NHEG-Magazine-September-October

www.NewHeightsEducation.org
www.NewHeightsEducation.org
Clarifying that student loan borrowers should be allowed by trustees to make full loan payments during the chapter 13 repayment
period, which typically lasts five years
Student Loan
Debt is Getting
Ugly
Agreeing to discharge the tax bill that a borrower in a federal student loan repayment program could face in 25 years for
forgiven debt
Encouraging lawyers to join nonprofit groups that represent student loan borrowers for free
While many of these judicial debt-relief strategies provide some benefit to those who have gone through the courts, by and
large, the effects represent only a trivial nibbling around the edges of a much, much bigger problem.
The Government Is the Problem
The bigger problem is that the U.S. government is in the business of making student loans in the first place, where it has
cumulatively borrowed more than a trillion dollars to be in that business. Because of its own massive borrowing, Uncle
Sam cannot afford to let many student loan borrowers off the federal hook.
That’s why when the government has provided relief to its stressed student loan borrowers, it has done so in the form
of income-based repayment plans, which trade regular student loan payments for what amounts to a special additional
income tax levied on the borrower.
By Craig Eyermann
Tuesday, June 26, 2018
On May 31, 2018, the total public debt outstanding of the U.S. government stood at $21.145 trillion dollars. Of that amount,
$1.211 trillion was borrowed so that Uncle Sam could be in the business of making student loans.
Over $1 trillion of that subtotal was borrowed after
President Obama took over the student loan industry on
March 30, 2010.
The Ugly Hockey Stick
As trends go, the chart of the history of the U.S. government’s
borrowing to fund student loans looks like an ugly
hockey stick, the kind that can have negative implications
for the population, particularly those Americans who have
a crippling level of student loan debt.
So much so that a number of federal judges are now considering
upending the laws written by Congress that make
student loans largely exempt from being discharged in
bankruptcy proceedings. These laws make it nearly impossible
for recipients of Federal Direct Student Loans to gain
relief from the burden of their having borrowed money
from the U.S. government.
There is a solution. The U.S. government can return the student loan business to the private sector, allowing lenders and
academic institutions to assume the primary risks for when their students might default on their loans.
At the same time, Congress should rewrite the nation’s laws to once again make student loans fully dischargeable through
bankruptcy proceedings. Just like almost every other kind of debt.
Until it does, that ugly hockey stick is only going to get uglier.unschooler, but after writing back and forth to the girl, he
realized that he liked both the girl and the writing! He became increasingly passionate about writing, ultimately majoring
in journalism in college and becoming a successful journalist.
When learning is connected to living, it is meaningful. It is not something that occurs at certain times, in certain places,
with certain people. It occurs all the time, everywhere, and with everyone around us. Unschooling allows natural learning
to occur by providing the time, space, support, and opportunity for interests to emerge and talents to sprout.
With unschooling, reading, writing, and arithmetic become purposeful activities connected to personal interests and
motivations.
Writing letters is enjoyable and important when it is necessary for your own purposes. Writing letters when someone else
tells you to—when it is forced—may not be so fun or helpful. As Plato warns: "Knowledge which is acquired under compulsion
obtains no hold on the mind."
Source: The Foundation for Economic Education (FEE)
https://fee.org/
Katy Stech Ferek of the Wall Street Journal reports:
For decades, bankruptcy judges refused to consider reducing student loans. That is now changing, and some judges are
throwing lifelines to people struggling to repay their deb. In interviews with the Wall Street Journal, more than 50 current
and former bankruptcy judges, frustrated at seeing borrowers leave federal courtrooms with six-figure debts, say they or
their colleagues are more open to chipping away at the decades-old guidelines that determine how such debt is treated.
“If the law’s not going to be improved by Congress, we have to help these young people who are drowning in student loan
debt,” said U.S. Bankruptcy Court Judge John Waites in South Carolina.
The articles go on to describe a number of remedies that U.S. judges are trying out, which are summarized in the following
list:
Issuing thorough, creative rulings in favor of borrowers that capture the consumer bankruptcy industry’s attention and lay
the groundwork for other judges to rule similarly
Cancelling private student loans spent on unaccredited schools, bar study expenses and other non-tuition related costs
92 NHEG Magazine | September - October 2018
September - October 2018 | NHEG Magazine 93