Student loans are no different than any other. What name or title you wrap a loan package with has nothing to do with how it is going to be paid back. Just because someone is willing to loan you money doesn't mean you have to accept it. Plenty of blame to go around here. Student loans are becoming the same as home mortgages were in and around the 2006-2008 housing bubble.
They were all based on the bigger idiot theory. Home mortgages then, just like student loans now, are being given out based on the ability of future income or equity to pay them off. The future is guaranteed to no one. People signed on to ARM, interest only mortgage loans with a 5 year balloon interest rate, because they were all banking on the value of their home going up. They could then refinance in 5 years with all of their new found equity. When that didn't happen, they couldn't stay and make the increased balloon payment because they couldn't afford it. And they found they couldn't get out by selling, because the home was worth less than half of what they owed.
So they walked away, and thus triggered the collapse of the entire market. The banks and the government made matters worse by approving these idiots, who had no business in the housing market to begin with. But liberal people in government were all pushing the position that, "everyone deserves to own a house". Again, the bigger idiot theory played out to the max.
Fast forward to today's student loan fiasco. Same song, different dance. These college professors, along with assorted other liberals are all pushing that, "Everyone must have a college degree". So we now have these kids seeking degrees in underwater basket weaving. Or else Tibetan dance culture. And they are spending a borrowed fortune getting them. Only to find when they graduate there is no one willing to employ them. They are taught that they MUST have a college degree, and trade and tech schools are for idiots.
So they come out of college owing well into 5 figures, and sometimes 6. Then they are subjected to the rude awakening that they can't pay off their student loans waiting tables at Applebee's. What were they thinking? And what were the people who loaned them the money thinking? When I went into trade school, I knew how much a 1st through 5th year apprentice made. And what Journeymen in my trade all earned. As well as the demand for qualified apprentices on the job market. It's not rocket science to research this stuff. Mike Rowe said it best.... "We are loaning money we don't have, to kids who can't pay it back. To train them for jobs that no longer exist".
