Saturday, July 30, 2022

Biden Administration Flirts With Student-Loan Debtors: Throw Me A Moon Pie, Mister!

 Mardis Gras parades are an ancient tradition in New Orleans, going back to the eighteenth century. Social clubs called krewes sponsor these parades, and krewe members throw trinkets called throws at parade-goers. 

Typically, a throw is a necklace of plastic beads, but krew members also throw toys, small stuffed animals, and plastic souvenir cups. 

Every year, Louisianians flock to New Orleans to attend Mardis Gras parades and gather up the trinkets flung from the parade floats. "Throw me something, mister," is the cry of the day as parade-goers compete for the attention of a krew member preparing to toss a good throw.

Most of the stuff thrown out a Mardis Gras parades is crap. Unadorned necklaces of plastic beads are so worthless that no one even bothers to pick them up. Occasionally, however, a krewe member throws something interesting like a football or a Moon Pie, which is a chocolate-dipped marshmallow sandwich. 

College-loan debtors are much like Mardis Gras parade-goers. The Biden administration dangles various student-loan-forgiveness plans before the electorate while student debtors shout, "Throw me something, mister!"  

We already know that some of President Biden's proposals are almost as worthless as a string of plastic Mardis Gras beads. Ten thousand dollars in loan forgiveness will satisfy no one when annual tuition at a private college runs $60,000 per year, and the average student debt is about 37 grand.

Mr. Biden will almost certainly extend the pause on student-loan payments one more time, probably until after the midterm elections. But that is just another string of plastic beads. Not making loan payments for two and a half years is nice, but these loan-payment pauses do nothing to eliminate the mountains of crushing debt. 

When the midterm election season is over in November, I feel sure that 45 million student debtors will feel much like those Mardis Gras parade-goers who plod back to their cars at the end of the day with sacks of worthless beads and a hangover from drinking too much beer.

Nevertheless, everyone should cheer up. Next year there will be more Mardis Gras parades and more proposals for canceling student debt. Who knows? Maybe the Biden administration will throw you a Moon Pie!

Throw me a Moon Pie, mister!

Friday, July 29, 2022

Attention, Mr. and Ms. Middle-Class Americans: Corporate America Doesn't Give a Damn About You

 You're a middle-class American, right? 

You have enough money in the bank to be a Chase Private Client, which entitles you to a Chase Private Client debit card. 

You've accumulated enough points staying at Hilton hotels to hold a Diamond status on your Hilton Honors card. 

When you travel on business, you frequently rent cars from Budget, and you expect Budget to treat you with exceptional courtesy and to be helpful if you have a problem.

Let me set you straight in the parlance of our times. That don't mean shit!

American corporations don't give a damn about their customers, and their television ads, bonus programs, and so-called special services are just bullshit.

I have enough bucks at Chase Bank to qualify as a Chase Private Client. A few years ago, $3,000 left my account through fraud. Chase detected the scam in time to stop the transfer but concluded that the transfer had to go through.

I protested, pointing out that I was a Chase Private Client. The answer I got? "We treat all customers the same." When I contacted my so-called "financial advisor," he pleaded with me not to use the word "fraud" in my email messages because that would cause him trouble with the FTC.

I filed a complaint with the Consumer Financial Protection Bureau, the Federal Trade Commission, and the Federal Banking Commission, and I finally got my money back. Still, I learned from that experience that being a Chase Private Client doesn't mean squat.

I have enough points with the Hilton Honors program to qualify as a Diamond-Level customer. Big whoop! When I called late one night to make a last-minute reservation, some guy at the call center tried to get me to listen to a spiel about timeshares! 

Later, I stumbled outside the front door at the Hilton hotel in Halifax and scraped my elbow. My wife asked the desk clerk at the registration desk for some bandaids, and he replied that the hotel doesn't have a first aid kit. And by the way, the desk clerk said that without looking up from his cellphone. (He eventually found us some bandaids.)

Wanna hear about Budget Rentacar? I rented a Budget rental car at the Phoenix airport two years ago. Electric power went down, making the rental car center a chaotic nightmare.

