legal affairs, and serves as the Gormogons’ financial and legal advisor. He successfully defended us against a lawsuit from a liquor distributor worth hundreds of thousands of dollars in unpaid deliveries of bootleg shandies.
The Geep has an IQ so high it is untestable and attempts to measure it have resulted in dangerously unstable results as well as injuries to researchers. Coincidentally, he publishes intelligence tests as a side gig.
His sarcasm is so highly developed it borders on the psychic, and he is often able to insult a person even before meeting them. ’Puter enjoys hunting small game with 000 slugs and punt guns, correcting homilies in real time at Mass, and undermining unions. ’Puter likes to wear a hockey mask and carry an axe into public campgrounds, where he bursts into people’s tents and screams. As you might expect, he has been shot several times but remains completely undeterred.
He assures us that his obsessive fawning over news stories involving women teachers sleeping with young students is not Freudian in any way, although he admits something similar once happened to him. Uniquely, ’Puter is unable to speak, read, or write Russian, but he is able to sing it fluently.
Geep joined the order in the mid-1980s. He arrived at the Castle door with dozens of steamer trunks and an inarticulate hissing creature of astonishingly low intelligence he calls “Sleestak.” Ghettoputer appears to make his wishes known to Sleestak, although no one is sure whether this is the result of complex sign language, expert body posture reading, or simply beating Sleestak with a rubber mallet.
‘Puter suggests the Czar suck it.