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Elizabeth Warren: Student Loans Should Have Same Rate Big Banks Get

Discussion in 'Political Discussion' started by Patters, May 8, 2013.

  1. Patters

    Patters Moderator Staff Member PatsFans.com Supporter

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    I think it's for legislation like this that the big banks and their conservative allies hate Elizabeth Warren.

    Elizabeth Warren: Student Loans Should Have Same Rate Big Banks Get

    WASHINGTON -- Sen. Elizabeth Warren (D-Mass.) unveiled her first bill Wednesday, designed to set student loan interest rates at the same level the Federal Reserve offers to big banks.

    With some student loan rates set to double on July 1 -- from 3.4 percent to 6.8 percent -- Warren's bill would reduce student loan interest rates to 0.75 percent, opening the Fed's discount window to students.

    "Every single day, this country invests in big banks by lending them money at near-zero rates," Warren told The Huffington Post. "We should make the same kind of investment lending money to students, who are trying to get an education."
     
    Last edited: May 9, 2013
  2. IcyPatriot

    IcyPatriot ------------- PatsFans.com Supporter

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    #87 Jersey

    Re: Student loan rates


    Huge .... very ... very HUGE. :yo:
     
  3. PatriotsReign

    PatriotsReign Hall of Fame Poster

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    #18 Jersey

    It's not a bad idea, but it doesn't address THE problem which is sky-rocketing college tuitions which are the result of "anyone who wants a college loan, get's one"

    So how do we control out of control education costs?
     
  4. wistahpatsfan

    wistahpatsfan Pro Bowl Player

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    Re: Student loan rates

    Boy. Liz knows where to hit the spots that no one can argue against...except that this will now be labeled "communist" somehow.
     
  5. PatriotsReign

    PatriotsReign Hall of Fame Poster

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    Re: Student loan rates

    nah....only if an idiot proposed FREE college education funded by taxpayers would they be labeled communist....and that would be communist!:D
     
  6. Nunchucks

    Nunchucks In the Starting Line-Up

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    Re: Student loan rates

    No, it actually would not be communist, but why let actual definitions of words get in the way.
     
  7. Real World

    Real World Moderator Staff Member

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    Re: Student loan rates

    What was the interest rate on the loan she got? I forget. Someone refresh me memory.

    One of the major reasons why student tuitions have exploded, is because of the cheap borrowed money via loans. Of course know nothing professors like Chief Talking Bull who have benefited from the tuition explosion, would love nothing more than to see even lower rates. Lower rates means more principle can be borrowed, which means highers tuitions and higher pay. Oh amd better bennies like no interest loans. Cheap money only leads to inflated prices and further hardship for those who matter most. But hey, it all sounds good so....
     
  8. JackBauer

    JackBauer Pro Bowl Player

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    Re: Student loan rates

    Sounds to me your intense dislike for Warren will color your judgment on any issue she'd champion, but you have a link to support your assertion there, bud?
     
  9. wistahpatsfan

    wistahpatsfan Pro Bowl Player

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    #75 Jersey

    Re: Student loan rates

    Yes. That's right. Let's make policy for the future based on what has happened in the past. That's kinda regressive, isn't it?

    The the reason tuition is too high is because the interest paid back by students who get loans is too low? How does that work? I don't know much about financing, so I'm sure you can edumicate me.
     
  10. JackBauer

    JackBauer Pro Bowl Player

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    Re: Student loan rates

    I had to go look that up because it didn't pass the smell test...needless to say I haven't found much describing student loans as a primary or even secondary driver of higher-ed costs.

    Maybe he's got a link I didn't find, though.
     
  11. patsfan13

    patsfan13 Hall of Fame Poster PatsFans.com Supporter

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    Re: Student loan rates

    The whole College model is pretty outdated, it started in the middle ages when the prof read a book to the students and they copied the book this was pre printing press. Later the University was valued for it's Library as centralized source of information, not that too is obsolete, With the internet most of what is taught in college can be done on line without the edifices of the typical campus and the attendant expenses.
     
  12. Nunchucks

    Nunchucks In the Starting Line-Up

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    Re: Student loan rates

    There is so much that goes into a residence based college education, to think it can be replicated with an online curriculum is naive at best and willfully ignorant at worst.
     
  13. Charlotte Pats Fan

    Charlotte Pats Fan 2nd Team Getting Their First Start

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    No Jersey Selected

    Re: Student loan rates

    You forgot to include " In my Opinion"
     
  14. patsfan13

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    Re: Student loan rates



    Note the use of the word most, btw what in the typical college education is worth 30k+ per year?
     
  15. BSR

    BSR In the Starting Line-Up

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    Re: Student loan rates

    Its basic economics. The only reason the majority of students can go to any college is because of through a combination of public and private loans. That includes Public, not for profit and for profit schools. The Feds and private corporations are subsidizing the majority of public education at little cost to the schools. The schools can literally charge whatever they want because a) children need an degree if they are going to get any sort of well paying white collar job b) The funding of those payments can be done by someone else. Without any downward pressure from the revenue side there is no incentive to maintain or reduce costs. In turn, those that provide goods and services to schools can also continue to maintain or increase prices since there is no downward pressure from the schools. With demand for higher education nearly inelastic to price increases, increased costs by the schools can just be passed on to students.

    The reality is that it can't go on forever. Eventually the rising costs reaches a point where the credit markets start to dry up and there are signs that the time is now. Private lenders are raising the borrowing rates or even getting out of the business all together. This is causing a little bit of a shake up and that isn't necessarily a bad thing as it might cause schools to actually rethink their pricing structure. With the majority of their students on some sort of loan they would almost have to do something about it without losing a large portion of their student body.

    While this bill certainly has great intentions, what it also does is prop up the student loan credit market once again by making more overall credit available and deferring the point when colleges realize that there is no more room to go up in fees.
     
  16. JackBauer

    JackBauer Pro Bowl Player

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    Re: Student loan rates

    Well, if it's basic economics, you'd expect it to be cited as a primary driver in education costs, no?

    The consensus seems to be that the primary reason education costs have gone up is cutbacks in support at the state level.
     
  17. DocHoliday

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    Silly. I hope undergrad rates skyrocket out of control.

    Maybe that way students will realize its not free money and stop willfully paying exorbitant tuition rates.

    Someone has to shake these kids and show them how awful it is to be paying student loans for 20+ years.

    Treat the problem not the symptom!!!

    Once big schools start losing kids to cheaper institutions for real they'll start having a reason to control costs. But if kids can keep getting cheap money they won't care.

    One thing I'd like to see is a removal of the deferment period. Once you borrow money you should be paying bills from the start. Maybe that way it'll become apparent what its costing you.
     
  18. BSR

    BSR In the Starting Line-Up

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    Re: Student loan rates

    No, because it isn't the direct cause. When a school experiences increased costs (I haven't read about cutbacks in state support being the cause of increased school costs, but whatever.) they have two choices: cut costs elsewhere or raise prices. Schools can just raise prices because an elasticity to demand. In other words, the demand for your product won't drop despite the increased prices. The proof is the rise of college tuition rates juxtaposed with the rise in college enrollment rates.
     
  19. JackBauer

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    Re: Student loan rates

    Sounds totally reasonable in theory. Though I'd like to see a study/some evidence to show this is how it operates in practice. In other words, I'd like to see some evidence of causation, not simply correlation.
     
  20. Nunchucks

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    Re: Student loan rates

    No, I did not.
     

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