The car I rented had a minor scrape, but I couldn't report that fact to any Budget employee due to the confusion caused by the electricity shutdown.  

When I returned the car, Budget claimed I had scraped it and billed me for $400. The Budget brochure I obtained at checkout stated that any dispute must be arbitrated and gave me an address in New Jersey. 

So I sent a certified letter to Budget's address in its brochure. You know what? Budget's hacks wouldn't accept the letter!

I finally got that straightened out, but I learned something from my experience with Budget. If you've got a problem, it's impossible to get in touch with anyone who has the authority to solve it.

I still patronize the Hilton hotels, bank with Chase, and occasionally rent a car from Budget, but I have learned something in my dealings with corporate America.

Corporate employees who interact with the public are generally polite and strive to be helpful. I always compliment these people when I'm asked to fill out an online survey. I always tip people when it is appropriate to do so. 

Unfortunately, the employees who work for corporate America are powerless to solve a customer's problems because the corporate shills at the top of the food chain won't let them.

Have yourself a nice day. And if you spend the night at the Hollis Hilton in Halifax, bring your own first aid kit!

Hollis Hilton: Bring your own bandaids

"Stepped in Blood": The Student Loan Program is So Screwed Up That There Is No Solution Without Pain

I read Shakespeare's Macbeth as a high school student, and I still remember one line from that play:

I am in blood stepped in so far, that, should I wade no more, returning were as tedious as go o'er.

I understood the line to mean that Macbeth had involved himself in so many murders that he might as well continue on the same bloody path as turn back.

That's America's situation with the disastrous federal student loan program. Forty-five million student debtors owe a total of $1.7 trillion in federal loans, and there is no way to undo the monstrous damage that has been done. 

Thousands of articles, books, news stories, and scholarly reports have been written about the student-loan catastrophe, but Eleni Schirmer summarized it very well in a recent New Yorker article.

Shirmer focused on elderly student-loan debtors, beginning her article by telling the tale of Mary Ann, who borrowed $29,000 to attend law school in the early 1980s. Today, she is 91 years old, and her debt has grown to $329,000.

As Schirmer explained, oppressive student debt is not only a problem for the young. One in five student borrowers is 50 years or older--about nine million Americans.

Hundreds of thousands of student debtors reach retirement age without paying off their debt. The federal government garnishes their social security checks if they default on their loans.

Millions of overburdened college borrowers have rolled their loans into income-driven repayment plans (IDRs) to lower their monthly payments. Theoretically, their debt is canceled if they successfully complete the terms of their IDR.

Unfortunately, only a handful of debtors have had their loans forgiven through IDRs. As Schirmer explained:
[O]wing to negligent bookkeeping, I.D.R's promise of cancelation has proved to be a mere mirage: as of 2021, more than four million borrowers could have accessed I.D.R. loan cancellation, but only a hundred and fifty-seven had ever received it.
As Shirmer relates, the federal student loan program is so screwed up, so burdened by bureaucracy, and so complicated that the government can't even tell us how much of the $1.7 trillion that is owed is principal on the debt and how much is accrued interest.

For years, the Department of Education has claimed that the federal government makes a profit on federal student loans. Over the last quarter of a century, DOE maintained, the feds created a tidy $114 billion on the program.

But the Government Accountability Office reported this week that DOE grossly miscalculated. In fact, the government lost about $197 billion--a $311 billion math error!

In fairness to the Biden administration, his Department of Education has brought significant relief to millions of distressed student borrowers--mainly by forgiving debt owed by students who claimed to have been defrauded by their colleges. And DOE has initiated several other minor reforms.

Unfortunately, the federal government can't tinker its way out of the student-loan mess. Real reform will be painful.

What, then, needs to be done?
  • The feds have got to stop sending student-loan money to the for-profit colleges and shut down this sleazy industry.
  • DOE urgently needs to terminate the Parent PLUS program, which has devastated hundreds of thousands of low-income and minority families.
  • Congress must reform the Bankruptcy Code to allow distressed student debtors to discharge their loans in bankruptcy. 
Finally, the federal government must put some reasonable cap on the amount of money students can borrow for their college education and force the colleges to get their costs under control.

