Tuesday, April 15, 2014
Student Loan Borrowers' Costs To Jump As Education Department Reaps Huge Profit
http://www.huffingtonpost.com/2014/04/14/student-loan-profits_n_5149653.html?utm_hp_ref=politics. DUE 21 APR 2014. What does Chris Hicks claim is the motivation of the Department of Education? Name 3 economic repercussions of increasing student debt after the student graduates?
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Chris Hicks’s claim that drives the motivation of the Department of Education is the profit made from the interest rate paid by borrowers that will excel the cost to fund loans and maintain the program. The economic repercussion of increasing the student debt after the student graduates is the deflation in the economy. As stated in the article the student’s paycheck will be dedicated on paying off the loans rather than purchasing goods allowing that money to circle back into the economy. Other investments in retirement and savings account will no longer exist because the students who take out these loans and are in debt will be too occupied to invest in these accounts. The students who borrow will be eventually left to fail because of the amount of accumulated debt that they know they will not be able to pay back in addition to the interest. Overall this increasing debt in order to go to college will come down to a cost-benefit analysis. Think about it would a college degree be worth a lifetime of paying back debt? To me I would not even attempt to go to college if I knew that was my future.
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DeleteChris Hicks claim that the motivation of the Department of Education is the program produces a profit because the interest rate paid by borrowers exceeds the federal government's cost to fund those loans and administer the program. The figure also accounts for loan defaults and borrowers' use of flexible repayment plans that tie monthly payments to their incomes. The economic repercussions of increasing student debt after the student graduates are the deflation in our economy. The student loan program is not about helping students or borrowers; it is about making profits for the federal government. A group of federal regulators, policymakers and student loan experts worry that the nation's economy will be restrained for years as monthly student loan payments take an increasing bite out of borrowers' paychecks. According to the article, researchers have found that student loan borrowers are less likely to start small businesses, save for retirement, take out a home mortgage or buy a car. The Education Department, on the other hand, has told some refinancing supporters that a plan to enable borrowers to refinance expensive debt into loans carrying lower interest rates could cost as much as $100 billion over a 10-year period in foregone federal revenue. In my opinion, if it wasn't for student loans, financial aid or Pell Grants, most of the students would not have been able to go to college or go to a graduate school.
ReplyDeleteChris Hicks claims that the program produces a profit because the interest rate paid by borrowers exceeds the federal government’s cost to fund those loans and administer the program. That is the motivation of the Department of Education. There are a lot of economic repercussions of increasing student debt after the student graduates. A group of federal regulators, policymakers and student loan experts worry that the nation’s economy will be restrained for years as monthly student loan payments take an increasing bite out of borrowers’ paychecks. A group of bank chief executives that advise the Fed also have warned about negative repercussions on the nation’s banking system from growing student debt loads. Hicks said younger borrowers face daunting circumstances. If forced to choose, he said he reckons that borrowers would most likely default on their federal student loans rather than give up their credit cards or forgo health insurance.
ReplyDeleteAccording to Chris Hicks’s the motivation for the Department of Education is the profit made from the interest rate paid by borrowers which will be greater than the cost to fund loans and maintain the program. Three economic repercussions of increasing the student debt after students graduate are 1) the nation’s economy will be restrained for years because student’s paycheck will be dedicated on paying off the loans rather than purchasing goods which stimulates the economy. 2) More people may be forced to default of student loan deb because the can no longer afford the payments, which would hurt the banking system. 3) The students who borrow will be left to fail because of the amount of accumulated debt that they will not be able to pay back, all these things can lead to economic ruin. Though college provides great opportunities people need to decide whether it will be worth taking out loans with high interest rates, or planning an alternate route to success.
ReplyDelete“The public needs to be concerned about a government agency acting like a bank,” Hicks said. “The Education Department has a profit motive.”
ReplyDeleteChris Hicks' motivation for the Department of Education is the profit made from the interest rate paid by borrowers (it will be more than the price to fund payments and regulate the program).
