There’s been a lot of hullabaloo around student loan interest rates lately.
If you haven’t heard, America’s student loan debt recently topped $1 trillion. That trumps what we owe on credit cards.
Come July 1, 2012, the government subsidized student loan interest rate is set to double from 3.4% to 6.8% on new undergraduate loans – a big jump over the 1.6% I enjoyed a few years back.
It’s not terribly difficult to pay off a small, low interest rate loan.
Even if you’re paying high finance charges on a low balance, or vice versa, you’re still in a good position to become debt free.
But when you have big obligations with big interest rates, you’re pretty much screwed.
Apparently, student borrowers are finally realizing that.
They’re gambling on a college education with borrowed money, and they’re scared of making a bad bet. Since half of the nation’s new college grads can’t find gainful employment, I can see why they might be worried.
Now we got folks demanding student loan debt forgiveness. They’re mad as hell the debt must be repaid at a totally reasonable interest rate. The pay-whatever-it-costs-to-get-a-degree guys wanna renege on their promise to the taxpayer. To that I say, “Nah, buddy.”
Here’s where I get confused.
Ten years ago, financial gurus, politicians – let’s just say EVERYBODY – was screaming, “Student loan debt is good debt!!!”
I don’t remember a single “expert” who disagreed with this position.
Heck, we should be proud student loans exceed credit card balances.
Let’s congratulate ourselves for this monumental achievement.
Bravo! Hell yeah! Let’s here it for us! *golf clap*
Both political parties are sucking up to the angry crowd of future debt dodgers. “Let’s keep the rate where it is,” they say.
Since the United States is deeply in debt, it’s natural to wonder aloud, “How in the fuck can we afford to hold interest rates where they are?!”
Who’s gonna pay for this?
Well, Democrats and Republicans have the answer. Let’s hear them out.
I’ve said it before, and I’ll say it until you tell me to find a better quote, but:
There are no solutions…there are only trade-offs. ~ Thomas Sowell
Someone has to be responsible for returning principal and interest on student loan debt. Or, at a minimum, the portion funded by taxpayers. (I couldn’t give two rat turds about repayment of private student loan debt.) Who better than the folks who borrow the money?
Being that I paid off my student loans years ago, I might be a teensy bit insensitive to people who’re crying about the pending interest rate spike. I acknowledge, yet refuse to apologize for, my indignation.
What’s your position? Do you think the government should block the interest rate increase on student loans?