Sadly, none of these reforms will ever take place. Why? Because reining in the student-loan program would be too painful for various higher-education constituencies, who are happy with the status quo.

Much like Macbeth, the federal student loan program is so mired in corruption, incompetence, and venality that it can't be fixed.  Tragically, this program, designed to help Americans go to college and improve their lives, has destroyed the lives of millions.

Steeped in blood and no painless options

Wednesday, July 27, 2022

Air Travel is a Nightmare: Let's Travel Anyway

 The Wall Street Journal reported today that the worst two airports in the world for delayed flights are Toronto and Montreal.  I can confirm that Journal's findings are accurate. I was in both airports a few days ago, and the experience was a nightmare.

Due to flight delays, my wife and I spent an unscheduled night in a Toronto Airport hotel and an unplanned-for night in an airport hotel in Atlanta.  These delays cost us more than $600, and we weren't reimbursed.

In addition to airline hassles, we found that the cost for almost everything we bought in airports has increased dramatically. At the Montreal airport, two burgers, a beer, and a glass of wine cost us 80 Canadian dollars (not including a tip). The hotel room in Toronto--more than $300 a night.

Despite the hassles and the unanticipated expenses, I'm glad my wife and I visited Quebec and Nova Scotia last week. Why?

First, the Canadians are almost universally courteous and friendly, and it was a pleasure to interact with them. A cab driver warned us that the French-speaking people of Quebec would be rude if we didn't speak their language, but that was not true. We had a lovely visit to a charming city.

Second, Canadian food is delicious, especially the seafood. Nova Scotia's sparkling wines are the best I've ever tasted--much better than French champagnes or the sparkling wines of California.

I have always found international travel stimulating, and my recent trip to Canada was no exception. For example, I learned the Canadians have told the penny to bugger off. They simply don't use pennies. You get charged ten bucks if you buy something for $10.01. If you buy something for $9.99, you don't get change back from your ten.

How sensible! Why don't the Americans adopt the same policy?

I was also moved by the Canadians' public displays of patriotism and remembrance for those who died while performing their duties. At the Halifax wharf, I saw The Last Steps memorial, which includes an old-fashioned gangplank. A nearby sign said that 350,000 Canadian men and women embarked from Halifax for Europe to fight in World War II.

 Sixty thousand Canadian soldiers did not return, and those young people took their last steps in their native land in Halifax before walking the gangplank toward war.

Who could not be touched by this simple memorial?

Thus, despite the hassles, the unexpected expenses, and an occasional rude encounter (only in the airports), I was grateful for my visit to Canada, our cheerful, hearty, and gracious neighbor.

The Last Steps Memorial

Sunday, July 17, 2022

It's Good to Be Shifty in a New Country: Young People Should Be Cautious About Going to College

 "It's good to be shifty in a new country," Huckleberry Finn observed in Mark Twain's most famous novel. 

What does it mean to be shifty? I think Twain meant that people should be cautious in a strange environment and suspicious about entrusting their safety and wellbeing to strangers--not to mention their pocketbooks.

You will be entering a new country if you enroll in college for the first time this fall, and it will behoove you to be shifty and cautious.  Higher education is in a tumultuous--even calamitous transition, and you don't want to get buried in the wreckage.

First, college enrollments are down, and the universities are scrambling to replace their lost revenues and lure more tuition-paying butts to sit in their lecture halls.  In fact, the small, non-profit schools discount tuition on average by more than 50 percent. That's how desperate the colleges are to snag new students.

In fact, many small non-profits are on the edge of closure and surviving almost solely on federal student-loan money. Religiously-affiliated colleges and schools with enrollments of less than 1,000 students are especially vulnerable. 

If you are wise, you will not enroll at a nonselective, nonprofit school unless you know how a degree from St. Nowhere College will help you get a job and pay off your student loans.