The three economic repercussions of increasing the student debt after scholars graduate are
1. The student's will have trouble paying back the loans. Their paychecks will go towards their student loans rather than utilities such as housing, electricity, water, etc.
2. Students will not attend Universities. They will resort to local colleges which is a lot cheaper than attending big universities. In my opinion, if I was in that situation, I would just go to a community college. Probably not even attend college if my future will be consist of paying off my debt.
3. Think of the family. Their saving account(s) will be empty. A lot of economic crisis will happen within a family if they have to pay so much to borrow. Especially for the lower class.
Chris Hicks says the motivation for the Department of Education is the profit made from the interest paid by borrowers that will fund loans and keep the program going. Some economic repercussions of increasing student debt would include, the students having trouble paying back the loans, causing them to not spend money elsewhere, thus not stimulating the economy.People wont be able to save money because they will have to pay it all to wherever they borrowed money from. Also, students wont be ale to go to higher level learning institutions because they are too expensive. If college costs too much, to some people, it seems smarter to just work at McDonalds their whole life, rather than take out student loans ad pay them back over the course of 50 years.
ReplyDeleteChris Hicks claims that the motivation of the Department of Education is to create a nice profit for them to receive from the interest rate paid by the borrowers.Three economic repercussions of increasing student debt after the student graduates are the following. One, savings accounts and money for retirement will very rarely exist because the students are going to be too invested into paying back their loans due to the increase in their interest. Two, more students will be going to local colleges rather than the more expensive Universities to try to save as much money as possible. And lastly, students who borrow will be left to fail because they will be borrowing money in order to pay back their debt, thus it will push the economy downward even more than it already is.
ReplyDeleteChris Hicks claim that drives the motivation of the Department of Education is the profit made from the interest rate (from borrowers) that exceeds the cost to fund the loans. The economic repercussion of increasing the student debt after the student graduates is the deflation in the economy. In other words, the money they get from their future jobs will be used to pay off their debt instead of things that can circulate money into the economy. Also investments in retirement and other accounts they hold will not be used because the students will be too much in debt. Also, the students who borrow will be in trouble in the end because the amount of debt they develop will not be easy to pay back with the additional interest.
ReplyDeleteChris Hicks claims that the motivation of the education department lending loans is that they will get a profit out of it. This is why they decided to increase the borrower's interest rates over the next decade. They are some serious repercussions to increasing the debt. One of them is the student will most likely not buy a house or car which means even less money will circulate in the economy. Another problem I that now less kids will go to college who depend upon the loan to help them, knowing they wont be able to pay it back. A third repercussion is if they go to college and by the end are not able to pay the loan back. The department would lose a lot of money that way because of their unreasonable increase in interest rates.
ReplyDeleteChris Hicks claims that the motivation of the education department lend loans is the profit made from the interest rate that exceeds the cost to fund the loans. Repercussions is that savings accounts and money for retirement will very rarely exist because the students are going to be too invested into paying back their loans due to the increase in their interest. A group of bank chief executives that advise the Fed also have warned about negative repercussions on the nation’s banking system from growing student debt loads.
ReplyDelete“The motivation of the Department of Education is to create a nice profit for them to receive from the interest rate paid by the borrowers” states Chris Hicks. After students graduate though, there are usually three economic repercussions of increasing student debt that follows. One of them including the fact that savings accounts and money for retirement will very rarely exist because the students are invested in paying back their loans due to the increase in interest. Two, more students will be going to local colleges rather than the more expensive state Universities to try to save as much money as possible. Last but not least, these students who borrow will be left to fail because they will be borrowing money in order to pay back their debt, thus it will push the economy downward even more on a downward spiral compared to what it already is.
