How @JoeBiden spent 4 decades helping Wall St prevent Americans from reducing their student debts

[riversedge]

umm. I did not know anything about this.


Greg Neumann retweeted
David Sirota ‏@davidsirota 4m4 minutes ago

INVESTIGATION: How @JoeBiden spent 4 decades helping Wall St prevent Americans from reducing their student debts http://www.ibtimes.com/joe-biden-backed-bills-make-it-harder-americans-reduce-their-student-debt-2094664 #p2


Joe Biden Backed Bills To Make It Harder For Americans To Reduce Their Student Debt
http://www.ibtimes.com/joe-biden-backed-bills-make-it-harder-americans-reduce-their-student-debt-2094664

By David Sirota @davidsirota [e-mail]


Vice President Joe Biden may be mulling a presidential run. Pictured, Biden smiles as he delivers remarks at the U.S.-Ukraine Business Forum in Washington in July 2015. Reuters/Yuri Gripas

Jennifer Ryan did not love the idea of taking on debt, but she figured she was investing in her future. Eager to further her teaching career, she took out loans to gain certification and later pursued an advanced degree. But her studies came at a massive cost, leaving her confronting $192,000 in student loan debt.

“It’s overwhelming,” Ryan told International Business Times of her debts. “I can’t pay it back on the schedule the lenders have demanded."

In the past, debtors in her position could have used bankruptcy court to shield them from some of their creditors. But a provision slipped into federal law in 2005 effectively bars most Americans from accessing bankruptcy protections for their private student loans.

In recent months, Democrats have touted legislation to roll back that law, as Americans now face more than $1.2 trillion in total outstanding debt from their government and private student loans. The bill is a crucial component of the party’s pro-middle-class economic message heading into 2016. Yet one of the lawmakers most responsible for limiting the legal options of Ryan and students like her is the man who some Democrats hope will be their party's standard-bearer in 2016: Vice President Joe Biden.

As a senator from Delaware -- a corporate tax haven where the financial industry is one of the state’s largest employers -- Biden was one of the key proponents of the 2005 legislation that is now bearing down on students like Ryan. That bill effectively prevents the $150 billion worth of private student debt from being discharged, rescheduled or renegotiated as other debt can be in bankruptcy court.

Biden's efforts in 2005 were no anomaly. Though the vice president has long portrayed himself as a champion of the struggling middle class -- a man who famously commutes on Amtrak and mixes enthusiastically with blue-collar workers -- the Delaware lawmaker has played a consistent and pivotal role in the financial industry's four-decade campaign to make it harder for students to shield themselves and their families from creditors, according to an IBT review of bankruptcy legislation going back to the 1970s......................

[MichMan]

1. Not sure bankruptcy is appropriate

I am going to get beat up for this, but don't agree that student loans should be discharged in bankruptcy. I agree that college costs are through the roof and state funding needs to be increased, but there are legitimate reasons student loans are not treated the same.

With tangible assets like mortgages and autos, you can't declare bankruptcy and keep the assets; they get repossessed. I can't buy a McMansion or a Tesla, declare bankruptcy and keep them.

Education cannot be taken away, so it would be tempting to game the system by borrowing the max available at a high dollar Ivy League school, getting an MBA for instance and declaring bankruptcy immediately upon graduation. Once your loan balance is wiped out, then go get offered a six figure job on Wall Street.

If it were to happen under these scenarios, the entire student loan system would blow up making college only available to those wealthy enough to pay cash. If it could be structured that you had to surrender all the credits or degrees , than I might reconsider.

I attended a private Engineering college in the late 80's when costs were much more reasonable, so I understand what obstacles students today face. IMO, the real issue is why the costs have gotten so out of hand. I wonder if the availability of loans has caused prices to increase so much.

[greatlaurel]

2. Your analysis are talking points from the banking industry. Sounds OK until you think about it.

Empty sound bite type excuse making for the people who are making money hand over fist with outrageous interest rates for student loans. The vast majority of student loans are being made to the for profit college system like Kaplan University and University of Phoenix. These poor students are being taken to the cleaners to enrich the scions of already wealthy people.

Of course, the costs of public institutions have gone through the roof thanks to the tax cutting mania of the GOP, the class warfare of the GOP to make sure poor people cannot afford a public institution and the gullibility of the middle class to resent tax money going to help those lazy college kids.

This article explains where most of the student loan money is really going.
http://www.ginandtacos.com/2015/09/14/
"The "leading" school in debt outstanding grew from $2.2 million to $35.5 million in just over a decade. I wonder if starting salaries have grown by a factor of seventeen since 2000? Total student debt in that time period has quadrupled. Mean wages have too, right?
The numbers are alarming enough, but if you really need to lose sleep look at where all the money is going. The top 12 schools are, with the exception of crushingly expensive Ivy League bastion NYU, for-profit or non-profit in name only (Nova SE is an open enrollment joke school that is barely accredited, and we all know Liberty University is, uh, rather a thinly veiled moneymaking scheme for the homeschooled crowd). And that raises the question: Who in the name of god is taking out this much money for such demonstrably worthless degrees? The average online degree holding graduate (the 2% of enrollees who actually graduate) is earning $21,000. $21,000"

The inability of students to discharge these loans for worthless degrees only encourage more scamming of desperate people into debt peonage trying to make something of their lives.

Uncle Joe hand a disgraceful hand in this. These needs to be discussed in the open.

Please do not push the talking points of the banking industry to help them hide from these vile practices.

[roguevalley]

3. he is part of the establishment that doesn't care about individual debt and what it does

to people and the economy. He helped credit card companies against us. He wrote the Patriot Act. He is no one I want anywhere near the White House.