And for God's sake, don't attend a for-profit school owned by a hedge fund or trades on the stock exchange. The creeps who own these schools are focused on money--not your welfare. 

Second, college towns are becoming more dangerous, especially the big cities, where many prominent public universities are located. Violent crime--rape, robbery, and carjackings--is spiking upward in urban areas.

If you plan to live off campus, do some research. Find out which neighborhoods are safe and which are not. If you come to college with a car, keep your vehicle locked and be cautious if you park in an isolated parking lot. Be vigilant when pumping your own gas. 

Finally, don't take out more student loans than absolutely necessary. President Biden has done more than any previous president to ease the student-loan crisis, and his administration has introduced many good reforms.

Nevertheless, it would be a mistake to take out student loans based on the expectation that government won't make you pay them back. 

The Biden student-loan relief efforts are commendable, but the feds have done nothing to bring down the cost of going to college. Tuition rates are continuing to climb, and naive young people who borrow a hundred grand to get a humanities degree at an obscure private college may be committing economic suicide.

So remember Huck's advice and be shifty in a new country. When you get to college, you will soon find that many of the people who are making a good living in the higher-education racket are not looking out for your welfare. 

It's good to be shifty in a new country.

Wednesday, July 13, 2022

"Boiling with Bitterness": Anonymous student debtor writes angry Reddit post denouncing the Democrats

We have not been appeased, and we have not forgotten. The press ignores us to the doom of the DNC this November

Posted July 13, 2022, on Reddit

Like it or not, many of the millions of us feel so sufficiently betrayed and harmed by the Biden Administration and those who chose him over just about anyone else that we will in November invoke our one and only legal means of effectively punishing them.

We are boiling with bitterness, choking with frustration, and desperate to make our pain known. We can’t afford to send our kids to good schools because of the crushing debt; we can’t take out mortgages on houses because of the suffocating interest rates. Most of us are minorities and women who thought higher education would improve our lives; not a few of us were first-generation college graduates.

When the DNC chose our candidates for us, we weren’t thrilled with Biden at first, but he won our favor by promising to seriously address the student debt crisis. When he said he’d be open to forgiving fifty thousand dollars of debt for each of us, and when he promised to forgive at least ten thousand, we stood ourselves next to him.

But then after he’d banged us and became POTUS, he began to pretend we didn’t exist. Remember several months ago when that journalist asked him two questions, the first of which was about us, and he responded by pretending the first had never been asked, answered the second, and then fled the stage? That hurt.

We have a lot of anger and bitterness, and the only legal means of making sure the Biden Administration feels it is at the polls this November. What other option do we have?

And while we’re preparing to do the unthinkable by not voting this November, the press is doing the worst thing it could possibly do for the DNC: ignoring us. By ignoring us, our cries aren’t reaching the Oval Office.

The DNC will be punished at the voting booth for choosing Biden. The only way we’ll show up is if our needs are met. Our kids need to be able to go to good schools, and we need to be able to mortgage houses, things we’d be able to do if the Biden Administration didn’t treat us like some chick he’d banged just to get a job with her dad.

We’re angry, we’re poor, and we’re not gonna take it anymore.

This Reddit essay is an eloquent expression of a student-loan debtor's frustration and bitterness at being saddled with college debt that can never be paid. Richard Fossey


Monday, July 11, 2022

Congratulations! You've been admitted to Nowhere State University--even though you didn't apply.

Surely you remember Woodie Allen's famous observation: “I'd never join a club that would allow a person like me to become a member.”

That's kind of like the situation with college admissions. Some schools are admitting new students even though they didn't apply!

A couple of companies have launched services that allow college shoppers to post their credentials online.  Colleges can view these credentials and admit students even though the potential student did not fill out an application for admission.

This development is just another sign that nonselective colleges are desperate--literally desperate--to round up enough tuition-paying students to pay their light bills. 

Traditionally, prestigious colleges have boasted that they are highly selective--often accepting only a tiny fraction of the people who apply. Harvard, for example, only admits five percent of the people who apply.

