My husband and I were watching the news over the weekend, listening to commentary about the bailout.
How it is a bold move.
How it is the largest bailout since the Great Depression.
The kids I haven’t even made yet are going to be paying for their grandparents’ mistakes. And, to quote my grandfather, it “really burns me up”.
It kills me that the tax payers are going to be paying for this situation. I haven’t asked you to pay for my mistakes, why should I be paying for yours?
I really wonder about what kind of benefit this bailout would have.
While I ranted like a lunatic at Brian about the situation, I started spewing out random ideas that I thought would be better.
And one of them might actually be better.
If people are insistent that there be some sort of bailout, why not bail out student loans? After all, something around 50% of recent college graduates have student loans. Studentdebtalert.org goes so far as to say that 39% of college grads have “unmanageable” levels of student loan debt.
What would happen if that $700 billion dollars was used to bail out current students or graduates? How would that impact the economy? How would that influence our economic future?
At the moment, my student loan payments are larger than our mortgage. And our mortgage is cheaper than renting in our area. What would an extra thousand dollars in our pocket do for us every month?
And we aren’t the only ones in this situation. Every couple we know has student loan debt. And Brian and I are lucky ones because he doesn’t have any student loans to pay. We only have to carry my debt with us while most of our friends have payments to make for two people.
I should also make sure I say that I don’t believe that a student loan bailout would be a good idea either but playing with the “what if” is always a good idea.
If your student loans disappeared, how would it change your life?
Would you still be in your current line of work or would you pursue something different?
Would you stay in the part of the country where you live now or would you have more freedom to explore new places?
What would you do with that extra money?
Tim Ramsey said...
1I recently came accross your blog and have been reading along. I thought I would leave my first comment. I dont know what to say except that I have enjoyed reading. Nice blog.
Tim Ramsey
09/22/08 8:50 AM | Comment Link
Carmella said...
2I would be spending more money on me, pay off our extraneous debt, and go back to school without the fear of being unable to pay for it.
and maybe Chris would go back at the same time. we’d both love that, even though we wouldn’t see eachother very much.
09/22/08 1:43 PM | Comment Link
Ron said...
3Bold post. And obviously something that would never happen. But…gee, wouldn’t that be something everyone could coalesce around?
Nice work.
09/22/08 6:25 PM | Comment Link
Voice in the Crowd said...
4If myself and my girlfriend suddenly had no more student loans…one, we’d move to a slightly nicer/central area of the city, and two we might not change careers, but we’d at least be able to consider it if we wanted. Right now, we can’t afford to take a chance because of the loans hanging over our heads. My career field thrives on contract to permanent work, but is also based on Grant funding most of the time, which means, you can be a great employee, but if they don’t get the next grant, you’re job won’t be permanent. Because of my loans (and high rent), I can’t afford to risk those jobs as I can’t afford to suddenly be without a job.
::Shrug:: like you said, it isn’t going to happen, but it would be nice…maybe I’ll write my senator and complain. That would feel good.
09/23/08 8:26 AM | Comment Link
Steve Johnson said...
5Yeah… it would be nice.
I hadn’t thought about this before, but it would probably have been a much better use of taxpayer money to use the ‘economic stimulus’ money to pay off student debt. What better way to stimulate an economy than to invest in its future?
09/23/08 1:23 PM | Comment Link
Deb said...
6I personally have no student debt. This is not due to parents who paid for me to go to school, but rather my refusal to go into debt in order to go to school. And so while I don’t have exorbitant amounts of student loan debt to pay off, I still made tragic financial decisions in my early-20’s compounded by more not-tragic-but-still-not-great financial decisions since. It is only now that I am fully onboard with a budget and financial plan to be debt-free by 2010…and I’m psyched!
While I do think it would be great to have someone come along and bail me out of my debt (student or otherwise), I think that more important are the lessons I’m learning by cleaning up my own mess myself. If only the same could be said for the Fannie Maes, Morgan Stanleys, and Goldman Sachs’ of the world.
The government’s bailout of the sub-prime mortgage missteps in the financial industry is certainly not the best case scenario and this taxpayer (and finance industry worker) is certainly not happy about it, however I honestly believe they just went with the lesser of two evils. It’s a shame no matter how you look at it.
09/24/08 12:19 PM | Comment Link
I hate my husband’s 12 emails » Dorie Morgan’s Rising Up said...
7[...] a much bigger deal: the homeless in Philadelphia (winter is coming) or the current economic crisis (can we talk about my student loans please?). My email is just [...]
09/29/08 10:26 AM | Comment Link
Kathrin said...
8I just received my 90 day notices advising me of my first payment. My great-grandchildren will be inheriting my loans at this rate.
My current school debt and the disaster that is our economy is preventing me from pursuing my doctorate (as well as academic burnout). However, even after taking some time off, I have no idea how I could sing going back to obtain my phd.
10/3/08 8:36 AM | Comment Link
Joseph said...
9There would be no drastic job changes or location changes, but we would change our lifestyle.
Without my wife’s loans, my wife and I would move to a 2-bedroom apartment. That way our son would have his own bedroom. Without my loans, we would also be able to add another $1000 a month to our home/college savings account. But given our school debt (our only debt), we have no college account for our son. He likely will have to take out loans to pay for college/graduate school too.
If wishing only made it so…
By the way, I would be happy to just get a lower rate on my school loans. In 2006 Bush fixed graduate student loan interest rates at 6.8% and 8.5%. This occurred at the same time that tuition at many universities substantially rose. Together, those two events translated into higher loan repayments. Now, although interest rates are falling, graduate students and recent graduates cannot consolidate at a lower rate because our loan interest rate is fixed. (Note: Congress lowered rates for undergraduate students, but not graduate students.)
11/11/08 9:10 PM | Comment Link