You're missing the bigger picture. People aren't rational actors and perfect information don't exist outside thought experiments. Our brains aren't hardwired to think about long-term consequences especially at the age of 18 and our brains are still developing until we're about 25. A goddamn math lesson isn't going to change that or magically create more jobs on the marketplace 4-5 years out.
Dohdough, I completely agree that, at the age of 18, most people aren't thinking about long-term consequences. Where we diverge is that you don't see the problem with letting these people (18 year old students who can't think about long-term consequences) take on the debt. I would say that the federal governments policy of limiting the amount of debt taken with federal loans is a good one. I would also be fine with making the requirements to get the loans more stringent. Let's stop the problem before it starts, not let a broken system continue and then throw money at it without changing the cause of the failure.
The math lesson I'm talking about is meant to point these exact things out to the person before giving them the loan - the idea is to get them to take out only the amount they need (maybe work their way through college and not take out any debt) it is not to create jobs. I don't know that the lesson would help, but they would have the information at least. How about this, you make it an entire course in high school instead of a one hour class. I don't really know, but do whatever you need to do to get the point across to them. Because, with the way loans function, when they sign on the line, they become liable for repayment of that loan.
What I really think needs to happen is that parents and others need to stop saying that you have to
get a college degree to succeed or that a college degree automatically
means that you will be financially successful or be able to get a good job. These are falsehoods.
When you talk about predatory lending practices, it's not something that's isolated to pay-day loans and check cashing establishments in the ghetto. We're talking about large multi-national banks. The same ones that caused the housing bubble. I shouldn't have to remind anyone that it was common corporate policy to push bigger loans on people and flat out lie about interest rates.
I agree with you about predatory lending practices and understand that the large banks do it. However, I don't think that this was the only cause of the housing bubble. I think some of the same investment advice was given to people regarding housing as it has been with college - that it is always a good investment, it will only go up. I agree that the banks and corporate greed were a large part of the problem, but I think personal greed on the part of the home buyer, deregulation, and again ignorance of loan products each played substantial roles.
The fact of the matter is that it's not a misconception. People with degrees make a substantial amount of money more than those without over the course of a lifetime. Not to mention that unemployment rates are at least half that of high school grads. A degree is the de facto requirement for a vast majority of entry level jobs. We're not talking hs diploma required and degree preferred here.
The misconception is that it can't fail
, that with a degree you will get the job you want/expect and that you will make the amount you estimate when you start college. I am not arguing that the wages earned by college graduates are typically well above those with only a high school diploma.
I don't think anyone here arguing for loan relief thinks that it's remotely possible that all loans are discharged or seriously suggesting that it should. The only reason why it may seem that way is because idiots are arguing that it's a "redistribution of wealth" or "handouts" as if it was a fucking headshot of an argument and not a snap toy, so we can't get to any real ideas. We already have a framework to structure a loan relief program with FAFSA and can do more than a half-assed job at providing some relief by merely reducing repayment amounts by retroactively adjusting the EFC while writing off the adjustments.
I don't really understand what you mean. First you say that you are not arguing for the loans to be discharged (I assume that we are talking about federal loans), but then you say you want "more than a half-assed job" at providing some relief by adjusting how much the person pays relative to their income (max of 15%) and then discharging the remaining balance after 25 years of payments. Exactly what else do you want the federal government to do? The plans that are in place seem pretty good to me.
I apologize for my error, I really thought that we were arguing that federal loans should be forgiven in bankruptcy or that the government discharge them completely.