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Recent college graduates who borrow are leaving school with an average of $34,000 in student loans. That's up from $20,000 just 10 years ago, according to a new analysis from the Federal Reserve Bank of New York.
In that report, out this week, the New York Fed took a careful look at the relationship between debt and homeownership. For people aged 30 to 36, the analysis shows having any student debt significantly hurts your chances of buying a home, compared to college graduates with no debt. The cliche of "good debt" notwithstanding, the consequences of borrowing are real, and they are lasting.
The report paints a mixed picture of how student borrowing has evolved over the last decade, since the financial crisis. There are some bright spots: For example, student loan defaults peaked five years ago and have declined ever since.
And repayment seems to have slowed down among high-balance borrowers —those who owe $75,000 or more. Meaning, after 10 years, they have paid down only one-quarter to one-third of what they owe.
On the face, this isn't necessarily good. But taken alongside the decline in defaults, Fed president William Dudley said in a press briefing Monday, it reflects something good. That is, graduate students, in particular, are signing up for government programs intended to help make payments more affordable.
Source: NPR
(Score: 2) by wisnoskij on Wednesday April 05 2017, @01:06PM (8 children)
The US government spends more than any nation paying for socialized medicine. So no, American taxes go to socialized medicine, and far more than your taxes do.
Every single cent spent by everyone for all heath related services in Britain, for example are about 150 billion. Times that by 10 just for medicaid and medicare. Similarly, the American government shovels hundreds of billions into paying for American Education. Before they started subsidizing Higher Education it was cheaper than most of the rest of the world.
America is the most socialized country on Earth. A huge percentage of its budget, the biggest of any country, goes directly to feeding, sheltering, educating, and healing its citizens.
(Score: 1, Touché) by Anonymous Coward on Wednesday April 05 2017, @01:24PM
Except so much of that money is wasted on bureaucracy and corporate profits.
(Score: 5, Insightful) by AthanasiusKircher on Wednesday April 05 2017, @03:22PM (6 children)
America is the most socialized country on Earth.
That's not accurate. Instead, the U.S. often chooses bad combinations of government programs allied with private corporations to produce the most inefficient economic systems... which is why American taxpayers end up paying so much.
You bring up Medicare and Medicaid, but they aren't really the problem. They may be somewhat inefficient, but they have much smaller overhead than private insurance and control healthcare costs directly in a number of ways. Instead of socialized healthcare, the U.S. chooses to force its citizens to pay private corporations to provide them "insurance." The Democrats had the power to produce a true socialized system a few years ago, but instead they passed the "Affordable Care Act" which continues the problematic interactions with third parties in U.S. healthcare that end up ballooning costs.
We did the same thing with Fanny Mae and Freddie Mac, organizations that are "sponsored" by the U.S. government to provide mortgages, but which also exist as public corporations. Thus, you get the worst blend: an organization that has enough freedom to completely screw up the mortgage market, but will always be guaranteed to be bailed out in a crisis.
Student loan programs are similar. They have become perverse incentives driving the increasing cost of American higher education, once again by introducing a government program that funnels money into intermediaries indirectly, while allowing them to manipulate the markets.
So no, in the U.S. we don't have socialism. Instead, we pay our government to prop up private insurance companies, bad mortgages, escalating private university costs, etc. The U.S. is so afraid of socialism that it refuses direct government intervention in many markets, instead creating "band-aids" that often provide perverse incentives that pour money into private corporations and entities.
(Score: 2) by wisnoskij on Wednesday April 05 2017, @04:33PM (1 child)
Medicaid and Medicare are not Obamacare. They directly pay for peoples healthcare costs. They are 25% of the entire budget or America.
I agree that all of these programs don't work.
(Score: 2) by AthanasiusKircher on Thursday April 06 2017, @04:12AM
Yes, I'm well aware of what all these programs are and how they function. The costs of Medicare and Medicaid are distorted because the general healthcare market is already so screwed up due to the influence of the private insurance system. Obamacare was just a bandaid on that system that fixed a few big issues while still leaving the market screwed up by profiteering third-parties.
Medicare and medicaid already tend to pay out a lot lower than standard market value for procedures and care, but there's a limit to how much they can limit costs before doctors stop accepting Medicare patients. (Over 20% of American doctors are apparently refusing to take on new Medicare patients these days because the payout is too small.) But the doctors need to do that due to increased costs for everything else in the medical system they are paying.
So yes, Medicare/aid are closer to socialized medicine, but they again don't work efficiently because of the government's other half-assed regulation of the private insurance market.
(Score: 0) by Anonymous Coward on Wednesday April 05 2017, @04:52PM
It's worse than that, yet.
Medicare and Medicaid hide their perverse incentives and socialised burdens such that their actual budgets don't reveal their real burden on society. The headline budget amounts are basically an accounting lie.
(Score: 0) by Anonymous Coward on Wednesday April 05 2017, @06:51PM (1 child)
The Democrats had the power to produce a true socialized system a few years ago, but instead they passed the "Affordable Care Act" which continues the problematic interactions with third parties in U.S. healthcare that end up ballooning costs.
I would suggest that a "true socialized system" would be unconstitutional. At least there is a very strong argument that it is not an enumerated power in the Constitution (although the Commerce Clause seems to be the catch-all so maybe not).
Therefore, the Democrats never had the power to produce a true socialized system. They had a first step in the process, but do you really think 2/3 of the states would ratify an amendment to grant the federal government this power?
(Score: 2) by AthanasiusKircher on Thursday April 06 2017, @04:00AM
We haven't been living under enumerated powers since the late 1930s, since SCOTUS stopped striking down laws on that basis. (One or two outlier cases in the 1990s or whatever don't count.) The ACA is absolutely unconstitutional according to pre-New Deal jurisprudence, as would be 95% or more of the existing federal government today. So I'm not sure what your argument is -- do you seriously think the ACA would pass constitutional muster under the federalism doctrine of the Founders (or the first 150 years or so of U.S. history)? Please point to the enumerated power that authorizes the federal government to force people to buy health insurance (or to force people to purchase anything from a private corporation).
Enumerated powers are meaningless now, so I don't see how one can say the Dems didn't have power to make a socialized system when they didn't have power to make the one they did. (This was proven in SCOTUS cases around the ACA, where a majority of the court actually agreed it was beyond enumerated powers... Except Roberts came up with a tortured way to redefine the wording of the law to read it as saying something different.)
(Score: 2) by c0lo on Thursday April 06 2017, @11:22AM
In other word, public-private partnership kleptocracy, aka legalized corruption.
https://www.youtube.com/watch?v=aoFiw2jMy-0 https://soylentnews.org/~MichaelDavidCrawford