Obviously, a college that accepts new students who did not apply can make no claim to exclusivity. In fact, such a school is probably very close to an open-admission institution.

So if you get an embossed letter on fancy letterhead from a university you never heard of, be sure to open it.

It might be a missive from an admissions officer at Nowhere University, graciously informing you that you've been admitted to the 2022 entering class. 

Then you will know what Woodie Allen was talking about when he said he wouldn't want to join a club that would have him as a member.


Never join a club that would have you as a member.

Sunday, July 10, 2022

Colleges Are Outsourcing Their Teaching Mission to For-Profit Companies. Is That A Good Thing?

Years ago, colleges employed people to perform auxiliary services. University employees staffed the campus bookstore, ran the student union, and performed janitorial services. 

Over time, however, universities began outsourcing almost all of their auxiliary services. Barnes & Noble now runs hundreds of college bookstores. National fast-food chains operate stores in countless student unions.

Recently, however, American colleges have gone beyond outsourcing their non-instructional activities. Now, the universities are outsourcing their core mission: teaching students.  

According to the Government Accountability Office (as reported in the Wall Street Journal), 550 colleges and universities are partnering with for-profit companies to design courses, recruit students, and manage instruction.

Academic Partnerships, one of the leading for-profit outfits,  contracts with universities all over the United States to manage graduate programs--for a hefty fee, of course.  Higher Education Inquirer estimates that AP collects about half the revenue from the courses and programs they manage.

2U, another for-profit online instruction provider, has a contract for services with the University of Oregon and gets 80 percent of the tuition for 2U-managed courses. That's a good deal for 2U's stockholders.

What the hell is going on? 

As the Wall Street Journal explained, colleges are losing revenue due to declining enrollments.  They aren't raising enough money to pay all their administrators and bureaucrats. Thus, hundreds of schools are investing heavily in online academic programs--especially graduate programs--to juice their revenues. 

Respected public universities like the University of North Carolina and the University of Oregon have turned to for-profit companies to design or revamp various graduate programs, recruit students, and oversee instruction.

Why don't the professors do those things?

I don't know. Perhaps the faculty don't have the skills necessary to recruit students, manage enrollment, or design academic programs for an online format.  Or maybe doing these things is just too fuckin' hard.

I have a professor friend whose dean ordered him to design and teach an online course for a master's degree program managed by Academic Partnerships. He was told the class would be conducted online over five weeks.  

My friend was a good soldier and taught the course as directed. He had over 600 online students!  When the class was completed, my friend told the dean he would never teach an online course that way again, even if it meant being fired.

As the Wall Street Journal pointed out, students are often unaware that they are taking a course managed by a profit-driven company, not the university. 

For example, the University of Texas at Arlington has a big-time financial relationship with Academic Partnerships, which manages graduate programs in nursing, education, business, and public health. Nevertheless, UTA's promotional materials do not disclose that Academic Partnerships manages these online graduate programs.

Students all over the United States are taking out loans to pay tuition bills at public universities in the naive belief that these schools are non-profit entities dedicated solely to the public good.  

Most of these students would be surprised to learn that a profit-making company is sucking up a good share of their tuition dollars to enrich their executives and investors.

My take on this? If a public university is so goddamn lazy or incompetent that it has to pay a private company to manage its academic programs, then that university should be closed. 

Saturday, July 9, 2022

Maximus, Student Loan Debt, and the Poverty Industrial Complex by Dahn Shaulis of Higher Education Enquirer

 The Higher Education Inquirer is taking a close look at who's invested in Maximus, the enormous social welfare profiteer. Maximus has been servicing student loan defaulters for years and has now taken over Navient's federal student loan business, branding it Aidvantage

Since 1995, Maximus (MMS) has grown from $50 million in annual revenues to more than $4 billion in 2021. 

Maximus (MMS) Share Price 1995-2022
(Source: Seeking Alpha) 

With an army of more than 35,000 workers, Maximus' clients include 28 US agencies: the Internal Revenue Service, Department of Commerce, National Oceanic and Atmospheric AdministrationBureau of the Census, Patent and Trademark Office, Federal Student Aid, Department of Defense and US Army, Department of Veterans Affairs, Homeland Security, Health and Human Services, Medicare and Medicaid, Department of Labor, Office of Personnel Management, Securities and Exchange Commission and many more. 