ReplyDeleteChris Hicks claims that the motivation of the Department of Education is the profit made from the interest rate paid by borrowers that will allow them to fund loans and maintain the program. The 3 economic repercussions of increasing the student debt after students graduate is deflation of the economy because the student’s paycheck will be going solely to paying off their loans instead of making other purchases that will put more money into the circulation of the economy. Also investments in retirement/savings accounts wont exist because the students who take out these loans are in debt and will be too busy to even think about investing in such things as these. Also many if not all of the students who borrowed money will not be able to pay it all back with the interest because it is such a huge amount that accumulated. In the end many students will opt out of going to college because they simply do not want to be in that situation of having to worry about paying all that money back.
ReplyDeleteChris Hicks claims the motivation of the Department of Education is the profit in the interest rate paid by borrowers that exceeds the federal government’s cost to fund those loans and administer the program. Some economic repercussions of increasing student debt after the student graduates would be people not being able to pay back their loans and manage paying their current bills at the same, causing them to be more in debt. This will effect the economy by limiting the money circulation. If you owe more money you wont be able to buy cars, a house, or other things to contribute to the economy. Also it will be harder for people to start their own businesses because it will be harder to borrow money. Whether you still owe money or not. If they increase student debt after the student graduates nothing good is going to come out of it. Everything is going to become worse, especially our economy but also peoples lives.
ReplyDeleteChris Hicks claims the motivation of the Department of Education is the profit made by the interest rate paid by loan borrowers. There are economic repercussions of increasing student debt after the student graduates. One of them is that there won’t be as many savings accounts since the student will not have any money to save because they will be using it all on paying back their loans. Another is that more and more students will choose small, local colleges rather than large universities so they won’t have to take out as many loans to pay for college. The last is that students will basically be setting themselves up for failure because they will begin their lives in the real world in debt. Instead of spending the money they earn from a job, they will pay back loans, which will not help the economy in any way.
ReplyDeleteChris Hicks claim that the motivation of the Department of Education is the program produces a profit because the interest rate paid by borrowers exceeds the federal government's cost to fund those loans and administer the program.The economic repercussion of increasing the student debt after the student graduates is the deflation in the economy. As stated in the article the student’s paycheck will be dedicated on paying off the loans rather than purchasing goods allowing that money to circle back into the economy. Other investments in retirement and savings account will no longer exist because the students who take out these loans and are in debt will be too occupied to invest in these accounts.
ReplyDeleteChris Hicks claims that the motivation of the department of education is lend loans is the profit made from the interest rate which exceed the cost to fund the loans. Repercussions are that savings accounts and money for retirement will probably wont exist because students are going to be too invested into paying back their loans because of the increase in their interest. A group of bank chief executives that advise the FED have warned about negative repercussions on the nation’s banking system from growing student debt loads. The students wont be able to pay back their loans. less kids will be attending university. It will be harder to get into university.
ReplyDeleteChris Hicks claims that the motivation of the education department lending loans is that they will get a profit out of it. The 3 economic repercussions of increasing the student debt after students graduate is deflation of the economy because the student’s paycheck will be going solely to paying off their loans. Instead of making other purchases that will put more money into the circulation of the economy. Whether you still owe money or not. If they increase student debt after the student graduates nothing good is going to come out of it. Inflation increases with College loans.
ReplyDeleteChris Hick's claim for the motivation of the Department of Education is the amount made from the interest paid back from borrowers. This will help not only to maintain the program but bring in extra revenue. The three economic repercussions of increasing student debt after graduation are the decrease in our economy, the decrease of college admissions, and the trouble of paying back loans. The decrease of our economy will be relying on the lessened amounts of circulation by students in depth. The decrease in college admissions would be because of the realization that they are walking into something that they cannot get out of. And lastly majority of the students who do borrow will have majority of their paycheck going straight to paying off the loans rather than purchasing things that would boost our economy.
