Many younger people are completely unaware that once upon a time, when people couldn’t find work, they could file bankruptcy and wipe out their debt–including their student loans.
Yes, in the 1980’s, when Baby Boomers were in college, student loans could be discharged in bankruptcy. Back then, people didn’t need to borrow much in order to go to school, and schools and housing were affordable. Schools and housing need to be affordable again. But the educational industry won’t change until it is forced to change. Setting students free is step one.
Society benefits when young people become educated and create innovations. Turning young people into indentured servants is destroying the United States economy, strangling the housing market, and forcing young people to stay in dead end jobs instead of creating new businesses. Student loans are dragging the economy down, and much of the debt is held by foreign governments and banks.
Many people don’t realize that student loans are currently treated the same as criminal restitution in bankruptcy court–debts owed due to criminal activities. For example, if a drunk driver injures somebody, they’ll owe criminal restitution, which can’t be wiped away in bankruptcy. Student loans are treated the same.
Why not treat student loans the same as tax debts, which can be discharged under certain conditions? Or better yet, treat student loans the same way that other unsecured debts are treated–make them fully dischargeable.
Student loans create an illusion that the American economy is equally accessible. It’s not. But young people don’t realize their mistake until it’s too late.
It’s time to wipe out the University-Student Loan complex and force our society to make college (and college housing) cheap and accessible to young people once again. The people getting rich from student lending must be held accountable. If students can pay their debts, they will. If they can’t, they’ll have to take their chances in bankruptcy court, possibly surrendering assets and damaging their credit. This is more than sufficient accountability for financial decisions made at a young age. It’s time to make lending and educational institutions accountable for their lies to American youth.