As a contractor to Federal Student Aid (FSA), Maximus has more than 13 million student loans to service.  Its four contracts with the US Department of Education total almost $1 Billion.  

While CEO Bruce Caswell made more than $6 million in total compensation last year, Maximus' customer service representatives, the people who have to make the calls to the growing number of student loan defaulters, make less money than workers at Walmart. 

Maximus has recently posted federally contracted jobs on Indeed for $13.15 an hour in Texas and South Carolina, even though the federal minimum wage has been raised to $15 an hour. Wages for Maximus workers in other states are reportedly even lower, as little as $10 an hour in Kentucky and other states with regressive economies.   

Maximus' largest institutional investors include BlackRockVanguard Group, and State Street Corp--three financial behemoths.  BlackRock has $10 trillion in Assets Under Management (AUM), Vanguard Group has about $7 Trillion in Assets Under Management, and State Street has almost $4 Trillion in AUM. 

Bank of New York MellonWells Fargo, and Bank of America each own 900,000 shares or more. 

Public retirement funds, including public school teachers retirement funds (see table below), are directly and indirectly invested in the Poverty Industrial Complex and the student loan mess through Maximus and other large corporations. 

Maximus' strategic partners include AWSMicrosoftOracle, and Cisco.  

Social justice advocates have to wonder, how can the student loan system be fixed if the US establishment has a vested interest in the mess?  
Maximus (MMS) Top Institutional Investors 

List of Public Funds Directly Invested in Maximus

Alaska Department of Revenue 
California PERS
California State Teachers Retirement System
Colorado PERS
Florida Retirement System
Pennsylvania Public School Retirement System
Teachers Retirement System of Kentucky
Louisiana State Employees Retirement System
Ohio PERS 
New Mexico Educational Retirement Board
New York State Retirement System
New York State Teachers Retirement System
Ontario Teachers Retirement System
Oregon PERS
State of Tennessee Treasury
Teachers Retirement System of Texas
State of Wisconsin Investment Board

Thursday, July 7, 2022

We're all just waiting for orders: A kind word for the Uvalde Police

 Years ago, I was a practicing attorney in Alaska. Most of my clients were rural school districts that operated village schools in what Alaskans call the Bush: that vast region of Alaska that is off the road system. Most of these schools could only be reached by air.

One day I received a call from the principal of one of the village schools. "One of our students has a rifle," the principal informed me, "and he's holed up in the gymnasium and shooting into the village."

I asked the obvious question: "Have you called the troopers?"

Yes, the principal told me, the troopers had been alerted and were in the air.  They would arrive in the village in about an hour.

Then I asked a second obvious question: "Why are you calling me?" After all, I was a civil attorney, and a shooting incident is a criminal matter.

The principal's reply astonished me. "Because the shooter is Special Ed."

Under federal law, all kids designated as Special Ed are entitled to an Individualized Education Plan (IEP), which cannot be changed without a due process hearing.

Apparently, the principal was concerned that arresting this kid or shooting him without giving him a hearing would violate his IEP.

I thought about this incident recently when I read about the massacre in Uvalde, Texas, where a young man killed 19 children and two teachers in an elementary-school classroom.  

Several armed Uvalde police officers were in the school while the shooter was killing children, but they waited about an hour before storming the classroom and killing the shooter. Some wounded children bled out during the standoff--children who would have lived had they received prompt medical care.

Why did the police wait so long before confronting the shooter? Experts have opined on this question. Commentators have suggested that a communication breakdown explains the police officers' conduct or perhaps confusion about who was in charge.  Some critics have charged the Uvalde police with cowardice.

I do not believe the officers hesitated out of fear. Texas lawmen are known for being physically courageous.  The Uvalde officers probably knew the families of the kids being slaughtered.  In fact, one Uvalde officer in the school during the shooting lost his child, and another officer's wife bled to death in her classroom. These officers weren't cowards. 