ReplyDeleteChris Hicks claim to motivate the Department of Education is the profit made from the interest rate paid by the borrowers that will allow them to fund the loans and maintain the program. The 3 economic repercussions of increasing student debt after the student graduates include deflation in the economy because the majority of a student’s paycheck will go only to pay back their student loans. This is an important factor due to the fact that these graduates will not contribute to the economy's circulation, in spending on other goods or necessities. Only having their paychecks go to pay back their student loans. The investments in the savings accounts or retiring accounts would barely exist due to the students loans, the graduates are in a big debt and will only have the mind set to pay off the loans that would drown them if they don't pay it off. The interest on these loans are so huge it seems almost impossible for the graduate students to pay them off since the accumulation has been growing.
ReplyDeleteChris Hicks claims motive for Department of Education is a their profit from loans. More importantly the interests they get from the loans. This profit allows Department of Education to fund more loans, creating more debts. Three economic repercussions in doing this are the limited circulation of money into the economy due to fact graduates leave college with loans that consume a majority of their paychecks to paying it back. Creating financial instability for many of those who have huge loans, making it hard to live a decent lifestyle because of loans being paid back and bills they now have on top. Not to mention, fact savings and investment would be practically impossible for graduates that have loans that are so high they won't be able to pay it back within their lifetime. this is a on going problem and we will need to create a a solution to this because its constantly growing.
ReplyDeleteChris Hicks’ claim that drives the Department of Education is the profits made from the interest rates paid by borrowers that will excel the cost to fund loans and maintain the program. Three economic repercussions would be the decrease in our economy, the decrease of college admissions, and the trouble of paying back loans.The decrease of our economy will be a result of the lessened amounts of circulation by students in depth. The decrease in college admissions would be because of the fact that students would be signing off into something that they cannot get out of, and extremely hard. And lastly majority of the students who borrow will have most of their paychecks going to loans rather than purchasing things that would help the economy.
ReplyDeleteChris Hicks illustrates the motivation for the Department of Education is the profit made from the interest paid by borrowers that will fund loans and keep the program going. Some economic repercussions of increasing student debt would include, the students having trouble paying back the loans, causing them to not spend money elsewhere, thus not stimulating the economy.People wont be able to save money because they will have to pay it all to wherever they borrowed money from. Also, students wont be ale to go to higher level learning institutions because they are too expensive. If college costs too much, to some people, it seems smarter to just work at McDonalds their whole life, rather than take out student loans ad pay them back over the course of 50 years.
ReplyDeleteChris Hicks’s claim that drives the motivation of the Department of Education is the profit made from the interest rate paid by borrowers that will excel the cost to fund loans and maintain the program. The economic repercussion of increasing the student debt after the student graduates is the deflation in the economy. As stated in the article the student’s paycheck will be dedicated on paying off the loans rather than purchasing goods allowing that money to circle back into the economy. Other investments in retirement and savings account will no longer exist because the students who take out these loans and are in debt will be too occupied to invest in these accounts. The investments in the savings accounts or retiring accounts would barely exist due to the students loans, the graduates are in a big debt and will only have the mind set to pay off the loans that would drown them if they don't pay it off. The interest on these loans are so huge it seems almost impossible for the graduate students to pay them off since the accumulation has been growing.
ReplyDeleteThe motivation of the Department of Education, according to Chris Hicks, is that the revenue made from the interest rate paid by borrowers will exceed the cost to fund loans and maintain the program. As a result, student loan borrowers are less likely to start small businesses, save for retirement, take out a home mortgage or buy a car. That would mean students wouldn't really be putting any money towards the economy because most of it would go to paying debt. Their income also wouldn't increase much because they probably won't be investing at all. Students would also be very likely to default on their debt because their insurance would take precedence over their debt.
ReplyDeleteChris Hicks claims that the motivation of the Department of Education is that the profit from the interest rate paid by borrowers will be larger than the cost to fund loans and will help maintain the program. Three economic repercussions of increasing student debt after a student graduates is that student borrowers are less likely to start small businesses, save for retirement, take out a home mortgage or buy a car. Furthermore, many students will default on their loans after being unable to keep up with the high interest rates and when a large amount of students default on their loans, the nations banking system will have negative repercussions from unpaid student debt.
