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Young America’s Foundation Spokesman Ron Meyer and Finaid.org Publisher Mark Kantrowitz on the growing student loan crisis.
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Ticking time bomb inside the federal budget putting taxpayers on the hook for billions of dollars in defaults.
-- student loans that's what I'm talking about escalating the nose bleed territory with a link course delinquency rates hitting a new all time high.
Outstripping any other consumer debts so.
Our student loans and new sub prime loan joining me out NA dot org -- -- weds and Ron Meyer spokesman for the young America's foundation.
Guys thanks for being here really appreciate your time.
The president is talking about higher education college degree is being an economic imperative.
Listen to the president.
-- higher education in.
Isn't it no longer a luxury and it is an economic imperative in the 21 century that is part.
What we need to fix the in this global economy and I'm gonna fight for every young person is well -- work hard.
Why should everybody have a -- to -- You know advise the president that let me try to -- and I think -- -- said this.
Let me be clear McDonough -- all proper let me be clear.
Every student should start with 30000 dollars of debt and -- a bankruptcy it's absolutely gas sign the current system we have in place right now for student loans is nothing short of immoral.
We're putting students we're telling students -- economically imperative for them to get a college education.
And then we're putting him in a situation to lose not only are they know jobs out there starting with thirty thousands the 2000 dollar debt is not a way to start your life and frank now.
-- let's -- market here I am -- give you more time I really am but we wanna get both sides.
-- truck isn't asinine debt these kids start their lives with so much debt and we give it to everybody.
Well and we need to have.
-- a college benefits a student benefits a country the students who have college degrees earned seventy to 80% more.
The federal government gets twice as much federal income tax revenue.
From -- -- college degree and someone without a college degree so its investment in both the future of the individual and the future of the country roughly the much the let's let.
-- -- -- -- -- lawyer we're talking about revenue are you kidding me I mean I don't really think that was you talk about revenue and to say that people wouldn't be going to college without this program.
There's also asinine and not true.
The fact the matter is a private lender actually look at higher education say no you cannot raise tuition 25% for years and have tuition they have teachers' salaries go up 9%.
While young American salaries have declined 4% you have to Betty your products.
And actually make it worthwhile and affordable and it's not right now and it's hurting my generation and I know friends and even me myself I get to be on TV but guess what.
I'm still struggling to pay my loans because of this system in eastern -- turn in the private sector let's let's get.
Let market and here for a second mark this is an interesting point.
That there are no controls.
Where -- the controls -- federal government.
What you to -- if -- didn't sign -- piece of paper and you haven't been in bankruptcy in the past five years -- get a -- -- if at any way to -- our taxpayer dollars.
-- annoyed at the federal government's goal is to enable access to college education we have twice as many people in college now as we did several decades ago.
The problem is that the government isn't focused on the profitability even though the loans are profitable the federal government that -- what the government needs to do is.
Make the loan limits contingent on prediction of what the -- students don't be able to repay the debt or not.
Will they earn enough money to pay back your student loans subtle delicate big winners -- -- the -- pick winners and losers mark would you ever get a loan to someone.
Who didn't actually -- who wouldn't be able ever pay it back no you went if it was a private investor they'd actually be able to help the students actually be able to measure whether or not.
The college there are going to end major they are getting -- actually be worth something.
And that's why the system isn't working the government can't do that and to say the -- -- big winners and losers among students I don't think it's -- either that's why it's gotta be a private.
Thing it's got -- return of the prime is that that's only thing it's actually fan.
-- Brian and -- -- you answer this question what would happen to college education this system in this country.
If all public dollars were pulled out.
Well you'd have a collapse of higher education you'd have only the wealthy going to college you'd have half of the college's failing.
Because in the and the private sector is it will not willing to fund loans every student.
And there are no more capable of choosing how to.
Fund loans appropriately than the federal government just look at what happened in 2008.
We went from sixty blunders -- and loans.
Two two dozen today.
Are all the comes out ahead of them already subsidized by the government.
Big but -- -- -- -- your private loans it -- you make the point that debt the public sector should be completely out.
And mark says he can't do that because there would be no college education how do you respond to that.
Mark said the literally two minutes ago that this sector is its profitable actually brings the government.
Money by lending these out I think it's that the government potentially problem in the private sector can -- and actually -- checks so -- higher education can't run roughshod over my generation.
The last word here mark.
Well it's -- what we need to do is reduce the shift from.
Government and state investments.
In higher education where they've been reducing the grants on a per capita constant dollar basis and -- then invest more.
In the grants more grants will mean less loans.
-- -- -- Some more -- more money nationalize the bailout all of trillion dollars worth of still -- right now great idea.
-- guys you agree and disagree I think that's what's going on here that's -- market -- good thanks for coming on tonight interesting topic I really appreciate your coming on talking to us about it thank you so much.