I think there is another explanation for their inaction.

Americans now live in a society dominated by 24-hour news. News commentators and "talking head" experts seize on every catastrophe and breathlessly report as each tragedy unfolds. Almost instantly, the experts appear on our television screens to tell the world what the authorities did wrong and what they should have done.

Moreover, many shooting tragedies like the one in Uvalde wind up in protracted litigation,  with lawyers grilling the people in charge and pointing out all the things that the people on the scene should have done.

All of us in this juiced-up world of hypermedia are getting a subliminal message that it is better to wait for instructions than react spontaneously to a tragedy like the one in Uvalde.  We want a higher authority to tell us what to do. Then--if we get sued--we can say we were just following orders.

Finally, I wonder if police departments have become less effective by turning themselves into paramilitary forces.  The little town of Uvalde had its own SWAT team, and many small police departments now have armored vehicles.

I think the Uvalde police may have dawdled while children were being killed because they were waiting for technical equipment and more highly trained rapid-response units.

In retrospect, I think everyone agrees that it would have been better for the Uvalde police to have immediately stormed that elementary-school classroom with pistols--even if one of the officers got killed in the assault.

Nevertheless, I have great sympathy for the Uvalde police officers who were waiting in a school hallway while children were dying--made impotent perhaps by a culture that trains all of us that it is better to wait for orders when faced with a crisis than to follow our natural instinct to act.


Wednesday, July 6, 2022

Federal Reserve Bank of Philly: Student-Loan Payment Pause Just Postpones The Day of Reckoning

 In March 2020, the Department of Education suspended required payments on federal student loans due to the COVID crisis. The feds extended the pause six times, meaning that most borrowers have not made student-loan payments for more than two years. 

Nearly four out of five borrowers benefited from the pause on their student-loan obligations during the pandemic. The question now is whether student debtors can resume making payments when the loan-payment moratorium expires next month.

No one can answer that question definitively, but a recent survey by the Federal Reserve Bank of Philadelphia suggests that many college-loan borrowers will have trouble getting back on track with their student-loan payments when the payment pause comes to an end.

According to the Fed report, borrowers' "chronic repayment struggles are not primarily the result of pandemic-related transitory financial shocks but are more systematic in nature." For most student borrowers, the Fed concluded, "[the payment pause] is simply postponing the day of reckoning with loan payments that [survey respondents] consider unaffordable."

About half the respondents to the Fed's survey whose loans were in abeyance said they could resume making loan payments when the moratorium expires. The other half said they could only make partial or no payments on their student loans.

Moreover, the Fed report pointed out, "A common narrative during the pandemic was that the forbearance period enabled many education loan borrowers to save or deleverage [pay down other debts]." The Fed found, however, that among student borrowers who didn't expect to be able to resume making loan payments, very few were using the moratorium to save or pay down other debts.

Like many reports written by government agencies and policy wonks, the Fed's announcement on expected student-loan repayment contains turgid language and an excessive number of bar charts.

Nevertheless, the Philly Fed said plainly that the long pause on making student-loan payments only postponed the day of reckoning for most distressed student-loan debtors.

Meanwhile, American colleges continue to raise their tuition prices, which means that millions of overburdened college borrowers will see their debt burden become even more onerous than it is now.

Tuesday, July 5, 2022

Robert Crimo III Killed Six People and Escaped in a 2010 Honda Fit: Are We Teaching Our Children Well?

 We all know the drill. An alienated young white guy commits mass murder with a semiautomatic rifle. Almost instantly, the shooter is captured or gunned down or commits suicide.

Political leaders, flanked by their lackeys, hold a press conference where they heap lavish praise on the police even if the police did a lousy job (like at Columbine and Uvalde). The liberal media cries out for gun control. Pundits describe the shooter as a cowardly scumbag.

Our political, media and cultural elites never blame themselves for these mass shootings. No one blames the public schools, where all these young shooters spent their childhood and youth. No one laments our waning religious beliefs or the disintegration of our nation's civic life.