ReplyDeleteChris Hicks claims that the motivation of the Department of Education is that the profit from the interest rate paid by borrowers will be larger than the cost to fund loans and will help maintain the program. The economic repercussion of increasing the student debt after the student graduates is the deflation in the economy. As stated in the article the student’s paycheck will be dedicated on paying off the loans rather than purchasing goods allowing that money to circle back into the economy. Other investments in retirement and savings account will no longer exist because the students who take out these loans and are in debt will be too occupied to invest in these accounts. People wont be able to save money because they will have to pay it all to wherever they borrowed money from. Also, students wont be ale to go to higher level learning institutions because they are too expensive. Furthermore, many students will default on their loans after being unable to keep up with the high interest rates and when a large amount of students default on their loans, the nations banking system will have negative repercussions from unpaid student debt.
ReplyDeleteAccording to Chris Hicks, the motivation of the Department of Education is the profit from the interest rate paid by borrowers will be larger than the actual cost to fund loans and will help maintain the program. The economic repercussion of increasing the student debt after the student graduates is the deflation in the economy. Student borrowers are less likely to start small businesses cause they're paying off their loans, they're going to save it for retirement, or take out a home mortgage or buy a car. People aren't going to be able to save any money because they're so in debt.
ReplyDeleteChris Hicks claims that the motivation of the Department of Education comes from the profit they make off of the interest that is paid by the borrowers. The three economic repercussions of increasing student debt after the student graduates would have to be the deflation in the economy. Having majority of the student's paycheck going towards the loans that need to be paid back. Next, families won't really have retirements or saving accounts to fall back on if they try to help their student pay back the money. Lastly, at this rate, students won't see a need to attend a state university and just attend community college, or worse, they won't attend all together and get a low paying job.
ReplyDeleteChris Hicks says the motivation of the Department of Education to increase intrest rates is that the profits exceeds the cost of issuing new loans which will maintain their program. Three economic repercussion of increased interests rates for student loans are: 1) Many will choose not to attend college with the fear of not being able to pay it back properly. This will result in a lack of 'skilled' workers which is key for a strong economy. 2) Many won't be able to pay it off and will end up in serious debt. 3) Money that could be used to purchase goods and services are instead going towards paying of a loan.
ReplyDeleteMr.Hicks says that the motivation of the Department of Education to increase interest rates is the profit will inevitably exceed the cost of a new loan. This will cause students to not attend to college or event drop out of college. There will be many young adults out there without experience in the working world which will cause a large amount of unskilled workers trying to find jobs. Many individuals in college will be buried in debt that cannot be payed off.. Lastly, the money that should be used to be put back into the economy through goods and services are instead going into the debt in college tuition and loans…
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Chris Hick the Leader of Debt Free Future say that the Department of Education is only looking to make a profit and nothing more. 3 economic repercussions of increasing the interest rate on the loan students will be taking out in the 2015-2016. A lot of students don't want to buy homes because they don't have enough money to pay their student loans and pay a mortgage on the house. Many of them are not saving for retirement so they don't have a secure net for them to fall back on because they are paying off student loans, Many kids in the near future won't see the benefits of going to college if after you graduate you are not worried about paying off the money and you are just under a lot of stress
ReplyDeleteChris Hicks claims that the program produces a profit because the interest rate That borrowers pay are higher than what the departments pay to fund all of the loans. Basically, the Department of Education is just making profit off of students struggling to get an education. There are a lot of economic repercussions of increasing student debt. Policymakers worry that the economy will suffer from the lack of money circulating. The nation's banking system could also be negatively effected by unpaid loans and plain, old bad policies. Hick also believes that people will end up defaulting on their loans.
ReplyDeleteChris Hicks states that the motivation of the Department of Education is the profit from interest rates will pass the cost of issuing loans and maintaining the program. Three economic repercussions of increasing student debt are deflation because the student's money will go towards paying back their loans instead of going into the economy, less students will attend colleges because they know it would be easier to go straight into the workforce after high school, and an increase in foreclosures because some people might not be able to pay for their rent.
