Quote:
Originally Posted by RickFLM4
The $114B (which by the way is a 5 year figure, not an annual figure, and tiny in relation to the total debt outstanding) and related report was flawed, as later reported by the GAO, perhaps in the broken link you posted. Even if you remove the effect of CARES Act, there is still a shortfall due to income-driven repayment plans already in effect.
If the debt could be discharged in bankruptcy per my earlier post, and interest rates were increased to reflect the risk of defaults, the taxpayer would not be paying for the defaults. Other borrowers would be paying for those defaults because the incremental interest would cover it. Sorry I didn't make that clear enough for you.
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Debt outstanding isn’t a profit or loss figure. $114B in profit is $114B in profit.
But your “solution” is that future students should pay for the defaults of students who came before them? And that’s somehow more beneficial to society?
Do you pay a higher mortgage rate due to foreclosures in your area? Or a higher car loan rate based on how often your neighbors defaulted on their car loans? That makes even less sense than the mess we have in place currently.