No one ponders why so many of these shooters were addicted to video games. No one asks why these shooters express their anguish in graphic detail on social media--anguish that is wholly ignored.

Crimo shot up a Fourth of July parade and escaped in a 2010 Honda Fit. Perhaps he knew that this pathetic little car symbolized his pathetic little life.

Crimo probably sensed that taking out student loans for college would not help him build a decent future for himself. He probably didn't have a girlfriend or any vocational goals. He was perhaps searching for meaning without having been issued a moral compass.

Whose fault is that?

James Howard Kunstler recently observed that "[t]he chief duty of men and women in [the] future will be doing everything possible to ensure that their children do not become hot messes." 

Who disagrees? 

But Americans are not striving to prevent their children from becoming hot messes. They're not doing everything they can to nurture and encourage young people to become functioning, self-reliant, and moral adults. 

Instead, our government shovels money into our corrupt universities to pay professorial nihilists to teach that America's heritage is nothing more than the story of white oppression. 

Our mainstream media has nothing good to say about patriotism or traditional civic values. Instead, op-ed writers label religious, patriotic Americans as "Christian nationalists," which is a racist code phrase.

No wonder guys like Robert Crimo III are becoming increasingly common. Indeed, the United States can hardly go a week without a mass shooting.

Ironically, the elites trying to destroy American civilization are never the victims of these young men's rage. They live in gated communities or highrise condos, surrounded by bodyguards and safely protected behind bullet-proof glass.

No, the people killed or maimed by the Robert Crimos of the world are school children, mall shoppers, and folks who only want to enjoy a Fourth of July parade.

Making his getaway in a 2010 Honda Fit

Saturday, July 2, 2022

Dana Milbank, progressive WaPo journalist, slams Texas (and Oklahoma)

 Dana Milbank published an article in the Washington Post titled "Texas Republicans want to secede? Good riddance." His essay drips with regional bigotry, and his description of Texas is so inaccurate and prejudiced that I feel obligated to respond.

Milbank's essay is a sarcastic response to a call from the Texas Republican Party to allow Texans to vote on the question of Texas independence. He would like to see Texas go. "Better yet," Milbank smirked, "let's offer Texas a severance package that includes Oklahoma to sweeten secession."

Why would any sensible person want to kick Texas out of the United States? Texas exports more goods and services than any other state,  and its homeownership rate is higher than New York or California--those hotbeds of progressivism. The Lone Star State is experiencing robust population growth while the population of many liberal-leaning states--California, Illinois, Massachusetts, and New York--is stagnant or declining. That's why Texas is gaining seats in the U.S. House of Representatives while supposedly more enlightened states are losing them.

Milbank's essay shows a shocking ignorance of Texas culture and Texas politics. He predicts that the U.S. would have to airlift "sustainable produce" and contraceptives if Texas were to form its own country.

But there is no evidence of any hostility to birth control among Texas political leaders or prejudice against healthy food. Milbank is merely displaying a provincial and ignorant worldview--a malady caused by watching too much CNN on television.

Milbank suggests that urban centers and South Texas would not leave the union if rural Texas were to secede, assuming urban Texas and Hispanic South Texas think like he does. It is true that Texas cities reliably vote for the Democrats, as do the voters along the Rio Grande River.

Nevertheless, the Texas Nationalist Movement, the prime advocate for Texas independence, is strong all over the state. As for South Texas, the Tejanos are appalled by President Biden's open-border policy and are leaning more and more toward the Republicans. 

Progressive and left-leaning pundits may sneer and ridicule Texas all they want and even encourage the state to form its own nation. But they should remember that Texas has the largest natural gas reserves in the U.S.

Self-righteous prigs like Milbank despise flyover country, but they rely on the heartland for the food they eat and the energy they need to heat their homes and power their cars. Milbank thinks the rest of the United States would be better off without Texas and should encourage the state to secede. 

He should be careful what he wishes for.

Dana Milbank: four-time winner of annual Paul Giamatti Look-Alike contest