ReplyDeleteChris Hicks claims that the Department of Eduction is acting like a banks and is motivated by profit. The three economic repercussions are that the economy become deflated as stun dents have to pay the their student loans bill instead of putting it back in the economy. the other effect it would have is that it it is causing a bubble that is sooner or later going to pop, causing the economy to crash again. The other effect is more people are going to pull from social security and Medicare as they can't pay for themselves because they have to pay off their loans.
ReplyDeleteChris hicks claims the motivation of the department of education is to make money/profit. 3 economic repercussions after the student graduates of increasing the student debt are that the they wont have as much money to spend (higher loans making it harder to live a sucessful life and pay certain bills such as car payments and rent), and the banks will have less money to lend because people wont have money to spend. All in all, increasing the student debt is going to cause less people to go to college, and if they manage to go to college they are going to be even more likely to not pay it off. if they do, itll take a lot to actually do it. they may be paying it their whole life.
ReplyDeleteChris hicks thinks that the motivation for the department of education is the profit they collect off of interest rates on student loans. Economic reprocutions of this include former students having to allocate more of their money to paying off their loans, thus preventing money that would be spent from entering our economy. There will be less people that actually go to college because of the debt they know that they would have to pay back. And that less people will be able to save for retirement because of the burden of student loans.
ReplyDeleteChris Hicks claims that the motivation of the Department of Education is the profit from the interest rate which is paid by borrowers will be greater than the cost to fund loans and will help maintain the program.This means that Students will have an added strugle to payback their loans. Yes, it maybe good in theory but the reality is simply that students will end up with the short end of the stick. This could lead to some students avoiding higher education altogether or simply going to small trade schools that cost significantly less. This would mean though jobs that require a high level education would be left open. These jobs would have to be filled so that would leave the wealthy and foreign labor to fill these jobs. When I say foreign labor I mean to say someone getting a work visa and making money here to send somewhere else. I find this to mean that America or atleast North America will be falling into endless pit of ignorance. American's would soon become babies who are dependent on others for everything. It may no get to this extreme but we simply need to something that will allow people to feel comfortable getting a higher education without the burden of overwhelming debt.
ReplyDeleteAccording to Chris Hicks, the motivation of the for the department of education is to collect high rates off of the nurturers in order to make a profit. 3 repercussions of raising student debt include, student not having money to put back into the economy, people hesitating to go to college due to the price, and possibly an increase in homelessness.
ReplyDeleteChris Hicks claim that the motivation of the department is to make money off students. "The U.S. Department is fprecast to generate $ 127 billion in profit over the next decade from lending to college and their families, according to the congressional budget office." The economic repurcussions of increasing student loans is very crucial, predictably it will have many negative impacts on college students. For instant, this will discourage many students to go forward with their education,, which is not beneficial to them. Also, students will have to deal with the stressed of school and paying debts most of their adult life. This is extreme and very discouraging to those high school seniors that are attending college. Lastly, the majority is looking forward to their retirement money in order to live comfortably, but unfortunatly those students wont have enough as to say their will not have the amount of expected money their should have had when their retire.
ReplyDeleteChris Hicks’s claim that drives the motivation of the Department of Education is the profit made from the interest rate paid by borrowers that will excel the cost to fund loans and maintain the program.After students graduate though, there are usually three economic repercussions of increasing student debt that follows. One of them including the fact that savings accounts and money for retirement will very rarely exist because the students are invested in paying back their loans due to the increase in interest.Also investments in retirement and other accounts they hold will not be used because the students will be too much in debt.Students will not attend Universities. if they increase student debts they will resort to local colleges which is a lot cheaper than attending big universities. In my opinion, if I was in that situation, I would just go to a community college. Probably not even attend college if my future will be consist of paying off my debt.
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